The flight of the wealthy is part of the dismal spiral that causes so…

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The flight of the wealthy is part of the dismal spiral that causes so many socialist countries to become impoverished, totalitarian nightmares:

1. Socialist promise goodies (welfare, healthcare, basic income) to the rubes in order to get elected.

2. As welfare becomes more generous, more people decide that it is easier to feed off others rather than produce themselves.

3. Fewer entrepreneurs make the sacrifices necessary to start companies, since most of the profit will be extorted from them to buy the votes of the parasitic class.

4. Wealthy, productive people leave in ever increasing numbers. This results in unemployment, reduced innovation, lower salaries, and lower tax revenues.

4. The government imposes Increasingly draconian regulations to prevent productive people from fleeing, such as capital controls, AML/KYC surveillance laws, exit taxes, and outright emigration bans.

5. As wealth dwindles, the ignorant rubes demand more government welfare, and the spiral worsens.

6. Eventually, the government collapses when it runs out of other people’s money.

"California’s reliance on high earners is unusually extreme. A small fraction of taxpayers accounts for a disproportionate share of personal income tax receipts, with the top 1% typically contributing 40-50% of all state income tax receipts. And this doesn’t account for their indirect contributions through business ownership, capital formation, venture finance and firm leadership. Losing even a handful of these high-earning taxpayers meaningfully alters revenue volatility, particularly given California’s dependence on capital gains realizations." [1,2, 3]

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The flight of the wealthy is part of the dismal spiral that causes so many socialist countries to become impoverished, totalitarian nightmares: 1. Socialist promise goodies (welfare, healthcare, basic income) to the rubes in order to get elected. 2. As welfare becomes more generous, more people decide that it is easier to feed off others rather than produce themselves. 3. Fewer entrepreneurs make the sacrifices necessary to start companies, since most of the profit will be extorted from them to buy the votes of the parasitic class. 4. Wealthy, productive people leave in ever increasing numbers. This results in unemployment, reduced innovation, lower salaries, and lower tax revenues. 4. The government imposes Increasingly draconian regulations to prevent productive people from fleeing, such as capital controls, AML/KYC surveillance laws, exit taxes, and outright emigration bans. 5. As wealth dwindles, the ignorant rubes demand more government welfare, and the spiral worsens. 6. Eventually, the government collapses when it runs out of other people’s money.