Kathy Hochul has a big problem: she and Mamdani have big spending plans, but the tax base of New York is eroding because high-net-worth individuals are leaving the state for greener pastures.
Her solution? Ask them to come back. Be patriotic. Take one for the team.
No, really. This is how well Democrats understand economics.
Kathy Hochul making a weak plea for wealthy people who have left New York (to red states like Florida) to come back to pay their high taxes to fund failing (unaccountable) social programs:
“I need people who are high net worth to support the generous social programs we have in… pic.twitter.com/7quhsFyWyn
— Matt Whitlock (@MattWhitlock) March 18, 2026
With the war raging in the Persian Gulf, it’s easy to let a host of other stories fall to the wayside. But there are plenty of them still out there that deserve attention. I have a bunch of stuff about crime, immigration, elections (did you know that there was a primary in Illinois yesterday that knocked out a bunch of progressives? There was, and it was glorious!).
But I couldn’t let this one pass by, because it exemplifies a serious problem the Democrats have as they move forward into the presidential primary season, not too far from now. The candidates are already out there making their pitches to voters, and each of them has a legacy of failure to clean up in a short time or develop defenses for.
Hochul’s appeal to the millionaires who are fleeing New York came last week at a POLITICO “Fireside Chat” that was fascinating, if you are into such things. It gave us insight into the dilemma that national Democrats face: their base is radicalized, their records are appalling, and their states are bleeding citizens.
Hochul was (sort of) pressed on the issue of taxes and skyrocketing energy costs in New York, and predictions that climate change legislation will push energy costs even higher at a time when Democrats are talking about affordability. Zohran Mamdani insists that he wants higher taxes in New York City, and the Democrats in the legislature are pushing a range of new taxes to fill the coffers.
If she weren’t running for president, she might go ahead with passing some of those tax increases, but she needs money from the very people who are turning their backs in order to fund her upcoming campaign.
So she temporizes.
Nick Reisman, Politico: To go from Olympics to One House Budget resolutions, which came out this week and I think are going to get voted on tomorrow. No huge surprise, but the State Assembly and the Senate included these revenue-raisers, tax increases, on some of the higher tax brackets and also corporations in their plans. Has your thinking changed at all on these tax proposals?
Governor Hochul: Let me frame it this way: I know New Yorkers are exasperated. They feel that everything’s stacked against them. They’re not getting ahead, their rents are too damn high, their childcare costs are high, their utility bills – and, thank you to Washington, we’re going to have higher prices at the pump, we already do. Everything just seems so hard for people, so I understand that frustration. You should’ve joined me in the North Country yesterday, in Ogdensburg and Watertown, and people are so upset about the tariffs raising the cost of everything. So there is this anxiety which is real, and we’re continuing to address the affordability crisis, which I believe should be the number one priority of this legislative session. What can we do to take off some of that pain that New Yorkers are feeling that I hear about literally every day? What I want to make sure we are smart about is having a system in place where it’s not just taxing for the sake of taxing. And being conscious of the fact that I need people who are high-net-worth to support the generous social programs that we want to have in our state. Right?
Now, there are some patriotic millionaires who stepped up. Okay, cut me the checks. If you want to be supportive, but maybe the first step should be to go down to Palm Beach and see who we can bring back home because our tax base has been eroded. So I philosophically don’t have a problem, I have to look at the fact that we are in competition with other states who have less of a tax burden on their corporations and their individuals. And I would say remote work changed everything. There were people who could only work in an office in Manhattan or work in New York State and they were captives to our state. They were going to stay. We saw that that’s not the case. Wall Street, businesses looking at Texas? They’re not going there because they have a nicer governor, I know that for sure, but they’re going there because of the tax rate. We have to be smart about this. But we can fund what we want to fund with what we already are taking in.
Nick Reisman, Politico: To hear Mayor Mamdani talk about it though, he says it’s not about taxing for the sake of taxes — he’s got a $5.3, $5.4 billion city budget gap that he has to address. I know you kicked in some money to pay that gap down, but he says that he really needs this tax increase, or at least the flexibility to get a tax increase in the City in order to address some of the fiscal challenges he’s facing in the first 10 weeks or so of his administration. Just, what do you make of the Mayor’s posture on that?
