New York, gone under

Dear all,

We welcome you to the Greater Caribbean Monitor (GCaM).

In this issue, you will find:

• New York’s socialist turn: a warning echo from Latin America

• No longer king of the hill?

• Diplomacy fractured: new rules in game

• What We’re Watching

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Best,

The GCaM Team

New York City has elected Zohran Mamdani—an openly socialist candidate—as its new mayor. While many U.S. outlets frame the result as a victory for “diversity” and “inclusion,” it also signals an ideological turning point for the United States.

A familiar story. The outcome in the country’s largest city is not an isolated event, but a sign of how far the radical left’s narrative is advancing inside the American political mainstream. During his campaign, Mamdani promised free public transportation, rent freezes, and higher taxes on businesses and “the rich,” all under the banner of “social justice.”

• The message resonated with younger and newly engaged voters, but for Latinos from Venezuela, Cuba, or Nicaragua, it carried an unsettling familiarity.

• They have witnessed this pattern before: generous promises, anti-business rhetoric, and moral appeals that end in fiscal deficits, job losses, and the decay of public services.

Latin America’s Mirror. Across Latin America—from Chile to Colombia, Argentina, and Mexico—left-wing populism followed a similar arc. Expanding social programs without productive backing led to macroeconomic instability and surging crime. Now, one of the world’s financial capitals appears eager to test the same formula, dressed in modern, urban aesthetics. Socialism today no longer arrives waving revolutionary banners but wrapped in hashtags, inclusive slogans, and the promise of “free everything.” The result is unchanged: the working middle-class ends up paying for it.

• Among conservative Hispanic communities in Florida, New Jersey, and the Bronx, Mamdani’s election is considered another sign of disconnect between urban elites and citizens who still value work, savings, and economic freedom.

• Many immigrants remember what happens when the state becomes the owner of everything: fewer opportunities, less freedom, and greater dependence.

• That collective memory may become decisive in upcoming federal elections as the Latino vote increasingly shapes national outcomes.

Why it matters. Mamdani’s policy agenda faces immediate fiscal and economic pressure: Free transport would cost billions in new public spending. Rent freezes, on the other hand, have historically reduced housing supply and accelerated neighborhood decline.

• Higher taxes risk driving companies and upper-income taxpayers toward low-tax states like Florida or Texas, where capital and talent have already been migrating.

• New York may soon find itself pushing out the very people and businesses that sustain its economy.

Between the lines. The question is whether the United States is beginning to repeat the ideological cycle that has defined much of Latin America. It begins with calls for social justice, continues with higher taxes, and often ends in inflation and disillusionment. The difference, for now, is institutional resilience: American checks and balances remain strong, and conservative voters are better organized.

• Yet history shows that economic freedom rarely disappears overnight—it erodes gradually, through applause, subsidies, and politically convenient promises.

• With midterm elections approaching, Mamdani’s victory could serve as a rallying flag for the Democratic Party’s progressive wing—and a warning sign for Republicans and Hispanic voters who defend fiscal responsibility and individual liberty.

• It’s also a reminder that prosperity does not emerge from state intervention but from innovation, productivity, and the freedom to create wealth.

The Bottom Line. New York’s socialist turn marks the start of a deeper national debate. The U.S. now faces a choice: repeat the mistakes that plunged Latin America into stagnation, or learn from them before it’s too late. New Yorkers have chosen to run the experiment. The rest of the country must decide whether to follow or stop it.

Once the uncontested capital of global finance, New York is slowing down—not only in growth but in purpose.

In perspective. The city that once symbolized American dynamism is now burdened by high taxes, regulatory overreach, and political leadership that treats private enterprise as a suspect rather than an ally. The data tell a stark story: the post-pandemic rebound is over, and what remains looks more like stagnation than recovery.

• It is normal for mature cities to cool off after decades of explosive growth. Paris, London, and Tokyo have all experienced periods of consolidation.

• But in New York’s case, the trend is sharper and more political.

• Productivity, real wages, and private investment have all weakened far faster than comparable global hubs.

Going under. Between 2019 and 2024, the city lost roughly half a million residents, a demographic shift compounded by remote work and the migration of both middle-class families and high earners to states like Florida and Texas. The metropolitan economy has diversified out of finance—but not into innovation. Instead, government spending and public payrolls now account for a larger share of output, even as tax receipts shrink.

• Democratic policy has deepened that slide. The state’s combined top tax rate is now among the highest in the United States, while housing and labor regulations continue to raise costs and deter new projects.

• The city’s business-to-population ratio—once a measure of its entrepreneurial strength—has flatlined.

• After adjusting for inflation, New York’s GDP per capita has grown at less than 1% annually since 2018.

The politics of decline. Enter Zohran Mamdani, the new socialist mayor who campaigned on free public transport, rent freezes, and higher corporate taxes. For progressives, his victory represents a “moral correction.” For investors and employers, it marks the point where New York’s structural drift becomes ideological.

• Mamdani’s platform mirrors the populist experiments that hollowed out major global economies: expansive promises backed by shrinking revenues. In a city already suffering from population loss and fiscal strain, new spending commitments risk accelerating the exodus of capital and talent.

• What is most striking is the disconnect between policy ambition and economic capacity. New York is behaving like a city that still dominates the global economy when, in fact, it is already being outpaced.

• Miami now attracts more venture funding per capita; Austin and Dallas lead in corporate relocations; and Florida’s economy recently surpassed New York’s in real GDP for the first time in modern history.

