The Los Angeles Times has a front page headline this morning: "Leaving California for "redder" pastures." However, the article proves the opposite of the article's intent in multiple ways.
First, I can't wait till the first couple profiled in the article, who moved from Modesto to McKinney, Texas, finds out about Texas state property taxes, which are 1.83%, nearly double CA's 1.00% property tax rate. McKinney adds enough to make the property tax rate more than double California's property tax rate. Texas ranks sixth in the nation for highest property taxes, while CA, much more due to high home values, ranks 17th. If the profiled couple had almost paid off their home in Modesto, which I bet is the case, they are likely going to pay the same amount of money in property taxes, and if their new home area economically grows in the next decade, they will pay more in property taxes than if they stayed in relatively small time Modesto.
With respect to sales taxes, Texas has a sales tax rate of 6.25%; however, McKinney adds 2.25% more percent, for a total of 8.25%. Modesto, CA has a sales tax rate of 7.88%, so a slight savings in sales tax in "bad" and "liberal" California. Oh wait. Texas sales tax includes a sales tax on services as well as goods, unlike California, which only taxes goods. The link provided about Texas sales tax on services includes cable, telephone, and internet service bills, movie theaters, golf courses, health clubs, rodeos, sporting events, insurance, real estate services, and photographs, and various other service providers. But what about state gasoline taxes? California, even with the new carbon related tax, is 80 cents a gallon, perhaps the highest in the nation. Texas' state gasoline tax is...wait for it...60 cents a gallon, much higher than I would have thought. So what accounts for the vast difference in retail gas pricing, as of November 4, 2019, with CA at $4.05 and Texas at $2.28 when the difference in gas taxes is only 20 cents a gallon? Maybe, instead of attacking "the stupid libs" in the State political leadership, Californians should be backing Governor Newsom's demand for an audit of retail gas prices in California.
But let's admit there is no income tax in Texas. However, this couple does not sound wealthy, so paying a bit of income taxes in CA is not so significant when compared to the probably higher property taxes--again, McKinney is economically growing, so home values will increase--and pay more and wider sales taxes over each year. The savings to live in McKinney compared to Modesto are not so significant, especially when CA proves the price gouging and orders a major reduction in gas prices as part of fines paid.
The rest of the Los Angeles Times article reveals politics is actually a very low reason for leaving the Greatest State in the Union. As with us, the article confirms the main reason people leave is the high cost of land and housing (funny how nobody ever mentions the high cost of medical care for Americans, which are what drives economic decision making, including whether to move or stay in a location). What was astonishing, but was buried deep inside the article, is a statistic I never saw before: A Texas real estate group compared the number of people who left CA in 2017 for Texas, around 63,000, to those leaving Texas to move to CA, also in 2017, which is about 41,000. CA has a state population of 40 million, while Texas' population just under 22 million. Thus, the leave rate is significantly lower for CA leaving for Texas than Texans leaving for CA! And 2017 is when The Wife and I left for New Mexico,* and, as I always say when asked, we left because of the high land prices and the American medical insurance system. The costs we paid in health care would have bankrupted other families who earned less coin than I did, and likely would have resulted in an early death for me.
So what explains the misleading headline, not including the comparisons of actual taxes paid in CA and Texas, as I did, and the hiding, at page A8 of the information that Texas residents move to CA at a higher rate than CA residents move to Texas? The answer is fairly obvious to anyone familiar with corporate press criticism of the past 100 plus years: the Los Angeles Times front page section headline writers have an agenda. They decided to focus on what the article admits is not a significant reason anyone leaves CA for another state. The headline writers and editors at the Los Angeles Times have an agenda, and that agenda is to discipline readers to believe government can't help us. The message is we are serfs for the corporate power which continues to rule our nation, and no matter what we try to do, it will always end up with people paying more in taxes, even though the people who pay the most taxes in CA are rich people, as it should be. Yes, I can make an argument against increases in the gas tax or sales tax as regressive taxes, which burden more workers and the poor, and it is why I support the higher state income taxes. I also support other reforms which are a topic for another day. But the point here is to show the front page article's breathless headline is not only misleading, i.e. failing to explain to the Modesto couple what they actually taxes in Texas would be and comparing those to CA, but what is called "burying the lede," which is the story how, according to a Texas realtor group, more left Texas for CA than vice-versa as a percentage of population.
* New Mexico has a 1.00% property tax rate, but much, much lower property values. New Mexico has a 7.70% sales tax rate, and one where we pay a tax on most services, including accounting, legal, cable, but not movie theater, food, medicine. The state income tax is around 4% for us, even when I was working as a lawyer. It should be lower for lower income people, but in 2019, the governor and legislature at least raised the top rate to over 6% for those families with $300,000 in income. And New Mexico's gas tax is around 20 cents a gallon, much less expensive than Texas or CA. More needs to be done in New Mexico to get to a better distribution of what economists call the "burden" of taxation, which would mean narrowing sales taxes to goods, lessening the tax on Social Security payments, and the like. That is coming, however, if I understand what our local representative in the State legislature (a good liberal Democrat) is aiming to do.
