Tuesday, July 28, 2009

The Dying of Massachusetts.

I saw a billboard on the ride into work today that stated that $1750 leaves Massachusetts every minute. I didn't get a chance to write down the URL they had under the billboard. Obviously, there is something in Massachusetts that is driving businesses and the wealthy somewhere else.

It turns out that when asked, business leaders rank California, New York, Massachusetts, and New Jersey as the worst places to do business. Citing high taxes and anti-business legislation these business leaders have opened up shop in friendlier states.

Business is the key to a healthy economy. I'm no economist, I'm no great thinker, but common sense dictates to me that there is a synergy between the government, the workforce, and the business that has to fit together for a healthy economy.

The government needs to ensure a fair set of rules and boundaries for businesses to operate in. Impartial courts to settle disputes between businesses, between workers and business and between government and business. The government needs to ensure there is a level playing field for all businesses to have an equal opportunity. Likewise, a business can't use unfair practices to stifle competition, becoming a monopoly. Likewise, there is a framework of rules for business to operate - they cannot be allowed to dump toxic waste into a river, or deforest land so the topsoil erodes away.

Businesses are slaved to supply and demand. They make a product and pay for the raw materials and labor according to supply and demand. Then, they sell thier product slaved to supply and demand. They are taxed on profits to pay for the government.

The workforce has it the easiest. They get paid salary and benefits to work for a business. They then spend thier wages to businesses for food, clothing, entertainment, etc. They are also taxed to pay for the government as well.

Now in Mass, the cost of doing business is higher than in other states. So if your a painting contractor it's not that big a deal. It's not like you are going to pack up your business to go to a different state every time new laws are passed that impact you. But you might.

If your a business that has a great new idea for a product, and have capital backing you via bonds or a stock sale, and you are looking for a location to build a factory, then Massachusetts is towards the bottom of your list. If you have been in business making goods for years and shipping them across the country, and Mass passes a bunch of laws that cost you more profit to stay in business here, then it might be worth closing the Massachusetts factory and building a new one in Colorado. The cost of the new factory is offset by cheaper taxes, and increased efficiency in your new factory. Massachusetts, which depends on business and employed workers for money is the loser, along with the workers in Massachusetts.

To me, it's not hard to get this balance right. But then again, I hold the view that a minimalist government is all we need. Business and industry are what makes a country prosperous. France is the perfect example, with 53%+ of its population employed by the government. In a good economy they lag way behind in thier GDP as they don't really make much to export. In a recession, however, they don't suffer as badly because they print money to pay thier workers. In the end, though, the bill comes due and thier worthless fiat money can't feed anyone.

If America is to survive and prosper in the future, we need to recapture that innovative and frontier spirit that is being drowned under the tide of cheap, Chinese goods. We need to rise up and seize opportunity when it knocks, not milk the system for what we are "entitled" to. We are not entitled to anything except life, liberty, and the pursuit of happiness. As an extension of the latter, we are entitled to an equal opportunity to make a fair wage. No wide-reaching government meddling in our health care. No taxation so others don't have to work.

The larger a system gets, the more waste it produces in an exponential amount to its size. The larger it gets, the more it wastes. Why does the government has to meddle with health care at all? Why does the government have to provide for retirement? If the Social Security administration was spun off into a private organization in the '70's then it would be showing a profit! Run it like a business, and get it out of the money-grubbing politician's hands. Likewise, if medicare and medicaid were made into private health insurance companies, wouldn't they be healthy enough to survive?

This is why Massachusetts is a failing state. With the current progressive mind set of anti-business, pro-freeloader, there can be no change for the better. Without a fundamental change to bring business into Massachusetts, then the government will need to increase taxes on the workers to pay for the spending programs. Then the migration of talent will escalate, as I can assure you it has already begun in earnest. Eventually all that will be left are the refuse of society, the Leeches, and thier political masters.


Herbalpagan said...

I agree! The migration of business from Mass means that the people will face increased taxes to make up the shortfall. I think that if people could sell their houses, many of them would leave as well.

western mass. man said...

Well said Nat.
Funny you mentioned CA, NY, MA, NJ as the worst states to do business in. They also happen to be the strictest on gun control also.
I see a recurring theme this morning as I plug through my morning blogs.
Maybe it is just me, but first, I saw this at JWR's site


Excellent article....one I can only dream of.
Than I see a post about a woman addressing the Santa Cruz city council. She makes me want to run away. God help us.

Bitmap said...

western mass. man said exactly what I was going to say, although I'll go farther and say in general those states have the most regulations, fees, and hassles for businesses and individuals.