Today, City Comptroller John Liu and Mayor Mike Bloomberg talked about the actual one percent of New York City. And unsurprisingly, they differ in their views on how the wealthiest top percent of New Yorkers impact the city’s economy.
Liu, who is expected to run for mayor in 2013, released a report today on income disparity in the city, finding that the top one percent of income tax filers receive one-third of all city personal income — a share which his office says is nearly twice the national average. The report, called “Income Inequality in New York City,” — drawing on Occupy Wall Street rhetoric — found that nationally, the top one percent accounts for 16.9 percent of income, while in New York, the richest percent account for 32.5 percent of reported income in 2009 (which is the most recent data available from the state).
This is troubling, according to Liu, because it can weaken or destabilize the local tax base, can reinforce racial and economic segregation, and can undermine the diverse economy in the city. In the release sent out today, Liu says: “It also threatens the very fragile economic recovery we are now experiencing.”
The top one percent, according to the report, ended the past decade with an average income of $2.2 million. This wealthiest group also skyrocketed at a much greater rate than the average income growths of the 99 percent, the report says.
“We must not repeat the pattern of the last decade when a few gathered enormous wealth, while the vast majority of New York families were left behind or saw very modest gains,” Liu said in a release.
At a press conference this morning at Google, a reporter asked Bloomberg what he thought about Liu’s report. The billionaire mayor said that the one percent are important and that he didn’t quite get the comptroller’s point.
“I don’t understand what his [Liu’s] charges are. We need wealthy people to come here Because they pay taxes,” Bloomberg said. “Keep in mind, that one percent pays fifty percent of the taxes in this city. That’s a very good deal for New York City, and I don’t know why he has a problem with it.”
The mayor went on to say that the root of the challenge is educational disparities, and that the taxes the one percent way help him continue his work of improving education in the city.
“Remember if you have an income inequality, it is fundamentally an educational inequality, because the correlation between education and wealth is virtually a hundred percent, and we are working as hard as we can to improve the schools for all of our kids so they can share in the great American Dream, so they can be wealthier,” he said.
The mayor said that the city’s investments in projects like CornellNYC Tech, the new campus on Roosevelt Island, help create jobs for people in all kinds of industries and services — not just the professors. He compared it to a movie or television production, in which the actors actually make a small percentage of the total incomes of the project.
“We are taking the money that that one percent or half of one percent pays…and using it to actually provide programs,” the mayor said.
The clash on this topic between Liu and Bloomberg is unsurprising. Bloomberg has been very unsympathetic to Occupy Wall Street, and most of the Democratic pols hoping to replace Bloomberg are generally seen as more fiscally liberal than the current mayor — which has fueled interest from the GOP in finding a more conservative candidate for the 2013 race.
Bloomberg added, “If you know wealthy people around the country, you better get out there and help me recruit them to come to New York, because that’s exactly the kind of…[people] we need if we are going to make the great American Dream available to everyone.”
In other Bloomberg-on-the-economy news, the mayor today responded to a question about Governor Cuomo’s comments this morning that he does not think a hike in minimum wage would be possible this year.
“I’m disappointed if that’s the way it turns out, but it’s up to the state legislature,” Bloomberg said, adding that while the minimum wage hike would be good for the city, he remains opposed to the city subsidizing some industries (he recently vetoed living wage bills in the City Council, paving the way for a courtroom battle).
In other other Bloomberg-on-the-economy news, the mayor was also asked today whether he bought stock in Facebook and whether he thought it was a good idea. He said Facebook is a “great company,” but doesn’t know what his investments or his foundation’s investments are.
He still offered a pearl of wisdom on how to invest.
“What I would say is that I don’t think any intelligent investor should have a very big percentage of their monies in any one investment,” Bloomberg said. “If that isn’t the lesson of Madoff, I don’t know what is. It’s your parents telling you, don’t put all your eggs in one basket. And people have forgotten that.”
He added, “If you have some Facebook stock — I don’t know if it works out or not — but make sure that it’s not a major percentage of your savings.”
This article from the Village Voice Archive was posted on May 21, 2012