Red States, Blue States: Two Economies, One Nation | CFA ...

Source: Veronika Kyrylenko

There’s always that last straw that breaks the camel’s back.  Now there is a pile of straw that is about to break the American donkey’s back.  There is ample evidence of that.

Recently, the United States has faced not one, but two serious crises that have demonstrated a complete incompetence of local Democratic governments and aggravated the issues they already had.  The crises we’re talking about are COVID-19 and nationwide protests accompanied by violence and crime.  Even though the recent touted “research” suggests that 90 percent of those protests were peaceful (would you like to be on a diet that is 90 percent non-poisonous?), that does not negate the fact that the interim results are far from the declared goals.  Black lives (along with all other lives) are now more endangered by increased crime than they were before.  Violent crime is on the rise in the cities that rallied the hardest demanding racial justice — Chicago, New York, Philadelphia, Los Angeles, Portland, D.C., Baltimore, Minneapolis, and Seattle.

These processes are superimposed on economic recession caused by the unnecessary shutdowns of businesses and schools.  The economy — President Trump’s greatest achievement — has been hit hard and mercilessly. The current‑dollar GDP decreased 34.3 percent, or $2.15 trillion, in the second quarter to a level of $19.41 trillion, adding to the first quarter’s loss of $186.3 billion.  Fifty million people found themselves jobless and with quickly thinning finances.  The Democrats in Congress hindered much needed economic relief packages in late March, in May, and then in early August, insisting on more funds to be sent to their failing states while Republican lawmakers proposed to focus on small business support.  While all Democrats-run states went to lockdown, almost half of the Republic states remained opened, with closed states imposing fewer restrictions.  Still, the blue states got hit harder.  Basically, Democrats would redistribute billions of dollars of aid from the working red states to the blue locked down states — it would be only “kind” and therefore “just.”

The damaged economy and civil unrest serve as a catalyst, reminiscent of the graphite-tipped rods entering the Chernobyl reactor and causing it to explode. Just as the Soviet workers rushed to flee Pripyat, saving their lives from deadly radiation emanating from the burst nuclear power plant, people flee Democrat cities and states that emit high crime, high taxes, and rapidly worsening infrastructure.

New York is a notable case. The Big Apple has 118 billionaires, more than any other American city.  NYC is home to nearly one million millionaires, more than any other city in the world.  Among those millionaires, some 8,865 are classified as “high net worth,” with more than $30 million each.  The top one percent of NYC taxpayers pay nearly 50 percent of all personal income taxes collected in New York.  Personal income tax in the New York area accounts for 59 percent of all revenues.  Property taxes add in more than a billion dollars a year in revenue, about half of that generated by office space.  The very same city contains the largest homeless population of any American metropolis.  The number of New Yorkers living below the poverty line is larger than the population of Philadelphia and would be the country’s seventh largest city.  The city spends lots of money to accommodate the poor, but who’s to bring bread to the table with earners leaving?

With COVID and high crime rolling across NYC and modern technology that made people more accustomed to work from any place that has an internet connection (sorry, California!), there is no incentive to stay there.  As described by Peter Van Buren, for the super-wealthy, New York once topped the global list of desirable places to live based on four factors: a desire to live among other wealthy people (we see where it’s going); investment returns on real estate (not looking great, if you can even find a renter or a buyer); lifestyle (now destroyed with bars, restaurants, museums, sport venues, theaters, and shopping shut down — with exception for looting); and, last but not the least, the future.  Pre-COVID and pre-BLM/Antifa New York had the highest projected GDP growth of any city.  Now it is called the worst state in the U.S. for its grim economic outlook.  The government’s response?  “Tax the wealthy,” says Mayor Bill de Blasio, while Governor Andrew Cuomo tries to allure the rich by “buying them a drink.”  

Notably, New York has been seeing a decline in its population for quite some time.  It is certainly not the only major Democrat-run state that observes this trend.  The exodus from CaliforniaIllinoisMichigan, and Minnesota continues, as many red states gain population, according to the U.S. Census Bureau.

Moreover, every few years, Gallup asks Americans whether they want to leave their states.  Remarkably, seven of the eight places that people are most eager to flee rank solidly Democratic in party affiliation.  These results have stayed consistent for years, and migration data reflect that.  A study by demographer Wendell Cox of net flows of migrants from state to state found that the same seven of the ten states with the most net out-migration are Democratic: California, Connecticut, Illinois, Maryland, Massachusetts, New Jersey, and New York.  By contrast, the states winning the most residents were Republican; politically neutral; or low-tax Democratic places, like Washington and Oregon.

Think about it: there are places that have been run by the Democrats for decades, with little to no opposition from the “evil” Republicans.  People who have had a chance to experience the results of their leadership want none of it.  Today, the way the Democrats have handled COVID and the protests, the violent part of which went largely unpunished, made locals speed up the packing.  Then there were eight years of the Obama presidency that failed America domestically and internationally.  Americans still remember that.

Now, with Election Day less than 60 days away, why would anyone want to extend the failing leftist policies that became as obvious as Joe Biden’s dementia onto the whole nation?  Obviously, the Democrat establishment and its cosmopolitan donors would, but when worse comes to worst, they’ll just move to their New Zealand mansions.  Where will you go?