A Zohran Mamdani Economy Could Destroy American Economy As A Whole

As it stands right now, the socialist candidate Zohran Mamdani appears to be on track to become the next mayor of New York City. He is not technically part of the socialist party officially. But his ideas and plans for New York verge entirely into the realm of socialism. New Yorkers, who were too ill-informed and uneducated to research Mamdani, decided it was a good idea to vote him as the Democrat primary candidate.

Since then, plenty have regretted the decision to back a guy who clearly has a distaste for New Yorkers, and the welfare of the American people in general. His ideas for the economy are even worse, and what he institutes in New York could have wide ranging effects and even hurt the American economy as a whole.

Essentially, Mamdani wants to force an equity agenda on the New York City Banking Commission, who has very strict rules on lending. Business analyst Joseph Ford Cotto says Mamdani wants to dig into that and ruin the profitability of the banks.

"They would have to have a fee structure that is unprofitable, and they would be forced to do lending that would be incredibly risky, with loans that were unlikely to ever be paid back," he says.

That sounds an awful lot like the 2008 financial crisis in the United States. Over lending to people with bad credit scores, unlikely to ever pay, created a housing bubble. Which popped and created an economic downturn. The Cliff Notes version anyway. Why Mamdani would think instituting a similar idea is a good plan is beyond comprehension.

But how does this mean anything for the U.S. economy? After all, he is just the Mayor of New York. But the ripple effect would come about primarily because it is New York, the biggest city in the country.

"Because the financial sector of the United States is New York City...it would have very unfortunate ripple effects across the country," says Cotto.

This would not just hurt the banks profitability. It would end up hurting people. Sure, the banks would basically give any Joe Shmo a loan. But it would create a borderline monopoly in the banking industry, where only the big fish survive.

"A lot of particularly smaller banks, privately held ones, would likely go under after having to deal with the insane cost of being in compliance," Cotto says.

Whether Mamdani gets elected as Mayor remains to be seen. But as it looks, the de-facto socialist will get a chance to instill his agenda on a major city. If it goes according to his plan though, it will fail spectacularly.