During last year’s mayoral campaign, Zohran K. Mamdani came off as an economic and fiscal fabulist, but at least he seemed politically astute. He was the only candidate who focused on rising costs, and he was authentic and fun. So the 34-year-old mayor’s first budget season has been jarring. The no-pain, free-stuff optimist has turned into a doomsayer who grimly warns that he may have to raise taxes on working- and middle-class New Yorkers, and that even such a tax hike may not be enough to pay for his promises.
The seeming personality transplant is, though, a calculated plan, just as calculated as his casual TikTok videos on the campaign trail. Mamdani hopes that by threatening a 9.5 percent, across-the-board tax hike on all city property owners, as he did last week, he can coerce Governor Kathy Hochul into supporting his proposed tax increases on seven-figure earners and large corporations instead. If Mamdani’s calculus is wrong, he will vaporize his aura of political genius, and New York’s more experienced permanent political class will discover that he’s not that good at this, after all.
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If you just dropped into New York last Tuesday during Mamdani’s City Hall presentation of his inaugural $127 billion budget for 2027, whose fiscal year starts in July, you’d think New York was undergoing a cataclysmic recession or even depression, or that it was the victim of years of willful fiscal deception. The mayor used the word “crisis” 37 times as he spoke to reporters; he even put the word in red ink for his slide show. “The city is facing a significant fiscal crisis, the likes of which we have not seen in a long time,” he intoned. New York has “a historic deficit, larger even than those faced during the Great Recession.”
Delayed until at least the late spring are the mayor’s plans for free buses and for a new, $1.1 billion-a-year Department of Community Safety to expand social services and replace some policing. Instead, the mayor said, “to balance the budget as required by law, our preliminary budget takes the only path within our control.” As a “last resort,” he said, the city “would have to raise property taxes,” for the first time since the early Bloomberg era, when New York was recovering from the burst tech bubble and 9/11. Mamdani would do this despite never hinting at it during the campaign or during his first weeks as mayor, and even though, as he acknowledged, the taxes would hit households making a median income of $122,000 annually. “We would also be forced to raid our reserves,” he added.
The city, the mayor insisted, has no other choice. Raising property taxes would come after the new administration has spent weeks grappling with this apparently unexpected catastrophe, including creating new “chief savings officers” across city departments to identify 2.5 percent of cuttable agency spending. Indeed, in late January, just weeks after taking office, Mamdani had already held an emergency press conference to warn the press corps about what he called the “Adams budget crisis,” laying out the nearly $12 billion deficit created by his predecessor. At that session, Mamdani blamed not just former mayor Eric Adams, but an elected official long out of office: former governor Andrew Cuomo, who resigned in 2021. Cuomo, Mamdani said, had created a “stunning fiscal imbalance,” with the city contributing 54.5 percent of state revenues and getting only 40.5 percent back.
Mamdani’s gloom-and-doom theater doesn’t track with the city’s economy. New York has its long-term problems, including job creation that lags the nation and depends too heavily on the taxpayer-subsidized healthcare sector. But the city is growing, adding a little less than 1 percent to its jobs base last year. Private-sector wages rose by 7 percent. Tax revenues are coming in fine: Wall Street enjoyed near-record profits last year, as Mamdani himself acknowledged. In the current fiscal year, which ends in June, tax revenues are projected at $84.3 billion, up from $80.3 billion last year. Without any changes to tax policy, they’ll likely reach $87.8 billion in the fiscal year that begins in July (federal and state grants make up most of the balance of New York’s annual revenues). Thanks mostly to these higher tax receipts, the supposed $12 billion deficit Mamdani flagged at the late January press conference shrunk to $7 billion last week.
Mamdani insists, as if it were a surprise, that his administration inherited a “historic budget gap.” But Adams wasn’t particularly adept at hiding the city’s deficits before he vacated City Hall in December. The nonpartisan Citizens Budget Commission, for instance, publicly warned during last year’s campaign that Adams wasn’t setting aside enough money for projected spending in future years, leaving the next mayor with larger-than-projected gaps. Yet Mamdani never warned of this looming budget crisis when he was running, nor did he counsel voters last year that continued Adams-era spending would imperil his own pet programs. The word “crisis” appears nowhere in Mamdani’s campaign-vintage fiscal plan, except to refer to 2008.
Solving New York’s projected deficit now wouldn’t be that hard: since tax revenues are growing, just cut back spending in line with that revenue surge. Adams is not mayor anymore, and New York has a new city council, too, so Mamdani doesn’t need to sacrifice his own goals for his predecessor’s—that’s why we have elections. For instance, Mamdani could rethink the plan to spend yet another $1.2 billion in the upcoming fiscal year on “asylum seekers,” when the Biden-era border crisis is now ended. As for what he calls the “Adams Big Six”—or $7.5 billion worth of unexpected spending over the final few months of this year and all of next year across areas including higher welfare caseloads, a newish rental-voucher program, and a higher-than-expected homeless-shelter bill—there’s no reason why Mamdani must sit by passively and allow this spending to occur.
