How do I mean?
France is just the latest spot on the map where “rich” folks are responding to socialist economic policies with their feet.
Even before it became official that French socialist Francois Hollande would win the final stage of yesterday’s French presidential election, defeating centre-right incumbent Nicolas Sarkozy, the specter of a new tax rate of 75% on income above €1m sparked an uptick in French inquires into trans-channel relocations.
In other words, France’s wealthy see the writing on the wall. They’re moving to England! Where have we seen this before?
New Jersey suffered similarly in the decade preceding the Christie Administration. Our own version of the millionaire’s tax, and a wave of regulations, mandates and out-of-control goverment spending sprees, sent wealth-creators running for the hills… of Pennsylvania and North Carolina!
I’ve frequently cited this Princeton survey which highlighted the dire consequences of “soaking and losing the rich” for the Garden State (h/t WSJ.com):
This result was all the more remarkable given that these were years when the stock market boomed and Wall Street gains were in the trillions of dollars. Examining data from a 2008 Princeton study on the New Jersey tax hike on the wealthy, we found that there were 4,000 missing half-millionaires in New Jersey after that tax took effect. New Jersey now has one of the largest budget deficits in the nation.”
Moreover, in February 2010, I relayed the results of Boston College study that revealed the clear correlation between “progressive” economics and the outward migration of rich people:
More than $70 billion in wealth left New Jersey between 2004 and 2008 as affluent residents moved elsewhere, according to a report released Wednesday that marks a swift reversal of fortune for a state once considered the nation’s wealthiest.
Conducted by the Center on Wealth and Philanthropy at Boston College, the report found wealthy households in New Jersey were leaving for other states — mainly Florida, Pennsylvania and New York — at a faster rate than they were being replaced.
“The wealth is not being replaced,” said John Havens, who directed the study. “It’s above and beyond the general trend that is affecting the rest of the northeast.”
This was not always the case. The study – the first on interstate wealth migration in the country — noted the state actually saw an influx of $98 billion in the five years preceding 2004. The exodus of wealth, then, local experts and economists concluded, was a reaction to a series of changes in the state’s tax structure — including increases in the income, sales, property and “millionaire” taxes.”
Of course some pols never learn.
New Jersey’s legislative “leaders” like Asm. Lou Greenwald are all-too-keen to repeat the same mistakes. Politicians are no less dense across the Pond, where voters in Greece are also running away from “austerity” reforms instead of tackling hard choices. You’d think the Hollandes of the world would look to the Germany for guidance; unfortunately, though unsurprisingly, the one healthy economy left in Europe has become a target of anti-austerity demagogues.
It’s always easier to create boogeymen than get busy solving problems.
Well, France just took the easy way out. And I do mean “out.” They’re not going to last long on their present course. Look at Greece! Voters in France and New Jersey may consider themselves more sophisticated than the birthplace of democracy, but we’re all always only one bad electoral decision away from disaster.