Income inequality is the most serious economic and social issue facing our state and nation. As the gap between the super-wealthy and the rest of us continues to grow, the middle class, which has been the cornerstone of the American Dream, languishes.
The COVID-19 pandemic, with the economic destruction it has reaped, has further exposed these economic disparities. Wall Street prospers while Main Street struggles. The effect on New York State has been devastating: We face a $15 billion budget gap this year alone that will grow to more than $63 billion over the next four years.
Help from the federal government is critical. New York State would be forced to dismantle critical services across the board without the Biden Rescue Plan. However, it is still a one-shot revenue. Without recurring revenue, support for critical services will fall off a cliff in future years.
At the same time that we face these economic challenges, New York possesses a regressive tax code that places too much of the responsibility for funding our state government on middle class and working New Yorkers.
We are confronted by crisis, but also presented with opportunity. We must have a financial plan to meet the economic crisis we now face — but it must be fair.
We cannot accept both cuts to essential state services and increasingly regressive tax policies. Millions of New Yorkers are living on the edge of financial ruin. Our food banks are flooded with desperate families. Working people can’t afford basic necessities, such as housing and shelter.
Poorer school districts are already cutting essential services for students who are more in need of help than ever. The Executive Budget cuts millions of state dollars to education for over 50 school districts on Long Island, endangering our children’s future.
But even as the wealth of a few has grown exponentially, many have insisted that progressive taxation is not an option.
We must do better. We need to have an open discussion about implementing a progressive tax code that also meets our communities’ needs for essential services.
That is why I recently joined with a coalition of organizations and constituents to support the Invest in Our New York Act, an ambitious revenue package designed to address New York’s huge projected budget deficits and meet the challenges of the future.
If fully implemented, the act’s $50 billion in additional yearly revenue could revitalize life in New York and on Long Island.
New York is one of the wealthiest states in the country, but income inequality has steadily worsened. In the three decades following World War II, the bottom 99 percent of earners were capturing approximately 99 percent of economic growth. But over the past 10 years, that has shifted dramatically — with the top 1 percent now enjoying an astonishing half of all income gains.
In that same period, tax rates for the rich have been steadily reduced. Remarkably, the effective tax rate paid by the middle and working class is now larger than that paid by the wealthiest New Yorkers.
To redress that imbalance, the Invest in Our NY coalition proposes a tax increase to the personal income tax for the wealthiest New Yorkers.
The other five bills in the package, taxing wealth, corporations and financial transactions, are also focused on the richest New Yorkers. These proposals must be part of the state budget discussion.
The status quo — lack of affordable housing, cuts to education, crumbling infrastructure, inadequate investment in green technology, limited public transportation, and the absence of truly affordable health care — is unacceptable. The Invest in Our NY coalition agrees with the 90 percent of New Yorkers who believe this situation cannot continue.
It is imperative that we find the right balance of progressive taxation and investment to ensure an economic recovery that benefits everybody. We will either meet the challenges of our time with a new vision for our society or face increasing economic disparities that foster division.
Please join with me in fighting for a more hopeful future for all our Long Island communities.
Fred W. Thiele Jr., a Sag Harbor resident, is the state assemblyman representing the 1st District, which includes the South Fork and Shelter Island. He will participate in a town hall-style panel discussion of the topic sponsored by Progressive East End Reformers at 7 p.m. on March 11.
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