On yesterday’s Your World, Neil Cavuto ignored a study showing that the wealthy do not flee states with high taxes as he hyped the news that former French President Sarkozy is considering leaving France to avoid a 75% tax rate, and golfer Phil Mickelson is considering “drastic changes” due to higher taxes. Cavuto coyly outsourced the argument to his guest, Dave Maney, saying, “Dave Maney says Democratic leaders here in the United States better take note, if they have the money, they will run.”
Cavuto “asked,” “Do (Mickelson and Sarkozy) have a point?”
Predictably, Maney thought so. He said, “I think they definitely have a point. …When someone says, ‘We’re going to be taking 60-odd percent of your income between state and federal taxes,’ or in France when they say, ‘Hey, the state’s taking 75% of your income,’ people with the means to move will say, ‘You know what? There’s got to be a better, a place that would be happier to have me…”
Cavuto added, “That place has been Nevada for a lot of Californians. There’s been a, sort of a money flight from California for some time now. …In the case of Maryland, once they were going to see a surtax on millionaires that involved more than just millionaires. The government there didn’t see the revenues it anticipated and all but rescinded it.”
Maney said, “I hear it from those guys (entrepreneurs) in California all the time. Like, what are they doing to us?”
Cavuto did not point out - but should have - that a study from the Political Economy Research Institute at the University of Massachusetts, Amherst found that millionaires do not move away from states when taxes go up. As Think Progress noted, the study found: The evidence available in the research literature suggests that the worst fears of the policy debates over raising additional revenue from high-income households to sustain spending on public services are unlikely to materialize. The rich will not go on strike. They will not cease working, stop investing, or even move, but they likely will find ways to shift the timing and composition of their income in order to avoid paying taxes.
Instead of giving his viewers all the available information, Cavuto sold a myth.
Have Mitt on for a guest someday. He’ll verify that everything I just said is correct.
http://www.huffingtonpost.com/george-lakoff/wheres-the-movement_b_435045.html
“And the property tax – OMG!”
All that proves is the following: anytime you cut taxes that pay for public needs, you are actually SHIFTING TAXES in the end — from one level of government (i.e. state or federal) to another (i.e. city and local counties). In other words, YOU ARE ACTUALLY TAXING OTHERS. Here is an article by the great George Lakoff that backs this up: http://www.huffingtonpost.com/george-lakoff/why-democracy-is-public-t_b_911205.html
I can relate to that after having lived in the NH where there is no state income tax (which everyone assured us was a really awesome thing). But no one bothered to tell us about the insane cost to register/license a vehicle. And the property tax – OMG!
Wow, sounds like it’s practically a done deal, right? The rich are getting the hell out of CA! However, if you read down in the very last paragraph it says – “While most of the evidence of an exodus so far is ANECDOTAL, some tax analysts expect the evidence to show up in declining tax revenues from the wealthy by 2014, as they figure out how to legally relocate without actually leaving the Golden State nine months a year.”
Add this, um, “evidence” to the Think Progress study and, well, LOL!
For a decade, the “job creators” have been paying all-time historic low tax rates (and even lower actual taxes) and yet, unemployment figures didn’t make any significant movement until the tail end of that time (and then, in an almost out-of-control upward surge) and even AFTER Obama allowed the continuation of those low rates, unemployment didn’t make much movement (albeit in a slower downward motion). And, incredibly, even after Obama decided that he wasn’t going to extend those low rates for millionaires, we haven’t seen a sudden spike in the unemployment rates.
IOW, there’s NO correlation between “taxes paid by job creators” and “actual job creation”—except in the putrid minds of GOPers and Teabaggers.
OTOH, considering how much money Sheldon Adelson wasted on the Newt’s vanity run for the GOPer nomination, you’d think Nevada would immediately enact a personal income tax on multi-millionaires. Obviously, if you can spend $20 million+ on a candidate’s vanity campaign (and another $30 million+ on another multi-miillionaire’s absurd “I’m a regular guy ’cause I shop at Costco” campaign), you shouldn’t have any problem paying a 1% personal income tax. Given that the $50 million+ Adelson spent on the campaigns was less than 1/4th of 1% of his $20 BILLION+ personal fortune, I don’t see why he’d have a problem with the State of Nevada getting $200 million of it. He made BILLIONS during Obama’s first term—and that was with a nearly bottomed-out economy. Considering that people making minimum wage in Nevada are still hit with a sales tax of nearly 7% on everything they buy (folks in the Vegas area pay just over 8% in sales taxes), they’re paying a far heftier chunk of their annual income than Adelson is (even if Adelson’s buying the most expensive cuts of meat and the freshest produce and the most luxurious toilet paper for his own use).
