Those of us in the Empire State are probably already aware of the state's financial difficulties. We're about $9 billion in the hole, and there doesn't seem to be a way out...or is there?
Talk about balancing the budget has prompted all sorts of wild ideas to raise taxes or cut services. However, most of these involve an unfair burden on the poor while completely ignoring an obvious solution.
New York is a rich state. There is money here; it's just in the hands of a relatively small number of people. Few people talk about taxing the rich as a way of overcoming this shortfall, but it would work and it needs to be done. Here's my solution on how to solve this budget crisis here. Listen up, Albany!
Personal income tax on anyone making over $1,000,000 a year who is either living or working in New York State needs to see a 1% raise in taxes. If you make your money from New York, it's time to give back to New York. Trust me, millionaires won't miss it.
In fact, a recent article in Forbes Magazine about the wealthiest people in the world stated that once you make over $500K per year, it's hard to see an increase in lifestyle. That means it is literally hard to find things to do with that money. You aren't pumping that extra money into goods and services that fuel the economy any more. It isn't providing any additional jobs. So why let that money just sit there?
New York could use that money. Not only to balance our budget, but because there would be a surplus from this tax, new jobs could be created by the government! In a recession, the government is the employer of last resort, but how is the government going to employ people without the money to pay them? Don't buy the lies that taxing the rich will hurt the economy. No, it will only HELP it. Taxing is our only way to get fully out of this recession.
This could probably work on a federal level too, but I haven't crunched the numbers yet. I suspect that tax rates might need to be raised 5-10% to balance things. I know, those millionaires might only have $900K to play around with (gasp!--that's only $860K more than the average American! How will they ever properly look down on the rest of us?).