Americans are increasingly voting with their feet, and according to Mercatus Center research fellow Jack Salmon, the biggest factor behind migration from blue states to red states isn’t the weather. It’s government policy.
Salmon, a research fellow and Gibbs Scholar at the Mercatus Center at George Mason University, joined Mike Koolidge on Chicago’s Morning Answer while Koolidge was filling in for Dan Proft to discuss why Americans are leaving states with higher taxes and heavier regulation for states offering a lighter government burden.
Salmon said he examined tax-filer data over a five-year period to look at where Americans were moving from one year to the next. While the traditional explanation for population shifts often focuses on warmer weather, he said the data pointed more strongly toward factors that state governments can actually control.
Tax burdens, regulatory policies, housing rules and labor-market restrictions were among the factors that correlated with population movement. Salmon said states that make it harder to build enough housing, impose extensive occupational licensing requirements or otherwise restrict the labor market can create additional costs for residents and businesses.
The result is a familiar pattern: people leave states where government costs and restrictions are higher and move to places where they believe they can keep more of what they earn and have greater economic freedom.
Idaho, Salmon noted, ranked at the top when measuring population gains as a share of a state’s existing population. That example also challenges the idea that weather alone explains domestic migration. Idaho hardly fits the traditional image of a warm-weather destination, yet it has attracted significant numbers of new residents.
Tax policy, however, remains one of the clearest differences between states. Salmon pointed to Virginia, where he said there has been no broad tax reform since 1961, while neighboring states have moved in the opposite direction by cutting income and corporate tax rates.
North Carolina has moved toward a flat income tax below 4%, Salmon said, while West Virginia and Kentucky have also reduced income tax rates. Tennessee eliminated its taxation of income in 2021, creating another incentive for residents to consider moving across state lines.
The financial difference can be substantial. Salmon offered the example of a married couple earning $150,000 in New York. Moving to a state without an individual income tax, such as Texas, Tennessee or Florida, could save that household more than $11,000 a year, according to his calculation.
For families already dealing with high housing, food and transportation costs, that kind of difference can be difficult to ignore. The rise of remote work has also made it easier for some workers to separate where they earn their income from where they choose to live.
Koolidge connected Salmon’s analysis to Illinois, arguing that states with similar climates can have dramatically different outcomes when their tax and spending policies diverge. Indiana, for example, shares much of Illinois’ Midwestern geography and climate while generally taking a different approach to taxes and government spending.
That comparison underscores Salmon’s broader argument: people are not simply relocating because they want more sunshine. They are responding to the economic incentives created by state governments.
The issue is particularly relevant for states trying to retain workers, businesses and families. When residents can work remotely and move without changing employers, the cost of living and tax burden in a particular state can become increasingly important considerations.
Salmon also suggested that the migration trend is not limited to Americans moving from one region of the country to another. He noted that people are increasingly looking for states where government places fewer restrictions on economic activity and where residents have more control over their own finances.
For Illinois, the message is straightforward. The state may have plenty to offer in terms of culture, communities and quality of life, but residents ultimately have to make the numbers work. When neighboring or nearby states offer lower taxes, fewer restrictions and more favorable economic conditions, moving can become an increasingly attractive option.
And unlike the weather, those are things state governments can change.