Content by RedShift
Posted at 11:01am on Dec. 23, 2006 Why Australia's Fertility Rate is Bouncing Back
By RedShift
As we noted here, California and the US enjoyed a rebound in fertility during the Reagan economic boom, and as we noted here, Estonia is enjoying a rebound in its fertility rate after years of economic reforms begun in the 1990s.
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Posted at 12:17am on Dec. 23, 2006 Blue State Socialism & the Economy-Fertility Connection (Part 1)
By RedShift
In several of our previous posts, we identified a causal link between the economic condition of Red States and the migration of the US population to those states. Readers have attempted to link the migration to climate, but this study proves that it is still taxes—and not climate—that drives people to vote with their feet.
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Posted at 5:03am on Dec. 19, 2006 "Jesusland" vs. Blue States and Blue Nations (It's the children, stupid!)
By RedShift
Remember the silly map from the post-election blogfest of 2004? "Those ignorant, Jesus-loving, America-loving bigots voted for Bush again!"
Well, there's something about those "Jesusland" nutjobs that ought to get the attention of every Blue State and Blue Nation politician who is worried about population shrinkage. It's a problem facing not only Blue States like those in New England, but also Blue Nations like Germany, Spain and Italy, which are suffering from fertility rates of 1.3 and lower (almost half the replacement rate). The Economist has followed this issue quite closely and shows that developed nations almost universally trend toward sub-replacement level fertility--except America:
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Posted at 9:05pm on Dec. 16, 2006 Fertility, Estonia and Milton Friedman
By RedShift
Strange as it may be to see all three in the subject line, Estonia is being watched by a very nervous Europe for these very reasons. Identified in a 2001 UN world-population report as "the fastest shrinking nation on earth," Estonia is taking matters into its own hands. With a population growth rate of -0.65%, and a fertility rate of 1.3 in the 1990s, estimates are showing that Estonia is possibly reversing the trend. Current estimates suggest a fertility rate of 1.5—still below replacement levels, but an improvement since the 1990s.
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Posted at 8:51pm on Mar. 2, 2006 The Blue State Exodus (Blue State (in)Fertility)
By RedShift
As we have previously noted in this diary, Blue States are suffering from a shrinking population. While it may not be true that all Blue States are shrinking, or that all Red States are growing, there are general trends and attributes which can be correlated to the Blueness or Redness of a state.
As we noted here, some of those attributes have to do with fertility, abortion rates, union membership as a percentage of workforce, estate taxes, fuel taxes, etc...
We were intrigued, therefore, that Phillip Longman identified not only the regressive population trends in the US, but correlated them with State Blueness. His March 2006 article, The Return of Patriarchy, strikes a familiar tone:
"This dynamic helps explain, for example, the gradual drift of American culture away from secular individualism and toward religious fundamentalism. Among states that voted for President George W. Bush in 2004, fertility rates are 12 percent higher than in states that voted for Sen. John Kerry. It may also help to explain the increasing popular resistance among rank-and-file Europeans to such crown jewels of secular liberalism as the European Union. It turns out that Europeans who are most likely to identify themselves as "world citizens" are also those least likely to have children."
We might also add that it could explain the gradual, southwesterly drift of America's population center. There are, of course, other observations to be made. I.e., US citizens who are most likely to call for a "global test" before implementing US policy, are the least likely to procreate. We have elsewhere observed that liberal social and fiscal policy may have something to do with that, and Longman agrees:
"As governments going as far back as imperial Rome have discovered, when cultural and economic conditions discourage parenthood, not even a dictator can force people to go forth and multiply."
We believe that Longman's observations support our theory that Blue State social and fiscal policy is creating an environment in which "cultural and economic conditions discourage parenthood."
Many readers have objected to the linking of the Blue State Exodus to just one cause, and we do believe that several causes together are bringing about the effect. We are not the first to observe this. We recall, of course, Professor Vedder's observation that there was a strong correlation between outmigration and primarily tax rates, but secondarily union membership.
We have also noted that both Rhode Island and New York are starting to act red in order to cut losses. And if a Blue State can shift Red economically while the rest of the country shifts Red demographically, it works well for all of us. Especially if it means that Blue States welcome the Return of Patriarchy, which is really just a return to the traditional nuclear family.
Who would have thought that the propagation of civilization would be so simple as a man and woman, in a monogamous relationship, having children?
