• Economic Disparity and COVID in New York City

    August 23, 2020 // 2 Comments »

    The separateness in this city, New York, and by extension much of the nation curled around it from America’s eastern edge, stands out. There are the hyper-wealthy and there are the multi-generational permanent poor. New York has more of each than any other city in America. In writing about them it has been easy to stress how far apart they live, even though the mansions of the Upper West Side are less than a mile from the crack dealers uptown. The rich don’t ride public transportation, they don’t send their kids to public schools, they shop and dine in very different places with private security to ensure everything stays just far enough apart to keep it all together.

    But that misses the dependencies that until now have simply been a given in the ecosystem. The traditional view of this applied to New York has been the rich need the poor to exploit as cheap labor, textbook economic inequality. But with COVID as the spark, the bomb of economic inequality may soon Beruit America’s greatest city. Things are changing and New York needs to ask itself what it wants to be when it grows up.

    It’s simple. New York is populated by the incredibly wealthy and the incredibly poor. The wealthy and the companies they work for pay most of the taxes. The poor do not work, or are underemployed, and consume most of the taxes through social programs. COVID is driving the wealthy and their offices out of the city. No one will be left to pay for the poor, who are stuck here, and the city will collapse in the transition. A classic failed state scenario. The new social contract.

    New York City is home to 118 billionaires, more than any other American city. New York City is also home to nearly one million millionaires, more than any other city in the world. Among those millionaires some 8,865 are classified as “high net worth,” with more than $30 million each.

    They pay the taxes. The top one percent of NYC taxpayers pay nearly 50 percent of all personal income taxes collected in New York. Personal income tax in the New York Metro-Region accounts for 59 percent of all revenues. Property taxes property taxes amount to more than billion dollars a year in revenue, about half of that from office space.

    Now for how the other half lives. Below those wealthy people in every sense of the word city has the largest homeless population of any American metropolis, to include 114,000 children. The number of New Yorkers living below the poverty line is larger than the population of Philadelphia, and would be the country’s 7th largest city. More than 400,000 New Yorkers reside in public housing. Another 235,000 receive rent assistance. The Queensbridge Houses in Long Island City is North America’s largest housing project with 3,142 apartments.

    That all costs a lot of money. The New York City Housing Authority says it needs $24 billion over the next decade just for vital repairs. That’s on top of a standing cost approaching $4 billion a year just to keep current housing operating. A lot of the money used to come from the Federal government before a multibillion-dollar decline in federal Section 9 funds. Today there is a shortfall and repairs, including lead removal, are being put off.

    NYC also has a $34 billion budget for public schools, many of which function as distribution points for child food aid, medical care, day care, and a range of social services. Costs for unemployment payouts are up dramatically because of COVID. The budget for a city as complex as New York is huge, a mess of federal, state, and local funding sources, multi-year grants. It can be sliced and diced many ways, but the one that matters is the simplest: the people and companies who pay for New York’s poor are leaving. The city is already facing a $7.4 billion tax revenue hit from the initial effects of the coronavirus. The money is there; New York’s wealthiest individuals have increased their net worth by $44.9 billion during the pandemic. It’s just not here.

    New York’s Governor Andrew Cuomo has seen a bit of the iceberg in the distance. He recently took to MSNBC to beg the city’s wealthy, who fled the coronavirus outbreak, to return. Cuomo said he was extremely worried about New York City weathering COVID if too many of the well-heeled taxpayers who fled decide there is no need to move back. “They are in their Hamptons homes, or Hudson Valley or Connecticut. I talk to them literally every day. I say. ‘When are you coming back? I’ll buy you a drink. I’ll cook. But they’re not coming back right now. And you know what else they’re thinking, if I stay there, they pay a lower income tax because they don’t pay the New York City surcharge. So, that would be a bad place if we had to go there.”

    Included in the surcharge are not only NYC’s notoriously high taxes. The recent repeal of the federal allowance for state and local tax deductions (SALT) costs New York’s high earner tax filers some $15 billion in additional federal taxes annually.