The new mayor had no trouble abruptly dispensing with one of his predecessor’s priorities. Mamdani is “discontinuing” Adams’s plan to increase the ranks of the NYPD by 5,000 officers. More such cuts would enable the mayor to launch his Department of Community Safety right now, and allow him to set aside some city funds to try to convince the state, which runs transit, to allow free buses. Creating a reserve for a property-tax rebate for rent-regulated-apartment owners might allow him to make a slightly more credible—though still weak—case that his promised rent freeze wouldn’t harm landlords.
Yet the guy who couldn’t stop smiling last year insists the city is in crisis now. Why? He needs a crisis to push through his proposed $9 billion in annual new taxes on high earners and corporations. He wants to raise taxes for the sake of raising taxes—and the governor, who must sign off on any such increases, won’t cooperate. Last year, Mamdani wanted these tax hikes partly to pay for his universal childcare plan. Instead, the governor swiftly agreed earlier this year to fund the plan’s gradual rollout with existing state revenues.
And neither the governor nor the state legislature has taken to Mamdani’s newer tack: accusing the state government of being unfair to the city. In early February, he trekked up to Albany to testify before lawmakers over this supposed unfairness, but Democrats were unmoved. Pat Burke, the state assembly’s Cities Committee chairman, observed that “it’s not the city” paying more money to New York State than it receives back; rather, it is individual taxpayers paying more, because that is how progressive taxation works: richer people subsidize poorer people, and New York City is richer than the rest of the state. Burke, from Buffalo, a city much poorer than Gotham, characterized Mamdani’s argument as, “we make more, we pay more, we should get more,” and called it a “bad argument.”
Mamdani seems not to have learned the lessons from more than half a century ago, when late-1960s-era mayor John Lindsay also wanted more control over the city tax base. Governor Nelson Rockefeller didn’t ideologically oppose Lindsay’s spending plans. But to Rockefeller and state lawmakers back then, just as for Hochul and state lawmakers today, the tax base is a state tax base, not a city tax base—and the state seldom voluntarily cedes power over it. Hochul didn’t respond to Mamdani’s argument with a lecture about state sovereignty over cities; instead, she smiled tersely and gave the mayor another $1.5 billion, bringing the deficit down to $5.4 billion.
He didn’t take the hint. Because Mamdani is not getting his way, he is ratcheting up the volume of his tantrum: during his City Hall budget presentation last Tuesday, he darkly warned of the “two paths that we can walk,” implying that unless Albany opens the gate to the “first path” (raining taxes on the wealthy) it will be the fall guy for his massive property-tax hike, the only tax that the city government controls. To Mamdani, this hostage-taking has some logic: he wants to broaden the coalition of people advocating for tax hikes on the rich beyond his core base of democratic socialists and traditional lefties, to include working-class and middle-class homeowners and their city council members.
But Mamdani may be overestimating his own political power—and if so, he is effectively walking out on his own honeymoon instead of taking the roses and champagne the governor has already given him. Hochul does not face a credible primary opponent from the Left in her own reelection this year. Unless democratic socialists and other pro-tax advocates want to vote for Republican Bruce Blakeman in November, they have little power to flex.
Just as important, New York’s city council, the other half of City Hall, will have a say in any property-tax hike. Council members are doubtless already hearing from the working- and middle-class homeowners among their constituents—a racially and ethnically diverse array of people who vote, and who will remember which representatives choose to hike their taxes. As Julie Menin, the relatively moderate new council speaker, said after Mamdani’s presentation, property-tax hikes “should not be on the table whatsoever.” Finally, no one—not state lawmakers and not city council members—likes being strong-armed, and Mamdani’s property-tax proposal has come as a shock to them.
If Albany and the city council successfully ignore Mamdani’s scare tactic, he’ll have done long-term damage to his agenda. Proposing the property-tax hike, for example, may harm his ability to garner state-lawmaker support for his still-vague plan to re-balance the property-tax system, so that owners of higher-value houses pay more while working- and middle-class homeowners pay less.
It may also imperil the biggest promise Mamdani made during the campaign: to freeze rents on the city’s nearly 1 million regulated apartments. The city’s Rent Guidelines Board will hear testimony about rising costs this spring ahead of its June vote—just when the state and city budgets are respectively due—on rent changes. Mamdani has now added uncertainty to this process, and even his appointees to the Rent Guidelines Board may balk at ignoring the impact a potential massive property-tax hike would have on landlords.
Mamdani won office with a simplistic, relentlessly consistent single-issue message—cheaper or free stuff—to voters unhappy with the other choices on offer. Now, he must get across a complex, multiple-contingency message to numerous interest groups with competing priorities—and then get those interest groups to follow a complex chain of elected-official accountability. Candidate Mamdani’s platform pledged that he would “permanently eliminate the fare on every city bus,” as simple as that. Now, Mayor Mamdani effectively says that if you want change, you need to figure out first who your city council person is, and who your two representatives in Albany are, and ask them to raise taxes on wealthy earners and businesses—and even then, the buses may not be free. Some homeowners may have favored Mamdani’s free-bus plan when they thought that the wealthy would pay for it, as Mamdani promised; they may feel differently now that they might have to pay more just to maintain existing city services.
Mamdani attained power through one set of empty gimmicks. He might now dissipate that power through a different set of empty gimmicks.
Photo by Lev Radin/Pacific Press/LightRocket via Getty Images