Policies matter in growing population
The latest population numbers from the U.S.Census offer plenty of warnings for Michigan, which suddenly finds itself with a crop of policymakers at all levels of government who believe there is no problem that higher taxes and tighter regulations can’t solve.
The fastest growing state in the nation last year was Nevada, which with Idaho was one of only two states to exceed 2% growth, well above the national average of 0.6%.
Nevada has no state income tax. Three other states without an income tax –Washington, Texas and Florida — joined it in the Top 10 in growth.
Nevada also borders California, which saw its population growth slow dramatically, while all of its neighboring states grew.
Nevada benefited from out-migration from California, as did Idaho and Washington.
One reason is that California continues to increase its tax and regulatory burden, and for the first time in decades, is at risk of losing a congressional seat in the reapportionment following the 2020 Census.
It’s not just taxes that are driving people out of the Golden State. The state’s regulatory hand grows heavier every year, driving up the cost of living and placing greater shackles on personal liberties.
Most recently, California aimed a torpedo at the gig economy with a law requiring individual contractors working for firms such as Lyft and Uber to be added to to the company payrolls.
The state is also weighing legislation to require that ride sharing companies use only electric vehicles.
It’s getting harder for California’s beauty and climate to outweigh the hassles created by its ever more intrusive government.
For Michigan, where growth was up slightly but well below the national average, the lesson is to avoid jacking up taxes and adopting anti-business measures.
The state’s flat, 4.25% income tax rate gives it an edge over all but the no income tax states. Yet Democrats in the state House are pushing to replace it with a graduated income tax to raise money for road repairs and schools.
That would be a disaster for a state that is already struggling to attract new residents, and has a sunshine deficit to boot.
Michigan over the past decade greatly reduced its regulatory burden, making it more attractive to do business here. That has started to produce significant job growth.
If Michigan hopes to continue that trend and someday join the Top 10 growth states, it must understand that policies matter, particularly tax policies.
There are a lot of things this state needs, and the temptation is always to raise taxes to pay for them.
But the more effective approach is to grow revenue by growing jobs and population, and that’s what current policies are designed to do.
Don’t abandon them.
— The Detroit News