Federalism: The System Is Working

By Virrage Images @ Shutterstock.com

The American federal system of state rule is setup to reward states that make the right policy choices and to punish those where politicians put their own agendas ahead of the people they were elected to represent. And it’s working. Americans are moving to states with greater freedom and lower taxation, and away from places like California, where restrictions and taxes have made life miserable for many. You read yesterday about the results of the U-Haul Growth States index. At The Tax Foundation, Katherine Loughead explained the foundation’s view of American movers, and their tendency to move to where their money is treated best. She writes:

Americans were on the move in 2024, and many chose low-tax states over high-tax ones. This ongoing trend is reflected in recent US Census Bureau interstate migration data, as well as commercial datasets released last week by U-Haul and United Van Lines.

The US Census Bureau’s most recent interstate migration estimates show interstate moves that occurred between July 1, 2023, and June 30, 2024. For the second year in a row, South Carolina saw the greatest population growth attributable to net inbound domestic migration (1.26 percent). Other states that saw significant domestic migration-related population growth were Idaho (0.83 percent), Delaware (0.79 percent), North Carolina (0.76 percent), and Tennessee (0.68 percent). At the other end of the spectrum, Hawaii lost the greatest share of its population to other states (0.65 percent). Not far behind were New York and California, which each lost 0.61 percent of their residents to other states, followed by Alaska (0.51 percent) and Illinois (0.44 percent).

The moving companies’ datasets, while less robust than Census data—and undoubtedly influenced by these companies’ geographic coverage and relative market shares—show similar overall migration patterns. Unlike the Census data in the map above, which show the extent to which each state’s population grew or shrunk due to domestic net migration, the moving companies’ datasets show the ratio of inbound moves to outbound moves for each state, with the states with the highest inbound-to-outbound ratios ranking most favorably.

As in the Census data, South Carolina claimed the top spot in this year’s U-Haul study, with the highest ratio of inbound-to-outbound one-way U-Haul moves, followed by Texas, North Carolina, Florida, and Tennessee. At the other end of the spectrum, the states with the highest ratio of outbound-to-inbound moves were California, Massachusetts, New Jersey, New York, and Pennsylvania.

Meanwhile, among United Van Lines customers, the highest inbound-to-outbound moving ratios occurred in West Virginia, Delaware, South Carolina, the District of Columbia, and North Carolina, while the states with the highest outbound-to-inbound ratios were New Jersey, Illinois, New York, California, and Massachusetts.

Both companies saw states like California, New Jersey, New York, Illinois, and Massachusetts among the biggest losers, and states like South Carolina, North Carolina, Arizona, Idaho, Florida, Indiana, and Tennessee among the biggest winners.

Action Line: The problem with federalism is that it's slow. Not everyone can pack up and leave home for a better America. Voting matters. Elections do, in fact, have consequences. Retirement is one time when you can make a cleaner break from your state and move to greener pastures. If you're moving for a "Liberty Retirement," I want to talk to you. Email me at ejsmith@yoursurvivalguy.com, and click here to subscribe to my free monthly Survive & Thrive letter.