Starting from the summer of 2020, the New York City Government, “the first financial center in the universe”, has been troubled by something more annoying than fighting the epidemic: lack of money, serious lack of money!
New York Mayor Bill de Blasio bluntly said at the press conference: “The cruel fact is that the deficit on the account is as high as 9 billion US dollars. We are at a loss.”
”New York is in deep budget crisis and is on the verge of bankruptcy.” Instantly boarded the news headlines in this city and across the United States.
Why is New York so “sleepy”
The U.S. Senate set aside $1.4 billion in an economic stimulus package in March 2020 to give New York City an “emergency”, but it was obviously just a drop in the bucket. De Blasio said that he has asked the New York State and the federal government for help again, but the higher-level governments have said that the landlord’s family has no surplus food, which makes him very disappointed.
Statistics in October 2020 show that nearly 6,000 companies have closed down in New York, and the number of companies filing for bankruptcy has surged by 40%.
The only way left is-major layoffs.
The Mayor of New York estimated that 22,000 government employees, including the Mayor’s Office, would have to be laid off to help the emergency.
Why is New York so “sleepy”?
Jack Kelly, a senior writer for Forbes magazine, believes that the most important reason for New York’s near-bankruptcy is the continued spread of the epidemic and collective telecommuting, which has led to a slack in popularity, which further caused a slack in “fortune”.
He analyzed that New York City relies heavily on prosperous business, entertainment and social activities to gather and retain the flow of people. During the prolonged epidemic, restaurants closed, museums closed, concerts and sports events closed. At the same time, companies are calling for employees to work from home, and the daily commute to and from Manhattan and other parts of New York has disappeared.
Without popularity, there is no business. Statistics in October 2020 show that nearly 6,000 companies have closed down in New York, and the number of companies filing for bankruptcy has surged by 40%.
In this way, one of the most prosperous and wealthy cities in the world, under the dual pressure of a sharp drop in taxes and a heavier burden of unemployment relief, actually slipped to the brink of bankruptcy.
Everything may be just the beginning of “escape from New York”
Everyone knows in their hearts that the rescue of emergency through major layoffs is just “drinking poison to quench thirst”, and it will not rule out that it will cause a greater crisis in the future.
The total number of employees in all agencies of the New York City government is almost 330,000, and more than 20,000 are laid off at once, which means that 6% of the employees are left alone. The livelihood and re-employment of more than 20,000 laid-off workers in the epidemic era is itself a major problem.
The government’s layoffs also mean a sharp drop in the quality of public services. Police, firefighters, cleaners, teachers… these ordinary but critical positions, once there is a loss of personnel and distraction, the consequences are very serious.
Jack Kelly’s bigger worry is that 2020 is just the beginning of “escape from New York.”
His observation is that due to the downturn in the city’s popularity and the decline in the quality of life, the rich first began to “flee” and move to nearby Long Island, Connecticut and other cities abroad, taking away a lot of wealth and urban tax sources.
Next, the prolonged city lockdown and home office work, coupled with rising unemployment and crime rates, made ordinary office workers living in small apartments in New York unbearable. They began to torture themselves: Why did they spend so much money on renting a pigeon cage in Manhattan and live such a frustrated life? !
They will be the next wave of “escape from New York”-leave New York to a safer place, a bigger house, and a better quality of life.
His prediction is that if the epidemic continues and popularity declines, the government’s financial situation will be more difficult. Mayor De Blasio may be forced to lay off more government employees in the future, leading to further deterioration of the city’s living conditions.
This “vicious circle” cannot be solved at present.
Who can replace New York
Just as pessimistic as Kelly is James Altucher, a popular New York podcast host and best-selling author.
He wrote a blog post titled “New York is Dead…The reason is as follows”.
The article said: “I love New York. When I first moved here, it was a feeling of years of dreams come true. Every street corner is like a drama being performed before my eyes: so many interesting people, so many interesting The story. Now, it is completely dead. The city has entered a death vortex and will never come back.”
Of course, there are also many “loyal” New Yorkers who still believe that the difficulties are temporary-this experience After “September 11” and countless great depressions and financial crises, the extraordinary cities can always find the energy to survive the desperate situation.
At present, the only certainty is that New York’s “bankruptcy” dilemma, even if it can finally come out, the probability will continue for a long time.
At the same time, the outside world is already looking for the “next New York.”
Ray Dario, the “great god” of the American investment community and the founder of Bridgewater Fund, recently told the Financial Times that in the 2020 COVID-19 crisis, due to the outstanding performance of China’s economy and attracting RMB 1 trillion in investment, China will Will catch up with New York and London and compete with them for the status of the world’s financial center.
He himself is “betting heavily on this trend that is destined to become an epoch-making change in the world economy.”