Inflated public sector spending and high taxes: NYC could go bankrupt for first time in 40 years

Daily Mail ^ | March 9, 2019 | Ariel Zilber

[rickmichaels]

New York City could be one recession away from bankruptcy, financial analysts are warning.

Experts say that the city’s high tax burden, its net out-migration, and skyrocketing public spending could result in New York’s first bankruptcy in more than 40 years.

‘The city is running a deficit and could be in a real difficult spot if we had a recession, or a further flight of individuals because of tax reform,’ economist Milton Ezrati told the New York Post.

‘New York is already in a difficult financial spot, but it would be in an impossible situation if we had any kind of setback.’

The last time New York was close to bankruptcy was in 1975, when then-President Gerald Ford famously refused to bail out the city from its crippling debt.

Last October, the city said that its long-term liabilities, including bonded debt, pensions, and other retirement benefits for its public sector workers, reached a record $257.3billion, an increase of $4.7billion since fiscal year 2017.

The average liability per New York City household has increased by more than $1,500 to $82,577, according to the Citizens Budget Commission.

Mayor Bill de Blasio’s new budget includes an additional $3billion in spending - on top of the current $89.2billion.

Analysts say de Blasio’s preliminary fiscal 2020 budget includes $750million in savings, but that won’t be enough if a recession comes - as many predict.

The mayor has also increased spending since taking office. The pace of his spending increase is triple the rate of inflation, according to the Post.

The state has also added more than 33,000 public sector workers in the last five years, thus increasing its long-term liabilities.

To make matters worse, Governor Andrew Cuomo’s preliminary budget calls for a $600million in cuts to spending on the city.

[Leep]

The Nazis..I mean the neo-socialist democratics.. will have a final solution.

[Alberta's Child]

The difference is that the Federal government prints money and has full control over its own liabilities. New York State and New York City do not.

This is nuts, and we had better start getting serious about it.

I've been hearing that for decades ... for so long, in fact, that I stopped listening.

[sauropod]

Kinda says it all, doesn’t it?

[mewzilla]

God knows we can’t trust Albany to police our local and county pols.

Wish we could trust the Feebs.

[BBB333]

Per your image:

Stocks skid,
Dow down 12

Reminds me of an old New Yorker cartoon I have saved...

It’s set in a bar..

Two bartenders working furiously — the bar is packed with patrons who ALL need drinks.

The caption: “Wild week! The Down was up 12 yesterday, down 9 today!”

From a more simple time...

[windsorknot]

“By their fruits you shall know them.”

[The Pack Knight]

Folks, who will be the losers and winners in a NYC bankruptcy. It has been 40 years one has happened. Anyone remember the details?

I don’t know about winners and losers, but ultimately NYC didn’t go into bankruptcy. They basically strong armed the teacher’s union to bail them out by buying bonds (which they had previously, and sensibly, refused to do). Gerald Ford publicly told them to pound sand and said he would veto any federal bailout, but then later caved and ended up approving a massive federal loan (but not soon enough to avoid pissing off the city’s voters and motivate them all to vote for Carter).

Ultimately, NYC elected Ed Koch—the last sane Democrat politician in American history—who put their fiscal house in order. They ultimately paid off all the debt.

[Liz]

Trump is far too kind to his enemies. Much of the “squandered” or more likely stolen money was Federal in origin.
Trump knows enough from the crafty Sicilians, being in the NYC construction business for thirty years. Trump should
have DOJ forensic accountants and auditors all over NY, Ill and Cali. He would probably bag most of the Democratic Party.

Good point, and even better: Trump should bring in some of the gaming guys he knows.
These guys are very VERY smart....they can spot a scam a mile away.

CASE IN POINT: guy called in, wanted them to OK a $50,000 wire-transfer for some gaming. "We'll get back to you," casino guy said.

They checked him out and found the guy was a govt employee. Needless to say, he did not get the OK.

[GOPJ]

Bailing New York out sends the wrong message ...that we’re all gullible fools.

[Roccus]

You forgot the Big MAC (Municipal Assisstance Corp.)

