The West Virginia exodus

Fifty years ago the famous African American folk singer Paul Robson forcefully sang the spiritual “Go Down Moses/Let My People Go” about people seeking to leave Egypt due to economic and social conditions by the Pharaoh.

In West Virginia, people have left the state for related reasons. Back in the 1960s, mechanization and the increased shift to surface mining convinced families in the coalfields to move to Ohio and Michigan due to post WWII job growth there at that time. Later on, another shift occurred to the South. The overall result was a loss of a congressional seat then held by Harley O. Staggers. Today, redistributing has again occurred and West Virginia has lost another Congressional seat, resulting in a 50 percent reduction from 4 to 2.

What caused the exodus? One reason clearly cannot be taxes, which are already comparatively low. Phil Kabler in a Charleston Gazette-Mail column noted the fiscal note compiled by Deputy Revenue Secretary Mark Muchow on the original version of the West Virginia Senate’s income tax plan (SB600). Muchow pointed out that states without income taxes are not tax-free paradises, that those states make up the revenue through myriad other taxes, including consumption taxes, business and corporate taxes, and property taxes that are considerably higher than comparable taxes in West Virginia.

“Muchow noted that residential property taxes in Florida are 2.3 times higher than West Virginia’s and Texas’ property taxes are 3.5 times higher. Commercial property taxes are double in both states. Tennessee has property taxes that are 56 percent higher than West Virginia’s, has the nation’s highest sales tax at 9.55 percent, taxes food at 6.25 percent and imposes an additional 2.75 percent sales tax on luxury items.”

Kabler noted, with comparatively low taxes, those concerned about taxes would already be flocking here.

It also is not because people wanted to leave. Strong family ties have continued to pave the road to Columbus and Detroit. Dr. John Phodiadis, a former sociology professor and researcher at West Virginia University’s Appalachian Center, once did a study of what it would take for people to move back and concluded people would take a substantial income cut to return.

The reasons that people left relate to employment and the absence of diversified job opportunities in the coalfields. This relates to education, health care, infrastructure, affordable housing, transportation and other socio-economic conditions.

In essence, firms, increasingly technologically focused, are not interested in states with a potential labor force that ranks 49th in the percent of West Virginia’s children who live in “near poor” families, trails the nation in the percent of college-educated workers, is 48th in the percentage of residents over 25 who do not have a high school diploma, and where management would not have a comfortable environment. It is also unlikely that the CEOs of the biggest companies whose median individual compensation, as reported in the Wall Street Journal, now exceeds $13.7 million will invest in constructing a gated environment like coal barons did when coal was a magnet. Their tax-free wealth will flow elsewhere where those who inherit the wealth will want to live comfortably.

In essence, a low-income tax rate would permit the wealthy to “use” West Virginia and contribute nothing to improving conditions, similar to what already prevails with the major land ownership of West Virginia’s natural resources.

In the meantime, the exodus of those who can will continue leaving behind those who cannot. The problem will therefore be unsolved and become worse unless there is a substantial investment in improving education, living conditions and infrastructure.

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