The Rich Bailing on Maryland

[nathanm]

The article says that the state lost $1.7 Billion of tax base as a result of these migrations.  That lost tax base divided by the 31,000 migrants tells us that the migrants had an average income of $548,387 per person.  Yes, maybe Maryland laid off 31,000 teachers... ;-)

Odd then, that their per capita income did not decline much and indeed declined less than Virginia's. Or Oklahoma's, for that matter. Basically, they cherry picked years so as to use a national trend (the financial crisis) to make an otherwise unsupportable claim. Maryland's 2011 individual income tax collections were almost same as their 2007 level. Again, Virginia (and New Jersey, for that matter) has fared worse, lending further credence to the idea that this particular study is worse less than used toilet paper.

Looking at more data, I'm very confused. Maryland's total state tax collections increased 2% (ish) from 2007 to 2010. What loss is it these people were complaining about again? Remind me to never believe any of the premises of the arguments put forth by anti-tax nutters. The entire foundation of their argument is utter nonsense to begin with. Tax troll is troll, I guess.

[Townsend]

Just so I don't waste my time, the article was crap then?

On the other note, go to Ireland.  Just went last year and it was crazy beautiful.

When in Dublin, take a private Guinness tour.  Go online and get reservations.

Get out of Dublin after 1 or two days and see the country.  We went SW and it was fan-damned-tastic.  Rented a van.

[Oil Capital]

Odd then, that their per capita income did not decline much and indeed declined less than Virginia's. Or Oklahoma's, for that matter. Basically, they cherry picked years so as to use a national trend (the financial crisis) to make an otherwise unsupportable claim. Maryland's 2011 individual income tax collections were almost same as their 2007 level. Again, Virginia (and New Jersey, for that matter) has fared worse, lending further credence to the idea that this particular study is worse less than used toilet paper.

Looking at more data, I'm very confused. Maryland's total state tax collections increased 2% (ish) from 2007 to 2010. What loss is it these people were complaining about again? Remind me to never believe any of the premises of the arguments put forth by anti-tax nutters. The entire foundation of their argument is utter nonsense to begin with. Tax troll is troll, I guess.

The "complaint" is very simple:  they lost 31,000 high income taxpayers with a total tax base of $1.3 Billion.  The fact that they may have had overall population growth and overall income tax collection growth in that time period does not contradict or take away from that fact in any way and really should cause no confusion.

As for your claim that they cherry-picked years to use a "national trend to make an otherwise unsupportable claim," with respect, that is nonsense.  There was no national trend of out-migration caused by the financial crisis.

[swake]

The complaint is very simple:  they lost 31,000 high income taxpayers with a total tax base of $1.3 Billion.  The fact that they may have had overall population growth and overall income tax collection growth in that time period does not contradict or take away from that fact in any way and really should cause no confusion.

Any chance you could provide links for your tax collection and per capita income numbers?

Where are the ChangeMaryland numbers coming from?

[nathanm]

The "complaint" is very simple:  they lost 31,000 high income taxpayers with a total tax base of $1.3 Billion.  The fact that they may have had overall population growth and overall income tax collection growth in that time period does not contradict or take away from that fact in any way and really should cause no confusion.

That claim is not numerically possible. If it were true, Maryland's average income would necessarily have dropped unless they simultaneously added a smaller cohort of even higher income people (in which case, were I a Marylander I'd tell the folks who left "thanks for making room!"). By all such related measures I can think to look at, Maryland has improved relative to other states. If there were some Maryland-specific cause, you'd expect to see some other state doing better than them by these measures.

[Oil Capital]

That claim is not numerically possible. If it were true, Maryland's average income would necessarily have dropped unless they simultaneously added a smaller cohort of even higher income people (in which case, were I a Marylander I'd tell the folks who left "thanks for making room!"). By all such related measures I can think to look at, Maryland has improved relative to other states. If there were some Maryland-specific cause, you'd expect to see some other state doing better than them by these measures.

Back to mathematics 101 for you.   ;-)   There is no reason to assume that all other incomes remained stable.  The claim is very much numerically possible in a non-static world, like the one in which we live.

[nathanm]

Back to mathematics 101 for you.

Funny, I was going to say the same thing about you. There has not been enough population growth to offset the loss they claim if there were a spate of lower income (but still above median) people migrating to Maryland. Explain to me how it is numerically possible for their claim to be both true and meaningful in any way and yet all measures of wealth to have gone up in Maryland. (there are some corner cases where the numbers could look like that, but I can't fathom why I would care that 31,000 people left and were replaced by people who are even wealthier)

[Red Arrow]

Three of those who left Maryland were my grandkids.  Leaving jobs that paid a whopping $9.50 an hour.  So, yeah...all the millionaires are leaving in droves!

$9.50/hr for 50 years without overtime is approx. $1,000,000.  They can do it if they are young enough.

