Tuesday, July 16, 2013

Which is more expensive: Renting a U-Haul trailor one-way from LA to Dallas, or vice versa?

If you said vice versa, pat yourself on the back! Why? Well, as Doug French explains in a book review over at The Freeman, more people want to leave blue-state California and move to red-state Texas than the reverse.  So the demand drives the price up.  An interesting tidbit, to be sure, but there is much more insightful commentary and economic enlightenment in French's review of famed financial guru Meredith Whitney's new book, Fate of the States.  Here are some interesting selections:
The author’s overarching theme in Fate of the States is that America’s economic power is shifting from its coasts to its middle. Whitney describes how power has shifted before, but the current trends are different: External factors aren’t driving economic fortunes anymore, but instead, “communities [are] being gutted by government ineptitude,” writes Whitney. 

At the top of this list are New Jersey, California, and Illinois, where high debt and economic dysfunction have persisted. These basket cases insist on trying to tax their way out of problems...

Today wealthy taxpayers are voting with their feet and taking their wallets with them—leaving local and state governments high and dry. When the rich leave, so do many jobs; working stiffs then hit the road to find employment. Business relocations away from California, for example, increased fivefold between 2008 and 2011.
You don't need to buy or read the book (though I'm definitely tempted) to derive benefit from French's excellent review, which is available here.