    “They don’t want to come back to the city,” Partnership for NYC President Kathryn Wylde warned. “It’s hard to move a company… but it’s much easier for individuals to move,” she said, noting that most offices plan to allow remote work indefinitely. “It’s a big concern that we’re going to lose more of our tax base then we’ve already lost.”

    While overall only 5 percent of residents left the city as of May, in the city’s very wealthiest blocks residential population decreased by 40 percent or more. Across the city the higher-earning a neighborhood is, the more likely it is to have emptied out. Even the amount of trash collected in wealthy neighborhoods has dropped, a tell-tale sign no one is home. A real estate agent told me she estimates about a third of the apartments in my mid-range 300 unit building are empty. The ones for sale or rent attract few customers. She says it’s worse than post-9/11 because at least then the mood was “How do we get NYC back?” instead of now, when we just stand over the body and tsk tsk through our masks.

    Enough New Yorkers are running toward the exits that it has shaken up the area’s housing market. Another real estate agent describes the frantic, hypercompetitive bidding in the nearby New Jersey suburbs as a “blood sport.” “We are seeing 20 offers on houses. We are seeing things going 30 percent over the asking price. It’s kind of insane.”

    Fewer than one-tenth of Manhattan office workers have returned to the workplace a month after New York gave businesses the green light to return to the buildings they ran from in March. Having had several months to notice what not paying Manhattan office rents might do for their bottom line, large companies are virtually leaving. Despite the folky image of New York as a paradise of Mom and Pop restaurants and quaint shops, about 50 percent of those who pay most of the taxes work for large firms. More Fortune 500 companies, 71, have their headquarters in NYC, than any other city in America. They are keeping their employees working from home. Conde Nast, the publishing company and majority client in the signature new World Trade Center, is moving out. Since the coronavirus hit the office has largely been vacant anyway and the publisher has given no indication when workers will return.

    It is no better in other sectors. A third of NYC’s small businesses are closing. On Madison Avenue in the ultra-rich 60s and 70s blocks most lux stores are closed. Retail foot traffic is down 85 percent from a year ago. The former customers are in Connecticut and the Hamptons, and so major art galleries have shuttered their city locations to open branches where the rich have relocated. Neiman Marcus is closing its flagship store in Hudson Yards. Tourism, once worth $70 billion a year, has fallen to near zero.

    Meanwhile, progressive Mayor De Blasio has lost touch with his city. After years of failing to address economic inequality by simply throwing free money to the poor and limiting the ability of the police to protect them, and us, from rising crime, his COVID focus has been on shutting down schools and converting 139 luxury hotels to filthy homeless shelters. Alongside AOC, he has called for higher taxes and more federal funds, neither of which is coming. As for the wealthy who have paid for his social justice experiments to date, he says “We don’t make decisions based on a wealthy few. Some may be fair-weathered friends, but they will be replaced by others.”

    What others? The concentration of major corporations once pulled talent to the city from across the globe; if you wanted to work for JP Morgan on Wall Street, you had to live here. That’s why NYC has skyscrapers; a lot of people once needed to live and especially work in the same place. Not any more. Technology and work-at-home changes have eliminated geography.

    For the super wealthy, New York once topped the global list of desirable places to live based on four factors: wealth, investment, lifestyle and future. The first meant a desire to live among other wealthy people (we know where that’s headed), investment returns on real estate (not looking great, if you can even find a buyer), lifestyle (now destroyed with bars, restaurants, shopping, museums, and theatres closed indefinitely, coupled with rising crime) and…

    The future. New York pre-COVID had the highest projected GDP growth of any city. Now we’re left with the question if COVID continues to hollow out the city, who will be left to pay for New York? As one commentator said, NYC risks leading America into becoming “Brazil with Nukes,” a future of constant political and social chaos, with a ruling class content to wall itself off from the greater society’s problems.

