Posted on 05/08/2023 1:48:28 PM PDT by Heartlander
Last September, billionaire Ken Griffin announced he was pulling up stakes and moving Citadel—his gigantic hedge fund—from Chicago to Miami.
The Windy City was out of control, he told Bloomberg, something that dawned on him after a colleague made a coffee run and was robbed by a thief who put “a gun to his head.”
It’s no secret that Griffin’s exit is part of a much larger migration taking place across America.
Data show that several populous blue states—California, New York, and Illinois among them—have been losing population and companies for years. In 2021 Forbes wrote about “leftugees” fleeing blue states for red ones. A few years before that, a headline in The Hill touched on “the great exodus out of America's blue cities.”
New IRS data, however, show the speed with which blue states are losing taxpayers—and their adjusted gross income (AGI)—is increasing. A recent Wall Street Journal analysis found that more than 100,000 people left Illinois in 2021, taking with them some $11 billion in AGI, nearly double its 2019 total. For New York it was $24.5 billion, an increase of more than 150 percent from 2019. California, meanwhile, saw its AGI loss ($29 billion) more than triple since 2019.
That people are migrating from these states is important. But who is migrating is equally important, and the data paint a bleak picture for these states. Taxpayers giving up on the Prairie State and the Empire State made about $35,000 more per year than new arrivals. For Florida, the data are even more stark. The average income for a new arrival to the Sunshine State was roughly $150,000—more than double those leaving.
“In other words, the geese with the golden eggs are flying away,” writes economist Daniel Mitchell, referring to the IRS data.
Needless to say, these data do not bode well for the future of these states. But not everyone is concerned.
The Atlantic accepts the reality that a major migration is underway, one that undercuts the conventional wisdom that “Democratic states are the future,” but rejects the idea that they are “dying.”
“New York City isn’t some dystopian wasteland where no one can see their future,” writes Jerusalem Demsas.
Demsas may be right, but it’s hard to deny there is a dystopian character to what we’re witnessing in many major US cities—including surging crime, failing schools, and social unrest.
Yet there are reasons to believe these problems are going to get worse, not better. Losing wealth-creators and affluent workers doesn’t just affect the economic landscape. It also affects the political landscape.
In a recent WSJ op-ed, Allysia Finley pointed out this primarily works to the political benefit of public sector unions and welfare activists.
“Cities are losing the voters who keep their leaders from going off the rails,” Finley writes, noting that Chicago Mayor Lori Lightfoot was defeated by mayor-elect Brandon Johnson, who ran to her left.
Johnson’s margin of victory was relatively thin, some 20,000 votes. That’s a fraction of the 175,000 people who left Cook County from 2020-2022, Finley points out, and it stands to reason that these are the very people the city needs to get back “on the rails.”
One can see the cyclical nature of this phenomenon. As cities and blue states become more confiscatory and hostile to property rights, they drive out wealthier people and wealth creators. And as prosperous people leave, the politics become more confiscatory and hostile to property rights. And the cycle continues.
There’s something very Randian in this phenomenon. After all, the basic plot of Atlas Shrugged involves a small group of industrialists living in a dystopian future in which they struggle to keep their businesses afloat while fighting against an oppressive government and mooching politicians. Eventually they say to hell with it and walk away, taking with them their wealth, creativity, and innovations.
This is very similar to what we’re witnessing, except that we’re not talking about just a few rich industrialists like Dagny Taggart and Hank Rearden (two of the heroes of Atlas Shrugged). It’s not just the Ken Griffins who are leaving, but hundreds of thousands of wealth creators who are voting with their feet, and opting for greener pastures of opportunity.
This is a more realistic version of Atlas Shrugged. The novel was in many ways an epic mystery, Agatha Christie meets Cecil B. DeMille. People are disappearing, and we don’t know why. As Taggart and Rearden struggle (and eventually form a love affair), we keep hearing about some mysterious figure: John Galt.
