Mamdani's Anti-DOGE City Savings Plan Includes Firing McKinsey, Not Hiring Them

Cutting government "waste" and increasing "efficiency" have long been rallying calls of the right, most recently with President Donald Trump's "slash-and-burn" methods through the so-called Department of Government Efficiency—which rapidly cut hundreds of thousands of federal jobs and threatened lives across the Global South by terminating billions in foreign aid—and his cuts to Medicaid and federal food assistance.

But New York City Mayor Zohran Mamdani on Wednesday appeared intent on "co-opting" the idea of efficiency, as one organizer said, as the progressive Democrat provided an update on his plan to save more than $1.7 billion in public funds "without compromising essential services."

The targets of Mamdani's savings plan aren't crucial healthcare programs like Medicaid—which even some Democrats like his erstwhile rival, former Gov. Andrew Cuomo, have attacked as "wasteful"—and education, but major government contracts with companies like consulting firm McKinsey.

Cutting the Department of Social Services IT contract will save the city $9 million per year, said Mamdani. McKinsey has contracted with the New York City government several times, including between 2014-17 when it was paid $27.5 million to reduce violence at the jail complex on Rikers Island—only to report "bogus" numbers as the problem worsened—and in 2022 when it was paid $1.6 million to research garbage disposal.

"The city was paying for a lot of work from outside contractors that was costing us far too much, so we're bringing a lot of that work in-house and saving our budget millions on things like IT services and software," said Mamdani in a video he posted to social media. "A contract with McKinsey at the Department of Social Services: no more. That's $9 million that we won't be spending next year.

Other savings identified by city agencies, which were directed by Mamdani to find $1.7 billion in public funds that could be saved to fill what city Comptroller Mark Levine called "the biggest budget gap since the Great Recession," include $1.15 million at the Department of Health and Mental Hygiene, which has been "overcharged for lifesaving medicine like naloxone."

"We're renegotiating that contract and saving another million dollars," said Mamdani.

Millions will be saved on leases as the city shrinks its "physical footprint" and stops renting spaces it doesn't need, and an estimated $13 million per year will be saved as officials strengthen its verification process to make sure homeowners are actually living in homes for which they get tax breaks.

Other contracts will be terminated or renegotiated at New York City Public Schools, generating more than $30 million in savings next year; the city's public hospitals system, saving about $40 million over the next two years; and the Department of Corrections, resulting in $4.3 million in savings.

Mamdani emphasized that to confront the city's deficit, "we need to tax the rich and end the drain that's been our relationship with the state for far too long."

"As we pursue that, though, we also have to take a close look at our own spending and cut waste wherever we can," the mayor said. "Because to deliver public goods you have to first deliver public excellence."

Organizer and writer Cole Sandick said Mamdani's "co-opting of efficiency from the right will be seismic for the American socialist project" and expressed hope that the mayor could begin "a national campaign against The Contractor State—neoliberalism's grand, massively inefficient outsourcing of government functions to private contractors."

Alex Jacquez, chief of policy and advocacy at the think tank Groundwork Collaborative, said it was "really exciting that NYC is generating operational efficiencies by in-sourcing needlessly outsourced public services and functions, building city capacity."

"More of this!" he added.