It may not be very nice to say “I told you so” when the warnings you issue become reality, but I’m not a nice person (at least when it comes to greedy politicians imposing stupid policy).
So I’ll openly admit that I’m happy to read that entrepreneurs and job creators already are beginning to escape the kleptocrat politicians in Illinois. Here are a few highlights of an article in the News-Gazette.
The founder of Jimmy John’s said he has applied for Florida residency and may recommend that his corporate headquarters move out-of-state as a result of the Illinois tax increases enacted last week. Jimmy John Liautaud told The News-Gazette on Tuesday that he is angry about the moves, which boosted the individual income tax from 3 percent to 5 percent and the corporate income tax from 7.3 percent to 9.5 percent. “All they do is stick it to us,” he said, adding that the Legislature and governor showed “a clear lack of understanding.” …Jimmy John’s, which has its corporate headquarters on Fox Drive in Champaign, has more than 1,000 sandwich shops nationwide, many of them franchise operations. Champaign has been its corporate base, but Liautaud said it will not necessarily continue that way. …Once he collects information on alternative sites, he will present it to the company’s board of directors and ask the board to decide. As for himself, “my family and I are out of here,” he said. …Jimmy John’s employs 100 at the corporate office in Champaign and has 190 other employees who work elsewhere but come to Champaign every four weeks, Liautaud said. …He said he’s sick of being “pummeled.” “I’m not sophisticated enough, smart enough or politically correct enough to absorb it all,” he said. Jimmy John’s offices occupy 23,000 square feet on Fox Drive, and Liautaud said he had considered buying a 20,000-square-foot building just north of those offices. Those plans went out the window with the tax increase, he said. …James North, president of Jimmy John’s, echoed many of the same sentiments. “I absolutely love it here,” North said. “But when you do the math, it doesn’t add up. Florida looks pretty nice right now.”
It goes without saying, of course, that Illinois is not the only short-sighted state. New York politicians also have a fetish for driving taxpayers to other states.
A special welcome to Instapundit and NRO readers, and an addendum. This example of people and businesses escaping bad policy by crossing borders is more than just a cheerful anecdote. It is part of a process known as tax competition, which is a powerful force for better policy between both states and nations.
[…] 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 […]
[…] 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 […]
[…] 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 […]
[…] 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 […]
[…] 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 […]
[…] Illinois has always had an unfavorable ratio when comparing the incomes of immigrants and emigrants. But you can see from this chart that there was a radically unfavorable shift after the tax hike. […]
[…] By the way, the net payers of tax are the ones leaving, not the net consumers of tax. And every time one of the geese with golden eggs decides to fly away, Illinois falls deeper into a hole. […]
[…] the United Kingdom, Italy, France, Spain, as well as Bulgaria and Romania. Or states such as Illinois, Oregon, Florida, Maryland, Washington, DC, and New […]
[…] when the tax burden becomes to onerous, leading to an exodus of jobs and investment. California and Illinois are case studies of this self-destructive […]
[…] why politicians had such a hard time pushing through a tax hike a couple of years ago. They eventually succeeded, but the politicians faced an uphill battle because they couldn’t play the divide-and-conquer […]
[…] 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 […]
[…] why politicians had such a hard time pushing through a tax hike a couple of years ago. They eventually succeeded, but the politicians faced an uphill battle because they couldn’t play the divide-and-conquer […]
[…] from around the world (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
[…] P.P.S. Politicians from Illinois will probably complain that they didn’t make the 10-worst list, but they shouldn’t be too worried. The Tax Foundation was looking at 2010 data and Illinois almost surely will be closer to the bottom when the 2011 data gets released and includes the impact of the midnight, end-of-session, post-2010 election tax hike imposed by the state’s kleptocrat politician…. […]
[…] the United Kingdom, Italy, France, Spain, as well as Bulgaria and Romania. Or states such as Illinois, Oregon, Florida, Maryland, Washington, DC, and New […]
[…] the United Kingdom, Italy, France, Spain, as well as Bulgaria and Romania. Or states such as Illinois, Oregon, Florida, Maryland, Washington, DC, and New […]
[…] from around the world (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
certainly like your website but you have to test the spelling on quite a few of your posts.
A number of them are rife with spelling issues and
I in finding it very troublesome to tell the reality on the
other hand I will surely come back again.
[…] 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 […]
[…] 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 […]
[…] in nation after nation, whether we’re looking at Italy, France, or Spain. Or states such as Illinois, Oregon, Florida, Maryland, and New […]
[…] P.P.S. Politicians from Illinois will probably complain that they didn’t make the 10-worst list, but they shouldn’t be too worried. The Tax Foundation was looking at 2010 data and Illinois almost surely will be closer to the bottom when the 2011 data gets released and includes the impact of the midnight, end-of-session, post-2010 election tax hike imposed by the state’s kleptocrat politi…. […]
[…] from around the world (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer Curve. […]
[…] from around the world (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
[…] But a tiny handful of states, led by Illinois, are moving in the wrong direction. Here’s a very powerful chart produced by the Illinois Policy Institute. The tax hike is about one-year old, and we’re already seeing strong evidence that jobs are fleeing the state. […]
[…] consequences of the Illinois tax hike. But since Illinois is copying European-style fiscal policy, don’t be too surprised if the result is European-style economic malaise. Rate this: Share […]
Arkydee,
Are you just an idiot or stupid? When did Exodus become an exclusive word for Jews?
I would bet you are jewish and you support Obummer .
Why can’t we just get along?
