- Stronger Communities
- Economic Growth
A Foundation for Greatness
By Bill de Blasio
Remarks as prepared
Thank you, Andrew, and thank you all for being here.
Right now, as we’re gathered this morning, one New Yorker is rushing past an attended desk in the lobby of a majestic skyscraper, swiping his key card at the turnstile as he makes his way onto the elevator that will take him to an elegant conference room. In that room, he’ll consider how best to capitalize on the stock market’s latest surge.
A few miles away, a single mother is also rushing, holding her two young children by the hands as they hurry down the steps of the subway entrance, slide their MetroCards through the turnstiles, and press onto a packed subway car en route to a daycare center located five stops from home. During the trip, she’ll wonder what her family will cut from this month’s budget to pay the grocery bill.
I’ve spoken of New York becoming a Tale of Two Cities – one that’s working quite well for our city’s elite, but one that’s forgotten millions of everyday New Yorkers – those who struggle to find good jobs and quality schools; those denied fair and equal treatment under the law; those who can’t find affordable housing and needed health care; those who don’t have access to early childhood and after-school programs that set our children on the right path, and keep them there.
Today, I want shine a bright light on where we are as a City; the challenges we face; and what we can do to repair an inequality of opportunity that threatens to unravel the proud promise of New York.
Many politicians talk about strengthening our middle class. And no one disputes that a vibrant middle class has made New York City a beacon of opportunity to so many generations…immigrants like my grandparents who came to America with the hope of chasing their dreams…of making life for their children and grandchildren a little better than their own.
But today’s reality is different. We must awaken to a hard, but unavoidable truth about where we’re headed right now. New York’s middle class isn’t just shrinking. It’s in real danger of disappearing altogether.
I am here to say that a New York City that continues the economic and educational policies of the last decade cannot – and will not – be a city of neighborhoods where middle-class families can live, work, and raise their children. Without a dramatic change of direction – an economic policy that combats inequality and rebuilds our middle class -- generations to come will see New York as little more than a playground for the rich…a gilded city where the privileged few prosper, and millions upon millions of New Yorkers struggle each and every day to keep their heads above water.
Today, the headlines tell the story that so many of our neighbors know firsthand.
On Wall Street, life couldn’t be better. Just this week, the Dow Jones Industrial average set a new record – breaking 15,400 for the first time in history. In Midtown, many corporations are reaping record profits. In Times Square, tourism is booming, and more visitors are filling our hotels than ever before. On the Upper East Side sits one of the nation’s most expensive private homes, a 12,000 square foot $125 million penthouse. Private high schools charge tuition that’s higher than most private four-year colleges. There are even restaurants that offer diners the option of a $1,000 caviar pizza, and – for the same price – a “Golden Opulence” sundae for dessert.
At work, those at the top are doing better than ever – with CEO pay hitting a record high in 2012 – at an average annual salary of $9.7 million – 354 times what the average worker earns.
For the wealthiest in our city, these truly are the best of times. A recent study reported by The Economist found New York City is home to more than 389,000 millionaires. We have three times as many millionaires as Los Angeles -- more, in fact, than LA, Chicago, and Houston combined. All told, almost five percent of our city’s population can call themselves members of the Millionaires’ Club.
And those lucky few are making their presence known. In 2009, Manhattan was home to 33 condo buildings with units selling for more than $15 million each. Today, that figure is 54 – up more than sixty percent – according to CityRealty.
But at the very same time, there’s another New York.
It exists in all five of our city’s boroughs – from Soundview to the South Shore; from Bayside to Bay Ridge; from Washington Heights to the Lower East Side. It’s a city where anxious parents whisper about making that month’s rent while their children sleep in the other room. Where a single mom prays each night that her daughter gets picked by the local pre-kindergarten lottery, in hopes that she gets the early education that could transform her life. Where a jobseeker walks more than a mile to find an open library with Internet access to post his resume. Where working parents, with no after-school programs to turn to, chase away thoughts about where their middle-school child might be, so they can finish the final hours of their shift. Where a black teenager slides off his hoodie on the way home from high school, hoping THIS will be a day when the police let him pass without incident.
