You’ve got Oregonians seeking to cascade into Idaho, Virginians who identify as West Virginians, Illinoians fighting to escape Chicago, Californians dreaming of starting a 51st state, and New Yorkers who think three states are better than one.
Separation fever is sweeping the nation as quixotic but tenacious bands of frustrated rural dwellers, suburbanites and conservatives seek to break free from states with legislatures increasingly controlled by liberal big cities and metropolitan strongholds.
“Oregon is controlled by the northwest portion of the state, Portland to Eugene. That’s urban land, and their decisions are not really representing rural Oregon,” said Mike McCarter, president of Move Oregon’s Border for a Greater Idaho. “They have their agenda and they’re moving forward with it, and they’re not listening to us.”
Taxes cannot be raised high enough to pay the total state and local government debt and promised pension and medical benefits in Illinois—the tax donkeys will flee. From Ted Dabrowski and John Klingner at wirepoints.org:
Illinois’ combined state and local pensioner debts have reached absurd levels. When divvied up between Illinois’ households, the “shadow mortgage” each one is on the hook for now totals hundreds of thousands of dollars per household, if not more, depending on who politicians target to repay those debts.
As Gov. J.B. Pritzker and other lawmakers try to extract that kind of money from Illinoisans, they’ll fail, for the simple reason that the amounts have become overwhelming. Too many households don’t have the means, while others won’t stick around to pay for it. They’ll just leave.
And as Illinoisans leave, the shadow mortgage on those who remain will jump. The crisis will only deepen.
From and to where the tax donkeys are fleeing from Ted Dabrowski and John Klingner at wirepoints.com:
Nearly 7.5 million people moved from one state to another in 2018, boosting the economies of some states while straining the finances of others.
The winners of the battle for people and their incomes included states like South Carolina, Arizona, Texas and Florida. Those findings are based on a Wirepoints’ analysis of the latest 2018 domestic migration data provided by the Internal Revenue Service.
The stakes are large. A growing population for the winners means an increasing tax base, economic growth and investment. And as baby boomers age and pressure to fund pensionsincreases, a growing workforce is a windfall.
On the other end of the competition are states that have become perennial losers. Connecticut, New Jersey, Illinois and New York have experienced some of the nation’s biggest drain of people and their money.
Putting the best and most qualified person in a position or job is becoming an increasingly quaint idea. From Jeff Thomas at internationalman.com:
A half-century ago, the US was the envy of the world – the Land of the Free, where virtually anyone could prosper, if he were willing to roll up his sleeves and work.
America was made great through the immigration of those who wished to pursue the American dream of “work = personal success.” It’s important for us to remember that those who were less ambitious remained in their homelands and helped their countries stagnate, whilst their worker-bee counterparts colonised America for generations.
An important lesson here: America was not built on immigration per se; it was built on immigrants with a strong work ethic.
Not so, today. Whilst there are certainly those who move to the US to pursue the original American dream, far more go there due to the promise of governmental largesse. Welfare, free health care, free education, etc., now attract those very same people that stayed behind in previous generations – those who made little or no contribution to the economy.
Illinois is just a preview of coming attractions for most of the rest of the United States. From Ted Dabrowski and John Klingner at wirepoints.org:
Illinois politicians’ refusal to address skyrocketing municipal pension costs is destroying cities across the state. Some cities like Harvey and East St. Louisare beyond repair, with the Illinois Comptroller already stepping in to confiscate city revenues on behalf of the municipalities’ grossly underfunded pension plans. Most other cities are deteriorating quickly. They’re fighting ever-increasing pension costs that are swallowing city budgets and chasing residents away. More than half of Illinois’ 650 public safety plans are less than 60 percent funded.
Peoria is one of those struggling cities. No, it’s not a Harvey or an East St. Louis, but it’s certainly in a downward spiral like many other cities. Peoria officials are adding new taxes and fees to deal with the city’s struggling budget. A new utility tax was added in 2018, along with a public safety pension fee that’s being ratcheted up over the next couple of years. Their efforts to tax more are likely to be futile. The numbers justify those doubts.
The new Chicago mayor wants the rest of the state to pay for Chicago’s profligacy. From Ted Dabrowski and John Klingner at wirepoints.org
It didn’t take long for new Chicago Mayor Lori Lightfoot to propose a plan that would wash her hands of Chicago’s pension crisis altogether. According to a recent report in Crain’s, Lightfoot wants the state to take over Chicago’s pension debts and merge them with the other pension plans throughout the state. The move would make all state taxpayers responsible for paying down the city’s debts.
The plan to shift city debts to the state would bail out the mayor from having to raise about $1 billion in additional taxes to pay for increasing pension costs by 2023. A massive tax hike is something she’s desperate to avoid.
But while Lightfoot may think the cost-shift is a solution, it will only make things worse for Illinois. She should expect significant pushback from many sides.
Start with downstate and suburban residents. Sure, their public safety pension funds would get consolidated under the state, too, but it’s the Chicago funds that are some of the biggest and worst-funded in the state. The four city-run funds are collectively funded at just 27 percent and face an official shortfall of $28 billion.
In contrast, the 650 downstate pension plans are 55 percent funded and have a shortfall of nearly $10 billion. The end result of any statewide pooling of pension funds will be a net bailout for Chicago.
Non-Chicagoans aren’t going to just accept yet another bailout of the city. Downstaters’ most recent bailout of Chicago came when the state’s new education funding formula locked in special subsidies for Chicago Public Schools. That included hundreds of millions in hold-harmless funding as well as $200 million-plus annually to pay for the district’s pension costs.
The people of Illinois are heading towards the exits. Understandable, given the state’s fiscal problems, insolvent pensions funds, and what’s sure to be continuously rising taxes. From Ted Dabrowski and John Klingner at wirepoints.org:
Since the turn of the century, Illinois has been in the midst of a perfect demographic storm. Residents are leaving the state in record numbers. The number of Americans moving into Illinois has hit new lows. Net foreign immigration has fallen by half. And the number of births has dropped by more than 20 percent.
These demographic forces have all combined into a single troubling fact: Illinois is shrinking. The state has lost population five years in a row. In 2018 alone, the state lost 45,000 people, the second-biggest population drop in the country.
The state’s growing domestic out-migration has been especially problematic. More Illinoisans are leaving the state at the same time that fewer Americans from other states are moving in.
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