I usually read intelligent comments here, but every now and then I read a comment like yours, and I know why my taxes are so high.
[…] should have had more faith in the hare-brained politicians of Illinois. When they’re not busy driving businesses from the state with punitive taxes or lining the pockets of the political elite with graft and corruption, these geniuses display […]
[…] Illinois courts would actually care about justice. As such, don’t be surprised to see more stories like this in coming years. GA_googleAddAttr("AdOpt", "1"); GA_googleAddAttr("Origin", "other"); […]
[…] shown lots of evidence from around the world (England, Spain, and France) and in various states (Illinois, Oregon, Florida, Maryland, and New York) to make the case that it is foolish to ignore the Laffer […]
[…] a perverse way, I’m glad that there are places such as Greece and Illinois. These profligate jurisdictions are useful examples of the dangers of bloated government and […]
[…] a perverse way, I’m glad that there are places such as Greece and Illinois. These profligate jurisdictions are useful examples of the dangers of bloated government and […]
[…] a perverse way, I’m glad that there are places such as Greece and Illinois. Profligate jurisdictions such as these are useful examples of the dangers of bloated government […]
Where is your logic Mr. josh? Mr. Dan Mitchell said that people would leave Illinois because of higher tax rates. And he showed a case where that happened. If 2 persons leave Illinois because of higher tax rates then Mr. Mitchell statement is correct. Already Mr. Mitchell assertion has been proven true because people have left Illinois because of higher tax rates. And we know about thousands -probably millions- of cases were business and people fled high taxes -just look how many people fled Mao’s China for overcrowded Hong Kong or look how many people fled Cuba for Miami!!.
If Mr. Mitchell had said “From now on, because of higher taxes, not a single person or business will move to Illinois” then a single business moving to Illinois -like the one that you show- would prove Mr. Mitchell statement wrong. But Mr. Mitchell never said such nonsense. You are refuting statements that Mr. Mitchell never made, so your post is senseless.
LuvBrazil and soon to be ex CA resident:
I’m not sure you read “Mr. Dan Mitchell’s” post. He was the one who said “It may not be very nice to say “I told you so” when the warnings you issue become reality, but I’m not a nice person (at least when it comes to greedy politicians imposing stupid policy).”
Pot, meet kettle.
More importantly, my point was that “Mr. Dan Mitchell” used anecdotal evidence to claim he was correct. If that is a logical argument, then anecdotal evidence of a company moving to Illinois proves that he is not correct. (another example here: http://tiny.cc/95tgo. Wow, the companies are just rolling into Illinois).
I think you need a lesson in the difference between causation and correlation. If, as threatened, Wisconsin lowers its corporate tax rate, which is not higher than Illinois’ even after the recent raise, then that is no different than Illinois providing tax credits to lure a company here. In fact, the tax credit is better for Illinois and its taxpayers.
Thanks for playing!
josh said:
Ah, anecdotal evidence. I guess this move of a Portland, Ore steelmaker to Chicago after the tax increase proves your entire thesis wrong: http://tiny.cc/lq809.
That’s funny. What Mr Dan Mitchell said is that people and businesses will leave Illinois because of higher tax rates. And it is happening and Mr. Mitchell already showed one case. To disprove Mr Mitchell you have to prove that NO ONE will ever move out of Illinois because of higer taxes! And you cannot prove that because already people are moving out of Illinois because of high tax rates!
At least you try to disprove Mr Mitchell instead of doing what the “politically correct” mainstream media and academia often does: CONVENIENTLY ignoring the INCONVENIENT TRUTH that taxes are harmful, they too CONVENIENTLY ignore their keynesian spectacular predictive failures.
You are disrespectful but you were able to post here. That shows that people that disagree can post here. Why there are not more people, like you, trying to prove Mr. Mitchell wrong? Because the “politically correct” academia and media very often CHOOSES to IGNORE the INCONVENIENT TRUTHS that are posted in blogs like this one because these INCONVENIENT TRUTHS DEMOLISH their nonsense “politically correct” theories that “justify” even more opressive power, control and $trillions for he political class.
Look how http://wattsupwiththat.com/ posts every week several papers showing how the United Nations co2 demonizing theory is nonsense. But the main warmist blog http://www.realclimate.org/ rarely tries to debunk the hundreds -maybe thousands- papers posted. Why they do not debunk the hundreds papers that wattsupwiththat posts? Because they CANNOT DEBUNK THEM! The only way left is IGNORING them!
For milleniums mainstream academia and media were able to sell us their ridiculous “politically correct” theories. Now it is OVER, with blogs like this one we are demolishing the old academia that brpough us such huge amounts of pseudoscience. And there is no way back because this is happenning because of the marvelous availavability of information of the internet! This is even better than all that FREE PORN that we got on the net!
Cheers
@Josh. Since you readily admit you’re not a nice person, let me add you should not refer to articles that make you look foolish. From your article:
“Illinois lured the firm with about $3 million in incentives, which include tax credits spread over 13 years and a one-time training grant of $50,000.”
So this firm is moving 70 employees from a blue high tax state to another blue high tax state, but they get a bunch of goodies paid for by the Illinois tax payer.
Ah, anecdotal evidence. I guess this move of a Portland, Ore steelmaker to Chicago after the tax increase proves your entire thesis wrong: http://tiny.cc/lq809.
It may not be very nice to say “I told you so” when the warnings you issue are disproven, but I’m not a nice person (at least when it comes to silly glibertarians making asses of themselves).
I am moving to Missouri. Only wish I had done this sooner. Illinois is becoming the Big Government State leader.
