Let’s make Minnesota a state people want to move to, not flee from
Yesterday, I had the pleasure of addressing the Freedom Rally at the State Capitol. I didn’t really have a speech as such, but below are some of the points I raised together with links to the supporting work.
People are fleeing Minnesota in record numbers. In the last two years we have lost, on net, 33,000 residents to other states, mostly to places like Florida. Our net losses in domestic migrants in the last two years have been the greatest since at least 1990.
We are losing Minnesotans of all ages. Since 2020, we see net losses of residents in five of the six categories the IRS breaks the numbers down into, including those under 26.
We are losing middle class Minnesotans. Since 2010, we see, on net, losses of residents in every income category above $50,000 annually.
Empirical research tells us that high taxes are a factor driving these population losses. A recent paper by economists Henrik Kleven, Camille Landais, Mathilde Muñoz and Stefanie Stantcheva that “review[ed] what we know about mobility responses to personal taxation” found that:
There is growing evidence that taxes can affect the geographic location of people both
within and across countries. This migration channel creates another efficiency cost of
taxation with which policymakers need to contend when setting tax policy.
The policies currently being proposed by the Governor and the majorities in the House and Senate will only make this worse. They include:
- A metro area sales tax
- Hikes in fishing license fees and state park permit fees
- A new, regressive tax on jobs to fund paid family and medical leave
- A new tax on deliveries of everything from Amazon packages to pizzas
And this is before we get to proposals for a new, top, fifth tier of state income tax and a new, higher, rate of state capital gains tax.
These policies all go in the opposite direction the research tells us we need to go in if we want to make Minnesota a state that people want to move to, not what it is now: a state that people want to move away from.
Follow the science: cut taxes.
We should use the historic opportunity presented by the state’s forecast budget surplus to cut income tax rates to the benefit of all Minnesota’s hard pressed taxpayers.
Governor Walz likes to compare Minnesota to Florida and himself to Ron DeSantis. What a comparison. In the first year of their administrations, Walz’ Minnesota lost, on net, 3,921 residents to DeSantis’ Florida. Between 2018 and 2021, Minnesota’s GDP grew by 2.8% while Florida’s grew by 9.3%. Total employment rose by 5.3% in Florida, but fell by 2.2% in Minnesota. That is why people are fleeing the Gopher State for the Sunshine State. Historically, people have always moved towards freedom.
This is a great state, I moved 4,000 miles to live here. But no state can withstand such an onslaught of destructive policy indefinitely. Minnesotans face a choice: do we want to be part of the America of ever higher taxes, ever higher government spending, low economic growth, shrinking employment, and vanishing populations? Or do we want to be part of the America with a bright future of freedom and prosperity? That is the choice we face.