Driving folks to Connecticut

Today's news brings tidings that New York Assembly Speaker Sheldon Silver is pushing a New York State Millionaires tax that would raise the rate for the wealthiest people in New York to 13%. This is very good news for Connecticut. If Connecticut can hold the line on income tax rates, there will be a substantial tax gap between the two states. Over the last few decades, Stamford and Greenwich have become financial centers with both large numbers of hedge funds and separate trading floors for UBS and RBS which have headquarters here. Given the use of electronic trading, there is no need for trading floors to be close to Wall Street anymore. the tax gap alone ought to be enough to push additional Wall Street companies out to the Connecticut suburbs. Indeed, there is enough office space under construction in Stamford right now to house a large number of new financial firms fleeing New York and its high taxes.

The Democrats in new York are crazy if they think that they can just raise taxes and no one will leave. If they pass this tax increase, they will be in the process of destroying one of the mainstays of the new York economy. I think that the New York Democrats new slogan should be "We never met an economy that we did not destroy."

I just hope that when the companies leave New York, they make a short move to Connecticut rather than the longer one to Texas or Florida where taxes are still much lower than Connecticut.