Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

The Continuing Exodus of Jobs and Taxable Income from California
Townhall.com ^ | December 29, 2012 | Daniel J. Mitchell

Posted on 12/29/2012 9:40:01 AM PST by Kaslin

Like most people, I’m a sucker for a heartwarming story around the holidays.

Sometimes, you get that nice feeling when good things happen to good people, like you find at the end of a classic movie like “It’s a Wonderful Life.”

But since I’m a bit of a curmudgeon, I also feel all warm and fuzzy when bad things happen to bad people.

That’s why I always smile when I read stories about taxpayers moving across borders, thus preventing greedy tax-hiking politicians from collecting more revenue.

“Where’s our tax revenue?!?”

I’m glad when that happens to French politicians. I’m glad when it happens to Italian politicians. I’m glad when it happens to Illinois politicians. And British politicians. And Spanish politicians. And Maryland politicians. I could continue, but I think you get the point.

I’m even glad when it happens to the politicians in Washington.

I smile because I envision the moment when some budget geek tells these sleazy politicians that projected revenues aren’t materializing and they don’t have more money to spend.

So I wish I could be a fly on the wall when this moment of truth happens to California politicians. They convinced voters in the state to enact Prop 30, a huge tax increase targeting those evil, awful, bad rich people.

Governor Brown and his fellow kleptocrats in Sacramento doubtlessly are salivating at the thought of more money to waste.

But notwithstanding a satirical suggestion from Walter Williams, there aren’t guard towers and barbed-wire fences surrounding the state. Productive people can leave, and that’s happening every day. And they take their taxable income with them.

Usually in ways that don’t attract attention. But sometimes a bunch of them leave at the same times, and that is newsworthy. Here’s an example of that happening, as reported by the San Francisco Chronicle.

Chevron Corp. will move up to 800 jobs – about a quarter of its current headquarters staff – from the Bay Area to Houston over the next two years but will remain based in San Ramon, the oil company told employees Thursday. …The company already employs far more people in Houston – about 9,000 full-time employees and contractors – than it does in San Ramon.

We don’t know a lot of details, but these were positions at the company’s headquarters and they were “technical positions dealing with information and advanced energy technologies…tied to Chevron’s worldwide oil exploration and production business.”

Let’s assume these highly skilled employees earn an average of $250,000. I imagine that’s a low-ball estimate, but this is just for purposes of a thought experiment. Now multiply that average salary by 800 workers and you get $200 million of income.

And every penny of that $200 million no longer will be subject to tax by the kleptocrats in the state’s capital.

In other words, we’re seeing the Laffer Curve in action.

Politicians can raise tax rates all day long, but that doesn’t automatically translate into more tax revenue. Politicians keep forgetting that taxable income is not a fixed variable.

What’s happening in a big way with Chevron is happening in small ways every single day with investors, entrepreneurs, small business owners, and other “rich’ people.

That’s good for the people escaping. And it also will warm my heart when California’s despicable politicians discover next year that there’s an “unexpected” revenue shortfall.

P.S. It’s just an anecdote that the Chevron jobs are going to Texas. But when you add together a bunch of anecdotes, you get data. And according to the data, Texas is kicking the you-know-what out of California. Maybe there’s a lesson to be learned?

The Bad Results and Unjust Consequences of the United Kingdom’s Gun Ban

I wrote yesterday about a silly proposal in the United Kingdom to ban long kitchen knives.

Some people objected because the story was from last decade, but that misses the point. Proponents of the Second Amendment are vigilant against encroachments in part because we’re worried about the slippery slope.

I predicted in yesterday’s piece that at some point the Brits would resort to banning long knives. I hope I’m wrong, but my prediction is based on what the U.K. government has done with gun control.

Ever since 1920, the government has made it more and more difficult for law-abiding people to possess weapons. And in a perverse example of Mitchell’s Law, the failure of one policy is then used to justify the next policy.

That’s how proposals that sound radical and foolish sometimes get implemented many years later.

We don’t know if this will lead to a knife ban at some point, but we can look at evidence showing that gun control in the U.K. was a precursor for a gun ban. And we also know such policies don’t reduce crime.

