Zohran Mamdani could well win the upcoming New York City mayoral race; the voters will decide that on November 4. Yet if his “democratic socialist” platform is implemented, the consequences for residents—economic and social alike—will be disastrous. As Ludwig von Mises might remind us, democratic socialism is still socialism, and “it doesn’t work.”
The Nature of Democratic Socialism
Libertarian economists have long explained that democratic socialism does not involve outright government seizure of the means of production. Rather, it manifests through layers of government interference in the private sector—via regulations, taxes, mandates, and bureaucratic controls. Each intervention distorts market processes, producing inefficiencies and crises that, in turn, invite yet more intervention. The cycle repeats, expanding state power and eroding prosperity.
A contemporary example can be seen in the Democrats’ push to extend Obamacare subsidies, which are set to expire at year’s end. These subsidies were meant to stabilize insurance markets, yet their expiration will drive premiums upward. The government created this instability by intervening in healthcare and now seeks to intervene again—at an estimated cost of $415 billion over ten years—to “fix” the problem it caused.
This incremental approach is socialism by installments: policy by policy, the private market is replaced with a government-run one. Mamdani’s proposals fit within this framework.
Freeze the Rent. Mamdani’s platform declares, “As Mayor, Zohran will immediately freeze the rent for all stabilized tenants, and use every available resource to build the housing New Yorkers need and bring down the rent.” Rent stabilization is a form of price control—a “rent ceiling” that prevents sharp increases but also suppresses incentives to build and maintain rental units. As Cato Institute economist Ryan Bourne observes, such policies “produce rental housing shortages and inefficiency.” In other words, they deepen the very crisis they purport to solve.
Building Affordable Housing. Mamdani also promises to “triple the City’s production of publicly subsidized, permanently affordable, union-built, rent-stabilized homes, constructing 200,000 new units over the next 10 years.” The estimated cost—$100 billion over a decade—would fall on taxpayers. The program would be managed by city bureaucrats, bound by union mandates and rent regulations, determining who builds the units, who occupies them, and what tenants will pay. It would distort the market further and lead to demands for even more state involvement.
As economist Thomas Sowell explained, “It is precisely government intervention in housing markets which has made previously affordable housing unaffordable. Both the history and the economics of housing show this.” Sowell’s research traces the surge in housing costs to the 1970s, when “severe government restrictions on the building of houses and apartments” were first imposed.
City-Owned Grocery Stores. Mamdani says he “will create a network of city-owned grocery stores focused on keeping prices low, not making a profit,” bypassing rent and property taxes to pass savings on to consumers. Given all the problems with housing and rent in New York City caused by government intervention, wait until you see how well city-owned grocery stores work—think Post Office, the VA, Obamacare, or—as current events reveal—the food stamp program.
A better option, notes Cato’s Scott Lincicome, would be to remove regulatory barriers that prevent private alternatives. “New York politicians have used zoning regulations to keep the nation’s largest and most affordable supermarket from opening a store anywhere in the five boroughs,” Reason reports. The irony is striking: rather than permit Walmart to compete and consumers choose, the city prefers to build its own grocery stores.
No Cost Childcare. “Zohran will implement free childcare for every New Yorker aged 6 weeks to 5 years, ensuring high quality programming for all families,” reads his platform. But childcare, like any service, entails real costs—labor, infrastructure, food, and utilities. There’s nothing free here. What Mamdani proposes is taxpayer-funded childcare for about 500,000 children. In a city with some of the highest taxes in the nation and a state ranked last in tax competitiveness, the burden would be immense.
Commenting on government-funded childcare, Milton Friedman said, “A fatal flaw in currently promoted proposals for government financing of child care is that they penalize the family in which the mother stays at home to provide child care under first-choice conditions. In effect, such families would be taxed to pay the child-care expenses of other families. We already have enough government policies that penalize the traditional family. We surely do not need any more.”
Raising Minimum Wage to $30. Mamdani vows to “bring the NYC wage floor up to $30/hour by 2030.” This too is a price control—a government-imposed floor on the price of labor. When prices are forced above market levels, employers adapt: they hire fewer workers, cut hours, raise prices, or automate.
California’s experience illustrates this outcome. In 2024, the state raised its fast-food minimum wage from $16 to $20 an hour. As libertarian economists predicted, it led to widespread job losses. A 2025 National Bureau of Economic Research study found that employment in the fast-food sector fell 2.7 percent, a loss of roughly 18,000 jobs.
Economist Walter Williams summarized the principle: “Reduced employment opportunities is one effect of minimum wage legislation. The minimum wage law has imposed incalculable harm on the disadvantaged members of our society. The only moral thing to do is to repeal it.” Ayn Rand put it more starkly: “Unemployment is the inevitable result of forcing wage rates above their free-market level.”
The Cost of Interventionism
When government intervenes in the marketplace, ordinary citizens lose. New York City already suffers under an array of semi-socialist policies—from rent control to excessive taxation—whose cumulative effects are visible in the city’s shrinking population and stagnant growth. To quote Mises, “Yet these events are not the outcome of the operation of the free market. They are on the contrary the result of well-intentioned but ill-advised government interference with the market.”
New York’s future does not lie in further centralization or state control. Its vitality has always derived from individual freedom, entrepreneurial energy, and the rule of law. The Big Apple became great because it allowed people to build, innovate, and prosper—not because government directed them.
If New York is to thrive again, it must return to those principles. Get big government out of the way, and the city’s people—their creativity, ambition, and enterprise—will do the rest.
