The Rich Are Fleeing to Texas
As soon as Ryan Holiday became a New York Times bestseller, he moved to a ranch in Texas.
As soon as Rachel Hollis’s book sold 1 million copies, she moved to Texas.
Right after closing a $100 million Spotify deal, Joe Rogan moved to a $14.4 million mansion in Texas.
Billionaire Mark Cuban already lives in Texas.
As does Michael Dell.
And the Walmart heiress.
Plus 95 of the Fortune 500 biggest companies in America.
According to Bloomberg, “The one-percenters are ditching the pricey hubs of New York City, San Francisco, and Los Angeles for lower-tax states like… Texas. Tesla’s founder Elon Musk just revealed his plans to move to Texas and companies like Hewlett-Packard and Oracle are joining the exodus, too.” The article almost mentions that Dropbox is heading to Texas as well.
What’s going on?
In a sentence: The rich are abandoning their responsibilities to society.
They don’t want to pay taxes and they don’t want to be regulated.
And who can blame them?
State taxes on personal income are 13.3% in California, versus 0% in Texas. Lower-level “elites” like Joe Rogan and Tim Ferriss know the truth about modern taxation: that multinational corporations have already purchased the American legislature and are using it to give themselves trillions in bailouts and subsidies. Why should hard-working entrepreneurs have to fund a corrupt system? Many of them will do far more to help the world with their tax savings than simply handing it over to quantifiably evil people.
For the bigger players who are actively lobbying Congress for private advantages, they know a secret about the nature of American power: that corporate-controlled politicians make laws that favor their own side and disadvantage their competitors. Roughly half the players play for Team Democrat, and half the players play for Team Republican, and every election cycle, somebody loses. Rather than seeking a level playing field, both sides snipe from cover. Sure, they may have been part of creating the problem, but they certainly don’t want to foot the bill to fix it.
What happens next?
Tax revenue erosion will soon be a common phrase in city council chambers across the country.
As the rich leave states like New York and California for laissez-faire regimes like Texas, we’ll witness a collapse in tax revenue. According to one economic model, if just 5% of New Yorkers earning $100,000+/year leave the state — which they’re already doing because of the pandemic — it would result in an annual loss of nearly $1 billion in city revenue.
This will lead to massive service cuts to infrastructure maintenance and development, education for children, health services, elder care, waste management, postal delivery, and every other department that maintains modern civilization. As budgets constrict, most cities will take on debt (which banks will be too happy to loan them), and what few publicly-owned municipal assets will be sold off to private investors. Taxation and service prices will both rise, but the returning value to taxpayers will fall dramatically.
And that’s just the start.
States will start competing against each other to re-attract companies. They’ll lower various tax rates to zero like Texas, and cut public services accordingly.
Eventually, when the majority of the nation’s wealthiest cities have relocated to the states or cities with the lowest taxes or the fewest number of consumer protections — and the masses are suffering in their hollowed-out cities — the rich will then go to Phase Two: moving offshore.
Because why would you stay in Texas when somewhere else has even less taxation and regulation?
Plenty of billionaires have already offshored their wealth, of course — the rich rob the commons of more than half a trillion dollars in annual taxation — but expect everyone in the seven-figure club to find a way to get in on the game. Elites have already destroyed the global corporate tax system, and the personal tax system is next. It’s a race to the bottom, and the rich are winning handily.
Eventually, because no one was funding the costs of civilization—the roads, schools, hospitals, health, safety, and democracy that leads to a creative working class — the rich will come to realize that America has become a hellhole, and those with the means will abandon even Texas for tax havens in the Caribbean, Europe, and beyond.
We’re already seeing it on a local level. Rather than fix the problems they create, the super-rich just try to actively avoid them. It’s why billionaires like Silicon Valley surveillance giant Peter Thiel are building doomsday bunkers in New Zealand.
They’re preparing for an Armageddon of their own creation.
People like Ben Shapiro (who recently abandoned California) rage about the “homelessness problem” in Los Angeles, but as a class, the ultra-elites do little to combat houselessness and do much to exacerbate the problem. And the houselessness problem of today is nothing compared to what it will be in the decades to come.
Think about it: Corporate automation is expected to wipe out 40% of jobs in the next 15 years and leave half of us economically non-competitive against AI. Yet prices will continue to rise, while the corporatocracy will continue to devalue our money and destroy purchasing power by printing zero-value-backed digital currency. And the rich are going to continue to offshore their wealth like never before.
So who is going to pay for the costs of civilization?
The reality is that we’re already bulldozing millions of people into poverty each year, and soon we’ll be leaving them to die in the streets. Globally, there are 1 billion people living in slums today, and that number is expected to rise to 3 billion in our lifetime.
Who pays to fix this? The ultra-wealthy simply will not help, and without commons land and community-held assets to help people get a start, the poor cannot help.
Anyone with the foresight to map out our current trajectory thirty years down the road will realize the elites’ hellish vision for we bottom 99%.
It’s up to the dwindling middle class to save the American economy.
#OccupyWallStreet was nothing compared to what’s coming. The working masses are filled with righteous (and unrighteous) anger. I’m honestly shocked that the Forbes 400 hasn’t already become a hit list. (It’s either a testament to the national surveillance system or the average American’s inability to connect the dots.) But when half the nation is unemployed, expect them to take to the streets and blame anyone who looks even remotely wealthy.
So what can we do?
A sensible democracy would end all subsidies and tax breaks for multinational corporations, and offer huge help and incentives for small businesses. This would lead to more competition, more jobs, more corporate accountability, and far more local taxation.
Rather than try to chase down multinationals and try to find their offshore tax dollars, it would implement heavy point-of-sale taxes on all products produced by all corporations. (After all, it’s the customers who give companies 100% of their value.)
Rather than mortgaging the future by borrowing manufactured credit from private banks, it would start infrastructure banks to fund city-held assets that could pay the costs of programs and services without the need for taxation.
But we certainly can’t vote our way out of this problem — we’re well-past the charade of democracy at this point.
We need to teach the elites a lesson
There has been an untold number of peaceful attempts throughout history to get the ultra-rich and mega-powerful to play a contributive instead of extractive role in society. But all have failed; because they used words instead of actions.
Violence, of course, is not an option — not only is it deeply immoral, but the elites control the police, military, and surveillance apparatus and will use them to violent effect when the uprising starts.
We need to do the irrational, the unthinkable, the impossible:
We need to change our spending habits. We need to defund the power-mongers, the partisans, and the tax-avoiders. Rather than getting one token vote every four years, each of us gets thousands of truly powerful votes each month. We need to spend our money on goods and services produced by companies that are local, democratic, accountable, tax-paying, worker-conscious, and environmentally-sustainable.
It’s unlikely we can ever get the majority of people to do this, but it’s the only way the rich will even remotely pay attention.
Today’s corporate elites are failing to learn the stark lesson that has felled all previous attempts to amass unaccountable power and maximize private profit while eliminating communal contribution and social responsibility: that maintaining a safe, happy, healthy, and flourishing consumer class (and planet) is an unavoidable cost of doing business.