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    Copyright © 2020. All rights reserved. The views expressed here are solely those of the author(s) in their private capacity.

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    Posted in #99Percent, Democracy, Post-Constitution America

    Time to Get Back to Work

    May 8, 2020 // 2 Comments »


     
    If America has a fast forward button on it someone should push it ahead to November. We won’t be done with the virus until we’ve done with the election. Between prudence and overreaction lies politics.

    We bleat about wanting decisions based on science. Then we do the same dumb red-blue thing, even counting the corona dead differently (nothing left certain but taxes now) to make the numbers seem better or worse depending on the shifty politics of better or worse. Something that should not be about Trump at all is All About Trump.

    There is no other country in the world so driven by politics so devoid of science. It’s killing us. Other countries have good leaders, some not so good. But look at us. Our nation is held hostage to protests and counter-protests, lockdowns and open bowling alleys. There is no other nation where so many are convinced their leader is actively trying to kill them with his virus response, even imagining he wants them to drink bleach.

     

    The MSM portrays protesters against government restrictions as dangerous, Trump death cultists who’d rather end up in an ICU that skip a haircut. It is an echo of the things that lost 2016 for the Democrats. The people don’t want haircuts. Such flippancy insults the righteous anger over lost livelihoods. They want to feed their families. They want thought-out targeted restrictions instead of politically driven over-reaction and fear mongering. It’s about deep emotional waters, sense of self, a whole lot more than just how the economy will help Trump win or lose. Many also are concerned that their lives, including the right to assemble, to worship, and to protest, are being controlled by leaders they don’t trust while a media they abandoned years ago mocks them. Beaches open in a red state are #FloridaMorons; in a blue state it’s #SurfsUp.

    But they see this time the Brooklyn elites are going a step further, beyond the deplorable label, to wishing them to catch the virus, figuring the infection will teach them a lesson before they vote wrong again. Wishing death on people you disagree with. It’s almost like cheering for a guy who drives his car into a crowd of BLM protesters.

     

    Elsewhere, medical professionals say the protestors have no right to put others’ lives at risk, and think it is just more than OK to physically stop the rallies. That’s called “the heckler’s veto” by the Supreme Court and is not allowed under the 1A, even if you’re a hero ER nurse or just an abortion protester blocking the door to a clinic. Stopping someone from protesting by shouting them down, driving a car into their crowd, or otherwise trying to stop them from exercising their rights (including the right to hold a dumb opinion or one you disagree with) is disdainfully unconstitutional.

    The medical professionals and their Muppet chorus of journalists sound like some soldiers who felt their sacrifice was made cheap by people who protested the war. Thank you for your service. It does not however allow you to choose which people can exercise their rights. When you choose to serve you serve those you define as worthy and those you don’t. It’s bigger than you, doc.

    Government is not supposed to be able to take away freedoms, even if it’s for “our own good.” Governments always invoke safety and security when they are taking away rights (see the Patriot Act.) The invoke the majority over the minority. It’s an old playbook, joined in this century by our 1A nannies on social media, who electronically block efforts to organize. If you’re screeching about how rights don’t matter when lives are at stake, the same old safety vs. liberty argument people always use, you’ve got company. The KKK used that argument to block blacks from marching, claiming it was a safety issue.

    Protesting against the government taking away your right to assemble is about as fundamental a civil right as you can get. The argument restrictions are needed to keep us safe (“we’ll get the virus!”) are about as fundamentally wrong as you can get. Yet authorities in California will no longer issue permits for anti-lockdown protests at any state properties, including the Capitol.

    Agree? Just remember what you’re saying now about these redneck inbreeding gun nuts the next time someone claims a march permit can’t be issued in the interest of public safety to a group you support. Hint: It’s the same thing. Rights are rights. Because you know what else can spread rapidly if “left unchecked?” Tyranny. Justice Louis Brandeis held free speech is not an abstract virtue but a key element of a democratic society. He ruled even speech likely to result in “violence or in destruction of property is not enough to justify its suppression.” In braver times when Americans challenged the safety vs. liberty argument, the Supreme Court consistently ruled in favor of free speech, reminding us democracy comes with risk. But that was another world ago, before we measured human worth in RTs.

