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I think the exodus from California to Texas is overblown. The choice is between Earn above average salary and enjoy good weather, politics, and outdoors. Earn

I think the exodus from California to Texas is overblown. The choice is between Earn above average salary and enjoy good weather, politics, and outdoors. Earn a median salary and enjoy okay weather and lower taxes.

madengr 5y ago
Good politics is subjective.
bluejekyll 5y ago
To back this up, CA and TX tax people differently, but CA is more fair: https://www.motherjones.com/kevin-drum/2019/11/taxes-are-surprisingly-similar-in-texas-and-california/ https://www.motherjones.com/kevin-drum/2019/11/taxes-are-sur... By More fair, I mean, CA has a similar tax rate across incomes, but does place more burden on top earners than TX does. TX on the other hand, is unfairly taxing people more at lower incomes, and less for people at higher incomes. TX policies don't align with my moral beliefs–I would not decide to raise my children there given the way the state is governed. That's of course a personal opinion, but I don't want to spend the rest of my life fighting for rights that we have in CA.
- yonran 5y ago
  I disagree with that article (which repeats the ITEP WhoPays report). It incorrectly assumes that the incidence of the property tax is on the renters that occupy a house rather than the landowner. If you think that property taxes are more regressive in Texas than California you would predict that poor people pay more for rent in Texas than California, when the truth is the reverse. And if you think that property taxes are regressive, you would predict that low property taxes reduce inequality, but the truth is that California’s low property taxes only enrich landowners at the expense of the poor and are the biggest source of inequality. The property tax is a rather progressive tax insofar as its incidence is on those who gain from excluding others, while it allows taxes on labor to be low.
  - kelnos 5y ago
    Rents in CA (bay area in particular) are a function of demand more than landlords' cost. When rents in CA go up by 40%, I guarantee you that's not because a landlord's taxes went up by 40%, but because demand has shot up and landlords can extract more profit from their renters. The big pandemic rent cuts in SF give a glimpse of what reasonable rents could look like here, if supply met demand (though even the lowest pandemic rents are still higher than they should be here). I agree that CA's housing situation does often enrich landowners at the expense of lower-income folks, but my take on that is that's more caused by NIMBYism and an unwillingness to build enough housing to meet demand. The Prop-13-fueled property tax distortion certainly plays a role, but I don't think it's the dominating factor. CA's property taxes are lower (by percentage of home value) than the national average, but not by all that much, on the order of a tenth of a percent or so. Property tax is absolutely not a progressive tax, by definition: everyone pays the same rate based on the value of their home, not based on their income or means.
    - yonran 5y ago
      > Rents in CA (bay area in particular) are a function of demand more than landlords' cost Exactly. In other words, especially where supply is constrained, the property tax is incident on the landowner rather than the tenant. > my take on that is that's more caused by NIMBYism and an unwillingness to build enough housing to meet demand Yes, the difference in land use is bigger than the difference in tax rates. However, when property taxes are higher, there is more incentive for cities and households to allow more housing. And even if you believe that property taxes are regressive, it should give you pause to realize that it is more than made up for by California’s bad land use restrictions. > Property tax is absolutely not a progressive tax, by definition: everyone pays the same rate based on the value of their home, not based on their income or means. No, that’s just who writes the check. You had it right the first time. The tax incidence is who bears the burden of the tax. Since property taxes are capitalized into the price and the supply is not very elastic, an increase in projected tax payments (due to an increasing rate or increasing property value) are largely borne by the landowner (in the form of a lower sales price or a sales price that grows more slowly) rather than the young worker who buys/rents it.
- seanmcdirmid 5y ago
  CA income taxes are incredibly progressive. WA is actually in the same boat as TX in regressive taxation (sales tax), but is a liberal rather than conservative majority state. However, any attempt to institute an income tax is shot down by the voters fairly quickly. WA at least doesn't have a prop 13.
adeelk93 5y ago
What do you mean by average vs median salary here?
- nabaraz 5y ago
  Poor wording on my part. I meant to say the average salary is much higher in California than in Texas. For example, here is Tech: https://i.imgur.com/rHBVWRt.png https://i.imgur.com/rHBVWRt.png
  - kelnos 5y ago
    22% isn't nothing, certainly, but I wouldn't say it's "much" higher. And it looks like Austin's tech salaries are going up YoY at 4x the rate SV's are.

