Millions Flee the Most Liberal State in the Union

In their recent book, “Why Nations Fail: the Origins of Power, Prosperity, and Poverty,” Daron Acemoglu and James Robinson point out that over the past 22 years, 3.4 million Californians have quit the state in favor of states and nations that have lower tax rates. The causes of this mass exodus has not been taxes, alone. Other factors have been excessive business regulations, the high price of housing and commercial real estate, costly electricity, union power, and high labor costs.

California has been naturally blessed in the past with some of the most attractive natural resources in the world. California has nearly 850 miles of pristine Pacific Ocean coastline; some of the world’s most breathtaking forests, deserts, and mountains; abundant oil, gold, and agricultural resources. In the heavily populated coastal regions, is located one of the world’s very rare Mediterranean climates—warm summers and a relatively warm, very wet winter—this combination, along with the fertile soil will grow almost any agricultural product needed by man. Grafted on top of that natural bounty is an equally impressive cultural abundance: the verve for experimentation and innovation that birthed the entertainment industry in Southern California and Silicon Valley in the north.

But…what happened? The Golden State is beset by high unemployment (10.6 percent in August, behind only Rhode Island and Nevada) and consistently ranks as the nation’s worst business atmosphere.

What’s the reason for this social catastrophe? Bad government, high taxes, and overly enthusiastic business regulation. All this coupled with a penchant for buying things where there is no money to pay for them. For instance, California recently voted to fund a multimillion dollar project to study and advance the use of embryonic stem cells, a technology with very questionable probable outcomes.

Across the nation, states that embrace free-market principles are beating jurisdictions that prefer big government to within an inch of their lives. The conclusion is—states should be more like Texas and less like California.

States with unobtrusive government fare much better than governmental behemoths like California.  A comparison between the nine states with the highest and lowest tax burdens, for instance, shows remarkable disparities:

During the decade that ended in 2010, GDP in the low-tax states grew by 20 percent more than in the high-tax jurisdictions. Population growth in the low-tax states was nearly four times greater than in the high-tax states. And the low tax rates didn’t exactly make paupers out of the states that embraced them either; those jurisdictions actually realized substantially larger increases in the growth of state and local tax revenue than did their more confiscatory brethren.

The conclusion is obvious: States that embrace conservative policies – low taxes, restrained regulation, free labor markets, a friendly business environment consistently outperform states where big government carries the day.

Oh! How I wish the United States federal government could learn this lesson from the states.

 

 

Where Do Our Moral and Political Values Come From?

Today’s blog post is largely taken from a book by Jonathan Haidt, a liberal professor at New York University and the author of The Righteous Mind: Why Good People Are Divided by Politics and Religion.  

Did you ever wonder why you believe the things you believe and why other people don’t see things the way you do? There have been three answers suggested to this question.

1)   Plato thought that our moral decisions were determined by our reason; and that our emotional responses followed those rational, thought-out, concepts.

2)    David Hume, the Scottish philosopher of the 18^th Century, thought that our emotional life is the prime mover in our moral decisions (and, thus, our political viewpoints). He thought that our rational selves then worked to justify what our emotions directed us to believe.

3)   Thomas Jefferson thought that our rational thinking and our emotional attitudes exist alongside of one another; they compete with one another, and the one that proves the stronger wins out in the end.

In his book, Haidt examines each of these possibilities through a series of very interesting experiments. He concludes that Hume is right—our emotional life is the determining factor in our belief systems. Our rationality follows what our emotions and our intuitions tell us is the right path of belief.

He points out that since our intuitions and our emotional mindsets are the final arbiters of our morals and our beliefs, it is useless to try to argue those who do not believe the way we believe into changing their attitudes in order to comport with our own. He reports that we can, however, influence others and cause them to come around to our way of thinking. But…it must be done on an emotional level and not on a rational, logical basis. In order to influence others, we must become their friend, their ally, their confidant. Sometimes, just showing them that we care about them and expressing our support for a point of view or a candidate that we support is enough to get them to look seriously at changing their affinities. That is the reason that yard signs work—the well-known technique of name recognition. They show that we, as constructive and helpful citizens, support one candidate or another. But…we cannot argue anyone into our political camp.

Here ends Haidt’s contribution to this post. Barack Obama is ahead in the polls not because he has the best program and certainly not because he has such a good record as a president. He is ahead because he connects with people on a more emotional level than does Mitt Romney. Obama exudes an attitude of confidence and every-day communication ability. He is likable! I only wish that there were a way of showing the American electorate that likability will not improve our situation with the national debt; and it will not help mend our damaged leadership position in the Middle East. Likability will not overcome the problems of out-of-control spending on give-away programs.

An end of likability will eventually come when America reaches the point where Greece and Spain have arrived—when there is no money available to borrow and where the free enterprise system has been stressed so badly that it can no longer grow and produce. Then…we will know the truth about likability!