Dynamic reality

Static revenue models work about as well as NFL plays that depend upon the 11 defenders remaining exactly where they’re lined up at the moment of the snap.

Columbia University Professor Marc Lamont Hill tells me, “Those who have more should pay more. The rich have always cried wolf like that.”

But the wolf is here. Maryland created a special tax on rich people that was supposed to bring in $106 million. Instead, the state lost $257 million. Former Gov. Robert Ehrlich, who is running again for his old job, says: “It reminds me of Charlie Brown. Charlie Brown was always surprised when Lucy pulled the football away. And they’re always surprised in Washington and state capitals when the dollars never come in.”

Some of Maryland’s rich left the state.

“They’re out of here. These people aren’t stupid,” Ehrlich says.

This Maryland supertax on millionaires was the example I used in RGD in explaining how I first began to notice the mainstream media’s inability to comprehend basic economic behavior. The precise figures weren’t available at the time, though, so it’s fascinating to see that the state government lost more than twice as much tax revenue as they were calculating they would gain.