There is no question that New York is the epicenter of the coronavirus outbreak in the United States. As one of the nation’s most densely-populated and highly-trafficked cities, the outbreak of COVID-19 his New York city and the surrounding areas harder than nearly anywhere else. The demands of the response effort have strained the state financially, evolving to near-crisis levels. The situation is truly unfortunate…but that doesn’t mean that the American taxpayer should bail them out like Governor Andrew Cuomo is demanding.
Cuomo, the new media darling, is imploring the Federal Government to pay for years of fiscal mismanagement in the Empire State, using the COVID-19 response as justification for the demand. To that, I say: “Tough luck. Deal with it yourself.”
The financial crisis is the New York state government’s fault, not the rest of the country’s.
Cuomo wrote a letter to the New York Congressional delegation begging for them to secure more money from the Federal Government. The governor wrote, “New York State is broke…and there has been absolutely no help to offset it.” Sounds like a New York problem to me, not an American problem.
Newsday reported, “New York has a lot riding on additional money. The State legislature approved a state budget last week, but with warnings that many revenue and spending figures—for school aid for other major items—are subject to the continued economic impact of the coronavirus and whether the state receives additional federal money.”
This is a self-imposed fiscal crisis. For years, New York has imposed confiscatory taxes on its residents and have driven many businesses out of the state. Fewer jobs equal less tax revenue for the state. It’s that simple.
Many of these businesses and residents are fleeing to Florida. According to a LendingTree study, New York lost the largest amount of adjusted gross income from migration, about $8.8 billion, last year.
The U.S. Census Bureau showed that while Florida received more movers than other states last year, New York’s outflows to the Sunshine State were the highest—67,772 people. New York had the third-largest outflows of any state, with 452,580 people moving out within the past year.
Individuals earning $650,000 can save more than $69,700 in taxes per year by moving from New York to Florida.”
And taxpayers in Florida and other states will be forced to foot the bill for New York’s anti-business policies. How is that fair?
Fox Business reported, “this trend has likely only intensified thanks to recent changes to the U.S. tax code. A $10,000 cap on state and local tax deductions has caused an exodus from states like New York, Connecticut and California—where tax burdens were already onerous—to low-state tax states like Florida, Texas, and Nevada.”
The moral of the story: High taxes cause businesses to relocate to low-tax states.
It’s common sense, but the Democrat-run states haven’t caught onto this trend.
It is only a matter of time before other states such as California and Illinois will be dropping to their knees at the foot of Uncle Sam asking for a bailout. The country can’t afford to give them what they want. The federal government already has over $20 trillion in debt and that doesn’t even include the $100 trillion-plus of unfunded liabilities.
These states have to take responsibility for their own actions. If the Federal Government bails one state out, they will be forced to bail every state out. Federalism will be completely dead at that point and our nation will be one step close to defaulting, creating an economic Armageddon.