Professor Joyce Lee Malcolm of George Mason University has a column in the Wall Street Journal, looking at the impact of anti-gun policies in the United Kingdom.

…the Firearms Act of 1998…instituted a nearly complete ban on handguns. Owners of pistols were required to turn them in. The penalty for illegal possession of a pistol is up to 10 years in prison. The results have not been what proponents of the act wanted. Within a decade of the handgun ban and the confiscation of handguns from registered owners, crime with handguns had doubled according to British government crime reports. Gun crime, not a serious problem in the past, now is. Armed street gangs have some British police carrying guns for the first time.

By the way, it’s not just gun crime that has gone up. The U.K. has become a much more dangerous and violent society – almost surely in part because the thugs don’t have to worry about armed resistance.

Heck, if you are one of the few legal gun owners in the nation and you shoot a burglar, you get arrested instead of a pat on the back.

The U.K.’s draconian restrictions on individual liberty lead to some Orwellian consequences. Professor Malcolm offers up two examples.

Meanwhile, law-abiding citizens who have come into the possession of a firearm, even accidentally, have been harshly treated. In 2009 a former soldier, Paul Clarke, found a bag in his garden containing a shotgun. He brought it to the police station and was immediately handcuffed and charged with possession of the gun. At his trial the judge noted: “In law there is no dispute that Mr. Clarke has no defence to this charge. The intention of anybody possessing a firearm is irrelevant.” Mr. Clarke was sentenced to five years in prison. A public outcry eventually won his release. In November of this year, Danny Nightingale, member of a British special forces unit in Iraq and Afghanistan, was sentenced to 18 months in military prison for possession of a pistol and ammunition. Sgt. Nightingale was given the Glock pistol as a gift by Iraqi forces he had been training. It was packed up with his possessions and returned to him by colleagues in Iraq after he left the country to organize a funeral for two close friends killed in action. Mr. Nightingale pleaded guilty to avoid a five-year sentence and was in prison until an appeal and public outcry freed him on Nov. 29.

Amazing…and nauseating. I already had written about the unjust treatment of Mr. Clarke, but Mr. Nightingale’s legal nightmare is just as absurd.

Gun Control Cartoon Drug War

Gun control laws are utterly perverse. They don’t work, just like prohibition didn’t work in the 1920s, and just like today’s Drug War is an unmitigated failure.

Gun bans turn law-abiding people into criminals, while simultaneously making life easier for the low-life scum of society.

And as the welfare state begins to fall apart and civil unrest becomes more common, the deadly impact of these bad policies will become even more apparent.



TOPICS: Business/Economy; Culture/Society; Editorial; US: California; United Kingdom
KEYWORDS: banglist; california; revenue; taxes; taxrates; taxratesisnotrevenue; unitedkingdom

1 posted on 12/29/2012 9:40:04 AM PST by Kaslin
[ Post Reply | Private Reply | View Replies]

To: Kaslin

The ‘Exit Tax’ strategy that these states will develop are real and will likely be enforceable across state lines.

This is what is coming next


2 posted on 12/29/2012 9:42:26 AM PST by Be Careful
[ Post Reply | Private Reply | To 1 | View Replies]

To: Be Careful
2 years ago California and Michigan were in nearly the same place in the sense of economic potential. Now after 2 years of economic reforms topped by the passage of a RTW law things are already looking far better for Michigan. Ford is dumping nearly a billion dollars into Michigan projects and even GM is moving Camaro production to Michigan. They're unlikely to ever be non union themselves but they see the potential for non union pats manufacturers returning to Michigan.

Snyder: Right-to-work law will make Michigan more attractive

"The phone's already been ringing at the MEDC (Michigan Economic Development Corp.) since we passed that legislation," Snyder said Friday in meeting with reporters. "People are starting to look at Michigan."

Its also important to note that the right to work law is only the most visible of the reforms we've seen over the last few years.
3 posted on 12/29/2012 10:01:18 AM PST by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 2 | View Replies]

To: Be Careful

I believe that unconstitutional. The SC has found a “right to travel” and also it could be strongly argued this has a negative effect on interstate commerce, which only Congress has the authority to regulate. No way politically I see the ability of people and companies to relocate to be hampered.


