New York Gov. Andrew Cuomo says he opposes raising taxes on the wealthy to help the state weather the coronavirus economic crisis, but it is clear that federal aid alone won’t solve the state’s fiscal woes. COVID-19 shutdowns have decimated consumer spending and tourism in New York and observers warn of a slow recovery. Cuomo’s administration is projecting a $13 billion drop in tax revenues through next April and a potential $61 billion hole over the next four years. Democrats in the state Assembly and liberal groups including VOCAL-NY have proposed tax hikes on the ultra-rich as a way of dealing with the crisis. U.S. Rep. Alexandria Ocasio-Cortez is among those who have urged Cuomo to get on board, telling the governor in a recent video that “it’s time to stop protecting billionaires, and it’s time to start working for working families.” Cuomo, though, remains unconvinced, saying that the state’s roughly 100 billionaires can’t make up the gap alone, and that overtaxing them will simply cause them to move elsewhere. “You have 100 billionaires. You will have to tax every billionaire half a billion dollars to make it up. You know what that means? That means you have no billionaires,” Cuomo said Wednesday in a conference call with reporters. He noted that New York already has among the nation’s highest taxes on the wealthy. Supporters of such measures, though, see an opening in the state Senate, where Majority Leader Andrea Stewart-Cousins has said that “this crisis calls for multimillionaires and billionaires to help our state shoulder this extraordinary burden.” Activists waved pitchforks Thursday outside the homes of some of Cuomo’s billionaire donors, including hedge fund billionaire Dan Loeb and real estate investors Steven Roth and Stephen Ross, saying the nation’s most wealthy are doing fine in a pandemic that’s landed hardest on the neediest. “The governor has a choice: he can either cut funding from students, nurses, seniors and working families who keep our city running — or he can tax the rich,” said protest attendee Alicé Nascimento, a policy director at the advocacy group New York Communities for Change. New York has put its hopes on Congress for months now to bail out the state. But the House and Senate departed for the weekend at odds over key issues: House Democrats propose $1 trillion in state and local aid, while the Republican Senate proposal didn’t include any such aid. Cuomo is demanding Congress end anti-“blue state” politics and send New York more federal aid. No federal aid will force the state to cut state spending by 20%, Cuomo said. That would mean about $8.2 billion less in spending on schools, hospitals and local governments, halted airport renovations, and fare hikes for subway, train and bus riders. Some cuts have already begun. State spending was down $4 billion in April, May and June as Cuomo’s administration froze state workers’ pay raises, halted hiring and new contracts and began holding back 20% of state payments to local governments, according to budget division spokesman Freeman Klopott. Lawmakers have taken other steps to make up for lost tax revenue, including borrowing $4.5 million and using $2.5 billion in emergency federal aid for schools and the Medicaid program. New York could slash spending by 10% even if Congress sends $7 billion, Cuomo told New […]
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