New York City’s business elite are grappling with the unexpected rise of democratic socialist Zohran Mamdani as the presumptive Democratic mayoral nominee. His platform, advocating for policies like a four-year rent freeze and increased taxes on corporations and wealthy individuals, has sparked significant concern and a scramble among business leaders to assess their options and potential responses.
NYC business leaders rattled by Mamdani’s primary win
The recent Democratic primary election for New York City mayor has sent shockwaves through the city’s business community. Zohran Mamdani, a 33-year-old assembly member from Queens, secured a commanding lead, surprising many who had coalesced behind former Governor Andrew Cuomo. This outcome has forced business leaders to reconsider their political strategies, with many now leaning towards supporting incumbent Mayor Eric Adams’ independent re-election bid.
- Key Concerns:
- Mamdani’s proposed policies, including a four-year rent freeze on regulated apartments and increased taxes on corporations and wealthy New Yorkers, are viewed as detrimental to the city’s economic health.
- Lack of established relationships with Mamdani, unlike with more moderate progressive figures such as Comptroller Brad Lander.
- Fear of a potential exodus of high-tax-paying individuals and businesses from New York City.
Kathryn Wylde, CEO of the Partnership for New York City, which represents over 300 major companies, articulated the widespread apprehension: "Mamdani’s past comments and campaign rhetoric raise serious concerns in the city’s business community. Most do not know him, but fear he is not well informed on the fiscal and economic challenges facing our city."
The ‘tax-the-rich’ platform and its perceived threats
Mamdani’s campaign has been built on a platform focused on affordability and addressing the cost of living, proposing initiatives such as city-run groceries and free public transport. To fund these, he suggests raising corporate tax rates and income taxes for millionaires by 2%, and borrowing an additional $70 billion over the next decade.
This has led to strong reactions from prominent figures:
- Bill Ackman (Pershing Square CEO): Stated that New York City "under Mamdani is about to become much more dangerous and economically unviable," and offered to financially support a viable candidate against him.
- John Catsimatidis (Gristedes owner): Floated the idea of moving his corporate offices to New Jersey if Mamdani wins.
- Kenny Burgos (New York Housing Association CEO): Warned that a rent freeze could lead to mass abandonment of properties, reminiscent of the Bronx in the 1970s and 80s, creating "vacant, deteriorated buildings."
Governor Kathy Hochul has also weighed in, preemptively rejecting the idea of state-approved tax hikes, expressing concern about losing residents to states like Florida.
Historical context and potential pathways forward
While the current alarm among business leaders is palpable, some observers point to historical precedents. In 2013, Bill de Blasio’s mayoral victory on a similar "tax-the-rich" platform also caused concern, but ultimately, the predicted exodus of the wealthy did not materialise. De Blasio engaged with industry leaders, and the city’s economic foundations remained strong.
Despite the rhetoric, there are signs of potential engagement:
- Mamdani’s campaign has reportedly reached out to business groups like the Real Estate Board of New York (REBNY) and the Partnership for New York City to arrange meetings.
- Kathryn Wylde confirmed that Mamdani is "very open" to meeting with Partnership members.
- Some, like lobbyist Suri Kasirer, suggest that allies of Mamdani, such as Comptroller Brad Lander, could serve as crucial bridges between the business community and the candidate.
Ultimately, the business community faces a choice: either actively oppose Mamdani in the general election, potentially by backing Eric Adams, or seek to engage with him to mitigate the perceived risks of his policies.
Sources
- Business Execs Ponder Making a Big Push to Reelect Eric Adams, THE CITY – NYC News.
- Business leaders are threatening to leave NYC amid Zohran Mamdani’s ascension. This scenario has played out
before—here’s what happened, Fortune. - Why N.Y.C. Business Leaders Fear Mamdani, The New York Times.
- Mamdani Wants to Meet With Major Business Heads, Wylde Says, Bloomberg.com.