Perhaps Hollywood would consider a new movie genre in which the dominant theme is that of boy meets girl, falls in love with and marries her, and raises children. Kind of wacky, we know.
RedShift
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Posted at 5:39pm on Feb. 18, 2006 The Blue State Exodus (What State Tax Rates, Unions, and Fertility Rates are telling us)
By RedShift
We noted here that taxes are not the only data that can be correlated to positive or negative migration rates at the state level. Professor Richard Vedder, Distinguished Professor of Economics at Ohio University, recently published his study into the migration of human capital here. We have read comments to this diary that suggest that climate and housing prices are more likely than state and local tax rates to drive migration patterns. Professor Vedder actually incorporated such variables beyond tax rates in his study and the alleged correlation did not materialize. The tax rate correlation, however, remained.
Professor Vedder did find another correlation, however. He included "the percent of the labor force belonging to labor unions," in his analysis and found that: "...the union variable [correlation] is negative - more union presence [means] more out-migration."
We have thus far included both fertility rates and tax rates in our Blue State Exodus analysis, and will now introduce Union Presence to show the correlation. When considering income, fuel, property and estate taxes, and then adding in abortion rates, fertilty rates and union presence, we find that the more times a state makes the "Top 20 List," the Bluer the state is, and thus the more likley to suffer from both economic and demographic decline. Here is our data:
Income Tax Top 20
Maine, District of Columbia, New York, Hawaii, Rhode Island, Wisconsin, Vermont, Ohio, Nebraska, Utah, Minnesota, Arkansas, Connecticut, West Virginia, New Jersey, Kansas, Louisiana, Maryland, Indiana, Kentucky
Fuel Tax Top 20
Hawaii, Nevada, New York, California, Wisconsin, Rhode Island, Florida, Connecticut, Washington, Montana, Pennsylvania, Michigan, Illinois, Maine, Nebraska, West Virginia, Idaho, Kansas, North Carolina, Utah
Property Tax Top 20
New Jersey, Connecticut, New Hampshire, Maine, New York, District of Columbia, Wyoming, Rhode Island, Massachusetts, Vermont, Alaska, Illinois, Wisconsin, Texas, Minnesota, Nebraska, Maryland, Florida, Michigan, Iowa
States with an Estate Tax
Connecticut, Illinois, Maine, Maryland, Massachusetts, Minnesota, Nebraska, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Vermont, Virginia, Washington, Wisconsin
Union Presence (as a percentage of total work force) Top 20
New York, Hawaii, Alaska, Michigan, New Jersey, Washington, Illinois, California, Minnesota, Ohio, Rhode Island, District of Columbia, Wisconsin, Maryland, Connecticut, Oregon, Pennsylvania, Nevada, Massachusetts, Montana
Abortion Rate (women aged 15-44) Top 20
Dist. Of Columbia , New York , Nevada , New Jersey , Maryland , California , Florida , Hawaii , Connecticut , Massachusetts , Illinois , Rhode Island , Virginia , Washington , Michigan , Colorado , Arizona , North Carolina , Oregon , Delaware
Bottom 20 States in Fertility (live births per 1000 population)
Vermont , Maine , New Hampshire , District of Columbia, Pennsylvania , Rhode Island , Massachusetts , West Virginia , Connecticut , Wisconsin , New York , Washington , North Dakota , Michigan , Maryland , Oregon , Montana , Alabama , South Carolina , Tennessee
Now, tallying up how many times a state makes the list, we find the following (leaving off a state that makes two lists or fewer):
Connecticut 7
New York 7
Rhode Island 7
Wisconsin 6
Maryland 6
New Jersey 5
Illinois 5
Washington 5
Michigan 5
Massachusetts 5
Maine 5
Hawaii 4
Minnesota 4
Nebraska 4
Oregon 4
Pennsylvania 4
Vermont 4
California 3
Ohio 3
Nevada 3
North Carolina 3
Florida 3
West Virginia 3
We find it noteworthy that states making the lists 4, 5, 6 or 7 times are Blue (with the exception of Nebraska (4), many of which are leading in the Exodus. We also note that several of the states making only three or four lists (Ohio, Oregon, Minnnesota, Pennsylvania, Nevada, and Florida) were squeakers in recent election cycles.
