Voting with our feet

Posted by: Phineas on November 17, 2010 at 1:03 pm

One of the functions of the decennial census is to determine how many seats each state gets in the House of Representatives. While this doesn’t enable us to determine in detail who is moving where and why, one can make a few broad generalizations with some confidence based on the likely apportionment.

And one of the chief among them is that people are fleeing high-tax, heavy government states like the plague:

Migration from high-tax states to states with lower taxes and less government spending will dramatically alter the composition of future Congresses, according to a study by Americans for Tax Reform

Eight states are projected to gain at least one congressional seat under reapportionment following the 2010 Census: Texas (four seats), Florida (two seats), Arizona, Georgia, Nevada, South Carolina, Utah and Washington (one seat each). Their average top state personal income tax rate: 2.8 percent.

By contrast, New York and Ohio are likely to lose two seats each, while Illinois, Iowa, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, and Pennsylvania will be down one apiece. The average top state personal income tax rate in these loser states: 6.05 percent.

The state and local tax burden is nearly a third lower in states with growing populations, ATR found. As a result, per capita government spending is also lower: $4,008 for states gaining congressional seats, $5,117 for states losing them.

The article also draws a correlation between states that require the payment of union dues (losing seats) and right to work states (gaining seats).

There are some obvious lessons to be drawn here about tax competition and free labor: first, businesses and wage-earners will be attracted to states that let them keep more of their own money and not burden them with excessive regulation. The second and related point is that granting unions a monopoly over labor (or access to taxes disguised as “representation fees” for those who don’t join the union) drives up the cost of labor to such a point that businesses will look to relocate elsewhere. It’s no coincidence that businesses (and their jobs) are fleeing high-tax, big government California, while low-tax, light-regulation Texas accounts for half of all the jobs created in the nation over the last year.

Will job-killing states learn this lesson? Perhaps. But maybe, like so many addicts, not until they hit rock bottom.

UPDATE: A timely example, via Heliogenic Climate Change.

-ANAHEIM, R. Frautschy: (…)

A recent discussion with my accountant determined that in order to comply with AB32 it will cost me almost the same amount as my yearly payroll. Now add in all the new or raised business taxes, and I must more than double the company income to make ends meet.

I received an offer from the state of Nevada. If I move my company to Nevada, my taxes will be 83 percent lower, no AB32 complications. Lower health care costs and more. It’s a no-brainer. I am laying off my entire staff and moving to Nevada. So, as of Dec. 31, 2010, the state of California will have 32 highly skilled workers on their unemployment hands. The unemployment rate is high in Nevada, so I can hire all new employees for much less.

(Crossposted at Public Secrets)

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  • 9 Responses to “Voting with our feet”

    Comments

    1. Toubabou says:

      Unfortunately, although many of these emigrants seem to have learned that their state of origin is toxic, they bring the attitudes with them that caused that toxicity. Colorado is being turned blue by Californians (Californicators was a slang term for them at one time) who left the oppression of California and are now trying to implement those same oppressive policies in Colorado.

      I guess, to say it more simply, unless the emigrants understand whytheir state of origin was toxic they stand a good chance of simply spreading the disease. I guess we can analogize with Typhoid Mary.

    2. Matt McDole says:

      Toubabou hit it on the head, I think. Yea, a lot of us are evacuating states such as California (like me) and New York, and the area I have moved to here in North Carolina is SATURATED with people from both states. For example; a lot of the NC natives I know say the name of my town is an acronym for “Containment Area for Relocated Yankees.”

      I’m no pollster, but taking a look at license plates in any given parking lot here suggests that the the acronym is well-deserved. Additionally, this corner of the Raleigh suburbs are heavily left-leaning.

      Coincidence?

    3. Great White Rat says:

      Both Toubabou and Matt have it right. Liberals can tell when things have turned rotten in their states….unfortunately, they aren’t equipped with the kind of cause-and-effect logic that would cause them to understand that THEIR policies are what caused the problems. To liberals, everything that’s wrong is ALWAYS someone else’s fault. You need look no further than the White House for Exhibit A.

      Toubabou’s disease analogy is a good one. I always thought of liberals who relocate as people who foul their own nests and make their own states wastelands – and then want to move in with you and repeat the process.

      The idea that the good jobs will go where taxes are low and the government isn’t extravagant isn’t in their programs, so they can’t handle it. You can lead a liberal to logic, but you can’t make him think.

    4. Carlos says:

      55 years ago my dad was bitching about all the californicators moving north to Oregon, driving up real estate prices and generally being a pain in the hindside with their “I’m from California so I’m a star” attitude.

      Now, 55 years later and with 20 years of the genii hemorrhoids running the staehouse and legislatures, they still haven’t figured out an effective way to prevent idiots who caused the problems in CA to begin with from moving up here and devastating this state, too. As a first step toward that end, I’d suggest getting rid of 95% of the state’s land use laws, which favor “I’ve got mine, now you can’t have yours” type local legislation.

    5. Migration from high-tax states to states with lower taxes and less government spending…

      That must be wrong. Every year at the public hearings at budget time in our county, members of the teachers union get up and say time and again that it’s high taxes and big spending on schools that attracts people to the county.

    6. Carlos says:

      I wouldn’t mind voting for increased school budgets if they could show me a decent return on my investment.

      For at least four decades they haven’t been able to, and I haven’t voted to increase the school budgets in all that time.

      Funny thing, though. Even though the school districts around here have been clamoring for years about cutbacks and such, the top-heavy administration keeps getting heavier and richer, all because they (the administrators) say they need better control over what’s happening in the classroom. Without facts to back it up, I would guess that at least 50 cents of every dollar of increased revenue goes to administration, and less than a dime goes to the actual classroom.

      But it’s all for the kids. Yeah, right.

    7. FrankNitti says:

      I live in school district with I guess a middle of the road enrollment (about 17000 students), as a matter of public record all salaries over 50,000 are published. In the district there are 24 people making over 100K a year (district office only) and if you throw in all the principals making over 100K the total is up to 34.

      These same administrators are always hollering about how they need more money for the kids, but when it’s time for budgets cuts…..it’s the support staff(janitors, cooks,secretaries, etc.)that are the first out the door.

      as Carlos said….”it’s all for the kids. Yeah, right.”

    8. Carlos says:

      For those of us who are somewhat confined to living where we do, here’s another idea: vote with your pocketbook! Walk into a store, look at whatever product you’re looking for, ask if it’s union-made, and if it is tell the salesperson thanks but no thanks, you’d rather do business with a company whose workers respect themselves and whose union bosses aren’t communists.

      If that happens often enough, word will get back to the manufacturers and the union bosses. The unions will have a fit and try to make government mandates about their products, but I don’t think even the Ninth Circus would uphold those.