That second city isn’t a world away from the first. Indeed, as an article in the New Yorker recently reported, you only need to take a ride on the subway to see how closely situated those two cities are.
Hop on the 2 train at Chambers Street, home to many Wall Street bankers, and head North, one stop, to 14th Street. The average income at your destination is less than half of what it was from where you boarded. Go five more stops to 110th Street, and average income is less than 20% of what it was at Chambers Street. Four more stops to 149th Street in the Bronx, and that figure slips to 8%.
On a weekday afternoon, that whole trip takes about 27 minutes. Not on an airplane, or in a time machine. On the 2-train.
The struggle isn’t limited to pockets of our city. It’s all around us. Today, one in five New Yorkers lives in poverty. When you include those who earn less than 150% of the poverty threshold, that figure soars to 46 percent. Let me say that another way. Nearly HALF of those who live in our city are at or very near the poverty level.
That’s not what New York City is supposed to be. It’s not who we are. It threatens our status as the greatest city on Earth. And yet the policies of the past have not set us on the path to bridging that gap of income inequality. Through neglect and denial, in fact, many of our city government’s policies over the past twelve years have made that divide even more severe.
Consider some statistics from the non-partisan Fiscal Policy Institute.
Between 2000 and 2010, the median income of the city’s eight wealthiest neighborhoods soared 55 percent, while median income dipped 3 percent in middle-income areas.
Despite tax breaks for businesses tripling since 2001 , good jobs haven’t followed – with our city’s unemployment rate almost a point above the national average.
For those who do find work, the job often doesn’t pay the bills. More than 400,000 New Yorkers didn’t earn enough to stay above the poverty line. And our homeless population living in shelters has swollen to 50,000 men, women, and children – the highest level of homelessness since the Great Depression .
The numbers are sobering. And the impact is felt every day.
We cannot consign an entire generation of New Yorkers to living this Tale of Two Cities. The Inequality Crisis undermines the very foundation of our city’s economy.
We haven’t forgotten that a similar divide helped pave the path to the Great Depression eight decades ago, as well as the Great Recession just a few years ago. We will not abandon our working poor. We refuse to allow the term “Middle Class New Yorker” to become an oxymoron. It’s not simply a moral imperative. History has taught us that no economy – and no city -- can thrive in the long-term under such circumstances.
We’re simply not building New York’s middle class. In fact, no less of an authority than the Partnership for New York concluded in a recent report that here in New York City, quote: “job growth is primarily in high-wage and low-wage categories.” The question: what’s left for those in the middle?
So that leads us to the challenge of the moment – the great test of our time. What will we, as civic-minded activists, elected officials, and community leaders, DO about the great income inequality infecting our city?
But before we can talk about what to do next, we must first recognize how we got here.
Mayor Bloomberg took office when the city was reeling from both 9/11 and an economic recession. The City’s growth strategy up until then had been largely focused on keeping the jobs created by our financial sector here in New York – even as technology was making such a strategy next to impossible.
The Bloomberg administration, to its credit, saw the need to replace a changing finance sector with something else. The mayor knew that without those elite earners in our system, our tax base would suffer irreparably.
So he worked to make the city more attractive to the tech industry; helped spur creative-class entrepreneurship; and launched a handful of initiatives to foster new industries –most notably, the Cornell-Technion graduate school of applied sciences. He sought to attract new college-educated workers to our city from every corner of our country and from overseas.
As a result, we’ve begun to grow our tech economy, and we now have pockets of advanced manufacturing -- like Brooklyn Navy Yard -- to begin to replace the tens of thousands of manufacturing jobs we’ve lost in the previous decade. That was a good thing for New York, and we can and we must continue this effort.