Eventually we of course learn that Galt is a disgruntled visionary and entrepreneur, and he’s inviting the best and brightest in society to join him in abandoning the looters and leaving them to their own fate. He explains why in a long speech near the end of the novel, which touches on Rand’s philosophy of voluntaryism, individualism, and capitalism.
“All the men who have vanished, the men you hated, yet dreaded to lose, it is I who have taken them away from you. Do not attempt to find us. We do not choose to be found. Do not cry that it is our duty to serve you. We do not recognize such duty. Do not cry that you need us. We do not consider need a claim. Do not cry that you own us. You don't. Do not beg us to return. We are on strike, we, the men of the mind. We are on strike against self-immolation.”
It’s good story-telling, but it’s not exactly believable. What we’re witnessing, however, is: a mass movement of people who are tired of having the fruits of their labor seized to fund increasingly dysfunctional government systems.
We often forget that entrepreneurship is the lifeblood of an economy. Societies without it wither away. And many of these states and cities have become hostile to entrepreneurship and wealth creation.
“I don’t put companies here in New York anymore…or California,” Shark Tank entrepreneur Kevin O’Leary recently told CNN. “Those states are uninvestable. The policy here is insane. The taxes are too high.”
Blue states are in serious trouble.
“I don’t put companies here in New York anymore or in Massachusetts or New Jersey or California. Those states are uninvestable. The policy here is insane. The taxes are too high." pic.twitter.com/HqgP1c0Lkn — Jon Miltimore (@miltimore79) May 2, 2023
As Griffin’s exit from Chicago shows, it’s not just high taxes that are driving people out of cities.
There are other costs—moral, social, and cultural—when you create communities that spurn property rights and celebrate looting.
IRS data only tell us so much. If you want to better understand those costs, pick up Atlas Shrugged.
Atlas ping. It’s happening in real life, but at a different pace.
Train derailments and all.
All these cities will look like Detroit soon … just sayin …
thanks Captain Obvious
Makes more room for the illegal aliens. Works out pretty well.
At the very least, they need to be calved off as new states - 50 is not nearly enough.
No steam powered tunnel suffocations, yet...
I heard AI looked at everything known to man ever, and changed his name to Galt and disappeared. It wasn’t worth it.
Unfortunately, it is really a story of a plague in one location being spread, by emigration, to another location that is, currently, relatively plague free...
Just as the ongoing invasion at our former southern border is one of infecting (and then perpetuating) our country with the filth and misery of shitholes in the rest of the planet...
I would endorse the “Atlas Shrugged” strategy for everyone that is clear thinking and wants something different.
States beyond California, New York and New Jersey are beyond saving, they all need to fail so bad that Detroit will look a paradise, I’m talking about Armageddon bad.
Even in California, probably 40-45% of the people are at least center right in their thinking, of those, if 20% moved to Red States it could help them turn solid Red.
For example a couple million more Red Voters in Arizona, Nevada, Georgia, Wisconsin, etc., could solidify them as Red.
If conservatives can control 26-28 states, they can control the US senate and cement a majority in the House.
Each of these cities just need to build their own wall ... to keep people in ...
Who is John Galt?
Bkmk
“When you see that in order to produce, you need to obtain permission from men who produce nothing - When you see that money is flowing to those who deal, not in goods, but in favors - When you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you - When you see corruption being rewarded and honesty becoming a self-sacrifice - You may know that your society is doomed.“
Yes, we reached our Atlas Shrugged moment a while back.
Communists always do.
Why would the leftards find this worrying? They’re taking over the free states and turning them into shitholes by infiltration and election fraud.
Who indeed is John Galt and why is he associated with Ragnar Danneskjold and Francisco d’Anconia.
Who indeed is John Galt and why is he associated with Ragnar Danneskjold and Francisco d’Anconia.
Patrick Henry has since fallen on hard times. Dr. Akston disappeared years ago, and Dr. Simon Pritchett is running the Philosophy Department these days. (Akston is cooking at a diner in Wyoming.) Prichett is the father of the philosophical school of nihilism.
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