Census: Fast Growth in States With No Income Tax

taxesEditor’s Note – Wow, people tend to move to where there are fewer taxes!  Who knew?

Actually, this plays into the old states rights adage that people will vote with their feet, meaning they will relocate to more friendly environs when their current state becomes too burdensome.

This also reinforces the idea that excessive taxation smothers free enterprise and diminishes growth.  Could it be that we troublesome conservatives are actually right in our economic theories?  Perish the thought!

 

Census: Fast Growth in States With No Income Tax

By Michael Barone
Real Clear Politics

For those of us who are demographic buffs, Christmas came four days early when Census Bureau Director Robert Groves announced yesterday the first results of the 2010 Census and the reapportionment of House seats (and therefore electoral votes) among the states.

The resident population of the United States, he told us in a webcast, was 308,745,538. That’s an increase of 9.7 percent from the 281,421,906 in the 2000 Census — the smallest proportional increase than in any decade other than the Depression 1930s but a pretty robust increase for an advanced nation.

It’s hard to get a grasp on such large numbers. So let me share a few observations on what they mean.

First, the great engine of growth in America is not the Northeast Megalopolis, which was growing faster than average in the mid-20th century, or California, which grew lustily in the succeeding half-century. It is Texas.

Its population grew 21 percent in the last decade, from nearly 21 million to more than 25 million. That was more rapid growth than in any states except for four much smaller ones (Nevada, Arizona, Utah and Idaho).

Texas’ diversified economy, business-friendly regulations and low taxes have attracted not only immigrants but substantial inflow from the other 49 states. As a result, the 2010 reapportionment gives Texas four additional House seats. In contrast, California gets no new House seats, for the first time since it was admitted to the Union in 1850.

There’s a similar lesson in the fact that Florida gains two seats in the reapportionment and New York loses two.

This leads to a second point, which is that growth tends to be stronger where taxes are lower. Seven of the nine states that do not levy an income tax grew faster than the national average. The other two, South Dakota and New Hampshire, had the fastest growth in their regions, the Midwest and New England.

Altogether, 35 percent of the nation’s total population growth occurred in these nine non-taxing states, which accounted for just 19 percent of total population at the beginning of the decade.

My third observation is that immigration is slowing down and may be reversed. Immigration accelerated during the 1990s, and the 2000 Census showed more immigrants than the Census Bureau had estimated.

In contrast, immigration has clearly slowed down since the housing bubble burst and the construction industry went bust in 2007. And the 2010 Census showed fewer residents in several high-immigration states than the Census Bureau had estimated were there in 2009.

The drop was particularly big, 3 percent, in Arizona, where state and local governments have cracked down on illegals, notably by requiring employers to use the E-Verify system to determine immigration status (that law was signed by Janet Napolitano, then-governor and now homeland security secretary).

We can’t be sure until more detailed data are reported, but it looks like we’re seeing significant reverse migration. The lesson is that states’ public policy and law enforcement practices can make a difference.

Read More – http://www.realclearpolitics.com/articles/2010/12/23/census_fast_growth_in_states_with_no_income_tax_108332.html

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