But here’s the problem. If all we do as a city is to replace one elite economy with another, we will fail millions of New Yorkers who need good jobs that work for THEIR lives…New Yorkers who graduate from our public schools and city colleges; who live in all five boroughs; who aren’t coveting a slot on the fast track, so much as crying out for a job that lets them live a stable middle-class life in the city they love.
Look at the facts. The tech industry and creative class can be gold mines of high-paying jobs for those lucky enough to land one. But employment growth in OTHER emerging industries – retail, tourism, and service jobs – is marked by low-wage jobs that give New Yorkers little or no ability to move into the middle class.
And it’s in creating an economy focused on jobs for the working and middle-class where Mayor Bloomberg simply has failed to act. It is in THIS New York where the Inequality Crisis is most desperate – made worse through policies generated by those who either don’t see, won’t acknowledge, or just can’t understand how millions of New Yorkers really live.
Take our neighborhood businesses, for starters. Under this administration, New York’s small businesses – particularly those in the Outer Boroughs – have been, at best, ignored. At worst, they’ve been under siege. While bankers and developers and hotel owners have prospered, mom-and-pop shops have been targeted by a ticketing war that is incredibly complex and extremely expensive – often in the name of filling the city’s budget holes rather than protecting consumers. We’ve got to free our small businesses from that burden by replacing a ticketing blitz -- which unfairly penalizes hardworking shop owners -- with common sense enforcement.
Instead of taking money away from small businesses that can’t afford it, we must refocus tax subsidies away from those who don’t need them, and strategically invest in jobs that lift all New Yorkers.
That begins by ending corporate giveaways – and reinvesting those resources into foundations for broad-based growth. Today, I’m proposing wholesale reform of our city’s tax incentive policies that give hundreds of millions of dollars to office towers on Park Avenue and unaccountable, one-shot subsidies to companies who can do without them. The Fresh Direct deal – giving away $130 million in taxpayer money to support low-wage jobs, all in response to the company’s empty threats -- was a mistake. And it’s a symbol of how upside down our economic policies have been.
By reforming New York’s incentive programs, we will free up resources to support entire industries and small business in all five boroughs – and begin to reinvest in real pathways to economic opportunity – like our sorely underfunded CUNY system.
So instead of $130 million for Fresh Direct, we’ll give our university system a fresh start – rebuilding what was once a gateway to opportunity for generations of New Yorkers.
In lieu of big giveaways to a few specific companies, we will pursues a city economic strategy that puts a premium on growing whole sectors of small businesses in emerging industries – from green jobs, to food exports, to advanced manufacturing – companies that can generate good jobs at decent wages in all five boroughs.
This administration made strides in spurring development in the Outer Borough neighborhoods closest to Manhattan. But to truly prosper, we must focus on economic development hubs that push deeper into our neighborhoods.
Doing business in New York is tough – and City Hall doesn’t make it easier. That’s why I’m proposing an expanded revolving loan fund for start-ups of $100 million from incentive subsidy reform, and a new NYC Innovation Equity Fund for entrepreneurs. Let’s put boots on the ground to work with local businesses and immigrant entrepreneurs to coordinate local job creation efforts, and help small business flourish.
And while efforts to make New York a global hub for young talent are admirable, we cannot afford to import more college educated New Yorkers than we produce. We must create jobs for young people who are growing up in this city… who have always called this home.
To get there, I have four concrete solutions.
First, let’s adopt Scott Stringer’s proposal for a dedicated STEM program at CUNY, and start preparing more graduates of our public high schools for jobs in the city’s tech industry – and set a goal that within eight years, the majority of skilled technology-related jobs in New York City are being filled by those educated in New York City schools.
Second, in the fast growing health sector, let’s prepare more of our young people and unemployed for middle-skill, middle-class jobs by scaling up innovative programs like the Bronx’s Health Education and Research Occupations High School that connects them to CUNY and work experience at Montefiore hospital. And let’s train New Yorkers for the 16,000 registered nursing jobs that are currently being filled by temporary foreign guest workers due to a shortage of qualified applicants here in our city.