Too much government is becoming the death of the U.S.
SteveBrooklineMA said:
“This is simply a good argument for a federal takeover of state taxes.”
On the contrary, this shows, with crystal clarity, that the ability of states to establish its own taxes has permitted moderate state taxes in the USA and that americans should fight, with all their forces, against federal government takeover of state taxes.
Just take a look at the horrifying -established by central governments- VAT TAX rate in Europe: 15% is the minimum rate! No american state has such a high confiscatory sales tax rate, because if a US state establishes high tax rates then people and capital will flee to other states and that forces high tax states to lower their tax rates to avoid such flight. If the federal government steals the states’ ability to establish their own tax rates then the federal government would establish in every state oppresive confiscatory high tax rates. That is pretty much what happens in most of the world where we are not lucky enough to have american and swiss superior democratic systems.
Probably -I know pretty well the Swiss system but I do not know well the US system- US superior democratic system impedes the federal takeover of state taxes, because if you allow takeover by the federal (central) government then taxes will be high everywhere and the USA will be like a western european stagnated tax hell. The USA may even become worse than an european tax hell because in Western Europe the political class has been forced, one time and another, to drive down tax rates to curb people and capital flight because the European Union is an union of neighboring countries where people, capital and goods very often can move freely. But the USA, not being part of such an union, may lack incentives to lower its tax rates. Already the USA is the biggest tax haven that ever existed, so it may not get worse than western European tax hells.
USA and Switzerland’s superior democratic system have impeded the takeover of state governments by a big central government. If the power of the central government is very poorly limited by the people in a country then, sooner or later, such country may have a Stalin who will establish a system of TOTAL CENTRAL POWER AND CONTROL which means too MASS MURDER by millions and TOTAL THEFT to millions plus slavery to everybdy excepting the political class. I think countries are different and some countries, even under dictatorships, will never allow demons like Stalin and Hitler to gain TOTAL POWER AND CONTROL. But that is another discussion.
Depending on the ability of the people to limit the power of the political class you can get a “federal” system where federalism is almost a joke like in the ‘Federal’ Republic of Germany, the United States of Brazil or the United States of Mexico.
@ScottS. I’m guessing from your comments you’re probably single, rent, no kids, and don’t run your own business. I used to think the way you do when I had no responsibilities. By the way, you are flat out wrong; the middle (productive) class has been moving out of CA for the past 10-15 years. The population is being replaced by illegals from the third world. When I went to High School in the late 80’s, CA schools were still top 10. CA public schools are now one notch above Mississippi at 49th.
But Hey, we had a partially sunny day yesterday so don’t mind the decaying antiquated infrastructure, punitive taxes, crappy schools, top 5 worst traffic congestion, over-priced homes, etc.
@Scott S … Sorry dude … The census says you’re wrong. Americans are leaving CA … the only thing keeping CA’s population from shrinking are immigrants.
And yes, I’ve been to Texas. I lived in San Antonio for about a year. Nice place. If it were just a matter of geology/geography … CA would probably win … but politically and income wise … I’d pick Texas over CA in a heartbeat!
Q: Does Illinois’ high taxes give the people of the state an overall higher standard of living compared to many other states? Are the schools, roads, police, fire, social services etc better than states or regions with lower taxes?
A: Ha, ha, ha, ha, ha, ha, ha, !!! Absolutely not, RTA taxes making our gas in the Chicagoland one of the highest in the country, real estate taxes are sky high with some of the most poorly educated students in the country, high crime rates, the worst roads, highest sales tax in the country in Cook County-Chicago, social services run by Union Goons and government hacks that all have connections to the Chicago Mob. Other than the beautiful scenery and wonderful weather, Illinois, mostly Chicago and Springfield sucks.
jsmith: It takes awhile to move a business. You have lease obligations, etc. that need to be filled out. But I have started the process of moving my consulting business out of Illinois. The way I’ve structured my business, the tax increase is going to cost me about $500,000 in 2011. That pays for a whole lot of relocation costs. We had already found what we were considering to be our “second” retirement home; now it is soon to become our primary Florida residence. Will our decision to move show up right away in the IL 2011 tax receipts? No, some of my income will still show as attributable to Illinois because, again, logistically it takes some time to move. Where will it be in a few years? All Florida, with no state income tax. I figure the state of Illinois will probably lose, over the course of the next five years, close to a million bucks in income taxes from my business as I transist down to Florida. And that doesn’t even count the losses to secondary businesses that help support mine….so yeah, stupid move by the Democrats.
[…] Jimmy John Liautaud, the founder of the Jimmy John’s restaurant chain, in reaction to the Illinois state legislature’s voting to increase state income taxes from three percent to five percent and corporate taxes from 7.3 […]
Mr. jsmith:
Thanks for your kind answer to my comment. Mr. Dan Mitchell made weeks ago the FORECAST that people and capital would flee Illinois because of ILLINOIS HIGHER TAXES.
Mr. Mitchell has shown in his monumental work on taxation and in his blogs MASSIVE EMPIRICAL EVIDENCE of people and capital leaving high tax jurisdisctions. Based on such massive empirical evidence he sustains the theory that high tax rates make people and capital leave. MASSIVE facts confirm his theory. That is how science is built. Mr Mitchell makes forecasts based on MASSIVE EMPIRICAL EVIDENCE, not based on anecdotal evidence.
Based on such science Mr. Mitchell made the Illinois forecast. And it is happening. In this post several US citizens explained how they fleed HIGH TAX states because of high tax rates and these comments confirm the theory that Mr. Mitchell alleges!
