Bloomberg News reports that the city’s corporate leaders and super-wealthy are offended by mayoral candidate Bill de Blasio’s plan to raise taxes on those earning over $500,000 a year to fund universal pre-K and after school programs for middle school kids.
The head of the business leaders’ group was astonished by de Blasio’s indifference to the needs of corporate executives. ““It shows lack of sensitivity to the city’s biggest revenue providers and job creators,” said Kathryn Wylde, president of the Partnership for New York City, a network of 200 chief executive officers, including co-Chairman Laurence Fink of BlackRock Inc. (BLK), the world’s biggest money manager.”
Some predicted an exodus of rich people from the city.
What has de Blasio proposed?
“De Blasio’s plan would raise the marginal tax rate on incomes above $500,000 to 4.4 percent from almost 3.9 percent. For the 27,300 city taxpayers earning $500,000 to $1 million, the average increase would be $973 a year, according to the Independent Budget Office, a municipal agency.
“For those making $1 million to $5 million, the average extra bite would rise to $7,793, the budget office said. At incomes of $5 million to $10 million, it would climb to $33,518, and for those earning more than $10 million, it would mean paying $182,893 more.”
Here is the reaction of one hedge fund manager: “E.E. “Buzzy” Geduld, who runs the hedge fund Cougar Capital LLC in the city and is a trustee of Manhattan’s Dalton School, where annual tuition tops $40,000, said de Blasio’s plan “is the most absurd thing I’ve ever heard” and “not a smart thing to do.”
Think of the billions that Bloomberg squandered on technology projects that fizzled (like the $600 million Citytime project), the failed merit pay plan ($53 million wasted), the failed plan to pay students to get higher test scores, etc.
The business executives said nothing because no one suggested that they would be taxed to pay for it.
De Blasio is proposing research-based programs. Those who care about education and kids should be cheering and should gladly pay an extra $973 (or more if their income is higher) to do what is right for kids.
Oh, and one more thing. The article says:
“The city’s richest 1 percent took home 39 percent of all earnings in 2012, up from 12 percent in 1980, according to the Fiscal Policy Institute, a nonprofit research group in New York.”
Don’t cry for me, Argentina.