Soccer Dad

Cause, meet effect. Can't get much clearer than your example. Nice post.

Trickle-down economics really does work, even though this idea has been mocked by liberals.

Try California. It raised taxes $14 billion, receipts are down and the budget deficit is at least $10 billion higher than the deficit taxes were supposed to cover at the time of enactment. And voters just rejected taxing themselves an extra $16 billion, which would have at best reduced the deficit by $3 billion but would not have eliminated it. The conclusion: higher taxes neither promote economic growth nor balance budgets. But you have to be a liberal to believe they do both which is why they never learn from past experience.

No demonstration here of cause and effect. Consider:

1) Many of the millionaires did not remain millionaires because they lost money (relatively) on their investments, businesses and professional practices due to macroeconomic pressures that are bad in Maryland, and worse elsewhere.

2) Those who did not lose money outright may have held onto tangible or financial assets that they might otherwise have sold at taxable profits, due to low market values.

3) A lot of DC lawyers and lobbyists - two of DC's biggest high-income industries - just lost their jobs, chief clients and practices between the change in administrations and structural changes in the practice of law. A decent number of those folks live in Potomac, Chevy Chase and Friendship Heights; once out of business, they may well have fallen under the million dollar mark, or just moved back to, say, Texas, right before New Year's Eve - not to duck the Maryland comptroller, but to get out of Dodge.

4) Gone Fishing: many people who are capable of earning big money are capable of doing big other things, such as spending the summer fishing. When the economy is bad, the choice between quality of life and meager economic returns gets easier. My father experienced this in the 1970s; he is a craftsman of custom fishing tackle and when the economy tanked, his executive clients went fishing.

Not sold on the thesis that a modest marginal income tax increase in fact spurred the millionaires to flee; more likely in my view (and I may be wrong) is that most of them limbo-ed below the million dollar line voluntarily (by holding assets or not striking when the iron is cold) or involuntarily (losses/bad macroeconomics.)