To look at the Pacific Northwest today one would never know that 25 years ago the region was an economic powerhouse at the forefront of technology and business innovation. At the time Portland and Seattle were known for constant rain as well as raining cash, and the “millionaire density” of the Seattle area was at historic highs. The tech boom and international trade with Asia had created a Silicon Valley of the northern coast.
Companies like Nike, Starbucks, Microsoft and Amazon established corporate offices and generated tens of thousands of jobs, and many of those jobs were considered high income. People can debate the overall effects of the population surge to the region; there are many who would argue that Washington and Oregon were better off when they were considered backwoods fishing and lumber states. That said, it’s undeniable that for a time the Northwest was one of the most desirable and lucrative places to live in the US.
That’s all gone now. The wealthy are leaving Seattle like it’s a leper colony and all that’s left are millions of broke activists, poverty stricken residents and illegal immigrants. Some blame the constant riots or the steady stream of welfare recipients. Others say that the draconian covid mandates caused people to jump ship. However, a primary factor in businesses (and money) leaving the city was the institution of a progressive “Payroll Expense Tax”.
The PET is a quarterly tax approved by the Seattle City Council in 2020 in the middle of the Covid hysteria. It increases taxes on businesses depending on how many employees they hire and how much their employees get paid. In other words, it punishes companies that hire more people and pay them a good salary. The conditions of the PET are very similar to what Democrats say they want for their “Wealth Tax” – An extra tax on top earners and large companies beyond the income tax.
Democrats were high on their own supply in the early 2020s and in their fervor to destroy conservatives they instituted every suicidal policy imaginable, from defunding police to near-zero prosecution for property theft under $1000. It’s not surprising that wealth taxes were established at the same time to “stick it to the capitalists”. What they seem to have forgotten, though, is that communist tactics don’t work if people and businesses are able to walk away, and that’s exactly what has happened in Seattle.
Larger businesses are packing up and leaving the Northwest as quickly as they arrived. Amazon, Meta, Google and Expedia are the most prominent examples of companies exiting the Seattle labor market and hiring elsewhere to avoid the Payroll Tax, but there are numerous others.
Hellbound and Down 