Think about that for a moment. The two fastest-growing sectors of New York City’s economy are dominated by workers who aren’t from New York.
Third, for people without a college degree, let’s replace the hodgepodge of overlapping and ineffective job training programs and invest in industry-linked apprenticeship programs directly connected to jobs in new fields like green building technology, information technology, and telecommunications.
Fourth, let’s connect every city high school to a relevant college, apprenticeship program, or business hub from day one.
Let’s do all of these things so we can stop importing engineers, nurses, and other skilled workers -- and start in-sourcing good jobs for workers who live here.
But even while we connect more New Yorkers to the skilled economy of tomorrow, we need to help lift up those who need good jobs today.
That’s why today I am calling on New York City to increase the number of contracts going to Minority and Women Owned Business, businesses which are far more likely to be located in our lowest income communities, creating jobs for those who desperately need them.
And, let’s expand opportunity for low-income New Yorkers to gain entry into the building trades by requiring public construction projects funded by New York City to train and hire public housing residents and residents of our low-income communities.
Finally, we must recognize that the best economic development policy is a living wage job with good benefits that allows people in our neighborhoods to spend and invest in their own community.
A core component of our economic development policy must be to raise the floor for all workers, with:
1. A broad living wage bill for workers in medium and large-sized commercial businesses that receive public funds;
2. A crack down on wage theft and labor law abuses; and
3. An affordable housing policy that requires developers to do more for middle-class and low-income New Yorkers when their property is rezoned – not give away a billion-dollar tax break to industry titans.
And to ensure that our workforce has the security they need to be as productive as possible, let’s invest in childcare and after-school programs that give working parents the security of knowing their children are safe and out of harm’s way while Mom or Dad is on the job.
But fixing our economic focus is just one piece of the puzzle. At the very same time, we need to turn the page on the current era in our public schools – a period when changes often made our challenges greater, with policies that:
• Closed or relocated schools in our most struggling neighborhoods;
• Installed a schools chancellor who never served as an educator;
• Turned classrooms into places where educators are forced to teach to the test;
• Either barely added to, or else scaled back funding for, early childhood and after-school programs.
A quality local school in every New York neighborhood shouldn’t be a privilege; it should be a right.
That’s why I have said what others will not. To guarantee every child of our city gets access to a quality pre-K program, and every middle school child has safe after-school activities, we’re going to have to ask the wealthiest in our city to pay a little more. My plan does just that -- and pays for it by assessing a modest surcharge on those earning more than a half-million dollars a year.
Some have taken issue with that approach -- arguing that raising taxes on the wealthy is a non-starter. I say that leaving any child of New York City behind is a non-starter – and will only make the economic inequality we face today grow worse.
Now, I know that addressing the Inequality Crisis is a massive challenge, and we won’t solve it overnight.
But I also know this. Real leadership means being unafraid to say what needs to be said – even when it’s not politically popular.
As a great New Yorker - Franklin Roosevelt - once said: “The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” That test must remain our test today. Let us step forward together to meet it.
Because whether the issue is public safety or taxes or job creation or educational opportunity -- New York City has been made great by leaders who saw that we are truly a city of neighborhoods. Leaders who know that all five boroughs were created equal, and should be treated that way. Leaders who take their cues not from Wall Street or big developers – but from everyday New Yorkers struggling to make it.
We don’t have to continue to live the Tale of Two Cities that confronts us today. There is a better way, and it’s within our reach. But to close that divide; to unite our city; to guarantee that New York is once again a city of opportunity for EVERY resident in EVERY borough from EVERY walk of life…. we need fearless, unflinching vision, political will, and an ironclad commitment to change the path we’re on.
That is a foundation for greatness, and it must be our collective cause – the most urgent priority of our time. If we rise to that challenge, we will restore the promise of New York -- for our lives, and for future generations who will thrive in the city we love so much.