State BANKRUPT – Governor Begs Millionaires to Return

New York’s millionaire fight is really a fight over blame, because Governor Kathy Hochul says Trump-era tax changes and COVID did the damage, while critics say the numbers point somewhere else.

Quick Take

  • Hochul tied the millionaire exodus to the 2017 repeal of the State and Local Tax deduction and to the pandemic.
  • She also said she will not raise taxes on high-net-worth residents, even while asking them to come back.
  • Fiscal Policy Institute data says the biggest wave was temporary and pandemic-driven, not a lasting tax revolt.
  • The public debate is being shaped as much by media framing as by the facts themselves.

Hochul’s Case: Trump, COVID, and Remote Work

Hochul’s core argument is simple. She says New York did not lose wealthy residents mainly because of state policy. She points instead to the federal State and Local Tax deduction repeal under President Donald Trump and to the shock of COVID. In her telling, remote work also changed the rules by freeing affluent workers from Manhattan’s old hold. That is why she calls the remaining rich “patriotic” and urges them to help rebuild the tax base.

That message has a sharp political edge. Hochul says she does not want to raise taxes on high-net-worth residents, even though she also says the state needs them to support public services. She has framed the issue as competition with low-tax states like Florida, where former New Yorkers can move without losing access to strong weather, better space, and lower taxes. Her argument is that New York is now fighting geography, technology, and federal tax policy at once.

What the Data Says About the Exodus

The strongest counterpoint comes from the Fiscal Policy Institute, which says the millionaire outflow was temporary and tied to the pandemic. Its December 2023 report found that over 75 percent of wealthy people who left during the pandemic moved to other high-tax states such as Connecticut, New Jersey, and California. That does not fit the simple picture of rich New Yorkers stampeding toward low-tax havens. It fits a crisis-year disruption more than a permanent tax revolt.

The same report says high-earner migration returned to pre-COVID levels by 2022. It also says only two out of every 1,000 top earners left New York in non-COVID years, a much lower rate than the rest of the population. In other words, the headline sounds dramatic, but the underlying movement looks smaller and less tax-driven than the rhetoric suggests. The best reading is that the pandemic amplified a real trend, then the trend cooled once life normalized.

Why the Argument Still Matters

This fight matters because it exposes the weak spot in high-tax state politics. Leaders often blame outside shocks when wealthy residents leave, because admitting that taxes or public spending drive people away is politically painful. Hochul’s language reflects that habit. But the available research does not show a clean tax-fight story. It shows a messy mix of remote work, pandemic disruption, social change, and only limited evidence that tax hikes alone caused the movement.

That leaves Hochul in an awkward place. She wants affluent taxpayers to return, but she is not offering a major tax reset. At the same time, New York City’s broader political climate keeps pulling in the other direction, especially as Democratic leaders debate higher taxes on the rich. For conservative readers, the common-sense lesson is hard to miss: when a state keeps spending heavily and keeps warning about flight, it is usually because the math is already uncomfortable.

Sources:

foxnews.com, finance.yahoo.com, youtube.com, fiscalpolicy.org

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