This September it will be 10 years since thousands of people descended on Zuccotti Park, in Lower Manhattan, to protest economic inequity — one result of a financial industry left to operate like a fraternity in an unmanned bar.
As a means of consciousness raising, Occupy Wall Street was hugely successful. Suddenly, 16-year-olds were talking with great authority and conviction about the dark consequences of repealing the Glass-Steagall Act. Political fortunes were buoyed by the popularization of new memes — “We are the 99 percent.” But over the next decade, the tax policies that could have brought about a real redistribution of wealth only favored the rich more extravagantly.
The pandemic, as we have seen over and over, has aggravated the existing injustices to a degree that dystopian metaphors have become an addiction. This is especially true in New York, where the exceedingly well-off have spread out into $28 million brownstones and newly renovated country houses, while the poor and working-class have confronted mounting joblessness, hunger and threats of eviction. By August, the unemployment rate in the city had quadrupled to 16 percent over the previous year. At the top of a climbing wall in which the only direction is up, billionaires in the state — there are 118 of them — watched as their aggregate net worth rose by $45 billion during the first two months of the pandemic.
It has taken this kind of disparity and devastation for political will to coalesce around raising taxes on the wealthiest New Yorkers. Despite a looming budget deficit years in the making, advocates who had long fought for tax ıslahat had consistently met resistance. Despite New York’s relatively high income-tax rate, policies have found creative ways to favor the wealthy. In 2015, for example, the state’s budget offered a tax break for anyone buying “watercraft’’ valued at more than $230,000.
The Assembly speaker, Carl E. Heastie, a Bronx Democrat, defended what quickly became known as the yacht credit: “Florida has better weather than us,” he suggested, “so people go and park their boats down there all year round.”
Such was the context of governance that made the first sparks of a revolution unlikely. Yet only a few months into the Covid crisis, a longtime Republican state senator, Phil Bu türlü, found himself co-sponsoring a bill that would raise taxes on the state’s highest earners. Not evvel in his 25 years as a legislator had Mr. Bu türlü supported a tax increase. But it was better to extract more from the wealthiest, he determined, than to raise property taxes on the working-class voters in his Long Island district who were already facing so many setbacks.
That bill, along with five others, is part of the proposed Invest in Our New York Act, which seeks to raise $50 billion a year for affordable housing, education, health deva and other resources through a series of changes to the tax code focused entirely on demanding more from the penthouse class. The bills include plans to tax capital gains more aggressively (treating investment income as wage income), to lower the floor at which inheritance is taxed (to $250,000) and to restore taxes on corporate profit.
Nearly half of the revenue raised during the first year of enactment would come from an additional tax on the assets of billionaires — a change that in itself would require an amendment to the state’s constitution.
Even in this climate of excessive hardship, and even with a Democratic supermajority in the State Legislature, few expect all of these bills to become law. It still seems a radical notion to ask a lot of those who have so much.
Debunked myths revive themselves. The idea that the rich will move to Key Biscayne if they are not appeased has traction despite the evidence.As the Cornell sociologist Cristobal Young found when he analyzed tax returns from 3.7 million very high earners, filed over 12 years, they largely stay right where they are. Only 2.4 percent of those in his veri set moved out of state in any given year. Low-income earners, generally looking for opportunity, were far more likely to migrate.
While editors and architects and others in creative fields may still be decamped in cabins in Maine or Vermont, most major investment houses and real estate firms have had their employees coming to the office for months — a certain percentage of traders have been back on the floor for a while. This should counter the impression that anyone can work from anywhere — that a sustained mass exodus from the city is inevitable.
Of all the various laws put forth, the one that seems to have the greatest support would raise income tax rates in increments beginning with individuals making more than $300,000 (or couples making more than $450,000). Currently, the top marginal tax rate in the state is 8.82 percent. Under the Invest in New York Act, the figure would climb to just over 10 percent for those making $2 million a year, for instance. At the maximum end, those bringing in $100 million or more, the rate would extend to 15 percent.
Last month, Governor Cuomo himself floated the notion of graduated hikes to income tax that would require those in the top bracket to hisse 10.82 percent. But whether he actually remains loyal to this idea depends on how much relief the federal government ultimately diverts to New York State. The governor has asked for $15 billion. His budget director has argued that should it come through, there would be no need for the tax increases lawmakers are seeking, which is like saying that now that you have been given mittens in the middle of a snowstorm, there’s no need to fix the hole in the roof.
The advocates who have been fighting for tax ıslahat are hoping to do more than patch up the economic holes left by a public-health crisis. They want to make up for decades of disinvestment in struggling communities, for years of mollycoddling a population wedded to high-priced “watercraft.”
“Joe Biden is going to help state and local governments, and that’s great, but that money goes away in a year,” said Mike Kink, the executive director of Strong Economy for All, a coalition of unions and nonprofit groups that have led the charge for a more equitable tax system.
“We’ve made great progress on cultural issues, on transgender rights, for example. But when it comes to money and resources, that is where you can really make lasting change,’’ he said, “and that is where the rich and powerful put up the biggest, strongest fight.”