Fmr. Obama Treasury Official Rattner: Trend of People Leaving ‘High-Tax’ States Like NY Is ‘Very Scary’ for NY, NY Needs to Cut Spending

On Thursday’s broadcast of MSNBC’s “Morning Joe,” Steve Rattner, who served as counselor to the Treasury Secretary in the Obama administration, stated that the trend of people moving from “high-tax states” like California, New York, and Illinois to “lower-tax states” like Florida, Texas, Utah, Montana, and South Dakota “is a very scary trend for those of us who live in New York.” And New York may need to take “a harsher, tougher look at where we spend our money.” But, unfortunately, it’s “heading in the wrong direction” and things will get so bad that they reach a critical mass.

Rattner said, “I can tell you some things that are not going to be surprising, given everything we just talked about. Now, this is 2020 to 2022. So, we have population data for the last two years, we don’t have income data yet. And what you can see, again, not surprisingly, California, Illinois, New York rank among the bottom five states in terms of outward migration, people leaving. Louisiana and West Virginia also in that category. I can’t tell you exactly what’s going on in Louisiana. And then, on the flip side, you have Florida and Texas ranking near the top in terms of picking up people. There’s also — and these are small numbers because they’re small states — people seem to be going to places like Utah, Montana, South Dakota, and so forth. But the big trend is obviously from those big three high-tax states down to those lower-tax states, and it is a very scary trend for those of us who live in New York.”

He added, “[W]e do provide a much better social safety net than many of the other states and I’m proud of that as a New Yorker. But you also have to be realistic, we live in a competitive world, and people are going to move around and live in places in part based on their taxes. And we have been increasing our taxes, whereas, as I said, states like Florida have not been. And so, we spend in New York vastly more per resident than do almost any other state in the country and it may well be that the time has come for a harsher, tougher look at where we spend our money. Unfortunately, it’s moving against us. Right now, you have a veto-proof majority in the State Assembly and the State Senate of very, very progressive Democrats who even Gov. Hochul, whatever her intentions might be, really can’t do much about it. And, at some point, it gets so bad that there has to be a fix, but right now, we are still heading in the wrong direction.”

Rattner concluded that he thinks when we get tax data for 2021 and 2022, it will be “even worse.”

Follow Ian Hanchett on Twitter @IanHanchett


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