4 posted on 12/29/2012 10:08:26 AM PST by A_Former_Democrat (Elections do have consequences, young people of America)
[ Post Reply | Private Reply | To 2 | View Replies]

To: Kaslin

The only thing that will stop these scoundrel politicians is a brick wall called reality.


5 posted on 12/29/2012 10:09:27 AM PST by VRW Conspirator (We were the tea party before there was a tea party. - Jim Robinson)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin
Governor Brown and his fellow kleptocrats in Sacramento doubtlessly are salivating at the thought of more money to waste.

They're gonna have a field day in Bakersfield if all this is true. (What ARE these companies thinking of?)

Din of hammers, oil wells signal Bakersfield boom.

6 posted on 12/29/2012 10:16:58 AM PST by Oatka (This is America. Assimilate or evaporate.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Be Careful
"You mean the, er uh, 'leaving town' tax?"


7 posted on 12/29/2012 10:17:42 AM PST by Lancey Howard
[ Post Reply | Private Reply | To 2 | View Replies]

To: AdmSmith; AnonymousConservative; Berosus; bigheadfred; Bockscar; ColdOne; Convert from ECUSA; ...

Thanks Kaslin. We need to support the political efforts of Demwit politicians running California, by sending our poor folks with all their Earthly possessions to warming climates.


8 posted on 12/29/2012 10:22:25 AM PST by SunkenCiv (Romney would have been worse, if you're a dumb ass.)
[ Post Reply | Private Reply | View Replies]

To: Be Careful
This is what is coming next

Actually California used t go after people who had retired and moved from the state. The Supreme Court stopped that years ago, but a new bench may see things differently.

9 posted on 12/29/2012 10:36:52 AM PST by itsahoot (Any enemy, that is allowed to have a King's X line, is undefeatable. (USS Taluga AO-62))
[ Post Reply | Private Reply | To 2 | View Replies]

To: Kaslin
Mitchell's Law is merely a special case of Haga's Law (Organization begets anxiety; anxiety begets the urge to organize), Haga's special case being the Blunder-fret Adaption.

It is an excellent book I recommend highly.

10 posted on 12/29/2012 11:21:55 AM PST by Carry_Okie (GunWalker: Arming "a civilian national security force that's just as powerful, just as well funded")
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

Soon, California will ask for a Federal bailout, subside or whatever it will be called and they will get it. The only potential hindrance is the House, and Boehner will be worked around along with enough reach across the aisle Republicans that legislation will be passed in the face of economic Armageddon if California collapsed. Then the rest of us will gt to pay for every nutty idea the left coast has passed. Count on it.


11 posted on 12/29/2012 11:24:39 AM PST by Truth29
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

They’ll “Limbaugh” them and try to use the courts to intimidate and or harass.


12 posted on 12/29/2012 12:24:42 PM PST by TalBlack (Evil doesn't have a day job.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

Good old Jerry Brown and his dog Sutter......

“Well, Sutter, the people of California finally did it. They voted to legalize theft. We asked them, and they responded. It’s like the sun is shining a little brighter.”

“Woof.”

“Yeah, I know money will leave the state, but who cares? If people will vote to legalize theft, what can’t we do here in California? We’ll just legalize lying and assault and murder. The sky is the limit now, Sutter! We can even legalize beastiality!”

“Woof!”

“Sutter! Where are you going?”


13 posted on 12/29/2012 1:43:27 PM PST by blueunicorn6 ("A crack shot and a good dancer")
[ Post Reply | Private Reply | To 1 | View Replies]

To: Lancey Howard; A_Former_Democrat; Be Careful; Kaslin

14 posted on 12/29/2012 4:59:56 PM PST by 4Liberty (Some on our "Roads & Bridges" head to the beach. Others head to their offices, farms, libraries....)
[ Post Reply | Private Reply | To 7 | View Replies]

To: Truth29; Lancey Howard; A_Former_Democrat; Be Careful; Kaslin

15 posted on 12/29/2012 5:12:47 PM PST by 4Liberty (Some on our "Roads & Bridges" head to the beach. Others head to their offices, farms, libraries....)
[ Post Reply | Private Reply | To 11 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson