Those who have strong feelings about how wealth ought to be distributed, and who think that government policy ought to be more redistributive, often fall victim to the fantasy that their golden geese will not just wander off into another jurisdiction.
No doubt the members of the Chicago City Council are nonplussed that their attempt to squeeze large retailers has led Wal-Mart, Lowes, and Target to put their plans for new Chicago stores (and new Chicago jobs) on hold. I bet a million billion dollars that at least a few council members have lamented that they can’t legally force the big boxes to open stores within Chicago city limits. They’re learning the bitter lesson that the right of exit is a powerful check on politicians who can’t keep their hands out of other people’s pockets.
Worried about inequality? Why not really sock it to the rich? Because the rich — or their money at any rate — will just leave town. Even champions of the poor, like Bono, head for the greenest pastures:
Irish rock band U2 has transferred part of its multi-million-euro business empire out of Ireland due to changes in tax laws there, a British newspaper has said.
In a report from Dublin, the Daily Telegraph said Tuesday the band had moved part of its publishing company, U2 Limited, to the same Dutch finance house used by the Rolling Stones because royalties are virtually tax-free in the Netherlands.
According to the Daily Telegraph, the band — whose frontman Bono campaigns against global poverty — made the move in response to Ireland imposing a 250,000-euro (170,000-pound, 321,000-dollar) cap on tax-free incomes.
I bet Bono thinks he knows better than politicians in Dublin how to use his money. And I bet Bono’s right.
A recent Washington Post article details how France is bleeding millionaires thanks to outrageously punitive tax rates:
[High-tech millionaire Denis] Payre, who moved his family to neighboring Belgium eight years ago, is today part of a sizable community of rich expatriate French driven out by the world’s highest tax bills on wealthy citizens. The exodus continues: On average, at least one millionaire leaves France every day to take up residence in more wealth-friendly nations, according to a government study.
Now, I bet that more than a few of those fleet-footed millionaires were in favor of those high tax rates, illustrating that the gap between ideology and actual consequences can open up even within a single soul.