The Myth of High-Benefits/High-Tax Government of California

1. lucky henry
   November 1st, 2009 at 2:27 pm

   Ron Paul has been trying to tell you folks this for years...

2. Skipweasel
   November 1st, 2009 at 2:57 pm

   Basing it on where people choose to live is very suspect, there are just so many other factors in play.

   How about a much more direct measure of what people want? I suggest that from time to time qualified members of the public should be allowed to pick how they're governed - perhaps in some sort of ballot.

3. Neal
   November 1st, 2009 at 3:09 pm

   I'm still amazed that people still don't understand that any time some organization (or person) is working with other people's money, there is very little incentive for them to be efficient and thrifty. The entire state and federal government is funded entirely by other people's money... your tax dollar. They didn't earn it, they don't deserve it and they have ZERO motivation to use the money wisely. Taxes are a cancer on society.

4. Colt Seaver
   November 1st, 2009 at 3:32 pm

   Water is wet.

5. D.D.
   November 1st, 2009 at 3:57 pm

   "The entire state and federal government is funded entirely by other people's money... your tax dollar."

   That would be better than the truth. The truth is money is being borrowed by the billions. If they only had our taxes they would have to make some big spending cuts.

6. Bill
   November 1st, 2009 at 6:02 pm

   I'm going to dispute your premise, Alex. Criticism of taxes and government doesn't involve an implicit assumption that "higher taxes translate to more government services." In fact, several versions of the small-government argument rely on the observation that higher tax rates have diminishing (or non-existent, or even negative) returns in terms of extent and quality of government services.

   Not to echo Neal too closely or anything, but it's remarkable the extent to which people are still surprised or "intrigued" by inefficiencies in government.

7. pwscott
   November 1st, 2009 at 6:32 pm

   As a resident of Georgia you can get screwed by the price of whatever the local government decides to build. One of the reasons I moved from my hometown was the idea of people who celebrated pine trees once a year planting expensive palm trees on the city square.Also the expensive pine cone fountain (which looked more like a pineapple) cost us more taxes for ammenities which few people voted. They hide these expenses in the city tax and sales tax.

8. zavatone
   November 1st, 2009 at 7:22 pm

   I moved from San Francisco to Texas about 3.5 years ago. Simply put, houses are not affordable in the SF Bar area. Everyone wants to be there and it forces prices up. Now living next to Dallas, I have a mortgage for less than what my rent was for a house 2 times the size. It's not 100% awesome though. They still have smoking in bars in much of Texas and religion is way too prevalent around here. There is no state income tax but prepare to make up for that with property tax. California is a great place to live for a while if you're making over 250,000 a year. Then you can afford a house. But in California, especially the SF area you've got beautiful outdoors and pretty good nightlife, no matter what your inclination is.

9. zavatone
   November 1st, 2009 at 7:23 pm

   HAH. SF Bar area. Oops. Looks like my previous life caught up to me.

10. Liam
    November 1st, 2009 at 7:25 pm

    Well this is really a simplistic approach, but it does not seem to factor population, population density and per student spending.

    For instance, the "top" schools besides CA are found here:

    http://www.psk12.com/rating/USthreeRsphp/STATE_US_level_Elementary_Cou ntyID_0.html

    And...

    http://www.psk12.com/rating/USthreeRsphp/STATE_US_level_Middle_CountyI D_0.html

    And if you look at what each state spends per pupil, found here:
    http://www.epodunk.com/top10/per_pupil/index.html

    You do see a general trend, there is exceptions no doubt. But the states that spend more on students seem to produce better students. This is just using that tax money wisely.

11. lukegr
    November 1st, 2009 at 9:25 pm

    I'm sorry, but this comparison is hare-brained at best. You cannot base a critique of taxation on two states. Especially when a predominant industry in California is low-profit farming, while Texas takes in high-profit oil money. Following the logic, Alaska, with it's ridiculously low taxes on individuals, should be exploding with growth. As much as I like simple explanations, this (and the original article) are pretty lame.

12. Doug fir
    November 1st, 2009 at 10:02 pm

    A deeper investigation will show that during the carefully selected time period more people moved to Texas because of rising oil prices and and a temporary expansion in energy related industries.

    There are probably better ways to measure the net benefits of various state tax/benefit systems.

    This smells like a libertarian-republican spin job.

13. mule
    November 1st, 2009 at 10:10 pm

    People want to keep the money they earn. If someone takes it, people will take action. People who think the government should decide how to spend their earnings should move to Cali, NY, Mass., etc. IDIOTS!

14. zavatone
    November 1st, 2009 at 10:53 pm

    Mule, people move to Cal, NY and Mass because of the job opportunities and the big cities have a fair amount to do. Will people spend more for a higher class of living that's more exciting? Many will. I've lived in NJ, NY, MA, MI, CA and currently TX. It's expensive in NY, but why? Because there is a huge job market and people want part of that market. Same in LA, the San Francisco Bay area, and San Diego. And there are lots to do in the cities as well. Just having your money doesn't mean as much to many people as having fun with it does. I think your IDIOTS! comment might be due to your not having lived in the places you are ridiculing. California leads the nation with a GDP just behind the entire country of France. People want a part of that and the lifestyle they think it will give them.

15. Alex
    November 1st, 2009 at 11:24 pm

    There's no question that living in California is expensive. Houses in California are more expensive not because of taxes, but simply because of supply and demand.

16. shecky
    November 2nd, 2009 at 2:11 am

    Supply and demand is a large factor in housing costs. CA has a well deserved reputation for expensive houses. But that assumes you want to live in some of the genuinely nice places of the State. Go to towns like Palmdale or Victorville, and you'll see lots of houses that can't be given away. Largely because those places are not very desirable places to live.