What can be concluded from this is certainly debateworthy, thus, this diary. Nonetheless, we believe that fiscal and social policy is driving Blue States toward a sort of Euro-Stagnation, that does not bode well for their future, or for the future of this country as a whole. For a great explanation of why we (and particularly Blue States) are at risk, see the January 2006 article, It's the Demography, Stupid, by Mark Steyn. Probably the best thing you can read on the topic this year.
RedShift
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Posted at 7:39pm on Feb. 16, 2006 The Blue State Exodus (New York)
By RedShift
We can think of no better introduction to this diary entry than the poignant observations of Merrill Bender, who observed that despite the housing price and climate benefits, "Its still taxes" that is causing the demographic shift currently taking place.
We have opined elsewhere in this diary that state governments generally realize this (though some have not yet yielded to the invisible hand), and are responding to the free market the way everyone else does: by cutting prices. We note that states have not initiated housing price reduction initiatives, but have instead proposed tax cuts, in order to remain competitive. Such is the beauty of our confederacy of sovereign states. They must compete for their population's affections and loyalty.
We believe Richard Vedder's excellent study bears out the most significant aspect of the shift when he acknowledges that tax variations between states has moderated slightly "as tax competition forced down some tax burdens in very high tax states." As seen here and here, New York's problem is particularly acute, as Vedder's observations clearly show:
"The biggest state of in-migration is Florida, while the greatest out-migration now comes from New York... in 1990, the tax burden varied from 8.35 percent in New Hampshire, to 15.53 percent in neighboring New York."
That New York "gets" this is evidenced by Governor Pataki's newly unveiled "$110.7 billion executive budget [that] includes $1.1 billion in business tax cuts to spur job growth," and that the Empire State started out the new year by implementing a dreaded "tax cut for the rich," lowering taxes "for those making more than $150,000 a year", something that at least one prominent New Yorker finds appalling.
In New York's anemic economy, for which the upstate outlook is downward--"there is going to be almost no growth at all. There hasn't been for the past 15 years or so"--the net migration is having its predictable electoral effects. New York has lost 5 electoral votes in the last two census cycles, and is expected to lose one more after 2010.
But we believe taxes are not the sole cause of the reduction in New York's gradual loss of electoral leverage. There are several ways for a population to shrink, but the most powerful are for people to leave, or people to not be born. New York not only has the 3rd highest abortion rate in the country, New York City's abortion rate is twice the national average. But the state also has a fertility problem, as its women are marrying significantly later than the national average marrying age. Marrying late, of course, reduces a woman's fertility window.
We humbly suggest that if New York continues overtaxing its most productive, and does nothing to incentivize its most reproductive, the state will continue both its economic and its demographic slides. This has not escaped the mind of even the most liberal pundits is evidenced by this foul-mouthed (be warned) plea for higher rates of liberal reproductivity. We believe that the Scots, who face the same problem, put it more tastefully here, suggesting politely that "Mothers should get tax breaks to boost birth rate." (Apparently, the Scotland on Sunday takes it for granted that its readers know where babies come from).
We applaud New York's leaders for their baby steps toward tax reductions. Now if only there were more babies taking steps, they'd stop losing electoral votes altogether.
RedShift
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Posted at 6:35pm on Feb. 15, 2006 The Blue State Exodus (Tax Revolt in Progress)
By RedShift
It appears that the Blue State Exodus, and its causes, are beginning to get more press. We have theorized in this diary that state tax rates are largely (but not solely) to blame.
Asf6 reminded us recently that "that correlation does not equal causation," an objection with which we expressed logical (but not idealogical) solidarity.
Nonetheless, it is becoming increasingly clear that the relationship is indeed a causal one, as several recent studies have shown. Yet another study (2/13/06) supports this.
Karen Hube reports on the shift at Barron's Online in her article entitled, Revolution on Wheels:
"THE REBEL COLONISTS WHO DUMPED 45 tons of tea into Boston Harbor showed the power of one kind of tax revolt -- the raucous kind. Now, 233 years later, large numbers of taxpayers across America are taking an entirely different approach. Quietly, without banners or raised fists, they are packing up their families and belongings and moving from high-tax states like California and New York to lower-tax locales like Florida, Nevada and Texas.
"From 2000 through 2004, a net 1.3 million people moved out of states with taxes on ordinary income and into those without such taxes, says Richard Vedder, an economics professor at Ohio University. While climate clearly has played a role in the moves -- the destinations are often in the Sunbelt -- many of the low-tax states posting gains aren't generally considered dream spots: Nevada, New Hampshire, South Dakota, Tennessee and Wyoming."
