The Stupidest Tax Increase in American History?

Unleash Prosperity Hotline
Issue #261
04/12/2021
1) The Stupidest Tax Increase in American History?

The vote in Albany last week to raise the income tax to 15% on Big Apple millionaires, is causing howls of laughter around the country. Our CTUP model predicts the tax hike will impel at least another one million New Yorkers to leave over the next decade. More than 100 New York business leaders raised the same yellow caution flag – to no avail. The New York Times (see headline below) is sticking with its fantasy that this is a progressive “victory” and that few people will defect to Florida – where climate change is going to put the Sunshine state underwater in a few decades. (Seriously, they wrote this!) 

New York, Finally, Taxes the Rich
A budget that spends on education, homelessness, and undocumented immigrants is the product of years of progressive politics


But history proves that wealthy New Yorkers will accelerate their exodus – especially if they can do math. James Tisch, a respected New York financier, has run the numbers:

“Under today’s rules, a taxpayer living in Florida keeps 27.3% more of his income than if he lived in New York City. With the New York State three percentage point increase in the highest tax rate, that Florida resident will keep 36.1% more income than the New York City resident. With the new tax hike, the Florida millionaire retains more than $59 of every 100 dollars he earns while the New York City resident keeps just $43.50.” 

The sensible newspaper in NY, the New York Post, understands the economic reality that America’s greatest city is being systematically “devastated” by crime, taxes, and abysmal schools.

2) Green Energy Boondoggles – Here We Go Again

On Friday the Biden Administration laid out more details of their infrastructure plan – which is really a $1 trillion Green New Deal in disguise. Transportation Sec. Pete Buttigieg has assured us that the money will be spent “efficiently” and that “there will be no waste.”

Perhaps Mayor Pete was too young to remember that this same green energy future was promised a decade ago when Obama’s stimulus was filled with billions of dollars of subsidies, tax credits, loan guarantees, and cash payments to the wind, solar and electric battery industries. Here’s a reminder of some of the endless string of bankruptcies and how much taxpayers lost:

GREEN ENERGY GREATEST HITS

– A123: Battery maker received a $250 million Department of Energy stimulus grant to build two factories in Michigan to manufacture batteries for electric cars. The company went bankrupt.
 
– Abound Solar: The manufacturer of solar panels received a $400 million DOE loan guarantee to build two factories — one in Indiana and another in Colorado. Declared bankruptcy in 2011.
 
– Beacon Power: $43 million DOE loan guarantee to build a facility in upstate New York to store extra energy from the power grid. Beacon went bankrupt.
 
– Crescent Dunes thermal solar power plant in Nevada desert, received a $700 million federal loan and later a $275 million grant. Never came close to meeting its energy targets. Bankrupt in 2014.
 
– Ener1: received $120 million grant to build two plants outside Indianapolis to manufacture batteries for electric cars and other uses. Bankrupt in 2012.
 
– Solyndra: The manufacturer of advanced solar panels received a $535 million loan guarantee to build a factory outside of San Francisco. No energy produced. Solyndra went bankrupt in 2011.
 
– Fisker Automotive: The electric car maker received a $529 million DOE-backed stimulus loan to design a mid-priced model and build a factory to manufacture the vehicle in Delaware. Biden celebrated the company and went to the ribbon-cutting ceremony.  Declared bankruptcy in 2013. Taxpayer losses, roughly $200 million.
 
– Nevada Geothermal Power: The firm received a $100 million DOE loan to build a geothermal power plant north of Reno. Bankrupt in 2013.

The Biden plan spends about ten times more money so we expect about ten times more Solyndra boondoggles. 

Subscribe to receive our full hotline

1155 15th St NW, Ste 900
Washington, DC 20005