The Exodus from New York, and How to Stop It
Written by Dan Smith
More and more New Yorkers are fleeing the state. Governor Andrew Cuomo and his Albany cronies are the cause. But there are solutions.
Over the past ten years there’s been an alarming trend in New York. While most other states have been consistently growing, New York’s population declined.
People are fleeing New York. In fact, “between April 2010 and July 2016, the latest data available, 846,669 more people moved out of New York state than moved in. That’s the largest outflow in the country,” confirmed Politifact.
Our declining population means:
- Our friends and neighbors and coworkers are leaving us behind.
- There are fewer people to make our products, to provide jobs, to visit our restaurants, to shop in our stores; and it means fewer people investing in our infrastructure.
- A depressed demand for our local products and for our real estate—meaning lower values on our homes and businesses and fewer new housing starts.
- Fewer people to pay for our ever-growing state budget—a budget which keeps growing despite our population shrinking.
But how can this be? New York has so much to offer, yet people are leaving in an era when the rest of the nation is growing. Sadly, our governor is oblivious. Declaring, “the exodus from New York is over,” Andrew Cuomo is in denial about facts staring him in the face. Perhaps his denial is intentional, because Governor Cuomo and his Albany cronies are also the cause of the exodus.
Exodus’ Causes: High Taxes and Costs, Onerous Regulations and Restrictions
In his article published in Forbes last year, demographer Dr. Joel Kotkin said, “high costs go a long way to explain which states are losing the most [people]. At the top, or rather, the bottom of the list is New York State, which had an abysmal 65.4 attraction ratio in 2014 and lost by far the most net migrants, an astounding 126,000 people.” New York has plenty of the problems Professor Kotkin says typify exodus: high costs—high income taxes, high real estate taxes, high fees and costs of compliance with New York’s oppressive rules and regulations. With higher costs and a tough business client, people are moving elsewhere, despite all that New York otherwise has to offer. This all falls right at the feet of Andrew Cuomo and the corrupt Albany politicians who drove us to this point. Just look at the environment Cuomo has given us:
- New York’s state and local income tax burden is one of the highest in the country.
- New York is the second worst state in which to do business.
- Property taxes are among the highest in the nation.
- New York cost of living is among the highest in the nation, and New Yorkers are getting less and less for their money.
As bad as things are, they may be getting worse. As Newsday declares, “here’s why NY exodus may speed up”—state tax hikes, changes in federal taxes to disallow deductions of New York’s incredibly high income taxes and the continuing minimum wage hike which is destroying restaurants and small retailers, among many other reasons New York is becoming less tolerable. All this comes under Andrew Cuomo’s tenure. How does he expect to be re-elected in 2018? Apathy amongst those of us who stay in New York is the only way!
Our Tax Base is Eroding, While Spending is Growing
New York is losing many high-income earners. They pay a large portion of New York’s high taxes and they’re leaving for low-tax jurisdictions. Professor Kotkin confirms this: “many of the most affluent states are the ones hemorrhaging high-income earners the most rapidly. New York sets the standard, with the highest outmigration of high income earners”. This does not bode well for our future state budgets. And to compound the problem, high earners’ departures are coming at the same time that many of our budget costs are coming due. It’s already starting to hit: state tax receipts were recently reported as coming in far below estimates, which will lead to a “triple threat of budgetary risks,” according to New York state’s comptroller.
There is a Way to Reverse the Trend
But all is not lost. In their report on the positive and negative aspects of states’ business climates, Forbes reports that “New York’s taxes, union workforce and red tape are among the highest in the country. On the plus side: the Empire state is an economic force comprised of an educated labor pool, huge venture capital investment, significant cultural and recreation resources and the headquarters of 11% of the 1,000 largest companies in the U.S.” So, despite our high taxes and oppressive regulations, New York has some significant things going for it. And the fixes to many of our problems are surprisingly simple: reduce taxes and eliminate red tape.
Simple Solutions, Tough Choices
Simple solutions don’t make them easy—politically. There are many politicians and bureaucrats in Albany who, along with their cronies, are happy with the way things currently are. Andrew Cuomo tops the list. They are powerful and they will use their connections and their lies to scare New Yorkers into voting to keep things just the way they are. But doing more of the same will not improve things.
So, what can be done?
Replacing Andrew Cuomo as New York governor is an essential step.
As far as policy, some of the changes which would go a long way to making New York more attractive to companies, workers and their families include:
- Reduce state and local government spending, from the nation’s second highest per capita.
- Lower our state personal income tax rates, from seventh highest in the nation.
- Improve our state’s business tax climate, from second worst in the nation.
- Lower our state and local debt levels, from the nation’s highest as a percent of GDP.
- Improve our business climate to attract corporations, entrepreneurs and jobs—do this by eliminating useless subsidies and corruption-prone gimmicks, and removing rules and restrictions to improve: business friendliness (sixth worst in the U.S.), lower cost of doing business (fourth worst in the U.S.).
- Continue to pursue and prosecute the rampant corruption in Albany and throughout our state until there is no more, so that businesses and citizens know there’s a level playing field and no rewards for being an Andrew Cuomo crony.
- Eliminate job-killing occupational licensing where it can’t be proven to improve safety or quality; review and reduce licensing requirements everywhere else, thereby making it easier to get good jobs without compromising safety.
- Revisit our escalating minimum wage rate laws which are being cited as the cause for store and restaurant closures and declining employment rates of the young and unskilled.
- Keep investing in our infrastructure—our bridges, water distribution, electrical grid, roadways, rail and airports, but get creative about promoting competition and obtaining financing without hitting the taxpayer: user-fees, advertising and privatization.
- Eliminate victimless crime laws, end the War on Drugs in New York, improve our civil forfeiture laws.
- Improve our education to better prepare future New York entrepreneurs and their employees.
Even small changes will go a long way to reverse the ugly trend of people fleeing New York. But it all hinges on removing Andrew Cuomo and his ilk in Albany. A state does not accidentally find itself with a favorable climate for living and doing business. We’re going to have to make changes. There are no easy roads or magical, painless policy options which get you there. But voters and the politicians who serve them can make good, albeit tough choices to become an attractive place for people and businesses.
Do New Yorkers have the will to elect leaders who will make those tough choices?
As a proud New Yorker, I sure hope so.