by Joel Kotkin
Wednesday, 21
September 2022
Behind the news
07:00

San Francisco loses another 39,000 taxpayers

Millenials and Gen Xers are leaving California in droves
by Joel Kotkin
Will the last person to leave California turn out the lights? Credit: Getty

Since the days of the Gold Rush, California has been a magnet for those seeking wealth. A backwater barely a century ago, with just over 3 million residents compared to nearly 40 million today, the Golden State established dominance over everything from agriculture and film to space travel and the internet.

But new data suggests that the tide may be turning, and a rich hegira is afoot.

Researchers found that 39,000 San Franciscans who had filed federal tax returns for 2018 had moved out of the city before filing 2019 returns, taking away a net of $7 billion in income in one year. A soon-to-be released report from the San Francisco Business Times, sources tell me, will see a similar phenomenon in Silicon Valley.

Once able to hold onto its rich, the Golden State seems to be following the course of high-tax places like New York, Illinois, New Jersey, Massachusetts and Connecticut. For years, these cities and states have been oozing billions in tax revenues as wealthy residents fled to the likes of Texas, Florida, Arizona, the Carolinas and Tennessee. While California still lags behind New York State in the money-losing sweepstakes, it is catching up: in 2020 the state lost $17.8 billion in tax revenue, with the loss spreading into the Bay Area, whose tech-rich economy historically kept the state solvent.

Remarkably, this all occurred at a time when the tech economy — the Bay Area’s driving force — was at its peak, and the disruptions associated with Covid-19 and the George Floyd protests had not yet occurred.

The reasons for this exodus are not hard to find. We know that out-migration from the Bay Area has soared since 2019, with the largest percentage loss of residents occurring in San Francisco and the Silicon Valley. Why? Because the state is becoming less and less safe. Indeed, two out of three SF residents plan to exit due to crime and homelessness, with an astonishing half of San Franciscans claiming in one survey that they had been robbed.

Those leaving were not knuckle-dragging Trumpistas or illiterate peasants (California leads the nation in illiteracy). In fact, the latest IRS data reveals that the largest net domestic out-migration is among disgruntled 35- to 44-year-olds, precisely the ages when many people reach their peak earnings, buy houses, and start businesses.

This goes to show that, for the first time in its modern history, California is no longer a beacon for the young and ambitious. The state has become the incubator of some of the worst political trends of our times — affirmative action, climate hysteria, identity politics — and it shows no sign of turning away from these. Slowly but surely, the state will essentially be one big retirement home. If things keep up this way, it will be time to throw away the surfboard and get a walker — if we can still pay our bills.

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Mike Doyle
Mike Doyle
11 days ago

But will the escapees take with them the germ of extreme liberalism that has so damaged California?

Brian Villanueva
Brian Villanueva
10 days ago
Reply to  Mike Doyle

Yes. They will. Because all the problems with their state couldn’t possibly be because of them.

Sharon Allen
Sharon Allen
9 days ago
Reply to  Mike Doyle

Regardless of how many leaves and you’re shouting liberals is the cause you’re incorrect. People been leaving CA for over 10 years now and the state isn’t getting better because of voters, leadership and misappropriation of funds to communities is why it’s disastrous. Look around. Homeless everywhere people can’t afford to live. I was raised in S.F. And have no damn regrets for leaving decades ago.