The bottom line. Some decline might be cyclical. The danger is that it becomes structural—that policy replaces productivity as the city’s growth model. The deflation of Wall Street’s dominance and the ideological capture of City Hall point to a broader erosion of competitiveness. With higher costs, rising crime, and declining infrastructure quality, New York is at risk of turning into a museum of its own success: still iconic, but no longer leading.

• New York’s slowdown is not just the natural fatigue of a city that has peaked. It reflects an economic environment suffocated by regulation, taxation, and anti-market politics.

• Mamdani’s election crystallizes that trajectory—from pragmatic liberalism to punitive progressivism.

• The world’s greatest city can survive slower growth. What it cannot survive is the loss of ambition that built it.

The recent diplomatic rupture between Peru and Mexico is not an isolated regional dispute but the clearest symptom of a broader geoeconomic reconfiguration.

In perspective. While the immediate cause was a disagreement over political asylum, the event reflects a world shifting away from globalization and toward regionalization. In this new era, the established diplomatic norms and multilateral forums that once promoted integration are losing traction. The rupture is the culmination of years of escalating diplomatic friction, rooted in a deeper ideological polarization that is redefining regional norms.

• The crisis began in late 2022, following the ousting of Peruvian President Pedro Castillo. Mexico’s administration immediately supported Castillo, granting asylum to his family and refusing to recognize the new government.

• Relations remained effectively frozen for years, with ambassadors withdrawn. The final break came in November 2025, when Mexico granted political asylum to Betssy Chávez—Castillo’s former prime minister, who faces charges of rebellion and conspiracy in Peru.

• This ideological standoff has already produced concrete geoeconomic consequences. The dispute paralyzed the Pacific Alliance—a key regional trade bloc—after Mexico refused to transfer the rotating presidency to Peru.

Why it matters. The traditional rules of Latin American diplomacy are being rewritten. The new order prioritizes ideological sovereignty and strategic alignment over the conventional norms of regional integration and non-intervention. This rupture codifies a new regional logic in which national ideological positioning supersedes multilateral commitments.

• Integrationist projects lose validity when they conflict with a government’s core political agenda.

• The dilemma mirrors the broader pattern of geoeconomic fragmentation.

• As the world reorganizes into U.S.- and China-led blocs, Latin American nations are being forced to make strategic choices about sovereignty and alliances.

Between the lines. This diplomatic rupture is more than a political quarrel—it marks a structural failure of the late-globalization system, with geoeconomic consequences that set a dangerous precedent for the entire region. The freeze of Latin America’s most market-friendly trade bloc, the Pacific Alliance, halts progress toward a unified Asia-Pacific trade hub and signals political instability to global investors.

• The precedent now established is that foundational diplomatic norms are subordinate to domestic political imperatives.

• Ideological alignment has become more powerful than binding treaties, rendering regional diplomacy unpredictable and unreliable as the rules are renegotiated.

• With major blocs like the Pacific Alliance and CELAC proving ineffective, the region is likely to pivot away from multilateral frameworks toward bilateral agreements, as individual nations race to secure their own place in new global supply chains, further eroding collective bargaining power.

In conclusion. The rupture between Peru and Mexico confirms that national ideological positioning now outweighs the established rules of economic integration. This geoeconomic fragmentation, driven by the actions of two pivotal partners, has effectively stalled vital institutions such as the Pacific Alliance.

• As Mexico and Peru prioritize domestic politics and realign within the emerging global order, they are not merely breaking a diplomatic tie; they are accelerating the region’s descent into a fragmented, post-multilateral era.

What We’re Watching 🔎 . . .

Senate GOP blocks war-powers curb on Trump as U.S.–Venezuela standoff deepens [link]

Antonio María Delgado, Miami Herald

The U.S. Senate narrowly rejected a resolution to curb President Donald Trump’s authority to strike Venezuela, deepening concern over Washington’s expanding military presence in the Caribbean. The measure by Democrat Tim Kaine failed 49–51 after only two Republicans backed it. Democrats, led by Chuck Schumer, warned that Trump’s deployment of the USS Gerald R. Ford and a growing naval task force risks “a major military confrontation.”

Since September, U.S. forces have conducted 16 strikes on alleged drug-smuggling boats, killing 67 people. The administration has not sought a declaration of war, instead citing anti-narcotics laws to justify operations that critics say resemble a regime-change campaign. The War Powers deadline has expired, but with covert CIA action already authorized and the carrier group positioned offshore, the question is no longer if Washington will escalate—but how far.

A Mayor’s Assassination Reignites Mexico’s Debate Over Confronting Cartels [link]

José de Córdoba, Wall Street Journal

Carlos Manzo, the 40-year-old mayor of Uruapan—Mexico's avocado capital—was assassinated during a Day of the Dead ceremony, reigniting anger over President Claudia Sheinbaum’s “hugs, not bullets” strategy. Known for leading police raids in his cowboy hat and bulletproof vest, Manzo had openly challenged cartels and criticized the federal government’s reluctance to confront them.

His killing sparked mass protests and calls for military intervention in Michoacán, a region dominated by the Jalisco New Generation Cartel. Sheinbaum blamed past administrations’ hard-line tactics and rejected U.S. intervention, insisting her intelligence-driven approach will prevail. But as violence surges and public trust erodes, Manzo’s death underscores a growing fear: that Mexico’s cartels now dictate the limits of the state’s power.