In a world with complete mobility, citizens would “vote with their feet” and political systems would function like a perfect market – the government entities that satisfied its citizens would stay in business and those that did not would go out of business. Satisfying its citizens would entail things like good government as well as policies that the citizenry agreed with. Taxpayers are essentially customers for government. Unfortunately, we don’t live in a world with perfect mobility. Immigration laws are a large part of that but we don’t even have perfect mobility in America or the EU- families have mortgages, jobs where they have built seniority, and roots set down in certain communities.
Nonetheless, people do vote with their feet. Take a good look at this map, showing where people are moving to and from (in terms of counties) across America. Click on Dallas and witness the high level of black lines showing mass movement into the county. Then click on Chicago and witness almost entirely red lines showing everyone moving out.
Obviously, there are other variables at work here. For example, Detroit has a ton of people moving just because the industries that used to make that city a bustling center for commerce are no longer there, so people are moving out. Furthermore, people like different cultures, different types of weather. And populations in cities naturally change as the dynamic nature of the American economy produces changing demands for certain industries.
But I’m going to state that I believe that these immigration/emigration flows into Dallas (and other Texan cities) are the result of good government; it is government that is has low regulation, low taxes, and generally stays out of people’s business. 3 out of the top 9 cities in the U.S. population are in Texas, something that could not be said as recently as ten years ago. After working this summer at an Illinois policy think tank, I can tell you that businesses are not happy with Illinois or Cook County. And they are moving with their feet. Businesses are leaving Cook County to go to Will County (which has much lower taxes) or they are moving out of Illinois altogether.
Do these populations outflows really matter, though? I’d say so. A lower tax base means less revenue for all those welfare programs Cook County and Illinois love to give out to people. They could actually increase their tax revenue (and prosperity for everyday citizens) by creating a better climate for businesses to create jobs and grow the economy.
Furthermore, I think it should be pointed out that Texas is a well-functioning state. Its lower taxes do not mean its school system is in shambles (they spend less but get better results by some metrics), criminals are looting everybody, old people are starving on the streets, or there are no music festivals. People who say we cannot make states like Illinois more business-friendly because there is nothing to cut in the budget are misguided. States like Texas can do it, so states like Illinois and California can too.