It is the beginning of another month which means it is time again to review the latest political class insanity from the American political class. Each month it takes us multiple posts to cover the wasteful spending, incompetent government organizations and employees, government programs that usually make a problem worse than resolving it, inane and idiotic politician comments, etc.
To review past posts on this insanity and idiocy, just click on the first few posts in each month listed to the right of this page. After reviewing just a handful of these insanity posts we think you will agree that we are currently being served by the worst set of American politicians ever to hold office in our entire history.
1)We have often discussed the concept of the “financial death spiral” as it relates to state governments across the country. The spiral unfolds as follows:
The state’s politicians spend much more money than they take in via taxation.
Then, rather than reduce government spending and waste, those politicians decide to raise taxes and make their state residents and businesses poorer in the process.
As a result, some residents and businesses leave so that they will be able keep more of their hard earned income.
This reduces the tax base and the tax revenue the state government collects.
Rather than reduce government spending, the state politicians cut services to residents and businesses and raise taxes.
This causes more residents and businesses to flee the state which reduces the tax base which results in lower tax revenue and the spiral is underway.
People basically want to be as free as possible in their lives and that includes keeping as much as their wealth as possible to spend anyway they see fit for themselves and their families. Eventually, we have predicted, a state government will have to declare bankruptcy as their debt and spending eventually drives off enough tax revenue producers and their financial viability collapses. Seems they never significantly reduce government spending, it is almost always more taxes will fix everything.
Our past analyses from several different angles always shows that the following states are the most likely to go bankrupt first:
Illinois
New Jersey
New York
California
Our current bet is that Illinois will go bankrupt first but the other three are also strong candidates.
Has anything changed since our last analysis? We do not think so since the “Annual Movers Study” has been published. This annual study documents moving patterns of residents' across the country. i.e. are more people moving out of a state or moving into a state. If those moving out are significantly higher than the number of people moving in, then the reduction in the tax base and the death spiral is likely underway.
So what states are hemorrhaging residents at the fastest:
New Jersey - New Jersey is the leading state losing residents since last year 68.5% of the state’s movers were outbound while only 31.5% were inbound. This is not surprising since New Jersey has been in the top ten of losing residents for the past ten years.
Illinois was second relative to residents fleeing with 33.5% of the movers being inbound to the state which was about half of the outbound rate, 66.5%.
New York - New York held down the third spot with a 36.9% inbound rate and a 63.1% outbound rate.
Connecticut - Connecticut was in fourth place with a 37% inbound rate and a 63% outbound rate.
California comes in sixth in this list with 43.1% inbound and 56.9% outbound.
The states listed above are known to have some of the highest taxation rates in the country: high property taxes, high income taxes, high gas and utility taxes, taxation on retirement accounts, etc. Thus, it is not a surprise why so many more people are leaving vs. coming into these states. In addition, as tax revenue dries up, government services are cut including law enforcement which has resulted in spiking crime rates in the above states.
The politicians in these states just do not get it: higher and higher taxes drive out productive, tax paying residents and businesses to the long term detriment of the state government’s financial viability.
A state government cannot stay viable forever if for every new resident, two existing residents exit the state. The financial death has to eventually kick in as the tax base shrinks.
2)While the above study looks at total movers, U-Haul also does an annual study of people moving into and out of states. Their analysis found that:
California just led the nation again, for the third year in a row, for most outbound moves relative to inbound moves based on U-Haul moving vehicle rental data.
According to the Santa-Barbara News Press, “U-Haul saw the highest demand for one-way equipment from California outbound residents, and saw the highest net loss of one-way U-Haul trucks from the Golden State” as residents fled like bats out of hell to escape the blue state’s socialist utopia of homeless shantytowns and toxic algae blooms. The report also notes that the state has seen a 12% uptick in the number of people getting the heck out of dodge, noting that “343,230 more Americans moved out of California compared to those who moved into it” and marking the third year in a row that the state has hemorrhaged people leaving for greener pastures.”
The most popular places for Californians to move to are Texas and Florida, states with significantly lower income, gas, utility, and other taxes and lower crime rates.
And it is not only residents who are fleeing a deteriorating quality of life situation in the state, over 350 companies, both big and small, including such names as Tesla, State Farm Insurance, and Charles Schwab, have moved their headquarters and other facets of their businesses out of California.
Politicians do not get it: people want to be free of high taxes, high crime, and a lower and lower quality of life. The move numbers don't lie.
3)As we have discussed many timers, at any point in time:
There are about 500,000 to 600,000 homeless Americans living on the streets of this country.
There are millions of American families that are struggling to feed their families.
About 30 million Americans do not currently have health insurance coverage.
Tens of thousands of Americans are dying every year, and increasing numbers, due to drug addiction.
Keep these numbers in mind relative to the failure that is Biden’s atrocious performance relative to illegal immigration:
Biden has removed just about any barrier that was in place along our southern border that was meant to control illegal immigration into this country.
As a result, literally millions of unknown illegal immigrants have illegally entered the country, overwhelming local government resources along border states.
This rush of millions of people probably included drug cartel, human trafficking, international criminal syndicates, and terrorist organization individuals, all of which place American lives at stake and in danger.
As a result, millions of foreigners have been taken into custody.
Last year, American taxpayers paid $324 million to house feed, and provide medical care to these illegal immigrants while in custody
This does not include the billions of dollars that the American taxpayers pay to care for illegal immigrants when they are released from custody and spread out across the country.
Based on analyses we have discussed previously, that $324 million could have provided over 100 million meals to the hundreds of thousands of homeless Americans. That $324 million could have provided a year’s worth of drug addiction treatment for almost 50,000 drug addicted Americans. It could have provided health insurance for thousands of American families.
You get the idea. The priorities of this administration and Washington in general do not have Americans at the top of the list. By opening up the borders, Biden and his administration are siphoning off billions of taxpayer dollars to pay for non-Americans while needy Americans go hungry, homeless, drug addicted, and without health insurance. Very, very bad priorities.
That will do it for today. State politicians driving their own state governments into bankruptcy and Biden and Washington taking care of foreigners while Americans suffer. Inept, incompetent, and insane.
Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:
