Glenn Beck: Why Progressive States Fail





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I want to focus on what puts states with progressive policies at greater risk than states with more conservative ideals — and who is in deeper trouble.

Obviously a tsunami is going to put basically everyone under water and, as you'd expect, the greatest crisis since World War II means that right now 48 states are in trouble. But there's a big difference between states that will almost always be at risk for going under water and then those that are better able to weather the storm. And that is based on how progressive their policies are.

If you look at the states that the Pew Center ranks as most failing, you will tend to see something in common: They are like California, in terms of budget deficit and several other key factors.

Rhode Island, Michigan and Oregon are all very progressive states. If you go down the list, some conservative states pop up.

You might say, "Hey Glenn! Why are Arizona and Nevada so high on that list?"

Well, despite conservative policies, the real estate market collapse most seriously affected Arizona and Nevada. Like I said, a tsunami puts everyone under water.

The other states, meanwhile, were running into trouble even in good times. Why?

Look at their policies, particularly their progressive taxes and other anti-business practices. These states not only heavily tax the rich and spread the wealth, but they also spend like times are always going to be good. They don't have rainy day funds that can help them get through tough times.

No, they pretty much need times to always stay good and probably even get better, just to stay in good shape — progressively ramping up their spending.

As I've said for years now, "as goes California, so goes the nation." And so it's not really any surprise that California's high taxing, high spending and obliviousness to future concerns sounds just like... well, exactly what the federal government has done.

But unlike the government which can borrow money from the Fed, states start to shut down and start issuing IOUs. In each case, these progressive states counted on the high earners' revenue and the big bonuses and when they didn't come through... big trouble.

New York's foreclosure rate happened to be really low because it's so tough actually buying property and so they weren't nearly as high on the Pew Center's list as you'd expect. They're still in huge trouble, along with New Jersey.

Actually, with all these states that are reliant on heavy earners, not only do you see a lot of volatility based on market swings like we're in now, but also millionaires' taxes don't work. Look at the volatility of California. Look at how the tech bubble and the housing bubble totally wrecked their plans.

They drive people out of the states. Rich people are rich partly because they know how to protect their money. And if all the states become too progressive, they'll just take their money overseas. All this leads to the Northeast being known as "America's Economic Black Hole."

Compare the financial situations of those states in the most trouble with the states that are in tougher times than usual, but far closer to recovery. What you'll find in states like Texas, Wyoming, Nebraska, Montana and North Dakota is that generally they are better able to weather the storm, because they have conservative principles.

States with broad-based taxes with low rates will go through downturns, but they are so much less reliant on the rich people continuing to earn. You'll also find much less of a union influence than those progressive states. Some other states that saved when times were good are Florida and Indiana and they are doing much better now as a result.

Here's something else to look at: If you look at the 10 states that rely most on individual income taxes — states like Oregon, New York, California — you see once again how the states with progressive income tax are generally in worse shape, due to that volatility I just spoke of.

And then check out the 10 states that concentrate their spending on public welfare. Well, what a surprise, New York again. And Rhode Island, whose progressive social policies mean they are more likely spending and spreading the wealth than they are saving that wealth or keeping money in the hands of individuals.

Even more dramatic is the volatility of taxes collected: From 1990, compare California, which has the highest personal income tax rate in the country, with Texas to see whose total tax collected is more stable. (By the way, Texas has no state personal income tax.) It's obvious which state sees more fluctuations and which is much more stable.

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Ami joined Glenn Beck on "Glenn TV" recently to describe how this wasn't just a few people — this was 65 percent of those he asked, and NO ONE seemed to think it was a bad idea.

Watch the video below to hear more from Ami Horowitz:

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Watch the video clip below or find the full episode here:

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Watch the special in full below:

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Watch the video below to catch more of the conversation:

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