WASHINGTON, May 2, 2016 — America’s dying middle class is putting big-spending blue states in something of a pickle as overtaxed, high-income earners head for tax-haven states.
Take New Jersey, for instance.
Hedge-fund billionaire David Tepper has had it with his state’s insatiable appetite for his income. He’s paid hundreds of millions of dollars in state taxes over the past several years, what income-redistributor Barack Obama would call his “fair share.”
In response, Tepper is voting with his feet. He’s moving to Florida, a state without a personal income tax.
According to the New York Times, Tepper’s impending departure has New Jersey’s legislative budget and finance officer, Frank W. Haines III, worried the move “may be forcing an unusual degree of income tax forecast risk.”
In other words, New Jersey’s big-spending legislature will have to recalculate its spending priorities now that a substantial chunk of its tax revenue – one man’s income – will soon be safely out of reach in the Sunshine State.
And that is the beauty of living in a country comprised of independent republics.
When King George III admitted defeat in America’s war of independence and signed the Treaty of Paris, his Britannic majesty acknowledged the newly liberated 13 colonies “to be free sovereign and independent states.”
The treaty may have been a single document, but his majesty’s government used it to make 13 separate peace agreements with 13 separate nations.
E pluribus unum, “Out of many, one” – the United (but independent) States.
“Our Founding Fathers had a vision of states working together but also competing against one another to put different ideas in play, seeing which ones work, which ones don’t,” wrote former Texas Gov. Rick Perry in his book “Fed Up: Our Fight to Save America from Washington.”
New Jersey’s high personal tax rates is an “idea” that tax-haven Florida is more than capable of competing with. “Beyond the debate on taxing the rich,” said the New York Times, “Mr. Tepper’s move is a case study in how tax collections are affected when income becomes very highly concentrated. With the top tenth of 1 percent of the population reaping the largest income gains, states with the highest tax rates on the rich are growing increasingly dependent on a smaller group of super earners for tax revenue.”
All this comes after eight years of government bailouts designed to preserve the very crony-capitalist financial system that securitized Washington’s unsustainable subprime housing debt, which was sold to the world as an “investment.”
The same government whose “too big to fail” bailouts fixed in place a loyal family of financial institutions who, through their contributions, sustains the very corrupt two-party system that, in turn, sustains them.
The same government whose Federal Reserve’s near-zero interest rate policies, coupled with the printing of trillions of dollars, has flooded the markets with liquidity, manufacturing a bull market that has driven the Dow, Nasdaq and S&P to unprecedented heights.
That artificial rise has dramatically increased the financial fortunes of billionaire hedge-fund managers like David Tepper.
Trickle-up Obamanomics has burdened job-creators with high taxes while strapping financially-stressed average Americans with exorbitantly high premiums for inferior medical care under Obamacare and high unemployment.
You see, it’s much easier to control a society when its pool of power players is limited to so few.
As economic philosopher Friedrich Hayek noted back in 1944 – the age of big-government figures such as Stalin, Hitler and FDR – “Economic control is not merely control of a sector of human life which can be separated from the rest. It is the control of the means for all our ends.”
Trickle-down economics, aka free markets, existed long before Ronald Reagan popularized the term. And it sustained America’s upwardly mobile and vast middle class, who in turn formed a substantial tax base that sustained their states.
States like New Jersey, which emulate the federal government in their high-taxing, big-spending, job-strangling regulations and freedom-killing ways, shouldn’t be surprised that billionaire David Tepper flees to a refuge provided by a pillar of our dying republic – a free and independent state.