All My (CA) Exes Live in TX: Businesses Still Fleeing Newsom a Reminder

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For many years, I’ve preached about how great it is to live in the United States, a constitutional republic that has federalism as one of its founding principles. Federalism means that each state is its own laboratory in government; each state largely runs its own affairs (at least, that’s how it was meant to be), and if any citizen doesn’t like it where they are, they have 49 other states to choose from. As George Carlin reminded us in his famous “Al Sleet, the Hippie-Dippie Weatherman” sketch, “Always remember, if you don’t like the weather, move!”

It’s a good system. What works for Massachusetts won’t work for Wyoming, and what the residents of Connecticut think is a good idea won’t often fly in Alaska.

This brings us to the two largest states in the lower 48 in both area and population, California and Texas. Corporations and people alike have been voting with their feet for some years now, and the flow is still coming from the once-Golden State and heading to the Lone Star State:

Despite claims by California Gov. Gavin Newsom that California is “the beating heart of the American economy,” companies keep relocating. Their primary destination is Texas.

More than 360 companies have exited California since 2018, according to the California Policy Center’s California Book of Exoduses, which tracks corporate exits from California. Since 2005, more than half that left had relocated to Texas by 2023, The Center Square reported.

Why would you suppose this exodus is taking place? Why are so many people and companies leaving an attractive place with a salubrious climate for another attractive place with a… mostly salubrious climate? (I was stationed in San Antonio and the humidity can be brutal.)

Could it have something to do with the fact that companies exist to turn a profit, and California makes that more and more difficult, year by year?

Every year, as California ranks last or near last, Texas ranks first as the best state for business, for attracting new businesses, first for job creation, job growth and economic expansion, The Center Square has reported.

In 2023, Texas gained 500,000 residents, with the most – more than 102,000 – coming from California, according to Census data. People are flocking to Texas because it has no personal income tax, a state government that supports law enforcement, its businesses are leading the U.S. in job creation and growth, and its economic expansion dominates, Gov. Greg Abbott argues.

Until 2020, California reported population gains every year since 1900. Under Newsom, California for the first time since 1850 reported its first population loss, according to Census data.

One would think that the impeccably coiffed Gov. Newsom and the Democrat-dominated California Legislature would look at all these facts and figures, and then maybe take a look at each other and ask, “Hey, guys, is there something else we should be doing here? Maybe we should try something different.”

Or maybe the voters in the deep-blue, urban enclaves that largely control California might make some different voting decisions, given the mess their state is in?

I know, I know; I had trouble writing that last line with a straight face. But still.

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Even so, given that the outflow is costing California a lot of tax dollars, the seeming lack of self-awareness in Sacramento is a bit bewildering.

Despite Newsom’s office recent claim that people were flocking to California, data shows the opposite: California remains the top state for exits, The Center Square reported. Businesses and residents are leaving California citing high taxes and unaffordable housing conditions, among other concerns.

Outmigration has cost California. In 2021 and 2022, California lost $24 billion in outgoing personal incomes, according to IRS data, The Center Square reported.

You know what, though? It’s OK. The wisdom of our nation’s founders, wisdom reflected in one of the oldest governing documents in the free world, the United States Constitution, has ensured that we can always vote with our feet. California’s many losses in recent years are Texas’s gain – Texas, Florida, Tennessee, and other red states. We can all vote with our feet, and out of 50 states, 50 experiments in governance, 50 laboratories of liberty, any American should be able to find a place that suits them. So, while Gavin Newsom and other California Democrats insist on maintaining their present state of “head up the fourth point of contact,” Greg Abbott and Texas are enjoying a happy influx of the hard-working and talented.

That’s federalism. It’s a beautiful thing.