Mr Mitchell is using the scientific method, unlike John Maynard Keynes in his “General Theory”. Keynes makes ridiculous assumptions that demonize the ownership of capital and he gives no empirical evidence. And his full of nonsense book even lacks elementary logic, while any beginner computer programmer can do a flowchart that explores diverse logical probabilities Keynes systematically does not explore the logical possibilities of his assertions.
It is not surprising that forecasts made on John Maynard Keynes pseudoscience fail spectacularily: Keynesian high priest Paul Krugman said that the 2003 Bush Tax cuts would never help the employment market. Well, the weekend AFTER the Bush tax cuts were signed into law was a MULTI YEAR UNEMLOYMENT HIGH which means that since the weekend after Bush tax cuts were signed into law unemployment went steadily down, FOR SEVERAL YEARS, ridiculing high priest Paul Krugman forecasts. But do not expect to hear about this huge Krugman failure in “politically correct” mainstream media and academia.
Blogs like this one are the NEW ACADEMIA. The old academia gave us pseudoscience, like Keynes “General Theory”, in these blogs we are demolishing the pseudoscience that mainstream media, academia and bureaucracy fed us for milleniums.
[…] Related: Post-tax-increase, the exodus from Illinois begins. […]
[…] The Exodus from Illinois Begins […]
I had to laugh when folks were crying about the ‘terrible’ increase in state income taxes to 5%.
I’m a Californian, and 5% sounds great to me! The income tax rate here tops out at 11%, I believe.
And of course there are city fees and taxes as well.
Yet, no one is leaving (if they are they are rapidly being replaced). Why?
Hmmm…Yosemite versus corn fields…The Sierra versus soybean fields…Surfing and movies versus peanut fields…
You want to live in paradise, you have to pay the price. Homes in San Francisco still start around $600,000 or so, and a million is quite common.
People WANT to live here. They don’t want to live in fly-over country.
Texas? Have you ever BEEN to Texas? I was in Dallas on Memorial Day a few years back, and it was 90 degrees and raining. Good gosh, man, that was miserable.
40 million people (our population) simply aren’t wrong.
BTW, it was 65 degrees and sunny today. What was your temperature today???
Whatever you do, don’t come to NC- we’re headed down the same socialist road that IL is on. We moved from IL to NC about 15 years ago- weather- and we love it here- weather- but the northeasterners coming down and bringing their liberal politics with them is ruining what should be the next thing to living in heaven.
Well, it seems obvious to me that the solution to this problem is laws that prevent people from freely moving from state to state! We can’t allow selfish, greedy people to just harm their community whenever they want. What about all the children? It was the State of Illinois that allowed them to get rich in the first place, and they owe something back. Selfish bastards!
(I don’t know about y’all, but I think I just hit upon the next great Lefty argument to decrease freedom and increase government control– and don’t you know, it’s ALL for the children.)
@johnqpublius
What is so disconcerting that you speak the plain truth, but much of the public remains heedless. Obama starts with a 10% base of black voters who blindly place color over qualifications and an equally blind trust in the federal government. But he can depend on professional women and a horde of government workers as well, at every level of government, and welfare recipients among college students and the the shiftless and the elderly to bring him close to a plurality of eligible workers. People forget that presidents are elected by fewer than 30% of eligible workers
Not to brag, but there’s something else about Texas. I live an hour from Austin and San Antonio, and know both cities pretty well, and though the racial mixture is nealy complete (San Antonio at 50/50 hispanic/anglo can not be more mixed) –no one even notices. I don’t think there is a more color-blind place on the globe.
As a few noted, and a couple readers contested, the biggest loss to states like California and Illinois are the people that never come. We lived in California back in the 80’s left for the East Coast and when we were ready to settle down, raise the family, build careers, we looked at California and settled in Texas. Since then we helped build two businesses, raised several kids with straight A’s who went on to top 20 universities. All of that could have been California’s but we weighed life there versus Texas and Texas won by a mile – initial gross salaries were lower, but with no income tax, cheap housing and highway building bias, Texas offered a better day to day life than California could ever offer.
Some ambitious economic grad student should figure out a way to measure this effect – it is real and the high tax states pay for it over decades.
I know that I am late to this discussion, but there’s an old definition of “politics” that cannot go unspoken …
politics = “poly” meaning many + “ticks” meaning blood-suckers.
@DocKnox … I lived in K-town for a couple of years while I attended UTK … Loved it there. Chattanooga has really changed itself and it a really nice place as well.
And you’re right, the Hall Income Tax on investment income needs to go away. TN is a solid red state, now let’s see if the republocrats can get rid of that last little bit of unfair taxes.
BTW, it’s why I plan on “officially” changing my residence to another state when I cash in my 401k …
People like SteveBrooklineMA are why Civil War II is on its way. The sooner the better, I say. I no longer wish to share a flag with such people.
[…] The Exodus from Illinois Begins It may not be very nice to say “I told you so” when the warnings you issue become reality, but I’m not a nice person […] […]
Born and raised in Illinois. Grew up in Champaign, current home of Jimmy Johns. Now live in the Chicago area. I too plan to leave when my youngest graduates high school. Unfortunately, that’s years off. Hope I make it that long. TN and TX are prime relocation states at this point in time.
Everyone’s welcome down here in Alabama the beautiful. But leave your unions behind! That’s the only reason Illinois raised your taxes. They gotta pay off the unions. The gulf coast is beautiful year-round. Cheaper to live than Florida too! Leave the leftist mentality too.
