“Can capitalism and socialism coexist? It seems the shift of people from high-tax states should be a canary in the coal mine. There is a breaking point. I have clients who moved for far less of a difference than what is being suggested,” Jeff H. Farrar, Co-Founder and Executive Managing Director of Procyon Partners, Wilton, CT said.
Advisors predict tax migration will continue to accelerate from high tax states such as NY, NJ, CT and CA. Not long after top podcaster Joe Rogan scored a $100 million deal with Spotify, he beat a hasty retreat from California’s 13.3% state income tax rate to Texas, where he will pay zero state income taxes.
“This place is going to blow up. This place is going to sink,” Rogan told reporters about California. Despite having the highest tax burden for wealthy citizen in the nation, the state has clearly failed to create social equality. California’s 18.2% poverty rate is second to only Washington DC’s, according to the US Census Bureau.
“All-out income redistribution is dangerous hill to slide down. It inevitably fails and takes years to climb back out of,” said Zitelmann, who is also the author of “The Power Of Capitalism.” The book details how failing policies of high taxes and high welfare created crippling levels of unemployment and taxpayer flight that drove countries such as Sweden and Norway to reverse course in the early 2000s. Instead, they embraced capitalism, lower taxes and far less generous welfare to create incentives to work and to lure back wealthy employers such as renowned Swedish furniture maker Ikea.
“It’s a simple metric really. A poor person never gave me or anyone a job,” Robert Braglia, president of The Intelligent Decision in New York City.
“It is people with incomes over $400,000, hardly ‘rich’ if you are in NYC, who create jobs and propel the economy forward. And we know that tax increases rarely produce revenue increases and have never lifted a country out of recession, they just slow economic activity,” Braglia added.