madengr 5y ago

Good politics is subjective.

bluejekyll 5y ago

To back this up, CA and TX tax people differently, but CA is more fair: https://www.motherjones.com/kevin-drum/2019/11/taxes-are-surprisingly-similar-in-texas-and-california/ https://www.motherjones.com/kevin-drum/2019/11/taxes-are-sur... By More fair, I mean, CA has a similar tax rate across incomes, but does place more burden on top earners than TX does. TX on the other hand, is unfairly taxing people more at lower incomes, and less for people at higher incomes. TX policies don't align with my moral beliefs–I would not decide to raise my children there given the way the state is governed. That's of course a personal opinion, but I don't want to spend the rest of my life fighting for rights that we have in CA.

yonran 5y ago
I disagree with that article (which repeats the ITEP WhoPays report). It incorrectly assumes that the incidence of the property tax is on the renters that occupy a house rather than the landowner. If you think that property taxes are more regressive in Texas than California you would predict that poor people pay more for rent in Texas than California, when the truth is the reverse. And if you think that property taxes are regressive, you would predict that low property taxes reduce inequality, but the truth is that California’s low property taxes only enrich landowners at the expense of the poor and are the biggest source of inequality. The property tax is a rather progressive tax insofar as its incidence is on those who gain from excluding others, while it allows taxes on labor to be low.
- kelnos 5y ago
  Rents in CA (bay area in particular) are a function of demand more than landlords' cost. When rents in CA go up by 40%, I guarantee you that's not because a landlord's taxes went up by 40%, but because demand has shot up and landlords can extract more profit from their renters. The big pandemic rent cuts in SF give a glimpse of what reasonable rents could look like here, if supply met demand (though even the lowest pandemic rents are still higher than they should be here). I agree that CA's housing situation does often enrich landowners at the expense of lower-income folks, but my take on that is that's more caused by NIMBYism and an unwillingness to build enough housing to meet demand. The Prop-13-fueled property tax distortion certainly plays a role, but I don't think it's the dominating factor. CA's property taxes are lower (by percentage of home value) than the national average, but not by all that much, on the order of a tenth of a percent or so. Property tax is absolutely not a progressive tax, by definition: everyone pays the same rate based on the value of their home, not based on their income or means.
  - yonran 5y ago
    > Rents in CA (bay area in particular) are a function of demand more than landlords' cost Exactly. In other words, especially where supply is constrained, the property tax is incident on the landowner rather than the tenant. > my take on that is that's more caused by NIMBYism and an unwillingness to build enough housing to meet demand Yes, the difference in land use is bigger than the difference in tax rates. However, when property taxes are higher, there is more incentive for cities and households to allow more housing. And even if you believe that property taxes are regressive, it should give you pause to realize that it is more than made up for by California’s bad land use restrictions. > Property tax is absolutely not a progressive tax, by definition: everyone pays the same rate based on the value of their home, not based on their income or means. No, that’s just who writes the check. You had it right the first time. The tax incidence is who bears the burden of the tax. Since property taxes are capitalized into the price and the supply is not very elastic, an increase in projected tax payments (due to an increasing rate or increasing property value) are largely borne by the landowner (in the form of a lower sales price or a sales price that grows more slowly) rather than the young worker who buys/rents it.
seanmcdirmid 5y ago
CA income taxes are incredibly progressive. WA is actually in the same boat as TX in regressive taxation (sales tax), but is a liberal rather than conservative majority state. However, any attempt to institute an income tax is shot down by the voters fairly quickly. WA at least doesn't have a prop 13.

adeelk93 5y ago

What do you mean by average vs median salary here?

nabaraz 5y ago
Poor wording on my part. I meant to say the average salary is much higher in California than in Texas. For example, here is Tech: https://i.imgur.com/rHBVWRt.png https://i.imgur.com/rHBVWRt.png
- kelnos 5y ago
  22% isn't nothing, certainly, but I wouldn't say it's "much" higher. And it looks like Austin's tech salaries are going up YoY at 4x the rate SV's are.