Crain’s New York Business: New York’s business leaders mum on Cuomo scandal
By Brian Pascus
March 15, 2021
Sexual harassment allegations leveled against Gov. Andrew Cuomo have left New York’s business community speechless.
The governor’s scandal has left CEOs in an awkward position—support the women making the allegations and suffer the ire of a notoriously vindictive politician or support the governor and risk a public backlash or company boycott.
Crain’s New York Business reached out to several business leaders, but most declined to comment. No one commented directly on the harassment claims.
“The business community has been so burdened by things in Albany the last several years that taking any public position is risky,” said Hank Sheinkopf, a longtime New York political consultant. “Cuomo is, in many ways, the antidote for the business community against the extreme progressives.”
With dozens of state Democrats calling for his resignation—including Senate Majority Leader Andrea Stewart-Cousins—the political dilemma that Cuomo faces is compounded by the fact that negotiations for the FY22 in Albany are already underway, leaving business leaders watching from the sidelines as an increasingly dysfunctional situation plays itself out.
“I think the focus of concern is on what’s going on with the legislature with respect to the budget, and particularly with regard to what happened this weekend,” said Kathryn Wylde, CEO of the Partnership for New York.
The Assembly and Senate announced a budget proposal over the weekend, one that levies new taxes against business interests and high incomes to the tune of $7 billion in revenue: the top income tax rate would move from 8.82% to 9.85% and two new multimillionaire tax brackets would add rates of $10.85% and 11.85%, respectively.
Other taxes proposed in the budget include capital gains taxes, a surcharge applied to corporate franchises, and a progressive tax against the value of second homes.
Concurrently, the Biden Administration has indicated it will seek to raise federal income taxes and the corporate tax to their highest levels in years, with some indications that federal tax levels may reach back to where they were in 1993, during the Clinton administration.
The Hotel Association of New York City offered no comment other than saying it is an ongoing manner in the Attorney General’s office and the Legislature. The New York Hospitality Alliance did not offer comment nor did the Real Estate Board of New York.
Big finance kept their lips sealed, as well: both Bank of America and J.P. Morgan Chase declined to comment on the matter.
There is the question of why some New York businesses and corporations, who have spoken up or made their support of the #MeToo movement clear over the past three years, are not taking a stand when the governor himself has been accused of workplace harassment.
“You reconcile it by saying money has no conscience,” Sheinkopf said. “It’s easy to say something about a national policy that doesn’t impact your bottom line. It’s much harder when you take on a regulator on a matter of principle and believe he won’t regulate you out of existence.”
Sheinkopf added that a big part of Cuomo’s job is to determine regulatory policy across the state and that his reputation is one built on not forgetting personal slights and settling old scores.
“Amnesia is not part of Andrew Coumo’s personality,” he said. “He can make life miserable for businesses.”
More than anything, the business community prefers stability over upheaval, according to George Arzt, a New York political consultant, and the sudden reversal of Cuomo’s fortunes has created a great deal of uncertainty for the state going forward.
“I think that the business community was rattled by the allegations because Cuomo had brought stability to the government,” Arzt explained, noting that Cuomo was a good leader during the pandemic and that he’s made himself accessible to the business community during his three terms.
But with Cuomo’s political future in doubt, New York’s economic future is up for grabs, as emboldened progressive legislatures in Albany and Manhattan seem poised to reverse policies supported by the business community for the better part of the last two decades.
“I think they are rattled,” Arzt said, speaking of business leaders. “They are afraid of an anti-business attitude in the legislature, in the City Council, and they feel they need a strong governor to hold the left-back.”