The seventh annual report on which states are doing well economically is out. The publication “Rich States, Poor States” looks at a number of factors pertaining to economic competitive policies. States that attract corporations/companies gain not only revenue but sources of employment. This is important for a state’s economy.
Anybody who can read current events should not be surprised by the results. Certain states are deeply in debt because of their high tax rates to support union contracts and perks. So it is no surprise that the bottom ranking states are Minnesota, California, Illinois, New York and Vermont where taxes are high.
These states believe the primary purpose of government is to redistribute income from rich to poor. The political theory doesn’t jive with reality. The bottom line for any company is profits. Ever increasing taxes force companies, especially when unions are involved, to seek other locations where they can maximize profits. What people forget is that unions and the public invest in these companies for retirement benefits. A good example is Kodak. It has gone bankrupt and people have lost their retirement funds as well as a place of employment. Good middle class people are now poorer.
The states at the top of the list are all Republican run states. The top five are Utah, North Dakota, South Dakota, Wyoming and Virginia. These are low taxes, business friendly states.
Other factors also play a part. Texas, Oklahoma, Wyoming, West Virginia, Montana and North Dakota (and a few blue states like Ohio and Pennsylvania) are getting rich from oil and gas drilling. Meanwhile, Democratic New York has extended its moratorium on the technological advance behind the boom, hydraulic fracturing, citing overblown environmental hazards, and Vermont has outlawed it altogether. California’s regulations prohibit nearly all new drilling of any kind. They are losing revenue to off-set taxes.
Where businesses go so do people. People are migrating to the Republican controlled states because that is where the jobs are. The west coast and northeast are losing people so by 2020 there will be a population shift which can have political implications. Yet liberals ignore or deny the obvious.
Democratic taxing, high spending, union friendly states are losing businesses and becoming poorer. They are going deeper into debt which creates a financial money pit for them. They are creating a Greece-style economic environment. They face a poorer future.