[Oil Capital]

Funny, I was going to say the same thing about you. There has not been enough population growth to offset the loss they claim if there were a spate of lower income (but still above median) people migrating to Maryland. Explain to me how it is numerically possible for their claim to be both true and meaningful in any way and yet all measures of wealth to have gone up in Maryland. (there are some corner cases where the numbers could look like that, but I can't fathom why I would care that 31,000 people left and were replaced by people who are even wealthier)

You seem to be assuming that all people in Maryland have static incomes.  The number that left (31,000) is a significant but not overwhelming number out of a population of 5.8 Million.  It is entirely numerically possible for the remaining people to have increased their incomes by enough to cause the per capita income to go up, especially when combined with newbies' per capita income that is above the previous median.  Not difficult at all.  It does not require a "corner case" and it does not require those who left to be replaced by people who are even wealthier.  

[Hoss]

You seem to be assuming that all people in Maryland have static incomes.  The number that left (31,000) is a significant but not overwhelming number out of a population of 5.8 Million.  It is entirely numerically possible for the remaining people to have increased their incomes by enough to cause the per capita income to go up, especially when combined with newbies' per capita income that is above the previous median.  Not difficult at all.  It does not require a "corner case" and it does not require those who left to be replaced by people who are even wealthier.  

Can you cite that?

[nathanm]

You seem to be assuming that all people in Maryland have static incomes.  The number that left (31,000) is a significant but not overwhelming number out of a population of 5.8 Million.  It is entirely numerically possible for the remaining people to have increased their incomes by enough to cause the per capita income to go up, especially when combined with newbies' per capita income that is above the previous median.  Not difficult at all.  It does not require a "corner case" and it does not require those who left to be replaced by people who are even wealthier.  

Yeah, you need to read what was claimed about these people again. 31,000 is about 21% of the increased population. Again, relative to other states, Maryland is doing better. Unless you're arguing that rich people are also fleeing every other nearby state the numbers don't make sense as presented. Given that I'm talking about per-capita income, the immigrants would have to individually make as much as the people who left to keep the income figures the same. Not likely in a cohort of 144,000 when compared to a cherry picked 31,000.

Even if that is true, it proves the premise false, which is that high taxes are driving out high income earners. If you really want, I can go pull the IRS data. I'm pretty sure the breakdowns by state are posted on their website.

[Red Arrow]

CNBC states that "The Change Maryland study found that the tax cost Maryland $1.7 billion in lost tax revenues."
http://www.cnbc.com/id/48120446

The change Maryland site says "In all, Maryland lost $1.7 billion form the tax base due to out migration during this three year period."
http://www.changemaryland.org/category/press-releases/  (bottom of 5.30.12 News Release, 4th article from top)

There is (I hope) a big difference between tax revenue and tax base.  Clever misquote.


$1,700,000,000. / 31,000 = $54,838.71.    Not  $548,387.

Net population loss or net gain.  Who to believe?

A population gain of 180,000

according to the US Census Maryland had 5.65 million people in 2007 and 5.83 million in 2011, an increase of 180,000 people over the quoted period.

would only need ($1.7 B/ 180,000) $9444. each to match the $1.7 B supposed tax base loss.

"Nearly 90 percent of Maryland's 5.8 million residents live in the densely populated corridor between Baltimore and Washington, D.C."
http://www.choosemaryland.org/factsstats/Pages/Population.aspx

Either of 31,000 or 180,000 is a small enough percentage of Maryland's population to probably not make much of a dent in the per capita income.


We need some honest information if we are to make any sense of this,  if we even really care.

[heironymouspasparagus]

$9.50/hr for 50 years without overtime is approx. $1,000,000.  They can do it if they are young enough.

Well, there ya go, then... that would be great if it didn't cost $1.5 million to merely exist for that time....

[Oil Capital]

Yeah, you need to read what was claimed about these people again. 31,000 is about 21% of the increased population. Again, relative to other states, Maryland is doing better. Unless you're arguing that rich people are also fleeing every other nearby state the numbers don't make sense as presented. Given that I'm talking about per-capita income, the immigrants would have to individually make as much as the people who left to keep the income figures the same. Not likely in a cohort of 144,000 when compared to a cherry picked 31,000.

Even if that is true, it proves the premise false, which is that high taxes are driving out high income earners. If you really want, I can go pull the IRS data. I'm pretty sure the breakdowns by state are posted on their website.

Again, you are assuming that every extant resident of Maryland had income that did not rise.   If that was true, then what you are saying makes sense.  But there is no reason to assume that.  There is simply no mathematical or numerical reason that you can't lose your top (very small) cohort of income, increase the remaining incomes (in the aggregate), and end up with higher per capita income.

[Conan71]

There is a good point that is being missed here though.  At some level, tax rates get high enough that those whom are targeted for the higher taxes will do whatever they can to avoid paying more taxes.  Show me one wealthy person who doesn't try to limit their tax liability either via state of residence, funneling funds to various trusts, exploiting loopholes written into the tax code, or keeping business operations off-shore.