This week, Gov. Kathy Hochul delivered her fourth State of the State speech, under a week before Donald Trump is slated to take the oath of office for his second term to the presidency and just under two years before she will face an election of her own.
While the governor wouldn’t likely characterize her new proposals as being directly responsive to the electoral discontent that powered a sharp turn towards Trump in NY in last year’s election, and which looms large in her own reelection effort, that’s obviously a driver of her policy focus.
The main planks she outlined — affordability, services, jobs and public safety — are essentially the same top-line concerns voters most surfaced in the run-up to the election and in polls since. (One of the other big-ticket items, immigration, was notably absent from Hochul’s speech at a moment when she seems to be trying to balance pressure to protect immigrant New Yorkers from a promised Trump crackdown with a propaganda-driven immigration discontent among voters.)
On affordability, in both her speech and the accompanying, more detailed policy book, the proposals took two general forms, the first being just giving people more money, or letting them keep more of their own. On the latter front, Hochul pledged across-the-board “middle class” tax cuts for what her office estimates would be about 77 % of all filers in the state, adding up to some $1 billion in tax savings for about 8.3 million taxpayers around the state when it is “phased in,” though it’s not clear yet how or when exactly this phasing is expected to occur. The governor would also seek to provide inflation “rebates” worth a cumulative $3 billion to some 8.6 million taxpayers, somewhat similar in concept to the federal Covid impact payments but at a state level and ostensibly in response to inflationary pressure.
Hochul also honed in on families and children as a particular node of the affordability agenda, laying out a series of proposals to expand child health care and access to child care (a longtime interest of hers) provide universal school meals, boost tuition assistance and a slew of other ideas. For the adults, she rolled out ideas for economic development, including a focus on the burgeoning domestic semiconductor industry, agriculture, workforce development and apprenticeships, and a plan to revitalize Albany itself with significant investments.
There’s a lot more in there, but at this stage most of it is essentially a broad-strokes framework that will be more concretely fleshed out when she actually presents an executive budget. It does reflect a central preoccupation that has come up again and again in essentially all focus groups and exit polls and voter conversations of the past year and change, which is money.
There’s an element of the classic James Carville sentiment of “it’s the economy, stupid” here, though I do want to note that, as I’ve tried to explore in some earlier newsletters, we’re in sort of a weird moment where the economy is booming on paper while malaise takes root and people feel incredibly pessimistic. Indicators like real wage increases, unemployment, personal savings, and so on show a historically strong economy, and not just in an investors-are-happy way but in a way that should be a measurable boon for middle- and low-income people. Nonetheless, everyone seems to think the economy sucks and there are concrete countervailing indicators, like last year’s record-high homelessness.
It’s not particularly easy to parse and people much more versed in the minutiae of economic data than I have struggled to explain it, though I’ve taken some stabs with my theory around an under-appreciated significant impact of what I call the end of the Covid social safety net. Inarguably, the rate of inflation and an increase in interest rates (related phenomena) have provided significant fuel to the fire as consumers see very concretely that what used to cost less costs more now.
Key costs around housing and health care have risen significantly, particualrly in the housing desert of New York, and that has to some extent plowed through the gains of the on-paper robust economy. That’s all certainly on Hochul’s mind, though I’ll note that her housing ambitions are much tamer than the bold proposals of a couple years ago, mostly having to do with tax breaks and funding as opposed to significant reform on housing production and zoning (though one somewhat novel proposal would attempt to constrain institutional investors like private equity firms from hoovering up housing in bulk).
The other huge plank is safety. This is one that I would argue is even more tied to current political perceptions, particularly when it comes to subway safety, which conservative opponents have seized on in the wake of a few headline-grabbing incidents like the burning murder of a woman last month. I’ve tried to thread this needle before, but the exploitable feeling of disorder is often not quite tied to the reality of crime. While no one can deny that there has been a spike in gruesome incidents and assaults more broadly, by any metric violent crimes are vanishingly rare on the system, and I think there are valid arguments to be made against a focus on this from a pure resource allocation standpoint.
Most of what has already gotten a significant amount of play in the public discourse are the hits — Hochul pledging to surge cops underground and put cameras in subway cars, as well as the always-contentious idea of forced hospitalization of those in a mental health crisis. To her credit, this was bolstered on the back end with pledges to actually expand access to and availability of mental health care, a lack of which has been a key driver in mental health circumstances. What most drew my eye, though, were some of the less-remarked-on planks in this plan, namely some surveillance-focused initiatives, like the expansion of so-called “crime analysis centers,” or fusion centers, that bring together local, state, and federal law enforcement to warrantlessly share information and engage in often-unspecified monitoring.
There’s way too much overall to fully get into here, but other chapters in the booklet relate to government efficiency, consumer protection, gender-based violence, sustainability, and social services. My main takeaway from all these in sum is that the governor remains pretty focused on appearing like an avatar of a moderate Democrat who has embraced some of the good bits of her progressive state — tough on crime but all-in on mental health services, pro-housing and pro-tax cut, all in on government services but concerned about government bloat and budgets, and so on. Now this will go through the wringer of the actual budgetary legislative process, but it’s a significant stake in the ground for where the governor is heading into the new year.
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