One of the messages of doom that were widely broadcast about what might happen should Zohran Mamdani win the mayoral election in New York City was that wealthy people might leave the city in droves because of the higher taxes he was promising to levy on them in order to fund some of the social programs that would benefit ordinary people. Such scare tactics to keep the wealthy happy are not uncommon. Some might view the departure of these people as not a bad thing, since wealthy people who begrudge paying more in taxes (which they can well afford) to benefit others are pests whom we would be better off without. Cristobal Young, a sociologist at Cornell University, and others have looked into this claim and find that this threat to move lacks evidence in support.

I research whether high earners actually move when their taxes go up. My colleagues and I have analyzed millionaire taxes in New Jersey and California, the migration of Forbes billionaires globally and decades of IRS data tracing where Americans with million-dollar incomes live.

Top earners are often thought of as “mobile millionaires” who are ever searching for lower-tax places to live. In reality, they’re often reluctant to leave the places where they built their careers and raised their families.
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The first fact is simple: Millionaires have low migration rates.

Mobility in America is highest among people who are still searching for their economic place in life. Workers who earn the lowest wages move across state lines at relatively high rates, about 4.5% per year, often in search of more affordable housing. People making $1 million-plus a year move only half as often: Just 2.4% of them pack up each year.

When millionaires do move, it rarely appears to be for tax reasons.
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Overall, only about 15% of millionaires who move end up with a lower tax bill. That shows the rich are willing and able to move for tax reasons. But because only about 2.4% of millionaires move each year – and only a fraction of those moves reduce their taxes – overall tax migration ends up being a small fraction of a small fraction. Not never, but not often.

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Europe’s richest man is whining about a proposed wealth tax for France. But of course, he is not complaining that it would hurt him personally, which would be very selfish, but that it would hurt the entire economy, which makes him a noble crusader and protector of the economic health of the country.

Europe’s richest man, the luxury goods magnate Bernard Arnault, has said that a wealth tax that could cost him more than €1bn (£817m) would be deadly for France’s economy.

The French founder of LVMH Moët Hennessy Louis Vuitton said in a statement to the Sunday Times that calls for a 2% wealth tax on all assets “aims to destroy the liberal economy, the only one that works for the good of all”.

The idea of a wealth tax has steadily gained ground in France because of a political crisis, with the government trying to push through unpopular budget cuts. The idea of a 2% wealth tax on fortunes worth more than €100m has been proposed by Gabriel Zucman, an economics professor who has become a household name in France.
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Zucman is a professor of economics at the Paris School of Economics and the École normale supérieure, and last year wrote a prominent study on the wealth tax for the G20. In June, Zucman wrote in the Guardian: “Unprecedented wealth concentration – and the unbridled power that comes with such wealth – has distorted our democracy and is driving societal and economic tensions.”

But Arnault insists that his motives are pure and that those who are pursuing this tax are doing so because, for some reason, they want to destroy the economy.

“This is clearly not a technical or economic debate, but rather a clearly stated desire to destroy the French economy,” Arnault’s statement said. “I cannot believe that the French political forces that govern or have governed the country in the past could lend any credibility to this offensive, which is deadly for our economy.”

Really? They ‘clearly stated’ that their desire is to destroy the economy? Where and when did they say this?

People like Arnault should continue to speak out like this so that people will increasingly see that what greedy, selfish jerks they are.

The US Federal Reserve has two missions: keep inflation under control and have full employment.

What should be the desired rate of inflation? If it gets too low, that might be due to the economy stagnating and heading towards recession. Too high and people and businesses start hurting and indulging in more short-term spending as a hedge against future price rises. The magic number that the Fed and the economic pundits have settled on seems to be around 2%.

In its Statement on Longer-Run Goals and Monetary Policy Strategy (PDF), the Federal Open Market Committee (FOMC) judges that inflation of 2 percent over the longer run, as measured by the annual change in the price index for personal consumption expenditures, is most consistent with the Federal Reserve’s mandate for maximum employment and price stability. When households and businesses can reasonably expect inflation to remain low and stable, they are able to make sound decisions regarding saving, borrowing, and investment, which contribute to a well-functioning economy and the well-being of all Americans.

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The BLS has released the August job numbers and they continue the dismal trend that started in May where the numbers were well below the required number needed to keep up with population growth. The revised numbers for June even showed a decline in jobs for that month.

You can read the BLS press release here that has a more complete breakdown of the data.

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The US economy is huge and like anything huge, it has a lot of inertia which makes it slow to respond to external forces. Since Trump has come into office, he has made sweeping and reckless economic moves that are not based on reality-based analyses but more on his pet theories, revenge against perceived wrongs, and sheer capriciousness, all designed to satisfy his need to be a bully. The tariffs have been his primary vehicle for the last feature and it has thrown global markets and trade relationships into turmoil. It was inevitable that this would lead to negative impacts on the economy but until this month, those consequences had not manifested themselves.

The July jobs report may be the first indicator. What was alarming was not the numbers for July itself but the steep downward revisions for May and June, which reduced the job growth to almost zero, usually a sign of an impending recession. Trump has responded angrily, as usual denying any fact that shows him in a bad light, claiming that the numbers were rigged against him, and firing Erika McEntarfer, the commissioner of the Bureau of Labor Statistics (BLS).

Needless to say, this has alarmed pretty much everyone outside the Trump cult because whatever crackpot economic theory you may be using, you still need accurate data to make decisions. If you appoint someone who will only give you numbers you want to hear, you enter a very vicious spiral indeed. Trump’s team has fanned out with a media blitz to try and minimize the damage of the jobs report but pretty much everyone in the reality-based world is alarmed by these moves, including some Republicans.
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