Excel's Coffee Shop

[basserdan]

Denninger: The Screaming Baby States

By Karl Denninger
2019-10-03 07:00
Whah whah whah! The big bad feds made us charge insane amounts of state tax and then when we tried to shove that up other state resident's ass via the federal tax code we got spanked. MAKE IT STOP MR. JUDGE!

Nope.

The lawsuit asked U.S. District Judge J. Paul Oetken to block the Tax Cuts and Jobs Act's limit on how much people can deduct in state and local taxes (SALT). The provision effectively raised the tax burden on citizens of high-tax states.

New York, New Jersey, Connecticut and Maryland brought the suit in July 2018, claiming the tax deduction limit was a way for the Trump administration to stick it to blue states. The judge ruled that the limit did not violate the 10th Amendment, which says that powers not delegated to the federal government in the Constitution are left to the states.

https://tinyurl.com/y2qrdshk

Nothing forced any state to put forward a revenue-and-spending model that was wildly outside of what other states did.

Further, nothing gave a state the right to try to shift that tax burden to others outside their state via the Federal Tax code. In fact it can be cleanly argued that such an attempted shift is flat-out theft for which the proper response is a full-on blockade by the other states, since the principle of Federalism is that you can't do that and if you're not going to adhere to the parts of the Constitution you don't like then you don't get the protection of the parts you do like.

But, we didn't have to go there because the ruling came as I expected it would: If you don't like the implications then change your state tax code and stop spending so damn much money.

New York is getting ass-pounded by this; their tax receipts are something on the order of two billion below where they forecast, mostly because those who make a lot of money have up and left for other states.

This is exactly how it's supposed to work: If you put together a crappy state people can and will leave.

The problem -- and one of the reasons I'm leaving Florida -- is that many of these people from Naw Yawk come here and then try to bring their political bull**** with them, including their government spending demands. That collides with the tax system, of course -- so I'll go where they don't want to be before they can further ruin this state -- they've already done a hell of a lot of damage.

https://market-ticker.org/akcs-www?post=236989