I run a small business in the People’s Republic of New York. I probably pay half of what my company earns in taxes, fees and everyone else’s taxes buried in the price of almost everything I buy.
What percentage is enough?
Ironically, most of my business for over thirty years was built on helping my clients go about doing their business while staying government compliant. Anyone who thinks that regulation and bureaucracy create wealth, or inherently ensure fairness, better be willing to sweat the details in making their agruments. I’ve had a front row seat at the circus.
It is heartening to see that a substantial and growing majority of productive people across America are finally waking up to the fact that government IS the problem, not the solution for most of the problems we face. Were it not for the Community Reinvestment Act, crony capitalism a la Fannie, Freddie and the big banks, (and coenabling by the Fed keeping interest rates too low in bowing to political pressure) the housing bubble wouldn’t have been able to bring the whole economy to its knees.
It is the government that has grown “too big to fail”… but the invisible hand of the market is more powerful than any government. It’s time to renegotiate the deal between the government and the governed lest they drag us all down the Road to Serfdom.
The unimpeded growth of the “social safety net”, public employee unionization, and particularly the public school monopoly, so beloved of progressives since the New Deal, has finally hit the wall of reality… there is no such thing as a free lunch.
The stimulus package and Obamacare were the final desperate acts of the foolish worshipers of big government.
The stimulus was the mother of all boondoggles… all it did was kick the can of public finance bankruptcy down road for a short time. Obamacare is proving to be the ultimate example of the road to hell being paved (or is that paged) with good intentions.
We are a compassionate society, but our government has been behaving more like a happy go lucky drunk tossing money around like confetti in a whorehouse than a sane and sober steward and protector of the common wealth.
Friedrich Hayek had a simple rule of thumb for good governance… any economic policy (or social policy that involves confiscation from one to give to another) that doesn’t increase competition in the production of goods and services in the private economy (where the real things that people want actually come from) is probably not a terribly good idea.
We have slowly become a socialist nation… (with Greg Immelt now starring in the role of Rudolph Krupp). Like all Utopian fantasies, it is doomed to failure by its own internal contradictions, and along the way erodes human dignity and freedom by its inherent injustice… the giving to one person or group the power to take from another to fulfill their ever changing and fuzzy headed vision of social justice ultimately devolces into the dysfunctional exercise of arbitrary power.
A previous commentor mentioned companies talking a big game but never leaving their blue socialist states. A few observations from CA:
-Large big name tech companies may not be “moving” their corp HQ’s, but there is absolutely zero investment in new facilities or new jobs here in CA.
-The new technology companies your hear in the media (twitter and such) are insignificant in terms of number of people employed.
-The last major defense contractor in LA recently announced they are leaving. Northrop Grumman is moving to VA.
-The only Mfg growth is in “green” federally funded technology. Look up Solyndra if want to cry/laugh.
My wife and I are moving our family to Charlotte, NC in April.
Why have states at all, SteveBrooklineMA? Erase all those worthless state borders, think of the savings in sending all those state workers packing! Think about how different the election in 2000 would have been sans the pointless fifedoms in the fly over states that sent Bush to the White House. Think of the savings in getting rid of the electoral college and those 538 show-stoppers in Congress — free the President’s hands!
Keep that “tax” life up there in the north, don’t bring them types of rules and regulations to Texas!
Why is it so difficult for the Socialist-Democrat Party of Illinois to understand basic economics?
The DemocRATs in Illinois are DESTROYING the state from their rat infested Chicago nest.
* * *
Your question assumes they think as you and I do and share our morality and goals for society.
Decades of evidence abundantly confirms they do not.
They know exactly what they’re doing and are succeeding admirably at what they want to do. NO power group is THAT stupid for THAT long (decades in the case of Illinois…I lived there from age 10 onward).
Think of leftists like locusts–going state to state doing everything that’s plainly destructive in order to BE destructive, so that it can be replaced by Utopia. When they’ve ruined one state, some of them seek to colonize surrounding, uninfected states with their hive-think; just look out west at the effect California leftists have had on Arizona, Colorado, etc.
Oh yes. They know exactly what they’re doing. Bet on it.
Y’all for got to mention Comerica Bank. Moved it’s Headquarters from Demo controlled Michigan to Dallas Tx. Now we have better services and fewer costs? Imagine that? Less gov’t =better services.
AMAZING!
Why is it so difficult for the Socialist-Democrat Party of Illinois to understand basic economics?
The DemocRATs in Illinois are DESTROYING the state from their rat infested Chicago nest.
As an example of how quickly they can DESTROY jobs and revenue they voted to TAX online Amazon affiliates. The result – Amazon dropped all Illinois affiliates, which put many of them out of business. Net result for Illinois – Decreased Tax Revenue and Lost jobs INSTANTLY.
Congratulation, you stinkin’ incompetent Democrat Socialist bas**rds!
Texas governor Rick Perry will definitely make a pitch to Boeing to come south from Illinois.
The Dallas-Ft Worth area has lots of aerospace plants and Houston has lots of places where ex-NASA Shuttle contractors are folding up shop, so buildings and land will be cheap for a corporate HQ.
Heard from Memphis and Nashville, so here’s a pitch for Chattanooga and Knoxville… Tn could do better (there IS an income tax that hits investors, the inheritance tax is very bad, and at best we are middle-of-the-pack business-friendly). But the central location (think shipping), right-to-work, fair tax structure (sales tax makes everyone pay a share!), generally good climate (our houses stay put, and usually dry!), solid state finances, and mind-your-own-business attitudes make Tn a very attractive place for refugees from the kleptocrats. Overall, Tennessee is in the top (ie, lowest) ten for taxes, and Knoxville has been in the top five places to move country wide for businesses for several years.
