Transcript
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Donna Shalala (0:19)
This is Planet Money from NPR.
Keith Romer (0:26)
Every Tuesday morning, this very easy to overlook but incredibly important thing happens, happens on the street. Where I live in Brooklyn. Three employees of the city of New York roll up in a giant truck and take away all the garbage for the people in my apartment building. Those guys in their stained dayglo green T shirts, they are just one part of this vast army of workers who make a city like New York even possible to live in. An hour or so after these sanitation guys roll through, my daughter packs up her bag. Am I gonna need a raincoat today? I really like the weather. And heads out to her public middle school. Bye, sweetie, bye. Where she will be educated by yet more city employees. Those sirens you are hearing, those are because just down the street from where my daughter catches her bus each morning, there is a fire station manned by, you guessed it, city employees.
Nick Bowset (1:29)
Altogether, more than 300,000 people work for the city of New York. 300,000 people who make it possible for the city to function. And this marvel of social coordination, like so many things in our world, is made possible by money.
Keith Romer (1:46)
Yeah, my family pays city income tax and property tax and sales tax, and because my wife is self employed, something called the Metropolitan Community Transportation Mobility Tax. And all of those taxes pay for the sanitation workers and the teachers and the firefighters.
Nick Bowset (2:03)
Those city employees mostly get paid every two weeks. But the taxes and the big chunks of money that come from the state of New York or the federal government, those come on a completely different timeline. Income taxes are due in April. A lot of property taxes are due in July and January.
Keith Romer (2:20)
Lots of cities like Chicago, L.A. houston, Philadelphia, San Francisco, they deal with this with a little financial magic trick. They move money from the future when the taxes come in to the present when they need to pay their workers. The cities pull off this trick by selling short term debt, little IOUs that only last for a few months.
Nick Bowset (2:43)
Now, New York has generally had enough cash on hand that it hasn't had to use this short term debt debt trick for a while. Partly this is because New York is just very, very careful about this stuff because 50 years ago it was very, very not careful about it. And the city stopped functioning in some of the basic ways a city needs to function to survive.