CEO Explains Exactly How New York Is Going To Collapse

When Tom Bilyeu hears Zohran Mamdani promise “free buses,” he doesn’t see compassion; he sees a spreadsheet bleeding red.

In a live show clip, the Impact Theory CEO argues that nothing is ever free. Somebody pays – either with higher taxes, reduced services elsewhere, or debt that shows up later with interest. His test is brutally simple: if you want “free buses,” what won’t you do to pay for them?

Bilyeu’s core fear isn’t transit policy. It’s ideology. He frames Mamdani’s platform as a moral crusade untethered from math, the kind that keeps marching even when revenue falls and capital flees. As he puts it, “follow the math or break the city.”

I don’t share Bilyeu’s showman flair, but I think he’s right about incentives. If a policy requires investors to ignore arithmetic, we should assume the policy will fail—even if the slogans sound saintly.

Housing: Lessons New York Already Paid For

Bilyeu’s sharpest critique centers on rent freezes. He reminds listeners that New York has tried versions of them for decades, peaking in the 1960s and 1970s, and the results were ugly.

He recounts a seldom-taught consequence: owners who could no longer cover taxes, maintenance, and repairs began deferring upkeep, then – at the bleak extreme – committing arson for the insurance payout.

Bilyeu cites The Bronx fire era to illustrate a larger point: housing is a business, not a charity. If the rules force a loss, people exit the business or cut corners until the building decays.

His hypothetical “mom-and-pop landlord” vignette isn’t just rhetorical. It mirrors what ReasonTV’s reporting found on the ground across the five boroughs.

In a deep dive, Justin Zuckerman documents how tighter 2019 rent laws helped create a ghost inventory of “zombie” apartments – units so underpriced that it’s irrational to renovate and re-rent them. Ann Korchak of the Small Property Owners of New York spells it out: “What bank is going to lend you $200,000 to improve an apartment when the legal rent isn’t even $1,100?”

That’s not theory. Kenny Bergos points at a Washington Heights three-bedroom that needs six-figure work but caps at a fraction of market rent. Lincoln Eckles shows two sealed units in Crown Heights that he says would lose money “day one” if reopened. 

Meanwhile, the market-rate units in the same buildings carry the whole financial load – and can’t carry it forever.

If the city makes it impossible to earn a return on regulated units, many owners will “mothball” them. That shrinks supply. Shrinking supply raises prices for everyone else. Rinse, repeat.

Winners, Losers, And The Lottery Ticket

One of Reason’s most revealing moments is a visit with Tyler, a software engineer paying $1,900 for a rent-stabilized home that would fetch more than double on the open market. 

He calls it “the golden apartment” – and he’s not wrong. That discount becomes a wealth escalator: extra savings for retirement, a future down payment, or simply breathing room.

But Tyler also admits something activists often dodge: “Should tech bros with $300,000 incomes be in stabilized apartments? Absolutely not.” The current system isn’t targeted to need. It’s luck – and sometimes inheritance. 

Private investigator Emanuelle Welch says she’s seen everything from pied-à-terres near Yankee Stadium to influencer fairy tales of a two-bedroom off Central Park passed to the next generation like a family heirloom.

Edward Glaeser, the Harvard urban economist, is blunt: long-term lock-ins misallocate space and block newcomers. Cities are engines of churn – people arriving with little, climbing quickly. If your affordable housing plan hinges on whether a stranger’s grandparents rented in 1947, your system has made scarcity hereditary.

This is the uncomfortable truth: rent stabilization creates winners with deep discounts and losers who never get picked. 

Julian Acosta and Zena, two New Yorkers featured by ReasonTV, keep lining up for apartments they can technically afford – only to watch landlords choose higher-income applicants. They sublet, they hustle, they apply again. The lottery keeps rolling without their number.

The Campaign That Promises To Double Down

Mamdani’s answer, according to Reason’s reporting from rallies and debates, is to freeze rents citywide for four years. He’d appoint members of the Rent Guidelines Board and use that power to lock rates on roughly a million units. 

Activists chant “freeze the rent” with conviction. They see it as a lifeline amid $4,400 one-bedrooms and relentless rent hikes.

The problem is what happens next.

Korchak predicts more owners will yank units from use or defer work – and the whole city gets poorer. Council Member Vickie Paladino warns that every “emergency” rule triggers the next “emergency” patch, a game of policy whack-a-mole that ratchets costs while shrinking supply.

Bilyeu – who calls socialism his “supervillain” – drives at why these cycles persist. He cites research that people often prefer punishing the rich over helping the poor, even when the latter would improve outcomes for both. 

If that’s the political incentive, it explains why policies that feel moral survive evidence that they don’t work.

Producer Drew pushes back in Bilyeu’s conversation, arguing values matter and pointing out that New York already has some of these controls. Bilyeu’s retort is that “some controls” haven’t solved the problem because they scare away investment and slow new building. 

His remedy: build more and regulate less – not zero regulation, but a lot less red tape on construction and renovation. Pair that with smart guardrails (for example, occupancy requirements or heavier taxes on a third property) and you might actually goose supply.

I rarely agree 100% with any “free market fixes all” sermon, but the basic prescription – make more housing legal to build and stop locking units into misfit tenancies forever – is the least-bad path cities have found worldwide. When you let supply move, prices bend. When you freeze demand in place and throttle supply, prices spike for everyone else.

Transit, Taxes, And The Capital-Flight Test

Back to those buses.

Bilyeu offers a useful litmus test for any “free” service: if you fund it, do you also retain capital? In his words, if wealthy taxpayers and businesses conclude the tradeoff is worth it, the policy survives. If they leave, revenues fall, and the math gets uglier.

He has “exactly zero belief” that a package of fareless buses, rent freezes, and broader redistribution survives that test. He sees it as an ideological move first and a fiscal plan second.

Maybe he’s too confident. Maybe New York could make buses fare-free while trimming elsewhere, or fund the experiment with a targeted revenue stream that doesn’t spook investors. 

But Bilyeu isn’t inventing the worry. We’ve watched cities promise everything to everyone, then discover that balance sheets don’t care about feelings.

If Mamdani does win, his first real-world metric won’t be applause – it’ll be permits pulled, units rehabbed, vacancy rates, private capital committed, and yes, tax receipts. If those hold steady or rise while services expand, I’ll happily revise my priors.

Hard Choices Beat Easy Slogans

Here’s where I land.

New York won’t “collapse” because a mayoral candidate has big ideas. Cities are resilient, messy, and louder than any one person. But a city can hollow out if it spends a decade choosing good intentions over good incentives.

Freeze the Rent feels righteous. It also calcifies privilege for the lucky and slams doors on the rest. “Free” buses sound kind. 

They also force tradeoffs that don’t vanish just because we rename the bill. And the history lesson from the Bronx, echoed by Bilyeu and reported by Reason, should inoculate us against policies that quietly break the financing model of housing.

If New York truly wants affordability, it needs to legalize abundance: fewer bottlenecks on building, faster approvals on rehabs, dynamic subsidies targeted to people (by income), not apartments blessed forever by the accident of time. 

Pair that with targeted anti-speculation rules that actually bite – occupancy requirements, vacancy taxes with teeth – and you tilt incentives toward homes, not lottery tickets.

In short: pick math over mantras. Make it pencil for the folks who build and maintain the places we live, and the city will keep attracting the people who make it worth living in. 

Ignore the math – and the collapse Bilyeu fears won’t be cinematic. It’ll be quieter: fewer units, shabbier buildings, longer lines, and a city that becomes affordable only to the rich or the lucky.

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