Y’all are sure enough welcome here in Georgia, but PLEASE don’t bring your Illinois/California/New York scorched earth style of government with you. As to you folks who say the threat of moving is just a bluff, check out California. About all they have left is illegal, undocumented, whatever folks from south of the border and unionized government welfare recipients posing as employees.
Businesses that can move will. Some people and businesses cannot move so easily.
On an individual and family level, another anecdote. Years ago I fled California for Texas, my sister stayed. We are both retired now, my sister being bled white by California’s taxes. She cannot leave, she cannot get enough for her home and land in the gold rush country to manage a move.
Businesses will be the same. JimmyJohns can move, it’s just offices, probably leased. A company that owns, say a big factory, will have a lot more trouble leaving. There is the land, there is the threat of huge environmental cleanup, etc.
Companies that can leave will. Companies that can’t will be bled until they are huge, decaying blights like in Detroit. Want to see the future of Illinois? Look at Detroit.
‘Can you hear me now ?’
Has the face looming out of the fog of the future
come into focus, with recognizable features ?
At last count, 26 of the 57 states have filed suit,
claiming ObamaCare is unconstitutional;
The solvent states will not allow the Feds to tax
them bankrupt to pay for this or any other plan
in the Progressive playbook.
The productive, taxpaying citizens will move
to those states, leaving their former homes
to sing the Bankruptcy Blues, and try and
explain to the Unions and the UnderClass
that the money has gone away.
Nah. Head to Nashville, TN. No income tax and we’ve been getting MI, Il and CA refugees for years.
LuvBrazil–anecdotal with respect to Illinois thus far.
To amplify my other point briefly, in blue states all around the country businesses threaten to leave if unemployment insurance taxes are raised, or if utility taxes are increased, or if the individual income tax increases, or if combined reporting is adopted for the corporate income tax.
And when push comes to shove, it seems that few do. Particularly the larger companies, who, of course, have invested quite a bit where they’re currently located.
Businesses do themselves no favors by whining about potential increases and then not leaving, or even by not making it abundantly clear that any investments they may make in the future are being made elsewhere and not in state X because of the increased taxes, or the tax and regulatory climate in general.
Under the original constitutional arrangement, the voters, property owners, taxpayers and (to a large extent) the soldiers were essentially the same people, and democracy could be expected to represent their interests, and detailed limitations on the power of government to tax and regulate were therefore unnecessary. In subsequent years, as the franchise was expanded, this common identity of rulers and ruled became less and less the case, until today those who vote for taxes do not pay them and those who regulate property and businesses do not own them. There is no reason to expect democracy to work under these conditions.
Current wind chill temp Indiana 7. Current temp Sebastian Fl 62 (a cold front moving thru) Back to 70’s tomorrow.Thats why closer is not better.
[…] The Exodus from Illinois Begins « International Liberty […]
jsmith says: Just anecdotes, so far.
Mr jsmith: If you are doing such comments then you should bother to read AT LEAST A MINUSCULE PART of Mr Mitchell’s MONUMENTAL WORK on taxation. Mr Mitchell has posted 100s -maybe 1000s- stories about capital and people fleeing high tax places and he has posted 100s of papers that show such flights, and he has himself written several papers on capital & people flight because of high taxes. He posted in one of his blogs a MONUMENTAL paper by an american organization -whose name I do not remember- that showed precisely how that happens in US states.
You can search for “Do State and Local Taxes Affect Relative State Growth? – by Zsolt Becsi” , probably that paper was linked in one of Mr Mitchell’s blogs, but I cannot tell for sure (This blog is not about beauty, but I must say that I totally fellt in love with that beautiful paper, that paper was crucial in deciding me to work in public policy)
Take a look at tax haven Hong Kong: The world Number 3 financial center, and it is so crowded with people that it has got the worlds highest-or near highest- population density along with some other low tax jurisdictions.
Obviously nobody here cares about what I do, but as near as 2005 I used to read regularly The Economist, eventough every day I saw more and more errors on that keynesian magazine. In a september 2005 article The Economist wrote a big survey about savings in the world. High taxes were NOT mentioned at all in the whole survey!!!. I read an article by Mr Mitchell where he explained, through taxes, such huge capital movements. And Mr Mitchell showed a paper where the infamous OECD agreed with him!. OECD realizes that capital flees high taxes!!!! Do you need more PROOF of that OBVIOUS fact? At that moment I very happily cancelled my “Economist” suscription and I have been very happy ever since.
It is not surprising that OECD is pursuing its infamous “tax harmonization” campaign for ruinning the whole world growth -in the same way that western european growth was ruined- by establishing european tax hell high tax rates.
But in Latin America -and in Africa too- we already have horrifying high tax rates -but hundreds millions prefer to remain informal than paying them- so government spending is not so high, excepting Brazil where consumption taxes can surpass an horrifying 45% tax rate
Taxes are the INCONVENIENT TRUTH that mainstream media and academia CONVENIENTLY IGNORES. Do not expect many europeans to admit that HIGH TAXES destroyed their growth and drove them to almost perennial low growth. The same thing happens with GLOBAL WARMING, THE SUN is the INCONVENIENT TRUTH that they CONVENIENLTLY IGNORE to avoid the collapse of their nonsense co2 demonizing theories promoting even more opressive power, control & $$$trillions for the political class.
