Big Companies Are Ditching Blue California For Tax-Friendly Texas

As Governor Gavin Newsom defeated a recall election this week, California continues to hemorrhage some beautiful people and businesses to other states.

While voters overwhelmingly voted to keep Newsom in the governor’s office, with 63% voting, “No, do not remove,” businesses and households are fleeing the state like mad to avoid the plagues of dysfunctional governance, confiscatory taxes, strangling regulations, and an over-active legislature with one bright idea after another that doesn’t benefit residents, but lines the coffers of the state treasury and the state’s aggressive, well-funded lobbyists.

According to the latest study on the American mass migration out of California from the Hoover Institute, “California is experiencing a serious loss of company headquarters to other states.” What’s more, government officials and politicians have remained curiously silent about the massive drain of people and capital from the Golden State, “The phenomena, which includes business in nearly all industries, has gone virtually unrecognized by the state’s elected officials and governmental agencies.”

The Hoover Institute researchers took the time to catalog every instance of business headquarters moving from California to another state. They found a staggering movement of job-creating companies out of California, “California lost a total of 265 headquarters in the period January 1, 2018, through June 30, 2021, and the departures are accelerating as more relocation plans move to implementation.”

Why are so many businesses leaving California? Survey after survey has found that business owners find the environment hostile to an enterprise. These findings remain consistent across all industries and businesses of all sizes, as do the migration figures. The most popular destination for companies leaving the state is Texas. The second is Tennessee.

Southern destinations for people fleeing Gavin Newsom and the Democrats’ reckless stewardship of California’s government have no state income tax. They’re among the nine states that hold the distinction. The other seven are Alaska, Wyoming, Florida, New Hampshire, South Dakota, Texas, Washington, and Nevada.

There’s a reason these states also rank among the top ten states ranked best for business by Chief Executive magazine’s 2021 survey of American CEOs. They rated Texas number one for business, followed by Florida, Tennessee, North Carolina, Indiana, South Carolina, Ohio, Nevada, Georgia, and Arizona.

These are states with brisk economic growth and significant inflows of people and capital from the United States and the rest of the world. Their business-friendly, low tax, low regulation, common-sense policies, and comparative fiscal restraint to California have richly rewarded them with droves of young people and older retirees seeking a better life for themselves than living in a dead state set on speeding toward hopeless communist dystopian.

Ralph Schulz, CEO of the Nashville Area Chamber of Commerce, recently told a local news affiliate that, “Life has gotten hard for people out in California, and they like the culture and lifestyle in Middle Tennessee, and they like the business environment.” Votes are cheap. Everyone has one. But people are voting with their money and their feet against Newsom’s bad governance in California.