Growth

Michael Barone has a great piece on how states with low taxes and housing costs are bringing people in, while states with high taxes and housing are shedding population or barely holding even.  Read it on Townhall.com.  Barone points out that sky-high housing is unaffordable to middle class people and big taxes hose them.  Doing research for Rep. Vaughan, I have discovered just how true it is, even more so than Barone points out.

            Hawaii and California are perhaps the two most resort-prone and beautiful states in America.  They also have 13% state income taxes, housing that is at least double the Midwestern states.  And both are declining in capitalist enterprises.  HI has lost people for 3 decades and is now only 1.4 million people.  You can get a tourist trap job there but it doesn’t pay much.  I talked to a variety of hotel employees on our vacation. (Sorry.  Who else does an old hotel manager talk to for fun?) All live “up in the hills” where housing is halfway affordable and the dog can run free.  

            Oklahoma and Arkansas are considered the cheapest housing states in the country, though many others are similar.  OK has cheap taxes too.  Kansas has 2/3 as many people and double the state budget—3 times the taxes per person.  Population growth of OK is double that of Kansas.  We have cut top tax rate to 4.85% but there are so many loopholes and tax credits with special interest groups, that no one wants to give up their special deduction.  Our tax commission estimates that if we cut all the exemptions and special treatments, we could immediately cut the top tax rate in half and still raise the same revenue.  That would put us as #10 in income tax rate, just behind the 9 zero tax states.  Some say that the only reason Texas beats us in growth is their zero tax on income.  Otherwise we have better barbecue and football and no alligators.

            If you compare the no-income-tax states to neighbors with high taxes, it is stunning in terms of economic growth and population growth. NH beats VT.  SD is stealing all MN’s business.  Lib WA clobbers lib OR.  Cattle ranching WY outgrows MT despite MT being a paradise for Hollywood nature lovers and skiers. NV all deserts bests CA. Try comparing IL, WI and MI, the high tax states of the North Central with IN which has cut taxes. The zero tax states grow at 3-5% annually while the high tax states grow at 0-2%.   

            Housing is cheap in OK and so are property taxes—half that of TX and KS.  The traditional ag and oil economy is becoming very well diversified, especially around Oklahoma City and Tulsa.  Boeing snuck out of Wichita and went to OKC. Our Indians do all the western art and then send it to Santa Fe so rich people can buy it within range of mountains.  

            As you might imagine, the low property taxes and low income taxes of OK are making the NEA howl.  We are the 49^th state in teacher pay.  That is, until you consider cost of living.    Then we are 36^th.  And teacher pay in many states (due to the racket of collective bargaining by a public service union with politicians) has elevated them well in excess of median income.  Median income in OK is $43K and teachers is $44K.  Spending on students is $8500 per year, lowest in the region.  But student test scores are #30.  In all cases, we believe we can grow our way out of the low numbers. 

            If you want to retire to OK the worst factor is that we don’t have enough docs and hospitals.  But demand for physicians is also low.  I guess we don’t go to the doc unless me and the vet just can’t figure out what’s wrong.  We aren’t half as fit as Coloradans, the healthiest people in the country, but our life span is only 0.5 years lower.  Figure that out. Indian medicine bags?  No joke.  My mother went to a powwow and saw those cute medicine bags, just the right size for her cell phone.  Bought one and showed it to some Indian teenage girls who have now started a trend of “native cell phone carriers” at Po Hi.

            Our worst worry is public service employee pensions which has unfunded liabilities of $10 B.  But then that has gone down in 3 years from $16 B due to the Republican Gov and legislature.  Getting there.

            If USA has a credit crunch, those high maintenance states are going to crash and burn.  I guess that means Okies will be called upon to bail them out.  It hasn’t been the first time.  Barone makes one huge mistake of facts in his article.  He talked about Okies going down Route 66 to the California Valley.  Ken Burns did the same in his documentary on the Dust Bowl.  Steinbeck started this idiocy.  It never happened.  440,000 Okies departed in the 1930 decade according to census records.  Postal records prove that only 60K went to CA and almost migrated to LA area.  225,000 went to Pacific Northwest where big dams were in dire need of good welders and cement and ironworkers which were abundant in the oil patch.  The “Okie migrants” in San Joaquin valley were actually Arkansans and Mississippians who talked in an accent like the Oklahomans who were already there working on the oil rigs. Hence the mislabel.  We do have a short street called Fresno in Ponca City.  I guess that proves we had Californians coming here in mass.  We have a Washington street also but it is pretty fallen down, maybe the worst street in town.  Which proves the migrants from DC couldn’t even run their own neighborhood.