“This is simply a good argument for a federal takeover of state taxes. With a nationwide uniform tax system,”
When you can’t compete definitely use federal power to enforce your onerous gov’t on everyone. Works so well in NK, Cuba.
I eat at JJ’s frequently (in St. Louis [COUNTY] Missouri). We would be happy to have you & your corporate offices over here – it’s a relatively short move.
And, there’s a freaky-fast movement afoot in MO to chock off the tax-freaks’ conduct – with success.
Watch Boeing. Citizens of the State of Washington felt betrayed when Boeing left Seattle for Chicago. The Illinois tax increases will hit both the corporate officers and one of the very few exports (commercial aircraft) that actually help our balance of payments.
Come to Virginia – we’re open for business. Low taxes and we are a right to work state, so businesses can leave their union woes behind. Mountains, beaches, temperate climate – the south welcomes all refugees from the north and mid-west (California, we’re not so sure):)
@Memphis Belle … The Memphis bio-tech segment is doing quite well.
http://www.commercialappeal.com/news/2011/jan/23/bioscience-continues-as-economic-star/
Liberal Democrats as plague, ideological locusts swarming from plundered city to vulnerable city.
Once my son is out of high school in a few years, my wife and I will be leaving a Chicago suburb, probably to head to Indiana.
These leeches only get so much.
Depending on the policies from Washington, DC, that can happen at a larger scale as well. Manufacturing and call support has been offshored to save costs; with the wrong tax policies, corporate management can go likewise.
“It is part of a process known as tax competition, which is a powerful force for better policy between both states and nations.”
If the Obamoids retain political power, watch for their move to impose tax ‘harmonization’, a favorite trope of the antidemocratic EU. It would forbid tax competition, and ensure that business and personal migration would be rendered hopeless.
Low-tax Indiana is much closer than Florida.
The financial exchanges need to look seriously at repatriating. However, because of Dodd-Frank and an overly aggressive CFTC, SEC, an out of the country move is probably more economically efficient.
@jsmith and @Steve White:
While it is true that some businesses issue hollow threats about moving out of an increasingly anti-business, anti-prosperity state, the fact is that businesses who *can* move easily will, and those for whom moving is more difficult may not. But that does not mean those businesses have no significant negative impact on job and economic growth – on the contrary.
Many businesses who want to move out but can’t (myself included) are minimizing their state tax/regulatory exposure by not hiring and not expanding facilities in the state, even shrinking if feasible.
CA has $25B budget deficit and the worst or second worst credit rating in the nation. So of course, our ever so brilliant voters just elected a very leftist governor (who as former governor in the 70s got us into this mess by allowing public employees to form unions), Lt. governor, attorney general and insurance commissioner….
As though that weren’t bad enough voters added insult to injury voting not to stop the enactment our very own cap-and-trade regime designed to increase the costs of energy, transportation, water, materials, hiring, and nearly every other activity human beings need to exist…
California, economically and socially, is being gutted and hollowed out by our political elite either by choice or ideologically-driven stupidity (it doesn’t matter): Very soon, the middle class will be at thing of the past leaving a tiny ultra rich elite ruling class who control the power, the unionized state employee force that keeps them in power, and a rapidly growing teeming mass of underclass poor with no hope of any future.
California is in decline heading toward abject failure. And know this: economic failure also means governmental, social and societal failure and is not simply an event we just get over – it is a long, drawn out, painful, degrading change in the very structures of our society and our lives.
Come to Tennessee! We have no State income taxes and a very business friendly environment in all of the major cities – Memphis, Nashville, Chattanooga and Knoxville.
We also have a very low cost of living in comparison to most states, which is one of the reasons International Paper relocated their Connecticut corporate headquarters to Memphis a number of years ago. We are also the home to the corporate headquarters to Fedex and Autozone, just to name a few more.
The weather is pretty good, the food is great and the people are very friendly. We always are happy to welcome newcomers.
Illinois residents (and even non-residents) may wish to explore various political efforts like this one to recall Gov Quinn.
http://globaleconomicanalysis.blogspot.com/2011/01/campaign-to-recall-illinois-governor.html
Come to Texas. Bring cash.
I almost hate to see so many blue-citadel refugees heading south –not that we don’t want y’all –we do –but that we are afraid you’ll cause another gulf coast oil spill to accidentally happen to us.
Ah, life as livestock –sure hope I can get used to it someday….
I believe Mr. Liautaud recently moved his family to Florida anyway, so moving the company may have personal, and not just business/tax, reasons.
It’s like when Ed Whitacre moved SBC (now AT&T) from St. Louis to San Antonio in 1995, so he could be near his momma.
May I suggest that Texas is the better alternative to Florida for the escapees, for a variety of reasons.
You make a good point, SteveBrooklineMA.
Skip the US and move all control to the UN. The UN is the only institution suited to represent all of the people. It is objective, impartial, compassionate, and not in the least corrupt.
And the UN stands for a clean environment where even animals have human rights. Who could ask for more?
We are the world.
As soon as my youngest son graduates from high school we’re gone…Missouri we can’t wait.
“You make a very good point, SteveBrooklineMA
. Skip the US and move the headquarters to the Bahamas.”
That’s why the lefties big goal is world government, international carbon taxes, etc. We must fight them.
By the way I left Illinois many years ago for Florida with no income tax. Watching the state crumble will be sweet!
If California can afford greenies via its underground weed economy, I don’t see why Illinois can’t afford democrats via its underground mob economy.
