Why People Are Leaving Blue States in Droves

from – The Daily Signal – by John York

Some Americans think state boundaries and the principle of federalism are outdated relics from the past. They couldn’t be further from the truth.

New data in a report from the American Legislative Exchange Council (ALEC) paint a clear picture: States with the best policies are being rewarded with an influx of residents, and states with unattractive policies are losing residents.

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Take two of the most high-tax, high-spend states in the union: New York and Illinois.

Over the past decade, New York has suffered a net loss of nearly 1.5 million residents and over 650,000 Illinoisans have moved elsewhere. Meanwhile, Texas, a right-to-work state with no income or estate tax, saw its population grow by 1.3 million.

Despite their appealing metropolitan hubs, New York and Illinois are shedding denizens.

States that scored high on the ALEC-Laffer State Economic Competitiveness Index, which takes into consideration 15 variables from the number of public employees to sales tax rates, have seen an influx of job-creating companies and taxpaying citizens over the last decade, while low-scoring blue states have been losing both.

While tax rates and labor laws are not the only factors that contribute to a state’s flourishing, the correlation between sound economic policy and private sector growth is clear.

The formula is simple. Good policy contributes to vibrant economies, and vibrant economies attract people eager for opportunity.

‘Laboratories of Democracy’

Federalism is about creating competition between the states by allowing them to craft their own respective policies, and then seeing what policies work best. This system has even more to commend it today than at the time of the founding.

Contrary to the expectations of progressive social scientists and pundits, government spending stimulates the government, but little else. A high minimum wage ultimately hurts those it is meant to serve. Progressive tax rates do not close chasmal blue state budget gaps.

Federalism is not just a boon to citizens—it is an advantage to state policymakers as well.

The states are often thought of as “laboratories of democracy.” That expression was initially coined by Justice Louis Brandeis, who ironically did not subscribe to the competitive view of federalism.

The idea is that when states implement policies, they provide test cases from which other states can learn. When a policy pays off, other states typically follow suit; when a policy is cursed by unintended consequences, other states can avoid the same pitfalls.

Many progressives claim that allowing states wide discretion to establish their own fiscal policies and regulatory regimes will result in a “race to the bottom” in which states attempt to drive out their poor and needy by decreasing welfare payments and lure in corporations by eliminating important regulations.

Political scientists have shown, however, that when it comes to welfare programs, public health regulations, and environmental protections, competition is what drives innovative and efficient solutions.

In other words, for progressives who are willing to pay the high price tag for expensive public services, there are still plenty of states willing to oblige.

Another critique of studies like the ALEC-Laffer Index is they heap too much praise on red states that implement conservative fiscal policies when, in fact, their citizens are shielded from the real downsides of fiscal conservatism—namely, limited spending on social programs.

Federal welfare policies allow frugal state governments to get credit for lowering taxes without taking the blame for cutting popular social safety net programs.

Essentially, critics argue, progressive federal policies end up subsidizing conservative state policies. As a result, states that score high on the ALEC-Laffer Index end up looking more appealing to more people.

On its face, this critique has some merit. Many of the states that score the highest on the ALEC-Laffer Index also tend to be states that get more money back from the federal government—mostly in the form of welfare payments—than they pay in taxes.

North Dakota, ranked No. 3 on the ALEC-Laffer Index, gets back $1.68 for every dollar paid in taxes. Tennessee and Oklahoma, also in the ALEC-Laffer top 10, get more back from the federal coffers than they put in as well.

Meanwhile, California, only four spots from the bottom on the ALEC-Laffer Index, gets only 78 cents back for every dollar sent to Washington. New York, dead last on the index, retrieves only 79 cents.

But federal policy also insulates residents of blue states from the full consequences of progressive fiscal policies.

Under current law, individuals can deduct their state taxes from their overall income for the purposes of determining what they owe the federal government in taxes. Thus, state politicians can hike up their tax rates without changing the effective tax rate their citizens pay.

While federal spending may make low-tax red states more appealing to residents and potential residents, the state tax deduction does the same for blue states.

Still, the broader thrust of this progressive critique is correct. Federal policy does alleviate some of the downsides that come along with both conservative and progressive fiscal policy.

A More Perfect Federalism

For the states to function as true laboratories of democracy, they should bear even more of the costs—and reap more of the rewards—of their policies.

The federal government should put more of the onus of funding and managing social welfare programs on the states and also consider eliminating the state and local tax deduction. This way, the real costs and benefits of state policies will be clear to citizens who can vote—or move—accordingly.

Were this done, the appeal of economically responsible red states would likely be even higher than ALEC’s study demonstrates it already is.

Lessons learned from state experimentation are of critical importance today.

As ALEC’s recent report shows, every one of the 50 states is wrestling with the mounting expense of unfunded liabilities caused by generous pensions and social welfare programs. Some states, like Arizona, are addressing the problem early and aggressively and others are taking note.

As state governments roll out various packages of cuts and revenue-raising measures to push themselves back into the black, they will provide test cases not just for one another, but for our radically insolvent federal government as well.

