Bashing New York City has long been a popular pastime on the right. Conservatives routinely portray the Big Apple as a dystopian wasteland. And the bashing has reached a fever pitch since Alvin Bragg, the Manhattan district attorney, announced multiple charges against Donald Trump. How dare Bragg pursue these cases, Republicans ask, when crime is running out of control on his home turf?
But New York crime isn’t really out of control. As in many places, crime jumped during the pandemic, but it seems to be subsiding; although Republicans won’t believe it, crime in America’s safest big city remains much lower than crime in, say, Miami or Columbus, Ohio.
Still, even before the pandemic there was a steady if not huge flow of people out of New York. Why were they leaving? It probably wasn’t crime, although perceptions can be at odds with reality. It probably also wasn’t taxes; I’ll get there in a minute. The biggest factor, almost surely, was and is the cost of housing.
About perceptions: From the early 1990s until the pandemic, a big decline in crime went along with consistent public beliefs that crime was rising. Interestingly, though, only a minority of the public said that crime was rising in their area — Americans seem to have believed that crime was surging someplace, just not where they lived.
And for what it’s worth, despite the recent increase in crime, large parts of New York don’t feel menacing to a casual observer. I know that Marjorie Taylor Greene, after a quick visit, called the city “disgusting,” “filthy,” “repulsive” and “a terrible place.” And there are, of course, bad neighborhoods. But for most of us who actually live here, life looks, well, normal, and it’s hard to believe that large numbers of people are fleeing an urban nightmare. In fact, in many ways the quality of life in New York is high — if you can afford it.
But can you afford it?
New York is a high-tax state — it has to be, to pay for relatively generous social programs. And New York City imposes additional taxes. These taxes do make living in New York more expensive.
However, while average tax rates are lower in red states than in blue states, red state taxes are highly regressive: they collect a much higher share of income from the poor and the middle class than they do from the top 1%. As a result, red-blue differences in tax rates for ordinary families are smaller than you might expect.
According to the Institute for Taxation and Economic Policy, the middle 60% of taxpayers in Texas pay 9.4% of their income in state and local taxes. That’s actually higher than the tax rate on middle-income families in California. New Yorkers pay more — 12.5% — but those extra three points of taxation probably aren’t a big reason to leave.
The big tax differences are for the top 1% — 11.3% in New York versus 3.1% in Texas, and there are clearly some high-income people who move for the lower taxes. But these are also the kind of people likely to place a high value on the amenities of a big, sophisticated city; New York remains one of the world’s favorite residences for the extremely wealthy.
For the middle class, however, living in New York really is hard to afford — not so much because of taxes, but because of housing costs. Here’s a very rough indicator (I’m sure that experts can produce a more accurate measure, but the conclusions surely won’t change): Zillow says that the median apartment rent in New York is $3,500, about $1,500 more than the median rent in, say, Dallas. Since median household income in New York is about $70,000 a year, the “housing tax” middle-class families pay for living in New York is on the order of 20% of their income, several times as large as the difference in actual taxes. And if you want to buy a house, the price gap is similar: Dallas is about 40% cheaper.
Oh, and to the extent that you see homeless people — one symptom of social disorder in New York — homelessness is in large part a result of expensive and unavailable housing.
So the cost of housing, not crime or taxes, is the biggest reason people might want to leave New York. It’s not much consolation to note that the problem of housing unaffordability is even worse in much of California than it is here.
The thing is, this doesn’t have to be happening. Greater New York is much more densely populated than anywhere else in America, with the average resident living in a census tract with 15,000 people per square mile. Even so, a lot more housing could be built — I live in a neighborhood with 60,000 people per square mile, and it’s nicer and even quieter than you probably imagine; no, it isn’t a nightmare of heaving humanity.
A major reason developers don’t build more housing in the New York area, and hence the reason living here is expensive, is that they aren’t allowed to thanks to zoning, land-use restrictions and — especially in the suburbs — community opposition.
In other words, never mind the lurid right-wing fantasies: NIMBYism, not crime or taxes, is the New York area’s main problem.
Paul Krugman | The New York Times (CREDIT: Fred R. Conrad)
Paul Krugman, winner of the Nobel Memorial Prize in Economic Science, is an columnist for The New York Times.