Editor’s Note (December/January 2025–26) - Paul Mattick Jr.

With disasters of multiple sorts unfurling daily, how not to enjoy the overturning of New York City’s political apple cart by Zohran Mamdani? This was the biggest upset in American politics since Donald Trump’s first victory in 2016, and it’s a lot more fun. Mamdani began his run as a largely unknown state assemblyman and ended with a sweeping victory, having excited throngs of voters. Certainly many of them were motivated by the wish not to see Andrew Cuomo’s old, white, corrupt face for another four years, but that was the least of it. Mamdani articulated something millions of people feel, and not only in New York: capitalism has just gone too far in making life difficult for the many, in order that a few can have more money than they could ever use.

On the face of it, his program was modest: free buses, frozen rents (for those in rent-stabilized apartments), free childcare. All of these policies have been tried successfully in the past in various places, including New York. Mamdani proposed to pay for them by raising the corporate tax rate to match that already in force across the river in New Jersey, and called for a small additional tax on the very richest New Yorkers. An enlightened businessperson, facing the exodus from the city of workers unable to pay the rent or afford childcare, might be expected to see all this as a rational solution to a situation untenable in the long term.

Yet in fact the “business community”—at least its highest echelons—reacted with fear and hatred, spending millions on electoral propaganda to try to overcome Mamdani’s popularity. Zionist real estate magnates didn’t care for his consistent opposition to the genocide in Gaza and the West Bank, but the whole class reacted negatively to the idea of even slightly increasing taxes on what are now called “ultra-high-net-worth individuals.” The day after the election, the strategizing started; to quote a New York Times headline, “Financiers Begin to Plan How to Offset Mamdani,” by moving to states with lower or nonexistent taxes or lobbying in Albany against his proposals. Their rage and anxiety is the flipside of working-class enthusiasm: both testify to a deep social truth revealed by Mamdani’s campaign and victory.

The official word for the issue on which that campaign was (as the pundits repeat) “laser-focused” is “affordability.” The first thing to be said about this is that it is hardly specific to New York: people are having a difficult time paying for housing, food, energy, and childcare throughout the United States—and really, around the world. Running for mayor of the US’s largest and richest city, often proudly called the “capital of global capitalism,” Mamdani thrust the growing immiseration of the American proletariat under a spotlight. As the social mix of people who elected him demonstrated, this group now encompasses not only nurses, construction workers, and bartenders, but young tech workers and members of the fabled “professional managerial class,” also increasingly shut out of home-ownership and finding their jobs surprisingly precarious even if relatively well-paid while they last; along with the self-employed, including debt-burdened taxi drivers and food-cart franchisees. People of all creeds, colors, and national origins who work for a living are sharing a recognition that they are being screwed.

The second thing to be said is that like all such buzzwords, “affordability” hides as much as it reveals. It points to rising consumer prices (despite the president’s assertion that they “are coming down FAST!”), which are indeed part of the story. But these prices are the flip side of wages, which have been squeezed for decades. From the perspective of society as a whole, money flows from employers to employees and then back again, as the latter buy back their product from the former, so that increasing prices is just another way to lower wages. What has emerged to view as “affordability” is the result of fifty years of wage repression.

This in turn is due to the general tendency towards economic stagnation that set in after the mid-seventies, as inadequate returns on capital led to declining investment in the production of goods. Emblematic is a company like Apple that had no production facilities, relying on a Taiwanese firm which in turn hired Chinese workers to churn out the iPads and iPhones designed by its engineers. US manufacturing employment declined as corporate money began to flow into a wildly diverse range of “services,” such as the distribution of goods produced around the world, the management and sale of computer data, and care for elderly survivors of gainful employment, as well as ever more rarified forms of speculation. This “financialization” of the economy, powered by a vast expansion of credit, seemed to create money out of money, though it required government bailouts when the inevitable bubbles popped—see 2000 and 2007. The industry captains of yore, like Andrew Carnegie or Henry Ford, were replaced in the public eye by titans of finance: bankers, e-merchants, and hedge fund managers like Steven Schwartzman, Jeff Bezos, and Peter Thiel. (Though it must be said Elon Musk has combined the mystique of fintech with a whiff of old-fashioned industrialism.) The need to squeeze money out of this financial apparatus to meet the demands of shareholders put direct downward pressure on wages while providing an incentive to increase gains by raising prices.

Every possible field of exploitative investment is explored. Housing, which once played a role in stabilizing an urban working class needed for exploitative employment, came to be a cash cow for hedge funds and venture capitalists, milked for maximum gain. It is this extraction, in the face of low wages, and not an inadequately “abundant” number of homes, that has made housing unaffordable. In New York today, tens of thousands of rent-stabilized apartments are kept empty by their owners in the hope of finding some way of raising the rents. “Affordable housing” is not built, not because of onerous regulations but precisely because it would be affordable—in other words, not sufficiently profitable. Meanwhile, real earnings in New York are as low today as they were in the midst of the 2007 crash1

What can social democracy—or even its American milquetoast cousin, democratic socialism—do? In Europe, where various forms of social democracy played leading roles after the First World War and again after the Second, such political forces are in retreat. In the UK, the Labour Party is doing its best to continue the decades-long effort to cut social welfare spending, a project to which socialist parties in Germany, France, and Scandinavia have long devoted themselves. But nonetheless, the EU does not see widespread hunger on the American (and British) scale; Paris’s school system is not filled with masses of homeless kids like the 150,000 in New York’s; and the pension “reform” imposed by the Macron government, just suspended for a year, only managed to push the retirement age to 64, a distant dream for most Americans. The modest persistence of the European social safety net suggests there is room for at least some improvement in US conditions, particularly in a rich city like New York.

This is probably what agonizes the local real estate and hedge fund lords and ladies, rather than the piddling, almost symbolic sums (a few fancy dinners, a few jet rides) they might have to pay in taxes. What if the success of a politician’s modest steps sparks further resistance to the degradation of life? The Democratic Party—still the party of corporate liberalism, as we called it in the sixties—is not merely failing to understand its voters in rejecting and attempting to sabotage candidates like Mamdani and Graham Platner. A few years ago, party leaders barely beat back Bernie Sanders, the most popular politician in the US; today they might not have been able to do it if he weren’t too old to run. But they would rather lose elections than welcome what might be coming. Whatever happens now in New York is likely to further the idea already at work in Mamdani’s election: that a better life than the one we’re offered now is possible.

Mamdani will certainly run up against the limits set by the institutional structure of New York politics, not to mention the nature of the social system, which remains based on the extraction of profit by the owners of capital. The nineteenth-century notion that socialism can be instituted through elections was disproved long ago. But once people get the idea that the future is not fated—that it can be affected by action—they may come to understand the depth of the changes required, and see the limitations of electoral politics in achieving them. Meanwhile, it is the very thought that we are not stuck—that history has in fact not ended—that shows in the joy people are taking in Mamdani’s achievement.

• 1https://www.economist.com/briefing/2025/10/30/as-new-jobs-in-finance-dry-up-new-york-citys-fiscal-model-is-wilting. In the inimitable words of John Williams, president of the New York Federal Reserve Bank, “There’s quite a bit of evidence … that lower and moderate-income households are facing some constraints from an affordability point of view—from the cost of living, the housing costs and basically many families living month to month.” (Claire Jones and Patrick Jenkins, “Gulf between rich and poor risks US downturn, Fed official warns,” Financial Times, November 9, 2025).