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26 Comments on "Why People Are Leaving Blue States in Droves"

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The problem with the exodus from blue states is that they often bring their nasty politics with them. Stop infecting red states with your failed progressive ideology. It didn’t work where you fled from and it won’t work here.if we wanted to be a blue state we would already be a blue state.

Yes, that is exactly what has happened in California, Oregon and Washington the liberals moving there have ruined those states. Now they are GOOD states to be FROM. I know I have lived all there of them.

You nailed it! Unfortunately, too many people who are democrats don’t realize that their party has been hijacked by socialists and communists and just vote party line…there are no more Truman or JFK type democrats in our state government. By today’s standards, JFK would be a conservative republican!

Sharon H

You are absolutely right that a lot of Democrats especially the older ones think the Democrats are still like Truman or JFK type democrats because I know a few of them. My aunt and uncle were Democrats back in the 1940’s and 1950’s and my parents were Republicans. In those days, it was exciting to hear them talking about politics, but now they are all gone and yes, you are right in saying that JKF today would be a conservative republican. Today politic are nothing like the good old days.

you people are so right on…..

you are so right, example North Carolina is getting more and more like a blue state and and l hate it, we used not to be that way but more of those creeps are moving south and like you said bringing their failed progressive ideology with them…….

There’s nothing progressive about it. They are anarchists and revolutionaries, and they’re trying to overthrow our form of government.

You gotta love those Blues.
Their ideology creates policy that drives taxes up the wazoo
Then run away to lower tax Red states
Leaving the rest of us with the Tab.

I and my husband moved to SC from NY and brought our politics with us. In NY we were in the minority but here is SC we are with the majority. Most of the people I talk to here feel the same way.
Taking your politics with you is not necessarily a bad thing.

I also moved to SC from The People’s Republic of NY. A lot of conservatives are moving down here from all areas of the country. The libtards go to NC. What a shame.

I grew up in Pennsylvania when it was a very Red state. As an adult wound up in Maryland, a terribly Blue state. Maryland liberals moved to Pennsylvania and now it is very Blue. I thought all the Blue folks were leaving the US if Trump won? One can only hope. I’ll be looking for a Red state soon. Wonder how to figure out where the Blues aren’t moving to?

Well, the blues definitely aren’t moving to other blue states. Even THEY know their policies fail.


I grew up in New York. New York was once a red state when we had a Republican governor, senators, and now it had changed to Blue. Why, because people changed since then. Hopefully, someday we will get back to a red state.

Nothing is going to change until you take the anarchists and leftists out of the schools and the media. They’re propagandizing the students and that’s creating more anarchy which will eventually lead to a civil war, and/or a coup. That’s what their end game is. You can’t pick up a magazine these days without getting page after page of leftist drivel. Everything is politicized.

The liberals just can’t seem to understand very basic economics. The blue states and the liberals who control them believe that higher tax rates are what’s needed to finance their beloved social programs. Doesn’t work. High tax rates and oppressive regulations discourage business investment and growth, in other words they discourage a growing economy. Lower tax rates and fewer regulations foster higher tax revenues because businesses can grow, prosper, and afford more in wages. This is true at both the federal and state level. Businesses are our economy, all of it. Create a better business climate and you create jobs along with higher tax revenues. Seems pretty simple to me and I’m just an old retired guy, but for reasons I have never understood, it escapes the liberal mindset.

How is Florida considered a blue state when most of the time the Republicans carry the state in a presidential election and we have Republican governors.

Because they still believe Al Gore won???

That whole “Gore really winning FL” fiasco is what changed my brother from a strong D to a strong R. I expect the current “Hillary really won the Presidency” chanters to effect a similar movement.

“I pledge allegiance to the flag and to the DEMOCRACY (?) for which it stands…….?????? Sounds weird, doesn’t it!!! We are a Republic, not a democracy! Why does Amac have to constantly blur this distinction with such phrases as “laboratories of democracy” in the article. A democracy is pure majority rule (lynch mob) without the protection of law. Democracies degrade into anarchy, then to rule of the powerful (oligarchy). We need to teach our people, especially our young people, what a republic really is.

Chuck G

I believe the Supreme Court Judges changed this “I pledge allegiance to the flag and to the Democracy (?) for which it stands. Who else would do this except the Supreme Court. Hopefully, when we get another new Judge like Neal Gorbach will changed all this.

This is not necessarily good news. yes the tax base for the blue state being left will fall but look what happened when folks got tired of CA and started leaving for OR and WA. Now if only good hard working conservatives were leaving for Red States then that would be great. I doubt it is only red thinking folks. time will tell

God Bless America

People have been encouraged to relocate to California for the generous benefits of our social programs.
Don’t know if it’s true, but I’ve been told that other states actually pay relocation expenses for their welfare recipients to come here! In the meantime, the socialists in our state government keep passing more and more ridiculous tax laws and unfriendly to business regulations, so that the biggest employers keep leaving the state. The largest employer in the state is now the state! My retirement income has, as a result, effectively shrunk by about 20-25%. Productive people are leaving the state in droves!

I thought Florida was a Red State.

Florida became a Red state this past election. the map is screwed up IMO.

God Bless America

right on the money

the left has not figured this out yet. they WILL understnd,even chuckie and hillary will get it. but the hard way. just like the election of 2016.