The Wall Street Journal editorial page assistant editor James Freeman weighs in on Tesla chief Elon Musk leaving California for Texas and taking his businesses with him, stimulus negotiations and New Yorkers’ access to the coming coronavirus vaccine.
Billionaire bond fund manager Jeffrey Gundlach isn’t planning to cut his ties to California just yet, despite the departure of his wealthy peers from the Democrat-led state and others with high tax rates.
Continue Reading Below
The Golden State has for every year since 2015 seen a net of more than 100,000 residents leave for another state, escaping the high cost of living, burdensome taxes and declining quality of life. California currently has a 13.3% income tax rate, the highest marginal tax rate in the country.
“I have no plan to leave California,” Gundlach, CEO and chief investment officer of Los Angeles-based DoubleLine Capital, which has $148 billion in assets under management, said during a conference call on Tuesday evening.
TESLA’S ELON MUSK CONFIRMS TEXAS MOVE FROM CALIFORNIA, WARNS STATE ON EXODUS
“I am researching,” he added. “I’m not doing it in a terribly aggressive manner. But if they raise the income tax to 16.8%, which they’re kind of talking about as a proposal, I’d probably work a little bit harder on it.”
Gundlach said in September that he was considering joining Tesla CEO Elon Musk, comedian Joe Rogan and conservative political commentator Ben Shapiro in leaving California to “escape incompetent governance.”
The ability to work remotely during the pandemic has fueled an even greater exodus as people have moved out of the state to avoid some of the strictest COVID-19 lockdowns in the country. California is on track to see more than 150,000 residents move to another state in 2020. Popular destinations include states like Texas and Nevada, which do not have an income tax.
Gundlach, however, warns that leaving California for cities like Austin, Texas, or Las Vegas comes with its own set of problems – including infrastructure that isn’t ready to handle an influx of new people.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
In order to build out their infrastructure, those places may “need to impose income taxes,” Gundlach said. “I would actually prefer to move to a state that was not one of the darlings of the migration crowd.”
