Say Anything Blog

I’ve had people spamming me with this link to a Pew study showing North Dakota as being one of the least attractive states to live in the union.  I hadn’t posted it yet because it seems as if the only attitude allowed on this subject in North Dakota is one that calls for lots and lots of government spending on efforts to create “good paying jobs” so that our college graduates don’t go other places to live and work.

Which is totally ridiculous.  Here’s the truth.

First, the outmigration trend has less to do with economics than an agricultural diaspora.  Put bluntly, agriculture doesn’t employ nearly as many people as it once did.  As agricultural technology evolved, as planting and growing and harvesting crops became easier and easier, fewer people were needed to work in the fields.  And fewer people farming (or even ranching) meant fewer people needed to work in the elevators and hardware stores and cafes.  All of those people had to find work elsewhere, and for most of them that meant leaving the state.  It still leaves meaning the state, in fact, as a lot of younger kids born into farming families tend to leave.  Because their work just isn’t needed on the farm.

Of course, that trend has reached its end.  North Dakota has finally reached a balance between urban and rural communities, and fewer people are having to leave.  Which is reflected in the state’s stabilizing population after years of decline.  It didn’t have anything to do with the millions political leaders pour into “economic development” schemes and everything to do with the culmination of a measurable social phenomena.

What is perhaps making North Dakota less popular now (outside of our long, hard winters, which we’re never going to be able to get around) is the fact that the state has an economic environment unfriendly to business and entrepreneurs.  That statement no doubt sounds like heresy to many in the state’s political leadership, but it’s true.  Corporate tax rates in the state are high (North Dakota’s combined state and federal corporate tax rates rank it right above Japan, which has the highest corporate tax rates in the world).  Sales taxes are high.  Property taxes are sky high.

And on top of all that the prevailing regulatory mood in the state is one that has the state all but controlling the economy.  If you happen to be well-connected politically, and if you can get in good with one of the various local economic development corporations, you can get a favorable tax and regulation situation.  But if you’re not well-connected, if the political powers-that-be aren’t inclined to grant you their favor, then the economic environment here isn’t very inviting at all.

In general, North Dakota’s economic environment (as crafted by the politicians) is one that favors businesses that depend on the government for subsidy and favors instead of businesses that can come here, compete and succeed.

And that’s the biggest problem with people leaving the state or not wanting to come here.

Cut taxes. End this absurd “economic development” scheming that does more harm than help to the state’s economy by keeping taxes needlessly high.  Then we’ll see a better situation overall.