“That’s as serious as a heart attack. This is worse than we had anticipated,” the governor said
New York Governor Andrew Cuomo made a stark announcement this week in regards to the state budget. Following the implementation of his new budget last month he came out to announce that over the course of December and January New York state saw a shortfall of $2.3 billion in tax revenue.
This is an object lesson for many on the left who feel the rich are a static group they can always depend upon to soak for more funds at their own discretion. The concept is that there is no fluidity in the options of the wealthy, and they will always be there. Andrew was met with a stark reality.
Cuomo painfully admitted he would now need to cut the state budget as a result of the loss of wealthy residents. The top 1% of New York’s wage earners supply 46% of the income tax revenue. Target them, and some will seek out tax havens elsewhere. Cuomo, of course, looked to place the blame elsewhere.
The pain felt by Cuomo was palpable. “SALT was an economic civil war,” he said, referring to Trump’s tax plan by employing hyperbole. “It literally restructured the economy.” Cuomo claimed this was an intentional attack on Democratic states, made to benefit the Republican states.
What he was referring to was the component in the Trump tax cut that limited the deductions that could be taken for state and local income taxes. The tax code made no provision for particular states, just in reference to those with existing income taxes. Of course, lost on Cuomo is that most states with an income tax — and even additional municipal IT — trend to the Blue. His confiscatory taxes are not the cause, it’s that damned Trump and his lack of deductions!
Also lost on the Governor is the rare argument he is making here; he is upset that the rich are unable to make a tax witholding. That is something he, and numerous other Democrats (such as the Representative from his state, Alexandria Ocasio-Cortez) frequently complain about in speeches. The rich are always demonized for “not paying their fair share” (I return to the 1%/46% ratio mentioned earlier), but now select Democrats are calling for the rich to be granted the chance to have more tax cuts made available.
The Governor also seemed strained to say that the solution was not to go after more of the wealthy income earners, because that would exacerbate the flight of those tax payers, and looking at solutions. “I don’t believe raising taxes on the rich. That would be the worst thing to do. You would just expand the shortfall,” he said.
“God forbid if the rich leave,” he said, mournfully. It boggles to actually hear those words escaping his lips. But, welcome to the tax party Andrew. Better late than never.