Governor Hochul: No, listen, I understand, and I’m working very hard to have a constructive relationship with the Mayor. You saw that when he was Mayor for eight days and we helped him get a win that he had hoped for, something that I had been wanting to do for a long time, and we put significant resources from the state into a multi-year program to expand child care across the state, not just New York City, but have the rest of the state catch up. We’ve done that, and it was not an insignificant amount of money for us to say right off the get-go, “$1.5 billion here you go, this will help.” But now it’s up to the City Council — and I’ve had conversations with Councilmembers. They’re doing their job too, looking at exactly is the Budget portrayed the way it needs to be? Are there areas of savings? Are there areas where we can just be making adjustments? And so I’m going to let them do their work and that’s how it’s supposed to play out.
Mamdani is a HUGE problem for her, which is why she was reluctant to back him. New York’s tax base is driven by people in the financial and services sector, and they are sick of being taxed to death. So sick that they are leaving.
Her solution? Appeal to their patriotism.
As for energy costs, she has an even bigger problem, because the middle class is getting squeezed and is angry as hell. She’s got a climate law to follow, but all the analyses tell her that costs will go through the roof as the law gets implemented.
What to do? She’s literally blaming COVID for upending their plans. It’s not the law, it’s the virus.
Nick Reisman, Politico: So on the affordability front, we’re hearing these — there’s no other word for — really just horror stories when it comes to people’s utility bills. They’re getting jacked up repeatedly this winter, and not just because it was cold out. NYSERDA put out this memo outlining some of the costs associated with the climate law and some of the future costs associated with that climate law and the energy costs there. I know you have identified some of those problems and some of your concerns. Do you think there needs to be a change to the climate law, a narrowing, a rolling back, an amendment, whatever you want to call it, and does it need to be in the Budget?
Governor Hochul: Let’s look at how we got here. Back when the law was passed in 2019, it was a very different world. It was a world that had not seen a global pandemic, that disrupted supply chains for all the component parts, for the nacelles and the wind turbines and everything you need to be able to build offshore wind the path that we are on. Could not have foreseen that. Followed by some of the highest inflation we had seen in years jacking up the cost once again. And then let’s throw on a hostile, very hostile administration in Washington that basically eliminates the tax incentives that businesses count on when they’re going to make investments in renewable energy – solar and wind being the top of the list. …
So what we didn’t have was a pandemic, inflation, lack of support from the federal government, which had been there before when this was all enacted, and tariffs. So I’m trying to create an environment that’ll adhere to those goals. Who does not want to protect our environment and our climate? Absolutely. I just can’t undo what has happened since those were put in place.
And now we are taken to court. Everybody can sue us. Everybody does. A judge in October said you have to have the new regulations in place by February, and we got a little breather, but the environmental groups wanted to have an expedited appeal. I have to get this settled with the judge to show that we’ve met those goals — literally met them — which is the NYSERDA memo. Remember the memo that scared the crap out of everybody when they saw those numbers? I’ve been pushing that memo around for a couple of years. Nobody was paying attention to it, okay. That’ll go into effect under the judge’s rule if something is not done during this budget time. That’s the reality I’m facing. I have an April deadline to meet what a judge has told us we have to do. So do we want to give ourselves some breathing room or do we want to impose those costs on you? Because that’s not hypothetical, that’s me following the law, if a judge tells me I have to do that. So that’s the world I’m in.
Hochul is trying to “moderate” and push out as many price increases as possible, but the political room to do so, given her base is so radicalized and indifferent to the practical effects of their policies, is almost nonexistent.
As Newsom is going to be weighed down by fraud scandals and high energy prices, Hochul is being squeezed in between the taxpayers she needs and the leftists who will decide who the next candidate will be.
And both are running states where productive people are fleeing.
The Democrats have little gas in the tank, and their solution appears to be siphoning what gas is left to fill Molotov cocktails they can throw at Trump.
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