I think the real driving force here is not so much the absolute tax rate but what the people get in return. Does Illinois’ high taxes given the people of the state an overall higher standard of living compared to many other states? Are the schools, roads, police, fire, social services etc better than states or regions with lower taxes?
People will pay a lot for good public services. Unfortunately, there seems to an inverse relationship between taxes and quality of services. As taxes go up, the proportional quality of service declines i.e. people get less bang for their buck. The more government spends, the more people have a vested interest in the spending and the more they lobby the government to spend more while requiring less in return. Eventually, you reach a point in which higher taxes actually have a negative effect on public services.
Expensive but poor public services drive people and businesses out of the state. If special interest have captured the government, the people stand a good chance of never being able to change things. They face a future of an ever declining standard of living. Why should people stay in such a dysfunctional state?
Winchester-Olin is moving their small arms ammo plant from East Alton Il to Oxford, MS, along with 1500 jobs. they announced this before the tax increase. We in MS appreciate the jobs!
I don’t know if SteveBrooklineMA is a troll or not, but many people will seriously advocate this position. The best thing that small-government advocates can lobby and advocate for is a shift of taxation and spending from the Federal Government to the States. Everything that can be handled at the State level (including Medicare and Medicaid) should be taxed/financed at the State level. Federal taxes should support the military and little else.
Lefty calls for a Jimmy John’s boycott to being in three, two, one….
May I say to the unemployed (and soon to be more unemployed) people of IL. Elections have consequences. We called you for weeks before the elections and told you what would happen if you elected Quinn. Many of you called us idiots or hung up on us. Well, how do you like Quinn NOW? P.S., I’m outta here before the end of the year.
Hmmmm.
“It is time to tip the balance of power here, away from corporations, and towards people, where it truly belongs.”
Yeah!
Because people who have never run a business and could not for their life actually successfully run a business should be in charge of how businesses work!
Yeah!
That whole Constitution thing, federalism and the entire structure of the US Republic; throw that crap out the window.
…
You utter boob.
Jsmith, the tax increase only took effect a week or two ago. It takes a long time for businesses to pack their bags – it can’t be done in a few days.
If you ignore clear warnings, you have only yourself to blame for the consequences. Think of California as a nice example of where you are most likely headed.
Personally, I’m not sure why the frigid, decaying Northeast has a population left. It’s a downright depressing place to live.
I’m much happier here in South Florida, where the sun usually shines, taxes are fair, and the government actually appears to at least try to do the right thing. After living in California and Pennsylvania, this was almost as big a shock as traffic actually – gulp – moving smoothly almost all the time. This is probably because they were smart enough to invest in roads instead of trains to nowhere. Nice job Florida!
It’s a great time to move here for sure – you can take advantage of our housing crash and our return to a degree of humility. Come visit while home prices are still low :).
D
“This is simply a good argument for a federal takeover…”
Just stop there. Why even have state governments? Just another layer of bureaucracy that can be done away with to allow direct rule from Washington. Consolidate corruption, special interests, and POWER, into one convenient spot. Why destroy just parts when you can loot and pillage everything.
I’m an Illinoisan, born and raised, and I live in Illinois now. I’ve been applying for jobs in other states. First good offer I get, my family and I are gone. One-party rule by the Democrats and their “shadow party,” the unions, has finally reached a point of corruption and theft where I can no longer stand, much less afford, to live in my home state. Sad, but that’s the way it is.
Jsmith has a point in his second paragraph: it’s the businesses that aren’t started and the people who decide not to move to Illinois that will be the problem.
But it doesn’t take too many Jimmy Johns moving out of the state to set the mood.
If Illinois, from 2006 on, had simply restrained spending to the inflation rate and the rate of increase in the population, we wouldn’t have a near $10 billion deficit. We’d still have a deficit but it would be much more easily managed.
We tax enough; we spend too much, and we’ve allowed the state government to be captured by the union wing of the Democratic Party.
You make a very good point, SteveBrooklineMA
. Skip the US and move the headquarters to the Bahamas.
The CEO of Caterpillar, Doug Oberhelman, was on CNBC just Thursday or Friday talking about relocating their Peoria based headquarters.
The threat is a real one. You don’t raise taxes in the punitive and confiscatory way that Illinois just did and not suffer the consequences.
Where will they go? I wouldn’t know with any certainty but the only facilities they’ve opened in the US recently have all been in the south where they don’t have state income taxes.
You make a very good point, jsmith. Skip Florida, and move the headquarters to Wisconsin.
This is simply a good argument for a federal takeover of state taxes. With a nationwide uniform tax system, corporations would be unable to play one state against the other. I suggest that the Feds increase income taxes to the point where they roughly equal current federal and state taxes combined. They could then funnel some of those funds back to the states, according to state population and adjusted so that states are effectively penalized for taxing on their own. This would effectively avoid any constitutional problems with the plan while ensuring state compliance.
It is time to tip the balance of power here, away from corporations, and towards people, where it truly belongs.
How dare you use the term “Exodus”. Don’t you realize the significance the term has for the Jewish people? Are you ignorant or just insensitive?
Just anecdotes, so far. And note that Florida has been harder hit by the recession than the country. Sure, it’s due to the housing market, but why isn’t the housing market in Florida juiced up by all the businesses fleeing there?
I’ve noticed businesses have a disturbing habit of threatening to leave and end up not doing it. I suspect the impact is more in who doesn’t come in and what businesses aren’t started, neither of which will ever show up in the headlines.
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