We politely leave it to the reader to contemplate the average hue of the states losing people, and the states gaining.
Hube's article, in any case, includes several graphics showing net migration and origination v. destination states.
We are only too happy to acknowledge that there are some Red States at the bottom of Hube's Top Ten list of high tax states (Ohio, Nebraska, Utah), and that there are some Blue States in her Top Ten list of low tax states. To the Red States in the former, we say "Change thy ways!" and to the Blue States in the latter we say "Good on ya, mate!"
In any case, the significance of this is not merely economic and demographic, but electoral, as well. There are 535 electoral votes to go around, and 150 of them don't move between states (a state with a population of 3 would still have 3 electoral college votes). The rest of them move with the people, so when we see a statistic like this, it represents a significant ongoing shift in the electoral college, generally from Blue to Red. America has nearly 300 million people, which means that each electoral vote currently represents about 690,000 taxpaying, mobile, and free-to-move citizens. Thus, in the last 5 years, Blue States have lost another 2 electoral college votes, and Red States have gained another 2.
OpinionJournal.com's Political Diary suggests that the electoral shift at the conclusion of the 2010 census will be much more dramatic than that, with Texas and Florida together gaining 5 more votes, and New York and Massachusetts together losing another 3. Other long term predictions (through the 2032 election) can be seen here. This suggests that, for all the Democrats' hard work to turn a Red State blue, the Red States are gaining where it counts: electoral college votes.
In any case, MichaelJ73 promises that Wisconsin will be Red in 2006, as well it might have been in 2004, so if we lose Ohio between now and then, a lost state will not necessarily mean a lost election.
RedShift
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Posted at 2:05pm on Feb. 7, 2006 Blue States Discover Free Market
By RedShift
Promoted from diaries by Thomas
You know your state is in trouble when businesses flee to Massachusetts for a tax break. In a December 30, 2005 article, entitled High Taxes Inhibit Rhode Island's Growth, M. L. Johnson wrote,
"High taxes and a lack of high-tech businesses are stifling the state's economic growth and hurting the overall quality of life, according to the author of a new study on economic competitiveness. ...Steve Kass, spokesman for Gov. Don Carcieri, said he wasn't surprised that Rhode Island lagged behind its neighbors. 'We've got a major headache in competing with Massachusetts on many levels,' Kass said, citing higher sales and income taxes and lower test scores as problems."
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Posted at 3:27am on Feb. 6, 2006 The Blue State Exodus (Vermont)
By RedShift
Brendan Miniter of the Wall Street Journal OpinionJournal.com suggested in November of 2005, "Former Gov. Howard Dean got out just in time." His successor, Gov. Jim Douglas, a Republican, has to deal with the consequences of years of liberal social and fiscal policy, and its deleterious effect on the state's growth rate.
When Miniter spoke with Douglas in November 2005, he heard of Vermont's dire straits directly from the Governor. The average age is increasing, and, ominously, the "children are disappearing."
"Approximately one-quarter of Vermont's 620,000 residents are on Medicaid and the cost of the program has been going up 15% a year -- putting it on track to devour the rest of the budget if left unchecked. 'But for Medicaid,' he said, 'I'd be talking tax cuts.' But there's another reality in the Green Mountain State that is equally pressing -- children are disappearing." (OpinionJournal Political Diary, Nov 18, 2005. The Political Diary is available by subscription only, here.)
As we have opined elsewhere in this diary, a state's economy cannot prosper if it lacks labor and capital, and in Vermont's case, both are leaving. Although the state is projected to grow over the next 25 years, it is growing in ways that will not lend themselves to economic growth. While Vermont's general population is projected to grow by 17% between 2000 and 2030, the over-65 segment is projected to grow by 124%. As Governor Douglas tacitly acknowledges, Vermont's population growth is almost exclusively in a segment that does not contribute to the state's economic growth. The only segment of the population that can possibly contribute to growth is not arriving--either through migration or through birth.