tony stone
tony stone
11 days ago

Look it’s very obvious what’s going on but since the ones discussing this issue are the ones causing it, there hasn’t been anyone pointing towards the real issue. The problem is tech. These kids get out of college and come to the bay area because they know this is where they’ll make their fortune regardless of the fact that they cause anyone else that doesn’t make silly money become desperate and some homeless. It’s a fact. There’s no other industry that has or makes this kind of money.
The rents are outrageous. The cost to buy a house is off the charts. It’s ridiculous and the list of problems it’s caused goes on and on. There’s a huge imbalance here that nobody seems to care to look at. Sure these tech people bring money but once they leave then it’s article after article about money leaving the state or the bay area.
Well here you go, this is what the bay area willingly signed up for and now is complaining about when it decides to leave.
There’s no commitment, no guarantees and when they’re gone they don’t care. They left here with pockets full of money from this state and take it elsewhere. So where’s your beloved tech people that were so wanted and loved now ? They’re leaving because it’s even too expensive for them.
They can find other places to destroy and then move on to yet another city to cause problems in. And you wonder why all the crime and 50% of these people leaving claim to have been robbed living in San Francisco. Well, hello there’s alot of people that could never make the kind of money these tech people make. It does nothing but cause problems but oh no these people are gods but tell me do these people make up the workforce that pick up the trash, do construction, clean facilities or supply the city with what’s needed ? No, they just use up more and more resources and leave a path of destruction behind for someone making minimum wage to cleanup.
It amazes me how this can go unrecognized. These cities that the techies are moving to better take note of what is happening here because believe me it’s gonna happen where ever these people making silly money go. Sure the local government will have dollar signs in their eyes as the money moves in but beware because there will be a price to pay and noone else will be able to afford it. Think about it.

2skibum@sbcglobal.net 2skibum@sbcglobal.net
Reply to  tony stone

Techies only part of the problem. The biggest problem are Democrats. Democrat techies, and Dems entrenched in every aspect of California laws or lack thereof. They have allowed and welcomed homelessness, lawlessness, high taxes, ludicrous unchecked careless spending on failed and failing social programs that only enrich the leaders and cronies. They also invite law breaking illegal immigrants who require everything. While the middle class hard working citizen gets nothing in return. This ex Democrat and 71 year California native saw the Dems turn California into a shithole. I finally left begrudgingly. There is so much more to say about Cali and it’s not good. If it wasn’t for its natural beauty it would be a nothing state. Poorly run for decades now!!!

Giovannii Blenio
Giovannii Blenio
10 days ago

Such a boomer thing to say that it’s the Dems fault. Tony Stone nailed it with everything he said.

As a life long Californian, what I’ve seen is exactly what Tony describes. Masses of people from other states moved here for one thing, money. There is nothing wrong with that, but they also brought their selfishness and arrogance. With selfishness and arrogance comes problems.

Their true colors eventually came out. When things got a bit more challenging within the state, they moved and started shitting on California from afar. They’ve played a HUGE role in the problems that have been created in the state, but their heads are so far stuck up their bank accounts and portfolios they fail to see how they’ve contributed.

Non native Californians came to California to plunder and pillage and buy up the property, then when the city or state wanted to build more affordable housing for those struggling from unaffordable housing, those same people who benefited from the rewards of the tech rush said, “Wait a minute. We need more housing. Just don’t do it in my neighborhood because it’s going to hurt my property value.” Them they charge to the city and the state governments to block the very thing the state needs more of.

I, for one, am happy all of these people are moving out. People who live outside of the state shit on Californians, but the reality is, the people who came were transplants from other states. Now these transplants, aka, nomads, are leaving and causing problems in Texas, Idaho, Oregon, and other states. And guess what, a high percentage of them are republicans. The problem is not their political affiliation, it’s their nomadic, “screw everyone it’s all about my money” attitude.

And it’s clear the native Texans, Idahoans, etc are not happy about seeing the same problems occurring in California starting to occur in their state.

I do agree with you that the state needs more political balance, and as someone who leans a bit more left (does that make me a liberal?), I would like to see more political balance, because if state government was only from the right, it would be equally as bad, just in a different way.

The problem is the baby boomer generation. They hold most of the financial power, political power, and influence, and they need to go, because they’ve created a mess throughout the whole country, not just California.

Their reign is coming to an end soon. Mortality is a great equalizer.

Last edited 10 days ago by Giovannii Blenio
Giovannii Blenio
Giovannii Blenio
10 days ago
Reply to  tony stone

Nailed it!

J Hop
J Hop
3 days ago
Reply to  tony stone

Yep, I’ve lived in Austin and Raleigh and it’s happening in these places as well.

tony stone
tony stone
11 days ago

You want to see a good example of the destruction these people cause, just go to Tahoe and there you will see what this industry is capable of causing. Nobody that cooks the food, buses the tables or washes the dishes can afford living there anymore. Really ?
Wake up !