    The value of services to taxes is an interesting metric, but needs to be broken down item by item to have any real meaning. For example, CA has huge costs paying not only for it's many State workers, but paying extra for relatively low skilled workers that are well unionized, labor that's overvalued compared to what can be had in states where unions are relatively toothless. This is an example where high taxes don't translate into better or more services, just higher overhead.

    Interestingly, CA is one of those states that tends to pay more into the federal system than it gets back. Western, Northeastern, and mid Northern States tend to get back less in funds than they pay out. It is curious that who pays also seems to correlate roughly with Blue and Red States politically, Red States tending to receive more than they pay, Blue States tending to pay out more than they get. Basically, Blue subsidizes Red. It'd be really interesting to find what kind of dynamic is at work there.

17. zota
    November 2nd, 2009 at 4:46 am

    So, Texas property values are a small fraction of those of California because... Texas tax rates are lower?

18. zota
    November 2nd, 2009 at 4:51 am

    Also, William Vogel is a bit of a <a href="http://www.claremont.org/publications/crb/id.1594/article_detail .aspright-wing freak.

    I bid the rotting zombie remains of the LA Times bon voyage upon their impending relocation to Houston!

19. Hobbes5
    November 2nd, 2009 at 9:12 am

    His premise is deeply flawed. People are moving to Texas for oil jobs which have been heavily subsidized by the previous administration. Bush is from Texas and he took good care of his home state when it came time for government handouts. Texas got the benefits of other states' higher taxes without paying them themselves.

    However, it seems to me that our tax dollars don't just disappear, anyway. They turn into salaries for government workers, contractors and teachers as well as educations for our children. Government workers take those salaries and spend them on food at grocery stores, tipping wait staff and clothing, etc. Taxes are the most effective way (or should be if we didn't have disproportionatly low taxes on our richest citizens) of moving money from the top of the tax bracket back to the bottom where it can start moving back up again.

    The big problem with the "trickle down" theory has always been that money doesn't trickle down, it flows up. People at the bottom always give their money to the wealthy who own their mortgages, grocery stores and clothing outlets. But, only some of tha money comes back down in the form of salaries. A lot of it ends up in CD's and overseas bank accounts which takes it out of circulation, slowing the economy. Taxes are a necessary method of moving money around.

20. KCanathema
    November 2nd, 2009 at 11:49 am

    It isn't true that the best schools are the ones with the most money. In El Paso where I teach, one of our schools receives no Title I funding because of our demographics. We have no infocus in every classroom, no smart boards, no classroom computers, nothing but desks, chalk, a projector and whatever the teacher buys herself. And yet we're also one the top performing schools in the district, and this with a sizable population of students who are stilllearning English. The school's performance is based on the teachers inside the school.

    While I think the above article is more accurate than some give it credit for, in a way I wish they were right that fewer people were moving here--and not just for oil jobs which is such a cliche notion, as if all we have are cows and drills--because some of those people moving will settle and then vote in the very restrictive taxes that they moved to escape.

21. Eric M
    November 2nd, 2009 at 3:07 pm

    Taxes are not a necessary method to move money around or else the the so-call war on poverty would have been won after the billions and trillions thrown into entitlement programs that great majority people don't deserve. Why should the "rich" invest their money in our economy when all they get is grief from the politicians and greedy but lazy people, which they get a better bang for their buck overseas. Unions and foolish regulations have helped wiped out most of the manufacturing jobs in our country. The unions keep asking for more without considering that the company finds that paying someone else less halfway around the world, since those people would rather have a job than starve. I would rather have LESS government on all levels, since they helped cause this mess anyhow! They don't deserve our money and they should not just give away our money, since it is not their money and they work for us! They love to spend, but when they need to stop: they just look for more ways to steal more of our money.

22. SM
    November 2nd, 2009 at 5:53 pm

    Forgetting the fact that Enron, a Texas firm, bankrupted the state of California in 2001 effectively forcing higher than needed taxes to balance the budget... and Hurricane Katrina generated a mass population migration from New Orleans to Houston in 2006... these "facts" regarding the two states over the 2000-2007 time span... are dubious at best.

23. AnthonyC
    November 3rd, 2009 at 2:34 pm

    Many problems with this one.

    First, state taxes are in general much less than federal taxes. High-tax states tend to have higher per capita incomes, resulting in federal grants to states that tend to move benefits from high-tax states to low-tax states. So high-tax states get better states benefits, but are penalized by the federal government's policies.

    Second, those people that move to low-tax states- they're moving there from high-tax states. They may not realize it, but they've become accustomed to all the services those taxes provide. When a critical mass of such people arrive (as is starting to happen now with New Yorkers in many parts of North Carolina), these new arrivals start demanding the services they used to take for granted. Taxes rise.

    If there is validity to the claim that people prefer low-tax states, it is (at least in part) either because of a form of arbitrage- some services are being offered in states while residents of other states indirectly pay for them, or because of the ability of citizens to become accustomed to services (consider them the norm) and not take them into account when deciding to move, as opposed to more easily quantified items like taxes.

24. Luis Paez
    November 3rd, 2009 at 3:39 pm

    I agree that you cannot just focus on "net internal immigration" state vs. state to determine public goods provided by a state. This is a fairly complex idea (public goods) that cannot stand decision making by one metric alone. I'd love to see a qualitative & quantitative state by state comparision to compare benefits & quality of life just based on public services (parks, health, etc.).

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