“Millionaire Flight” theory – Don’t fall for it

a world war one or two plane crashes

There have been a number of news stories over the last two years about how the wealthy are fleeing states which have increased taxes on the highest tax brackets.

I’ll show you this line of thinking is not borne out by the facts, and is irrational to boot.

Here’s an example; a new story from the Wall Street Journal  – titled “Millionaires Fleeing Taxes” (August 7, 2012).

The description of the video interview with the reporter (Arden Dale) states “When states raise taxes millionaires move out.”  And the interviewer starts the piece by declaring, “Millionaires are fleeing from taxes!”

Wow, that sounds serious, and certainly very definitive.  Let’s learn more.

Interviewer – “So tell us, where are the millionaires going?”

Ms. Dale – “People don’t want to be taxed… but when we looked the actual numbers, the actual studies of whether ‘Millionaire Flight’ occurs, what we found was that there is no really great statistical data that shows that it does.” (Note: while this is being said, a banner on the screen reads “Millionaires moving to avoid taxes.”)

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