And just as with a family, it’s important to be sure that the help you’re giving isn’t actually detrimental.

I believe it to be detrimental, and could compound to become more detrimental in the future.

I did this math a while back, but if memory serves, after WW2 about two-thirds of the country’s GDP came from the industrial states — The Northeast, the Rust Belt, and California. By a decade ago, that ratio had dropped to about 56%, IIRC.

This shift has been costly. It’s easy to forget that prior to the Barge and Welland Canals being built, Buffalo NY was the richest city on the PLANET. Consolidation and the movement of industrial capacity to low-tax states doesn’t create any value in terms of GDP, but puts more money in the pockets of the corporations, as they shifted their facilities to the South.

Now, there’s a lot more than just that going on when you talk about the shift of productive facilities, but one can draw the conclusion that disparity in taxation rates is a destabilizing force in the national economy. Jobs are lost in one place, restored in another, and the decision to move to one jurisdiction over another all depends on the size of the tax breaks the local jurisdiction comes up with, and those tax breaks are taken directly out of local funds normally used for infrastructure, local health care, emergency response, etc. The jurisdiction makes out in the long run, but there is a short term dislocation which causes problems.

My $.02. Being in Texas, we benefit from this shift……but I still believe it to be unhelpful.

Written by

Data Driven Econophile. Muslim, USA born. Been “woke” 2x: 1st, when I realized the world isn’t fair; 2nd, when I realized the “woke” people are full of shit.

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