Matt Yglesias Makes the Libertarian Tax Foundation Punch Itself In the Face With Its Own Study

Another day, another weird map from a libertarian group that seems designed to debunk libertarianism. Last time it was strange assertions about freedom, today it’s the Tax Foundation explaining why there are no successful businesses in California or New York.

From another Matt Yglesias piece on the same study:

Two ways to think about this.  One is that taxes fund services, so low-tax juridictions gain an edge that’s offset by a lack of amenities. Of course having high taxes and then wasting the money on nonsense is going to be a problem. I wonder if you looked specifically at places that spend a lot of money on non-service items (legacy pension costs or interest on old bonds) you might see an impact there.

The other is just that most jobs and businesses really aren’t that mobile. The vastmajority of people work in local service provision. That’s to say they work at medical facilites or restaurants or schools or else they drive cabs or fix roofs. You have to do that stuff where your customers are.  Idaho may be a great place to open a restaurant, tax-wise, but the reality is that there are only so many customers for a restaurant in Boise. If you go to Chicago or Dallas you’ll find a much deeper market.

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