California’s Aging Population Will Cripple the State Economy
The migration of people, money, and companies out of California has evolved into a clear challenge to the economic future of the Golden State.
The migration of people, money, and companies out of California has evolved into a clear challenge to the economic future of the Golden State. Terrified by the loss of so much revenue — an estimated $91 billion between 2019-23 — the state, as well as other blue outposts, is looking at ways of forcing people to stay. California lawmakers have proposed further targeting of the ultra-rich, but the upper-middle classes are also at heightened risk; like the billionaires, they are seeking to move away to escape the taxman’s grip.
One method to reduce incentives for leaving the state, proposed in the California press this week, is to turn the screw ever more tightly by heavily taxing residents who sell their overpriced homes. In many cases, this could land middle-class people with capital gains liabilities which, in some cases, could be upwards of a million dollars.
This is an attempt to avoid the ramifications of California’s tax and regulatory policies. Since 2020, there has been a steady flow of people — over five million — from Democratic-supporting counties to those which voted for Trump. This weakens blue-state economies, while also threatening their tax base. As other states impose their own wealth taxes, lawmakers are exploring options to make residents pay to leave — a kind of migratory ransom.
Economic Dynamism
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