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the virtues of federalism
States with the Highest Taxes Have a Desirability Problem

A recent Gallup survey finds that people who live in states with the highest taxes (including income, property, and sales taxes) are more likely to want to head for the exits than people who live in states that let them hold on to more of their earnings:

Approximately a quarter (26%) of residents who live in states with the lowest tax burden say they would like to leave their state. And this rate generally holds for residents in the second and third quintiles. However, there is a three-percentage-point increase to 31% among fourth-quintile states and an even greater jump to 36% among the fifth quintile. Even after controlling for various demographic characteristics including age, gender, race and ethnicity, and education, there is still a strong relationship between total state tax burden and desire to leave one’s current state of residence.

The survey only measured the expressed desire to leave—not the commitment to doing so. Indeed, Gallup reports that “only 12% of Connecticut residents who report they would like to move say they plan to do so in the next 12 months.” Still, even if most of those who say they want to leave never actually do, the correlation between tax burden and dissatisfaction with the state is striking. And even though this finding might seem relatively straightforward—Americans don’t like taxes, after all—three further points seem worth making.

First, if you look at the data, you’ll see that people living in the ten lowest-taxed states wanted to leave their state in the same ratio (26 percent) as people living in the next 10 states (the second quintile), and only marginally less than the people in the next 10 (the third quintile). So it may be that level of taxation doesn’t matter so much—at least in terms of state desirability—until it gets above a certain level. The people living in the ten-highest taxed states are significantly more likely to want to leave than anyone else.

Second, the data casts doubt on one of the assumptions underlying blue model governance: Namely, that Americans don’t mind high taxes so long as they also are promised high levels of security and lots of public services in return. High-tax states like Illinois and New York (fourth and fifth tax quintiles, respectively) both have relatively generous welfare programs and large public sectors, and yet they both rank in the top 10 of states people are most likely to want to leave. Material security isn’t the only thing that matters; Americans value autonomy as well. (It’s also possible, of course, that the corruption and inefficiency endemic to these states makes residents feel that they aren’t getting a good return for their money, and that well-administered high-tax states would see more support).

Third, the data highlight the virtues of federalism, which makes it possible for people who do choose to leave to vote with their feet. The existence of this option has probably helped keep tax rates lower overall.

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  • jeburke


    • JR

      That made me chuckle.

    • Jim__L

      Still, it’s surprising how much of the time Captain Obvious needs to be there to try to save the day.

  • Fat_Man

    It only affects the middle class. Poor people are going to get welfare, and rich people don’t care because they will lie and say they live at the condo they own in Florida and visit for two weeks every winter. And as far as the elites are concerned, this a feature not a bug. They don’t want middle class people around. Manhattan and San Francisco are their ideals, full of rich people like them and a few mendicants to allow themselves to preen about how much they care.

    • ljgude

      I think you are dead right that it only effects the middle class and that creates the strong cohort of both political parties who are voting against the establishment wings of the two political parties. Class warfare is supposed to be about the proletariat rising up against the ruling classes, but what we may have here is a revolution led by the middle classes. Given all the Marxist twaddle about it is easy to forget it was the rise of the merchant class that reined in the hereditary royal elites in Europe and brought about democracy. Now we have a hereditary elite that has lost the plot about what the country is about and is threatened from both the right and the left. It may take an election cycle or two for the right kind of leadership to emerge, but I think the middle classes have noticed they are being screwed and they are going to get the crooks off their backs eventually. Middle Classes of America UNITE! You have noting to lose but your houses, but they are going to take them anyway! 😉

      • Boritz

        I hope you are right about the ‘strong cohort of both political parties’ but it is quite amazing, especially on the Republican side, how many strong, hard b**ch slaps over a long time were required to produce an awake state in this group and get them to abandon the paradigm I-just-have-to-vote-for-whichever-candidate-they-put-forth. They may have waited too late to unzombie themselves.

    • Fat_Man

      More evidence:

      “In an open letter to San Francisco’s mayor Ed Lee, tech entrepreneur Justin Keller said he is “outraged” that wealthy workers have to see people in pain and despair. As The Guardian reports: ‘The latest cultural altercation between San Francisco’s tech workers and the city’s impoverished population finds one such ‘entitled’ citizen declaring the homeless are ‘riff raff’ whose ‘pain, struggle and despair’ shouldn’t have to be endured by ‘wealthy’ people commuting to work.”

      • Dale Fayda

        Thank you for posting the link to the article. Hard to believe that a progressive utopia like SF is drowning in the human refuse they have so “compassionately” welcomed into their city [sarcasm].

        I’ve said it before and I’ll say it again… Liberalism is a mental disorder.

  • Dale Fayda

    Well, look who pulled his had out of his butt to announce the spring! People don’t like confiscatory tax rates – thank you for the tip, TAI!

  • Pait

    Did the study interview 500 adults altogether as Gallup says in the linked page, or 500 in each state? If the former, then the margin of confidence given is impossible. If the latter, it’s just an unclear phrase – although the confidence still seems excessive given the recent track record of Gallup phone polls, especially considering that the question is more subtle than a plain yes-no.

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  • Boritz

    “The survey only measured the expressed desire to leave—not the commitment to doing so.”

    This dovetails nicely with the study that shows people mistrust their blue state governments yet they elect those governments and keep them.

  • hecate9

    The headline makes for a nice story- only (as usual) the reporting is slipshod and the conclusion begs the question. This Gallup poll can make no claim about causality. There can obviously be many reasons why people might want to move, and while the survey controlled for race, gender, etc, it didn’t investigate any of those reasons. Apparently, it didn’t even ask people WHY they wanted to move. About the same number of people wanted to leave Alaska (with very low taxes) as California (with very high taxes).
    I offer an observation: the commenters (at least) on this website are very uncritical and have a general tendancy to accept “news” that confirms their already-held biases. The level of scientific and statistical sophistication in the comments is generaly low.
    I think an intelligent conservative needs to be able to look at a study or piece of data, determine what it shows and what it does not show. The hypothesis “all other things being equal, high state taxes CAUSE more people to desire to leave the state” might well be true. But this survey in no way proves it.

  • Frank Messmann

    Philosopher John Rawls developed the idea of the “veil of ignorance”: Before you were born, if you did not know if you would be born rich or poor, lame, brilliant, or retarded, in what country would you want to be born? High-tax Sweden and Denmark are often chosen.

    • Jim__L

      That makes it particularly ironic that the birthrate is so far below replacement in those places.

  • Anthony

    Well, here’s a related (quite extensive read) social/political component from a woman’s point of view:

    • f1b0nacc1

      Terribly funny article….she equates ‘independence’ with being dependent on government hand-outs. Jack Nicholson’s character in “As Good as it Gets” had it right….to create a woman, simply take a man and remove reason and accountability.

      • Anthony

        I must have missed equivalence you reference as I don’t recall reading such. But, Author covers a lot and reads definitively though movie characterization above adds flavor.

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