On the other hand, NYC water comes from the Catskills. The water is so good that it is a fair trade.
That's something I often hear. My answer is: There is no true accounting of this, and also - these things will sort themselves out after separation. We in Upstate pay higher taxes to Albany, who then deigns to give it back to us with transfers to their Gov't, education and business cronies in Upstate, and have the gall claim they are subsidizing us. We also suffer through rules, regulations and mandates made for NY City, which add to a high cost of living and doing business in Upstate. It is why jobs and young people are leaving, and most towns and small cities of Upstate look like Appalachia.
If this changed, Upstate NY could achieve a normal, balanced economy.
Also, does anyone count how much the NY State Power Authority (with a board comprised completely of downstate members) subsidizes NY City with cheap hydro-power from Niagara Falls?
An interesting study of the Upstate-Downstate taxation issue can be found here:
“New York City and the Downstate Suburbs give far more to
Albany in taxes and other revenues than they get in
state-funded expenditures. The Capital Region and the Rest of State, by contrast, get significantly more than they give. These conclusions hold under any of several alternative methodologies this study employs for regional allocation of the personal income tax and selected expenditures.
“Tables 1a and 1b on the following page summarize the overall distribution of revenues and expenditures under two alternative assumptions...”