A Spade is a Spade … and a Myth is a Myth
In a recent Star-Ledger op-ed, David Bugen of the wealth-management firm RegentAtlantic weighed in on the idea of raising income taxes on New Jersey’s wealthy and tsk-tsk’ed NJPP for calling the supposed problem of wealthy folks fleeing New Jersey a “myth.” But in the op-ed, he follows in the footsteps of his firm’s “Exodus on the Parkway” report and cherry-picks migration data to perpetuate the myth – yes, myth – that there is a widespread tax migration problem, driven by a progressive income tax, that is at the root of New Jersey’s struggling economy.
The statistics Bugen uses on income migration to Pennsylvania are correct but misleading because they are presented without context. While losing $514 million to Florida and $256 million to Pennsylvania sounds like a lot, it is less than 0.3 of 1 percent of the over $300 billion of adjusted gross income generated each year in New Jersey. Furthermore, Bugen fails to mention one pesky little fact: the same year as those losses to Florida and Pennsylvania, New Jersey gained $492 million in income from New York – must have been those New Yorkers fleeing high taxes for, well, high taxes. (A recent report from New York City’s Independent Budget Office confirms that high-tax New Jersey is a top destination for New York City’s wealthy movers.)
The bottom line is that there is no widespread wealth migration from New Jersey. It is a false problem, and continuing to focus on it distracts policymakers from the urgent need to fix New Jersey’s economic and financial crisis.
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