As we learn more and more about our current population, thanks to the Census Bureau, we are also getting a glimpse into the American psyche – Americans are driven to seek places where there are less taxes, less government spending and less union influence. Michael Barone has a few highlights for us.
- The lesson is that high taxes and strong public employee unions tend to stifle growth and produce a two-tier society like coastal California’s.
- The eight states with no state income tax grew 18 percent in the last decade. The other states (including the District of Columbia) grew just 8 percent.
- The 22 states with right-to-work laws grew 15 percent in the last decade. The other states grew just 6 percent.
- The 16 states where collective bargaining with public employees is not required grew 15 percent in the last decade. The other states grew 7 percent.
- The most rapid growth in 2000-10, 21 percent, was in the Rocky Mountain states and in Texas. The Rocky Mountain states tend to have low taxes, weak unions and light regulation. Texas has no state income tax, no public employee union bargaining and light regulation.
The fact is that many of these states believe that the more taxes you impose, particularly on the rich, the more money they will get in order to fund their bigger-government scheme and wealth distribution plans. But that is entirely not the case. Fostering a friendly economic climate with low taxes, low spending and right-to-work are ultimately what drives people to a state, thereby increasing potential tax revenue and economic gain. Meanwhile, as these high-tax, high-spending states continue to lose revenue, they continue to raise taxes. In California, for example, “Nearly half of California’s income taxes before the recession came from the top 1% of earners: households that took in more than $490,000 a year.” But it’s state saw less growth compared to lower tax states, and it is also in a gigantic financial hole .. considering that the top 1% of earners are also the most volatile income group to rely upon. The Wall Street Journal also points out, “New York, New Jersey, Connecticut and Illinois–states that are the most heavily reliant on the taxes of the wealthy–are now among those with the biggest budget holes.”
It’s not rocket surgery, unless you are a liberal who cannot understand why people would want less government in their lives.