Art Woolf, professor of economics at the University of Vermont, addressed this situation in his January 15, 2006 Rutland Herald article entitled, Demographic shift will hurt Vt. economy:
"Over the next two and a half decades, Vermont will experience unprecedented demographic changes that will have significant impacts on the state's businesses, schools and government. By 2030, the number of people over 65 will double, but the number of working-age Vermonters will remain unchanged from current levels. Vermont businesses will find it increasingly difficult to find and attract sufficient numbers of workers to satisfy their needs. With fewer taxpaying workers, state and local governments will see slower growth in tax revenues. At the same time, demands for governmental services for the larger number of elderly Vermonters will grow."
Facing a demographic and economic crisis, what is a state like Vermont to do? Raise taxes! Woolf describes [but does not appear to advocate] the inevitable as his article continues:
"[T]he doubling of the number of senior citizens will likely mean a big increase in the costs of any programs that target seniors. The most significant of these are state Medicaid expenditures which pay for nursing home care for low-income senior citizens. There are also reasons to expect that the state will pass new laws providing more benefits to senior citizens. The major reason is that older Vermonters are more likely to vote than younger citizens and there will be many older Vermonters in coming years. Politicians respond to their constituents' desires, and those desires will increasingly be for programs that benefit older Vermonters."
Vermont's taxes are already in the 90th percentile. Up does not seem to be the intuitive choice. But Vermont's problems do not end here. As Miniter noted, the few children actually being raised in Vermont leave as soon as they can, and the elderly from other states are migrating to Vermont to take advantage of the state's generous benefits for seniors:
"The state has one of the lowest fertility rates in the country, and thousands of youngsters leave as soon as they graduate high school and never come back. Instead, they're replaced by oldsters who've been flocking to Vermont for a quiet retirement and generous health care subsidies." (OpinionJournal Political Diary, Nov 18, 2005).
And to insure that only the neediest seniors move to Vermont (not the capital-laden kind that can contribute to economic growth), Vermont made sure that its estate tax would not expire with the Federal equivalent.
It almost hurts to write this, because the state is so obviously suffering from a curable disease. One obvious move for the state is to make itself more family friendly and more business friendly. That it is failing at the former is clear from the Judge Cashman debacle where a child rapist in Vermont was given a 60-day sentence. That deafening silence you hear in the background is the thousands of American families with children who are actively not moving to Vermont, even after the sentence was changed. But wait, it gets worse. How about an initiative to encourage fewer children in the state? That's pretty much what the Toronto Globe and Mail's Andrew Reding wrote in 2000, as he praised Vermont's cutting edge policy proposal to discourage childbearing in a state that desperately needs more children:
"It is fitting that Vermont, the state that pioneered environmental protection, will now become the first state to offer gays and lesbians the opportunity to marry. As a gay elected official and environmentalist, I see a natural link between pink and green. In a world facing overpopulation, one of the more obvious environmental policy options is being overlooked--making homosexuality more socially acceptable. With more than six billion humans taxing the carrying capacity of the biosphere, procreation is becoming more of a threat than a guarantee to human survival."
Vermont cannot survive if its economic policy is "fewer children, more elderly, higher taxes." Yet that appears to be precisely what Vermont's economic policy is. What is happening in Vermont is the global old age tsunami in miniature, and all US states would be wise to heed it.
To his credit, Art Woolf knows that there is a real economic solution to the problems, and higher taxes and lower spending are not really the solution. He writes:
"State and local governments will have to make some very difficult and painful choices in the coming two decades. At the same time, Vermont's private-sector firms, nonprofits and other organizations will find it very difficult to expand their employment. In a worse case scenario, firms will either leave the state or expand outside of Vermont. State and local governments will have to dramatically increase taxes or drastically cut services.... State policymakers will have three basic choices. One is to increase taxes significantly to a level Vermonters have, heretofore, not experienced. That could have significant impacts on the economy of the state. The second is to cut the growth in current expenditure programs and resist the political pressures to enact new programs, especially high cost programs for the elderly. The third is to enhance the economy of the state so that additional tax revenues can be brought in to finance these growing costs. None of these choices will be easy to implement. But the problems faced by the state of Vermont are clear and they will loom larger each year that nothing is done." (ed: emphasis ours)
Let's hope Vermont follows Governor Douglas' lead, and chooses door three. And here's a tip for those who aren't sure how to interpret Woolf's last suggestion: cut taxes, reward fertility, and make nuclear families the building block of your future.
Of course, there is a fourth option: Vermont can choose the Blue pill, and life will "carry on as before."
RedShift