Exit Fee
By Martin Harris

With the benefit of hindsight, I can look back on Ernest Hemingway’s famous dismissal of F. Scott Fitzgerald’s 1926 line "the very rich are different from you and me" with his own "yes, they have more money" and argue that he (Hemingway, not Fitzgerald) got it wrong. He should have said, "yes, they have more wheels". If you want evidence of the mobility of the affluent, you need look no further than the histories of class-based urban re-gentrification or suburban-migration patterns or the various analyses of upper-income-quintile tax avoidance behaviors. There seems to be quite a noticeable correlation between Wealth and Mobility: folks with more W also display more M. Montpelier’s Golden Dome folks, who have been making remarkable progress in moving the State’s economic base away from the old earned-income triad of agriculture, manufacturing, and tourism, towards a new unearned-income monad of passive cash flow in forms ranging from the pension check to the trust-funder stipend, should take careful note: their favored new constituencies of pensioner-retirees, rich kids, and tax-loss "businesspersons" are a lot more potentially mobile, should they become displeased, than the traditional Vermonter population of relatively-low-liquid-wealth farmer, machine-shop operator, or bed-and-breakfast owner ever was.

It’s not my intent here to support or denigrate (is that verb acceptable any more?) the New-Vermont economic model designed by the Golden Dome folks, even though they themselves aren’t at all open about the overarching social-engineering objectives of their taxation, land-use, business-climate, and regulation policies, but it is my intent to caution them that, unlike farms, machine-shops, and Victorian houses which can’t move, their favored new wealth base is much higher in both W and M, and can vote with its feet, for any real or imagined reason, if it becomes disenchanted with its chosen leaders. Such studies as Rich States/ Poor States, published last year by the American Legislative Exchange Council, are filled with statistics on the observed mobility of high W&M folks ( my phrase, not theirs) when faced with new or cumulative governmental behaviors –taxation or regulation, typically—they find distasteful. It is my intent to be helpful, and to that end, I humbly offer this legislative suggestion: the Vermont Exit Fee. Attention, citizens/taxpayers: if and when you want out, you’ll have to buy your way out.

This pay-to-flee idea isn’t my invention, I must equally humbly explain: it has deep roots in Vermont governance: the SU school system.

Those readers of this column who were in Vermont in the ‘60’s and even into the ‘70’s, and were old enough to be alert to such matters, when the first major rash of new-school-construction came out of the older Supervisory Union structure whereby a single superintendent’s office administered a number of town elementary schools and, typically, a single high school, sometimes with vocational center attached, will recall the noteable lack of enthusiasm of some town school directors (as they were then called, preceding the more recent "board member" appellation) for both the building programs and the superintendencies which were pushing them, and how they discovered, as did the South in 1861, that secession was theoretically possible but practically quite difficult.

That was because, as explained by superintendents of that era ranging from Brandon’s Lloyd A. "Pete" Kelley to Lyndonville’s Urban Wakefield, the would-be walkers would have to pay their share of the SU’s debt before departing. By that time, of course, most districts had already bonded for a bond issue or two, although nothing in the magnitude that would come in later decades, but even so, buying an exit ticket was, for all practical purposes, as impossible as paying off your mortgage with a single check. The same reasoning could now be applied to those rascally high-net-worth folks and businesses who might want to, as the ALEC report describes it, flee to a more tax-friendly state: the Golden Dome folks could keep them captive (and paying) in Vermont by presenting them with an exit-fee demand equal to their calculated share of the State’s present governmental indebtedness and liabilities. As the French peasantry were (and still are) rumored to have done with their force-fed-for-pate-de-foie-gras geese, that would nail their feet to the floor.
 

Martin Harris is a former Chairman of Citizens for Property Rights