     

    There is science which should be informing decisions. The irony is that while claiming a small rally in Denver will cost lives, or Florida will kill people by opening its beaches, the same voices remain silent as NYC keeps its subway running 24/7. The timing of the public beach versus public transportation debate came as a new study detailed NYC’s “multitentacled subway system was a major disseminator — if not the principal transmission vehicle — of coronavirus infection,” “seeding” the virus throughout the city. Without a superspreader like the subway it can be contained locally. It is tragic when the virus rips through a nursing home or meatpacking plant (it is a virus after all, it will go viral), but all of those together barely touch a week’s body count in New York. Shut down mass transport.

    We can put most people back to work with limited risk; the protesters are right. The virus kills a very specific patient. About half the dead are over age 65. Less than one percent of deaths were under age 44. Almost 94 percent of the dead in any age group had serious underlying medical issues (about half had hypertension and/or were obese, a third had lung problems.) The death toll in NYC under total lockdown: 22,000. Death toll in much more densely populated Tokyo with “smart” lockdown: 93.

    About 22 percent of New Yorkers already have the virus antibody and thus expected immunity. A logical conclusion — large numbers already have or had the virus, and that it is harmless to them — is simply ignored. Quarantine/social distancing is for those most vulnerable so we can stop wrecking all of society with cruder measures. Hospitals should separate patients by age. No need to keep kids from school, especially if that means isolating them inside a multigenerational household. Let them wear soggy paper masks to class, even tin foil on their heads, if it makes things easier. Online classes are lame and America doesn’t need a new generation dumber than the current one.

    The New York-New Jersey area, with roughly half the dead for the entire nation, practices full-on social distancing while Georgia was one of the last states to implement a weaker stay-at-home policy. Yet as Georgia re-opens, the NY/NJ death count is over 27,000. Georgia is 892. NY continues adding around 500 bodies to the pile every day, even with its bowling alleys closed.

    We judge risk versus gain for every other cause of death. We wear condoms. We watch our diets. Time to do the same for the virus. As for lockdowns, we may not even be judging them accurately. Some 22 states have had fewer than 100 deaths. Only 15 states had total deaths for the entire duration of the crisis higher than NYC’s current 500 a day. The original goal of lockdowns, to buy time for the health care system (and most resources were never needed due to over-estimates of the viral impact), has passed. If the new goal is Virus Zero it will never come. If the real goal is harm Trump we’ll have to put up with this without serious discussion until November.

    A Stanford doctor nails it: “Strictly protect the known vulnerable, self-isolate the mildly sick and open most workplaces with some prudent large-group precautions. This would allow the essential socializing to generate immunity among those with minimal risk of serious consequence, while saving lives, preventing overcrowding of hospitals, and limiting the enormous harms compounded by continued total isolation.”

    We are fretting and frittering away our national muscle watching TV about a bigamous tiger keeper. There are too many who want this isolation to continue indefinitely, a pathetic nation whose primary industries for its young people are camming and GoFundMe. We focus on the virus deaths, but the Reaper keeps a more accurate tally: deaths from despair, from hunger (two million new people became food insecure in NYC since the virus), financial losses (26 million Americans have filed for unemployment), mental health issues, and abuse (domestic murders during the viral months in NYC  outstripped the total from 2019.) In some ultimate irony, parents are postponing vaccinations for fear of bringing their kids to medical facilities.

    It is the reaction to the pandemic that exhausts us, not the pandemic itself. So when someone claims it is Money vs. Life they miss the answer: It’s both. It should not be taboo to discuss this. The debate needs to be about human life in full.

     
     

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    Copyright © 2020. All rights reserved. The views expressed here are solely those of the author(s) in their private capacity.

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    Posted in #99Percent, Democracy, Post-Constitution America