The largest share — about $2.3 billion over two years — is expected to come from the city’s delaying certain pension payments, a change that requires state approval and buy-in from municipal unions.
…
To balance this year’s budget, Mr. Mamdani is proposing to delay payments into New York City’s pension funds.
The city has five pension funds representing teachers, police officers, firefighters and other unionized municipal workers. The returns, which are invested, total about $300 billion.
The mayor’s plan, which would save $2.3 billion through the end of the upcoming fiscal year, would involve restructuring the city’s contributions to the funds following an overhaul instituted in 2013 by Bill de Blasio, then the mayor of New York City, and Andrew M. Cuomo, then the governor. At that time, the mayor changed the city’s pension payment obligations following a drop in the assumed rate of return, to 7 percent from 8 percent.
(and fucking, of course: “Police officers’ pensions would be unaffected by the proposed change, as their union, the Police Benevolent Association, is opposed to the plan.”)
So, it sounds like the biggest contribution to the balanced budget is to push problems down the road and delay funding pensions. To a certain extent I get it. He was left with a time bomb that was about to go off, and if he can balance the budget (even if it’s by delaying pension payments) he can defuse that time bomb and get some breathing room. I would hope that the unions accept the pension delay because I think having him as mayor is going to pay off for them in the long term.
It’s clear that this budget isn’t really balanced, at least not long term. It sounds like he’s still going to have to make some hard decisions, either cutting benefits or raising revenues. It sounds like one item that needs addressing is the cost per student in NYC which is twice as high as other places. That’s going to involve making some hard decisions and taking on some powerful special interests.
And of course, if he can actually fix NYC’s biggest problem (the NYPD) he’ll go a long way to solving the other probems.
Except with most debt you’re making incremental payments toward it. This is skipping one of your scheduled payments and then claiming that your budget is balanced.
Budgeting is a cash flow management tool.
Deferring payment is a cash flow positive action.
Besides the budget you also have a balance sheet, where debt is a liability, that is separately balanced against assets. It’s not very clear what that means for governments though, if debts exceed assets, who will reclaim a government?
No one gets elected for having a well reasoned plan to actually bring down a budget deficit these days in the long term. The voter can’t or won’t accept that fixing something that took years to create will take years to get out of. And admitting that is electoral suicide.
A huge chunk of it was state spending, or the state agreeing not to force the city to meet state mandates:
Earlier this year, Ms. Hochul committed $1.5 billion in state aid for a host of municipal services. The state budget, which has not yet been finalized, is also expected to include a host of policy changes and revenue increases that will funnel another $4 billion to the city over the next two years.
…
The city is expected to save another $1 billion over two years from several changes, including the state’s expected agreement to delay a class-size mandate in public schools (despite Mr. Mamdani’s support for the mandate as a candidate); more school aid from the state; and the assumption by the state of a larger share of death benefits for families of police officers, firefighters and emergency medical workers.
That’s happening because “Ms. Hochul, … is facing re-election this year, [and] needs Mr. Mamdani’s help in turning out Democratic voters in New York City.” After she’s securely in office for another 4 year term, who knows how willing she’ll be to do those same deals.
If Mandami remains popular, maybe he can keep the governor on his side. It would be ideal if they solved some of these problems as a team instead of working against each-other. I’m hopeful. Right now people seem to be in a very anti-status-quo mood. Mandami is showing how Democratic Socialism is a different way of doing things from the status quo. If he appears to be succeeding, more people will want to work with him. If more people can work with him, he can maybe take on some of the really big challenges that require a lot of people working together. At that point, it’s not just a budget that appears to be balanced if you shift the pension burdens into the future. It may actually be a budget that will really work in the long term.
That’s happening because “Ms. Hochul, … is facing re-election this year, [and] needs Mr. Mamdani’s help in turning out Democratic voters in New York City.” After she’s securely in office for another 4 year term, who knows how willing she’ll be to do those same deals.
If he delivers NYC, then he owns her, and she’ll have to come through with the favors.
Hochul and dnc immediately started smearing him on msms, and then only stopped because the amount of attention he was getting from potential voters, to vote against the DINOs, she isnt his friend.
…
(and fucking, of course: “Police officers’ pensions would be unaffected by the proposed change, as their union, the Police Benevolent Association, is opposed to the plan.”)
https://archive.ph/XARnw (NY Times)
So, it sounds like the biggest contribution to the balanced budget is to push problems down the road and delay funding pensions. To a certain extent I get it. He was left with a time bomb that was about to go off, and if he can balance the budget (even if it’s by delaying pension payments) he can defuse that time bomb and get some breathing room. I would hope that the unions accept the pension delay because I think having him as mayor is going to pay off for them in the long term.
It’s clear that this budget isn’t really balanced, at least not long term. It sounds like he’s still going to have to make some hard decisions, either cutting benefits or raising revenues. It sounds like one item that needs addressing is the cost per student in NYC which is twice as high as other places. That’s going to involve making some hard decisions and taking on some powerful special interests.
And of course, if he can actually fix NYC’s biggest problem (the NYPD) he’ll go a long way to solving the other probems.
All debt is “kicking the can down the road” in some way, having a plan for it seems better than not though.
Except with most debt you’re making incremental payments toward it. This is skipping one of your scheduled payments and then claiming that your budget is balanced.
But… it is?
Budgeting is a cash flow management tool. Deferring payment is a cash flow positive action.
Besides the budget you also have a balance sheet, where debt is a liability, that is separately balanced against assets. It’s not very clear what that means for governments though, if debts exceed assets, who will reclaim a government?
No one gets elected for having a well reasoned plan to actually bring down a budget deficit these days in the long term. The voter can’t or won’t accept that fixing something that took years to create will take years to get out of. And admitting that is electoral suicide.
That’s the biggest individual contribution, but it was only about 20% of the deficit. The other 80% was actually solved, as far as I can tell.
A huge chunk of it was state spending, or the state agreeing not to force the city to meet state mandates:
…
That’s happening because “Ms. Hochul, … is facing re-election this year, [and] needs Mr. Mamdani’s help in turning out Democratic voters in New York City.” After she’s securely in office for another 4 year term, who knows how willing she’ll be to do those same deals.
If Mandami remains popular, maybe he can keep the governor on his side. It would be ideal if they solved some of these problems as a team instead of working against each-other. I’m hopeful. Right now people seem to be in a very anti-status-quo mood. Mandami is showing how Democratic Socialism is a different way of doing things from the status quo. If he appears to be succeeding, more people will want to work with him. If more people can work with him, he can maybe take on some of the really big challenges that require a lot of people working together. At that point, it’s not just a budget that appears to be balanced if you shift the pension burdens into the future. It may actually be a budget that will really work in the long term.
If he delivers NYC, then he owns her, and she’ll have to come through with the favors.
Or what? There’s no election for years.
What? There’s an election every year, especially in cities and states. There will be an election 2027, too.
Hochul and dnc immediately started smearing him on msms, and then only stopped because the amount of attention he was getting from potential voters, to vote against the DINOs, she isnt his friend.
Healing has to start somewhere, though. Getting good news will attract more investments and will make the city more rich eventually.
And I hope that other sacrificed subsystems will follow the uptrend as well.