Gradually, then suddenly, blue state America is heading for financial disaster
In his famous 20th century novel "The Sun Also Rises," Ernest Hemingway’s character, Mike Campbell, was asked by a friend how his financial ruin had happened. Campbell replied to the question simply, "Two ways. Gradually and then suddenly."
Just a cursory look at today’s headlines and one can see this very idea of "gradually and then suddenly" playing out in the fiscal health of many blue states. California, the poster child for a state heading down the road to financial ruin, is slated to lose four congressional seats in the 2030 census due to population loss.
Moreover, major companies such as Wells Fargo and Quantum, with others surely to follow, are moving their headquarters out of the Golden State to Florida. In fact, Miami was recently labeled by one national outlet as the "new Silicon Valley."
Two of the other largest out-migration states in the country? Illinois and New York. Ken Griffin, the multibillionaire who runs the largest and most successful hedge fund in America, Citadel Hedge Fund, left Chicago in 2022 and moved his headquarters to Florida. Meanwhile, both Illinois and New York are slated to lose between two and four congressional seats in 2030 due to population loss.
So, what is going on here? Well, in short, individuals and companies have had it with blue state taxes, wild spending, suffocating regulations and draconian environmental policies that stifle innovation and entrepreneurship. They are moving to red states like Florida and Texas that value capital, markets, free exchange and opportunity. Florida and Texas, incidentally, are projected to gain four congressional seats in 2030.
Using any measure — GDP growth, job creation, capital investment, employment rates or the all-knowing U-Haul index of in and outmigration — red states litter the top 10 places to move with the occasional purple states of Arizona or Nevada breaking into the mix.
Meanwhile, the aforementioned California, Illinois, New York and many other blue states reside at the bottom. Americans have simply had it with bloated government and the nanny states that want to control every aspect of one’s money and life. And those Americans are voting with their feet.
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The left likes to say that warm weather and beaches are the reasons citizens are moving to red states, but that belies the truth. Last time I checked, Utah, Idaho and Montana had neither warm weather nor beaches and yet these states are routinely in the top 10 of these indices.
What does all of this tell us? Well, we’ve seen this coming for some time. California hasn’t gained a congressional seat since 2000. Illinois and New York? Last century. Blue states have seen their economies weaken and their populations slowly shrink since then, but politicians in those states refuse to acknowledge the reasons why.
Now reality is sinking in, and with the loss of electoral votes comes the loss of political influence in Washington D.C., let alone financial ruin.
Mike Campbell probably knew little of electoral politics, but he did know a thing or two about bankruptcy, and his acknowledgement of its occurrence being "gradually and then suddenly" is a cautionary tale for America. Blue states should take heed.