{"id":31635,"date":"2025-06-23T15:28:30","date_gmt":"2025-06-23T15:28:30","guid":{"rendered":"https:\/\/financialrush.com\/?p=31635"},"modified":"2025-06-23T15:28:30","modified_gmt":"2025-06-23T15:28:30","slug":"wall-street-should-heed-the-signal-from-mamdanis-mayoral-race","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=31635","title":{"rendered":"Wall Street should heed the signal from Mamdani\u2019s mayoral race"},"content":{"rendered":"<p> \n<\/p>\n<div>\n<p>Unlock the White House Watch newsletter for free<\/p>\n<p class=\"article__content-sign-up-topic-description o3-type-body-base\">Your guide to what Trump\u2019s second term means for Washington, business and the world<\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=b3a10c9a-1a06-4123-ac5f-f31f0c0b745d&amp;newsletter-id=65b8fec772badb00166eafc6\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>The race to decide the next Democratic candidate to be mayor of New York is going down to the wire and there are more than a few Wall Street titans sweating over the outcome.<\/p>\n<p>Polling for the lead contenders \u2014 former mayor Andrew Cuomo and a 33-year-old assembly member Zohran Mamdani \u2014 has suggested the outcome will be close. For prominent Wall Street figures, the prospect of a socialist Mamdani taking the helm of the world\u2019s largest financial capital has provoked an unusual degree of concern.<\/p>\n<p>Assembly-member Mamdani has built his campaign around a promise to raise taxes on the city\u2019s wealthiest residents and on the big banks and companies. <\/p>\n<p>Bill Ackman, the founder of Pershing Square, Dan Loeb, the hedge fund founder of Third Point, Steven Roth, the founder of real estate investor Vornado, Anthony Scaramucci\u2019s SkyBridge and former mayor Michael Bloomberg are just some of the biggest names across the financial industry collectively throwing millions of dollars to stop Mamdani.\u00a0\u00a0<\/p>\n<p>Cuomo, the former governor who resigned in 2021 amid sexual-harassment allegations that he strongly denies, has re-emerged as Wall Street\u2019s firewall candidate. \u201cFix the City,\u201d the political action committee backing Cuomo, has already raised $24mn, making it the best-funded outside group in New York municipal history. Michael Bloomberg donated $8.3mn, while Ackman chipped in $500,000 and Loeb added $350,000.\u00a0<\/p>\n<p>Ackman, who used to be a prominent Democratic party donor and is now one of the most vocal supporters of US President Donald Trump, said that if Mamdani won there would be a \u201cflight of businesses from New York\u201d. \u201cMost of the businesses that operate in New York City in the financial sector are incredibly portable,\u201d Ackman, who lives on the Upper West Side, <a href=\"https:\/\/www.thefp.com\/p\/escape-from-new-york-business-leaders-mamdani-new-york-city\" data-trackable=\"link\">told<\/a> the Free Press.<\/p>\n<p>A prominent private equity investor told me: \u201cSocialist policies have failed everywhere. Why would we adopt them in the world\u2019s capital of capitalism? It makes no sense.\u201d <\/p>\n<p>Mamdani wants to impose a 2 per cent income tax on New Yorkers who earn more than $1mn year, introduce tighter rent controls, raise minimum wages, expand affordable housing supply and increase the city\u2019s top corporate tax rate from 7.25 to 11.5 per cent \u2014 like in neighbouring state New Jersey \u2014 that he forecasts will generate $9bn in new revenue. Backed by US representative Alexandria Ocasio-Cortez and senator Bernie Sanders, Mamdani also wants to introduce government-run grocery stores as well as free childcare and buses.<\/p>\n<p>It is an expansive agenda but the issue that appears to exercise Wall Streeters most is the tax increases. That touches on a broader national debate that is another hot button issue for the finance community \u2014 how to rein in rising national deficits. Finance leaders warn with mounting urgency that federal deficits are spiralling out of control.<\/p>\n<aside aria-labelledby=\"aside-label\" class=\"n-content-recommended--single-story n-content-recommended--inset\" data-component=\"recommended\">\n<p class=\"n-content-recommended__title o3-type-body-highlight\">Recommended<\/p>\n<div class=\"o-teaser o-teaser--article o-teaser--small o-teaser--stacked o-teaser--has-image js-teaser\" data-id=\"1f76c045-011d-49af-aaa4-aab2917bbc5b\">\n<div class=\"o-teaser__image-container js-teaser-image-container\"><a href=\"https:\/\/www.ft.com\/content\/1f76c045-011d-49af-aaa4-aab2917bbc5b\" data-trackable=\"image-link\" data-trackable-context-story-link=\"image-link\" tabindex=\"-1\" aria-hidden=\"true\"><\/p>\n<div class=\"o-teaser__image-placeholder\" style=\"aspect-ratio:2241\/1260\"><\/div>\n<p><\/a><\/div>\n<\/div>\n<\/aside>\n<p>JPMorgan\u2019s Jamie Dimon has <a href=\"https:\/\/www.ft.com\/content\/8c3628f3-477f-4124-8b3f-2bb76bf567cd\" data-trackable=\"link\">warned <\/a>America\u2019s borrowing binge will lead to a \u201ccrack\u201d in the US bond market. His comments have been echoed by Jim Esposito, president of Citadel Securities, who warned that the growing US deficit poses a \u201cticking time bomb\u201d risk to fiscal stability, and the president of Goldman Sachs John Waldron said that bond traders view the surge in US government debt as a bigger risk than tariffs.<\/p>\n<p>But most in finance are opposed to increasing taxes or removing loopholes like carried interest, which is used by buyout investors to pay significantly less in taxes than income tax.<\/p>\n<p>\u201cHigh taxes are not the solution to crazy deficit levels\u2009.\u2009.\u2009.\u2009if taxes go up people will find a way to protect their earnings, it\u2019s natural that people would do that,\u201d said one hedge fund investor. \u201cThe problem is waste. We need to cut government expenditures and let businesses invest in innovation and growth.\u201d<\/p>\n<p>Making cuts without shredding programmes that voters cherish, however, is difficult. Even the cost-cutting drive by the so-called Department of Government Efficiency set up by Elon Musk only <a href=\"https:\/\/www.ft.com\/content\/085430ab-27fe-46fc-a798-1059649d3b32\" data-trackable=\"link\">found<\/a> a fraction of hoped for savings.<\/p>\n<p>Next year will mark 15 years since the Occupy Wall Street Protests emerged after the financial crisis. The questions over inequality raised by that movement persist, not least because of the asset price bubble fuelled by an era of cheap money after the crisis. If tax is not the solution to deficits, Wall Streeters need to be clearer about what they recommend. Otherwise, support for the likes of Mamdani might only grow.<\/p>\n<p><em>jfk@ft.com<\/em><\/p>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.ft.com\/content\/b3a10c9a-1a06-4123-ac5f-f31f0c0b745d\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Unlock the White House Watch newsletter for free Your guide to what Trump\u2019s second term means for Washington,&hellip;\n","protected":false},"author":5,"featured_media":31636,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":["post-31635","post","type-post","status-publish","format-standard","has-post-thumbnail","category-us","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/31635","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=31635"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/31635\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/31636"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=31635"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=31635"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=31635"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}