Kevin Price
What other states can learn from New York's fiscal failure
By Kevin Price
Politicians keep telling us that the rich need to "suck it up" and throw in well beyond their share. They tried this in Maryland and it has resulted in a drop in revenue that is comparable in their tax rate increases. A recent study from the Empire Center for New York State Policy is showing that the state is suffering from a similar fate.
The authors of the studies — E.J. McMahon and Wendell Cox — point out that between the years 2000 and 2008, there was a departure of 1.5 million people, mostly from New York City, with destinations that were safer for finances. Proof that money was a major factor in the decision making is seen in the income groups that have been coming and going from the state and the impact it is having on the budget.
According to the study, the families that have been leaving have income levels that were 13 percent higher than those arriving to the Empire State. In Manhattan and the New York County area, the impact was even more profound. Those leaving the Big Apple had an average income of $93,264, which was approximately 28 percent higher than those who were arriving (which made $72,726 on average).
The real injury is not so much in people, but in revenue. According to the study, the trade off in the income groups of those arriving and those leaving translated in a lost $4.3 billion in taxpayer income. Add that to the other years in the study (2001 through 2008) and it adds up to a devastating $30 billion.
The authors of the study are some what cautious in their approach and do not attempt to single out a particular reason for the mass departure, but the Wall Street Journal places the state's and city's excessive tax rates. Citing the Tax Foundation, between the years of 1977 and 2008, New York was consistently ranked first or second for having the highest rates compared to the rest of the country. During the years covered in the Empire Center Study, New York's taxes ranged between 11 and 12 percent of income.
Taxes reach its highest level in 2004 saw a high in departures in 2005. That year, the state lost approximately 250,000 people who moved to other parts of the country. Meanwhile the state has passed another massive tax bill that likely lead to people leaving the state as they vote with their feet.
There is an old saying, "the more you tax something, the less you get of it. The more you subsidize something, the more you get of it." New York is committing economic genocide, through heavy taxation, on its most affluent residents. The result, ironically will be fewer tax dollars and a decidedly poorer state.
© Kevin Price
November 6, 2009
Politicians keep telling us that the rich need to "suck it up" and throw in well beyond their share. They tried this in Maryland and it has resulted in a drop in revenue that is comparable in their tax rate increases. A recent study from the Empire Center for New York State Policy is showing that the state is suffering from a similar fate.
The authors of the studies — E.J. McMahon and Wendell Cox — point out that between the years 2000 and 2008, there was a departure of 1.5 million people, mostly from New York City, with destinations that were safer for finances. Proof that money was a major factor in the decision making is seen in the income groups that have been coming and going from the state and the impact it is having on the budget.
According to the study, the families that have been leaving have income levels that were 13 percent higher than those arriving to the Empire State. In Manhattan and the New York County area, the impact was even more profound. Those leaving the Big Apple had an average income of $93,264, which was approximately 28 percent higher than those who were arriving (which made $72,726 on average).
The real injury is not so much in people, but in revenue. According to the study, the trade off in the income groups of those arriving and those leaving translated in a lost $4.3 billion in taxpayer income. Add that to the other years in the study (2001 through 2008) and it adds up to a devastating $30 billion.
The authors of the study are some what cautious in their approach and do not attempt to single out a particular reason for the mass departure, but the Wall Street Journal places the state's and city's excessive tax rates. Citing the Tax Foundation, between the years of 1977 and 2008, New York was consistently ranked first or second for having the highest rates compared to the rest of the country. During the years covered in the Empire Center Study, New York's taxes ranged between 11 and 12 percent of income.
Taxes reach its highest level in 2004 saw a high in departures in 2005. That year, the state lost approximately 250,000 people who moved to other parts of the country. Meanwhile the state has passed another massive tax bill that likely lead to people leaving the state as they vote with their feet.
There is an old saying, "the more you tax something, the less you get of it. The more you subsidize something, the more you get of it." New York is committing economic genocide, through heavy taxation, on its most affluent residents. The result, ironically will be fewer tax dollars and a decidedly poorer state.
© Kevin Price
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