When Will They Get It? You Can't Tax People Into Staying

Today, Washington state Democrats passed a 9.9% income tax on those earning over $1 million a year. Within hours, Starbucks founder Howard Schultz — a man who built his entire identity around Seattle for 44 years — announced on LinkedIn that he and his wife are moving to Miami.

The timing wasn't subtle. It wasn't meant to be.

This is the part where we're supposed to pick sides. The right screams "told you so." The left says he's a greedy billionaire who owes Seattle everything. Both are doing what they always do: making it about the villain of their choosing instead of reckoning with the actual mechanics of what just happened.

So let's reckon with it.

The Pattern Nobody Wants to Learn From

Schultz is not a singular event. He's a data point in a trend that's been accelerating for years, and that the states experiencing it keep refusing to take seriously.

California is the master class. The state has watched Tesla, Chevron, Oracle, SpaceX, X, Charles Schwab, Hewlett Packard Enterprise, In-N-Out Burger, Palantir, and Realtor.com all relocate headquarters to Texas, Tennessee, or Florida — every single one citing some version of the same thing: taxes, regulations, cost of doing business. California's top state income tax rate hit 14.4%, the highest in the country. Texas charges zero. The math isn't complicated.

The results aren't complicated either. California faces a projected $50 to $70 billion deficit in 2025-2026 — a reversal from a $97 billion surplus just four years earlier. The Tax Foundation ranks the state 49th in business tax climate. Over 200,000 residents left on net between 2024 and 2025 alone. Starbucks itself announced a new corporate office in Nashville, Tennessee, even while keeping its Seattle headquarters. The corporate footprint is already quietly migrating south.

The Amazon Case Study: A Preview of What’s Coming

New York already ran this exact movie — and the ending was ugly.

In 2018, Amazon chose Long Island City, Queens as one of two locations for its second headquarters — HQ2. The deal came with a promise of 25,000 jobs and $2.5 billion in investment. New York state and city governments offered $3 billion in incentives to make it happen.

A coalition of progressive politicians and activists — most visibly, Alexandria Ocasio-Cortez — mobilized against it. Their argument: Why are we handing $3 billion in public money to the richest company on earth? It's a fair question. The backlash worked.

In February 2019, Amazon pulled out, citing politicians who "have made it clear that they oppose our presence." The jobs went to Arlington, Virginia instead — a place that was, in Amazon's own words, "willing to partner" and "think long-term."

Here's the important nuance: AOC's underlying concern about corporate welfare wasn't wrong. Handing billions in public subsidies to trillion-dollar companies is a legitimate problem — and we'll get to that. But the outcome wasn't a victory for the working people of Queens. The 25,000 jobs — entry-level positions, operations roles, tech support, logistics management — didn't materialize in New York. They materialized in Virginia. The ladder moved.

When COVID hit in 2020, New York City faced catastrophic unemployment. The counterfactual was impossible to ignore: 25,000 Amazon jobs would have been a meaningful buffer. Instead, the city got the moral victory of not subsidizing Bezos — and all the economic pain of a gutted labor market with no cushion.

New York. Seattle. San Francisco. Chicago. The same movie, different cities, same ending: make it politically toxic to do business here, the businesses leave, the tax base shrinks, services deteriorate, and the people who can't leave — the middle class, the working class, the people these politics were supposedly designed to help — are left holding the bag.

This Is the Part Where Someone Mentions Atlas Shrugged

Yes, it's that part. Bear with me for a second.

Ayn Rand's 1957 novel Atlas Shrugged is the book conservatives deploy like a weapon and progressives dismiss like a cringe artifact. But there's a reason the premise keeps showing up in real life: a society that endlessly penalizes its most productive members eventually watches them disappear. In the novel, the "producers" — industrialists, inventors, entrepreneurs — quietly withdraw from a society that treats their success as a resource to be taxed and redistributed. The engine of the world stops.

The novel is ham-fisted, ideologically rigid, and Rand's heroes are borderline sociopaths. Nobody's arguing it's a policy blueprint. But the core observation — that capital is mobile, that talent is mobile, and that punishing both creates a race to the bottom for everyone left behind — is not ideology. It's economics. It happens every time.

The Millennial Angle Nobody's Talking About

Here's the part that should enrage everyone under 45 regardless of political affiliation:

When businesses leave, they don't just take the billionaire's tax bill with them. They take the jobs. The entry-level jobs. The mid-level jobs. The jobs millennials and Gen Z are grinding to get into. The jobs that might — might — let someone afford a one-bedroom in a city they actually want to live in.

