“He’s planning to pay for these proposals with various tax hikes, including a large jump in the city’s corporate tax rate from 7.5 percent to 11.5 percent.
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Unfortunately, raising the corporate tax rate could also hinder the job market, cause corporations to relocate, and decrease long-term government revenue, potentially damaging New York’s status as the financial capital of the world.
Corporations hit with higher tax rates would seek ways to cut costs, possibly harming workers through either layoffs or lower wages.
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In the United Kingdom, for example, around one in six British companies cut hiring in the fourth quarter of 2024 in anticipation of tax hikes that took place in April 2025. If New York employees aren’t directly laid off, they could face lower wages in the long run.
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Already, the exodus of banks from Wall Street to corporate tax havens, such as Elliot Management’s relocation to Florida, has cost the city millions in managed assets. New York City simply cannot afford to watch other businesses follow.
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“”Businesses have only three options to pay for higher taxes: raise prices; reduce costs; or lower returns to investors,” as the authors of the U.S. Chamber of Commerce report wrote. “In reality, they do all three.” The fourth option, one even more feasible if a tax hike only hits New York City, is that businesses will flee.”
“Throughout the Greek debt crisis, the overwhelming majority of Greeks wanted to stay in the Eurozone but bridled at the austerity measures required to do so. Today Greece ranks among the top five economic performers in Europe. Unlike Greece, which required international intervention to implement necessary reforms, Argentina took the task upon itself, the voters rebuking establishment parties and taking a chance on a political outsider. If Greece was worth saving, then Argentina is no less deserving of a lifeline.”
“the “national security” argument clearly has been foundational to Trump’s trade policies. Higher tariffs will make America’s military more self-sufficient and capable against future threats; that’s the White House’s point of view.
One problem: that’s not how the people actually in charge of America’s national security see it.
“The Defense Department routinely acquires items and materials from foreign sources indispensable to meet defense needs that are not readily available or produced in sufficient quantities within the United States,” wrote John Tanaglia, director of pricing, contracting, and acquisitions for the Pentagon, in a memo dated August 25.
The memo instructs other officials at the Pentagon to provide “duty-free entry certificates” to military purchases that would otherwise be subject to tariffs. Doing so, the memo explains, will “maximize the Department’s budget to meet warfighter needs.”
First and foremost, that’s yet more proof that tariffs are raising costs for American purchasers of foreign goods. And it is true, of course, that Trump’s tariffs are straining budgets everywhere. Being able to ignore those costs must be nice—many, many businesses across the United States surely wish they had the power to simply wave away those costs as easily as the Pentagon apparently can.”
“American goods are losing ground fast. A recent KPMG survey finds that “60% of businesses reported decreased overseas sales” in the first six months of President Donald Trump’s tariffs. For instance, U.S. liquor exports tumbled 9 percent in the second quarter of this year, with steep declines across the European Union, Canada, Britain, and Japan, which together buy about 70 percent of these exports. In another example, China—once a key customer for U.S. farm goods—has turned instead to Argentina and other suppliers, and total U.S. soybean exports are down 23 percent this year.
Smaller companies are also adversely affected. A valve and gas component maker in Napa Valley just announced that it will shut down a plant and discharge 237 employees, citing weak overseas demand linked to tariffs. Let’s not forget the upcoming Supreme Court case of V.O.S. Selections, Inc. v. Trump, where U.S. importers and resellers of wine, electronics kits, apparel, and other goods argued that the April 2 “Liberation Day” tariffs disrupted their supply chains, forced steep price increases, and threatened their viability.
American consumers, too, are paying the price. KPMG finds that nearly half of American companies have already raised prices because of tariffs; two-thirds have passed at least part of those costs on to shoppers; and nearly 40 percent have paused hiring, with a third cutting jobs.
CEOs overwhelmingly expect tariffs to weigh on business for years. Goldman Sachs estimates U.S. consumers are now footing 55 percent of the total tariff bill, while foreign exporters bear only a sliver of the costs.”
China’s stranglehold on the supply of rare earths is damaging America’s ability to build military equipment and commercial cars. So far, Trump’s trade war on China is costly with little to no reward.
“”I think a global tariff is the right way to do things,” Cass said. “It’s a very simple, broad policy that conveys a value that we see in domestic production.”
That is, more or less, the view that the White House adopted during the first year of Trump’s second term: Making stuff in America matters, and the best way to encourage more production in America is to make it more expensive to import anything made somewhere.
Of course, there are two major flaws with that logic. First, there are things that can’t be made in America—or can’t be made here in sufficient quantities to satisfy Americans’ demand. Coffee, chocolate, bananas, and many other agricultural products, for example.
Second, making things in America often requires importing raw materials or intermediate goods. More than 50 percent of all American imports are unfinished goods that are used to make other things, from cars to houses to industrial pumping equipment and chocolate bars. If all those materials are suddenly more expensive, it becomes harder, not easier, to manufacture more things here.”
“the company’s market share decreased by 10 percentage points following its merger in 2014, sitting at around 70 percent in 2024. Live Nation’s FY 24 net profit margin of 2.8 percent—considerably lower than the total U.S. market’s net margin of 8.7 percent—suggests that the firm lacks pricing power. Moreover, the profits Live Nation makes have little to do with the secondary ticket market: “Revenue from fees on concert ticket resale is less than 2% of Live Nation’s revenue,” the company said in a reply to Blackburn and Luján on Friday.
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so long as artists set prices below the market rate, brokers will find a way to get tickets to those who value them the most, with or without Ticketmaster.”
“Under Milei, inflation has dropped massively. The poverty rate has gone down. Public spending has plummeted, and budget surpluses have appeared. Housing supply in Buenos Aires has totally turned around following the repeal of rent control laws.
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But “the policy of managing the currency has become a trap,” adds The Economist. “Even after he partially floated the peso in April alongside an IMF [International Monetary Fund] bailout, he has sought to maintain its level artificially high. Defending the exchange rate has cost Argentina billions of dollars in scarce foreign-currency reserves and has pushed interest rates sky-high, creating a drag on growth. Jobs, rather than inflation, are what now worry voters the most.”
Milei had to get a credit swap from the U.S., to the tune of $20 billion (which he must pay back, though the terms of the deal have not been made clear to the public). He secured a similarly massive IMF bailout back in April. He keeps needing emergency credit lines to keep the peso strong, but it’s not clear that this policy is totally working. It makes sense why he would pursue it in the first place: Prices have historically spiraled out of control, and the central bank is not trusted by the people. In order for some of Milei’s less-popular social safety net cuts to be palatable, the people needed to feel like there was some legitimate stability and predictability in their monetary system, lest they revert to favoring Peronism.
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“Under the exchange rate system that Milei implemented earlier this year, the peso floats freely within a band,” writes Lorenzo Bernaldo de Quirós for the Cato Institute. “When a government tries to maintain a fixed but adjustable exchange rate, it creates perverse incentives. If markets perceive that the currency is overvalued, expectations of devaluation are created, prompting speculators and citizens themselves to take their capital out of the country to avoid losses. To defend the exchange rate, the central bank must use its international reserves, but these are finite.” Reserves are limited; speculators can easily take advantage.”