[The Pack Knight]

Nation-states don’t go bankrupt, but there have been a number of sovereign debt crises. The results are not pretty, and I don’t think anyone living in those countries at the time just said “that’s interesting.” Nor do I think the rest of the world will be able to brush it off when it happens here.

[The Pack Knight]

I didn’t. MAC bonds are the bonds the teachers union was strong armed into buying.

[Roccus]

They also made the decisions on what the city could or could not spend money on.

[The Pack Knight]

The difference is that NY State and NYC have a federal government to bail them out. The federal governenment does not.

Yes, we have a powerful economy and attractive bonds that give us a great capacity to kick the debt can down the road. But the problem will come to a head eventually. At one point world investors will lose confidence in our bonds, then we will be looking at hyperinflation or austerity, and possibly a global depression. The longer we wait to fix it, the more painful the fix. When it happens, it will probably happen pretty fast.

[BeauBo]

Maybe New York State could be renamed New Venezuela, and New York City, New Caracas?

In addition to usual running out of other people’s money to spend, the murder rate in the city is up 30% and the wealthy are increasingly moving out.

Maybe New Detroit?

[The Pack Knight]

Yes, and I think that was part of the threat that led to the teachers union bailing them out. Teachers were all about to be furloughed as nonessential personnel.

[Liz]

Where has $850m gone? NYC Mayor Bill de Blasio's wife can't account
for staggering amount of tax dollars he gave her for mental health project...
DailyMail.com ^ | 3/01/19 | Chris Pleasance for MailOnline / Posted on 3/1/2019, 3:15:11 PM by blueyon

Chirlane McCray was assigned a $850million budget for her ThriveNYC program But records show scheme has failed to keep track of what it spent the money on The small amount of data that was collected shows it fell far short of targets Despite that, organizers have expanded the budget to $1billion over five years (Excerpt) Read more at dailymail.co.uk ...

=================================

THE ODD COUPLE---M/M DeBlob -----DE BLOBBIO DESCRIBES HER AS HIS "NUMBER ONE ADVISOR"

Insider buzz is that Blobbio is ruled by his wife---that the two work hand in hand to make public policy decisions. (Earlier news reports say Police Commissioner Bratton cautioned DeBlob not to bring his wife to the crucial meeting held to redress grievances of five cop unions Blobbio had slandered. Then.... boom...Bratton was ousted). RESUME ENHANCEMENT PROGRESSIVE-STYLE During DeBlobbio's campaign, his wife Chirlane I. McCray was billed as a writer, poet, editor, communications professional, and political figure who published poetry and worked in politics for the Clintons.

THE REAL STORY Mrs DeBlobbio loudly declared her lesbianism in a magazine article---she was in a black feminist lesbian group and wrote poetry about being a lesbian. Politicker noted her husband's campaign website doesn't reference her background as an avowed lesbian and a lesbian activist or lesbian poet: It notes her affiliation with the Combahee River Collective, omitting mention of the group’s lesbian roots, referencing it as "a pioneering black feminist collective."

The two met while both worked for the Dinkins campaign. She says she had a nose ring and wore African garb when he spotted her and was completely smitten. She never told him she was a lesbian. And later said after their marriage she was still attracted to women. During the mayoral campaign, she was asked about her lesbian lifestyle----she retorted she "didn't understand the question." The Blobbio's honeymooned in Communist Cuba and picked coffee beans w/ Sandinistas (then America's arch-enemies). The New York Post ran a cartoon depicting the couple in bed, McCray on the phone telling someone, "I used to be a lesbian, but my husband, Bill de Blasio, won me over," while her husband lay beside her clad in sexy lingerie.

[Moonman62]

The federal government’s finances are far worse.

...

Does the federal government pay a higher interest rate on its debt than NYC?

[Steely Tom]

I thought the unaccounted for amount was 1.6 billion that was missing. You would think hiring your wife would be looked down upon . No diff from aoc and her bf.

Keeping track of where money goes be acting white.

[freefdny]

NYC currency
10 Cortezes = 1 Sharpton
10 Sharptons = 1 Rangel
10 Rangels = 1 Cuomo
10 Cuomos = 1 Dinkins