America’s Great Wealth Migration

anti business

America’s Great Wealth Migration

Within American states, the last two years have seen a dramatic shift of relocation (both for individuals and businesses) and family income within our country. About 70% of the moves were from urban to urban areas, and 56% moved from suburban to suburban areas. The shift was from high-tax and high-regulations states, to low-tax and reasonable-regulations states. Money walks, and moves to where it is welcome. Just as important, these trends are expected to become long-term

U.S. cities with populations over 1million experienced an 88% decline in their growth rates from 2010 to 2018. New York and California were hit hardest. New York lost 1.6% of its population but almost 3% of its income, meaning that the people who left were big taxpayers and big earners. Low taxes, low crime rates, and the freedom to live your life without fear of government intrusion are the main reasons for the Great Migration.

In 2020, a total of $40 billion of income was lost by California and New York. Most of the money went to Florida ($24B), Texas ($12B) and Arizona ($4B). California’s big state income tax is driving people out, along with major increases in the cost of living, a terrible legal environment of anti-business laws, high prices, and the homeless/drug problems in the larger cities. It is also the most regulated state in the U.S. In recent years, California has lost 2.6 million residents, even with big-time foreign immigration. The California counties that have seen the largest exit of their population are San Francisco, San Mateo, and Santa Clara. New York also saw a huge decrease in population, with roughly 70,000 leaving in 2020 alone. An example of why: New York City’s budget expenditures are equal to all of Florida.

Business headquarters are also abandoning California, which has seen 265 headquarter relocations from 2019 to 6/30/2021. The monthly average losses in 2021 were 12. And this is probably an undercount, since many relocations are not made public. The Tax Foundation ranks California 49th on its state business tax-climate rankings. Only New Jersey has a worse tax climate.

If Americans want to remain as attractive on the international stage, the states should adopt policies that make us more like Florida and Texas and less like California and New York. But, unfortunately, the Biden administration and Congress are trying to turn the country into California.

Forbes stated, “America has had the strongest, most dynamic economy in the world for the last 80 years, but economic success is not guaranteed. The wrong public policies slow innovation, deter new business formation, and repel talented workers.” Just look at California and New York. John R Smith

This article was written by John R Smith.