From 2011 to 2021, net headquarters relocations out of California were associated with roughly 77,600 headquarters jobs moving out of state. These aren't CEO jobs. These are HR coordinators, operations managers, junior analysts, marketing associates — the rungs of the ladder that working people use to climb.

Dallas-Fort Worth captured 100 headquarters relocations between 2018 and 2024 — more than any metro in the country. Austin added 81. Houston added 31. Those are jobs that used to exist in California, New York, and Illinois. They don't anymore.

So when Seattle passes a millionaire's tax and Schultz leaves by sundown, the millennial in Ballard trying to climb the ladder at a Schultz-adjacent company isn't cheering. They're watching their industry's center of gravity quietly shift to Miami.

Hold On — Let's Be Honest About the Other Side

This is not an argument that billionaires deserve sympathy. Howard Schultz has a net worth of $6.6 billion. He will be fine in Miami. His family office will be fine. His lifestyle will not change in any measurable way.

And AOC's instinct about the Amazon deal — that handing $3 billion in public money to a trillion-dollar corporation sets a dangerous precedent — wasn't wrong on the merits. Corporate welfare is a real problem. Cities bidding against each other in a race to hand public money to the richest companies in the world is genuinely bad policy.

The "they'll just leave" argument can also be weaponized to justify never taxing the wealthy at all — which is exactly how we ended up with the grotesque inequality we're sitting in right now. Corporate tax rates have been slashed repeatedly over decades on the promise that it would trickle down. It didn't trickle. The pie got bigger, the slices for most people got smaller. That's a real and documented failure.

But here's the thing: there's a difference between taxing wealth at the federal level — where capital genuinely has nowhere to flee — and taxing income at the state level, where all you're doing is subsidizing Florida's economy. And there's a difference between refusing a bad subsidy deal and making your city politically hostile to any major employer.

A federal wealth tax, applied uniformly, changes the equation entirely. You can't move your residency to Texas to avoid a federal obligation. The money stays in the system. That's the conversation worth having.

What Washington state just did instead is perform progressive politics while functionally giving Schultz a graceful exit and donating his tax bill to the state of Florida. It's not that the intent was wrong. It's that the mechanism is broken.

The Part That Should Keep Everyone Up At Night

California's structural problem is a preview of what happens when you build a tax base on a narrow band of ultra-high earners and then watch them leave. The top 1% of California earners pay roughly half of all personal income tax revenue. Half. That's not a progressive tax system — that's a system balanced on a knife's edge where a few thousand people's residency decisions can crater the state budget. And when estimates suggest $1 to $2.5 trillion in assets may have left California in late 2025 and early 2026 alone, that knife is wobbling. The "All in Podcast" crew has mentioned this.

The people who suffer when that budget craters are not the people who left. They're the people in underfunded public schools. The people who depend on state services. The people who were supposed to benefit from the millionaire's tax in the first place.

That's the cruelest irony of the whole thing. The policy fails the people it was designed to help, while the people it was designed to target simply update their LinkedIn and call a Miami realtor.

So What's the Answer?

Not "no taxes on the rich." Not Atlas Shrugged as governing philosophy. Not "just let the market work it out" — we've seen that movie too.

The answer is building tax policy around mechanisms that can't be circumvented with a moving truck:

• Federal-level wealth and income taxes that apply regardless of which state you live in

• Exit taxes on unrealized gains when high-net-worth individuals change residency

• Closing the stepped-up basis loophole that lets intergenerational wealth transfer virtually untaxed

• Stop building state budgets that are structurally dependent on a handful of billionaires staying put

• When negotiating corporate incentives, build clawback provisions — if the jobs don't materialize, the tax breaks don't either

None of this requires sympathy for Howard Schultz. He can enjoy his Miami penthouse. But continuing to run the same play — pass a state-level tax, watch the wealthy leave, act surprised, cut services, repeat — isn't progressive governance. It's theater.

The Bottom Line

Howard Schultz didn't betray Seattle. He did exactly what any rational actor with $6.6 billion and a 9.9% new tax bill would do. That's the problem.

Amazon didn't abandon New York because AOC asked a valid question about corporate subsidies. It left because the political environment made it clear the welcome mat had been pulled. The question of whether the subsidy was worth it is legitimate — but 25,000 jobs went to Virginia either way.

When policy is designed around the assumption that wealthy people and major employers will stay put and absorb whatever you charge them, it isn't policy. It's wishful thinking. And the people left holding the consequences are never the ones who could afford to leave.

So when will they get it? Probably not today. Today they're celebrating a vote. The bill comes later — and it always lands on the people who can't pay it.

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