Richard Parker
Richard Parker
10 days ago
Reply to  tony stone

Yeah, Queenstown in New Zealand is similar. Multi-million dollar properties but good luck securing a plumber to fix your burst water pipe…

Javier H
Javier H
10 days ago

Our tax paying dollars hard at work buying votes for Newsom and beachfront houses/stock for Pelosi lol

Are Californians that dumb or had something odd been going on with our elections for a very long time now?????

Tim Stack
Tim Stack
10 days ago

My wife is a lifelong Californian, I’ve lived here for 5 years. We left the bay area in 2014 and moved to Humboldt. We are leaving Humboldt for Florida. We are done with the far left over regulation and over taxation. Time for the best governor, Ron DeSantis

tim heidecker
tim heidecker
10 days ago
Reply to  Tim Stack

Holy cow has American politics done a number on your brain.. you do realize taxation is an authoritarian idea of the right and is not a left idea at all. In fact, the left idea of taxation is no-taxation aka libertarianism (which has no relation to the cult of of the GOP).

You do realize the middle-class tax squeeze is an idea held by both gop and dem leaders right? Imagine that, those two hideous parties actually have a lot more in common.

I won’t bother giving that swamp monster another Ping by mentioning his name, but good luck out there!

xxxxxxx zzzzzzz
xxxxxxx zzzzzzz
10 days ago

If your younger and not liberal you haven’t a heart as you become older and wiser if your not conservative you haven’t a brain. (Churchill)

Dermot O'Sullivan
Dermot O'Sullivan
11 days ago

To get a full picture the article should also give information on people who are moving to the state, assuming that this is also happening.

Brett H
Brett H
11 days ago

What’s relevant, I think, is whether that’s an unusual amount to be leaving. And who they are and who those moving in are.

Diane Frediani
Diane Frediani
10 days ago

The problem with these exodus articles is they don’t report on the thousands of people moving in. No matter how awful things are, folks always want to come to California. That will never change.

tim heidecker
tim heidecker
10 days ago

Oh no! If only we hadn’t given big tech billions in tax-incentives while we screw the people who actually live and work here.

M. M.
M. M.
11 days ago

Joel Kotkin wrote, “[California] has become the incubator of some of the worst political trends of our times — affirmative action, climate hysteria, identity politics — and it shows no sign of turning away from these.”

The residents of a state (or country) are responsible for its quality of life.

Some demographic groups deserve more blame than other groups for a deteriorating quality of life. In California, we can identify the groups to blame by using the following 3-step process.

1. Identify a ruinous government policy.
2. Identify the politicians who created the policy (in step 1), promoted it, or voted for it.
3. Identify the ethnic or racial groups who gave a majority of their votes to the politicians in step 2.

Using the above steps, we can easily determine that Hispanics consistently give a majority of their votes to politicians who damaged the quality of life in California. The high taxes, the excessive regulation, the high rate of crime, etc. are due to Hispanics.

Hispanics are 40% of Californian residents (and outnumber the other 3 demographic groups) and deserve most of the blame for wrecking Californian society. “Open borders” greatly swelled the number of Hispanics in California and its electorate.

Get more info about this issue.

luisa Almeida
luisa Almeida
10 days ago

California has the LOWEST ileteracy in the Country, NOT the highest!

Bean Bag
Bean Bag
10 days ago

All this writing by a sprawl living NIMBY and no mention of prop 13, a tax scam that soaks the young and the poor families and transfers that wealth to the old and the rich.

I am one of those folks who will soon skedaddle out of here.

Or geriatric NIMBYs like you would have allowed abundant climate responsible market rate housing where public transit pencils out.

But no. You didn’t so now eat sh#t

M. M.
M. M.
11 days ago

Last edited 11 days ago by Matthew M.
christopher bolander
christopher bolander
11 days ago
Reply to  M. M.

You know they were here first, right?

christopher bolander
christopher bolander
11 days ago

What an alarmist: “in 2020 the state lost $17.8 billion in tax revenue” … so, during the height of the pandemic California lost less than 1% of its total tax revenue of $248 billion? Seriously, dude, get some perspective!

Last edited 11 days ago by christopher bolander
rrr jjj
rrr jjj
11 days ago

STEM isn’t a strong point of perspectivists.

1% of $248B is $2.48B

Last edited 11 days ago by rrr jjj