216,000 People Leaving California in Surprise Exodus

For those of you who follow the MLB, you likely know that Merrill Kelly is an ace pitcher who was recently traded to the Texas Rangers in the year 2025. And he's very good. He's crafty with his throws. He keeps his pitches in tough spots. And he's really good at adjusting his approach to keep the hitters guessing at what he's going to be doing next. And this range of skills has translated into a lot of money for him. In 2025, he was making somewhere around $7 million a season. But in 2026, he was given two separate offers. He was offered $20 million a year to play for the California Padres. Or, separately, he was given a $13.3 million a year offer to play for the Arizona Diamondbacks. Looking at it from the surface, it seemed like an absolute no-brainer. Except he chose to go for the Diamondbacks. And this wasn't necessarily just because he liked Arizona more. It was simply because of taxes. The taxes over in California are so high that that $7 million difference between the two different contracts translated to only a $2 million difference in what would have actually been hitting his bank account. In Arizona, he'd make $13.3 million a year and take home about $8 million. But in California, he'd, on paper, be making $20 million a year, but taking home about $10 million. And I guess for him, that wasn't enough to make the move to the Golden State. In explaining his decision, here is what I don't think it's any secret on how much money you get taken out of your pocket when you go to California. It's just, like I said, they take too much money out of my pocket, man. The taxes over there are a different level. And the different level that he referenced in that statement of his, it can easily be seen with another high-profile recent case. The most recent Super Bowl happened to take place over at Levi's Stadium in Santa Clara, California. And as I'm sure many of you know, the Seattle Seahawks wound up winning that game. But what many people don't know is that the Seahawks quarterback, Sam Darnold, he wound up owing about a quarter of a million dollars in jock taxes to the state of California after winning the game. That was, by the way, roughly $70,000 more than he actually earned for that game. And the reason for that disparity has to do with how California taxes out-of-state athletes. California has a rule that out-of-state athletes must pay state income taxes based on the number of days that they work within the state of California. And the Seahawks, during their Super Bowl trip to California, totted eight working days. So the California Treasury Department, they took Darnold's $35 million a year salary, they divided it by 200 working days, they multiplied it by eight, which is the number of days he worked in California, and they taxed them at the higher tax rate that they have in California. If he had played that same Super Bowl game over in Arizona, instead of owing a quarter million dollars, he would have instead had an extra $200,000 in his purse. But because he played in California for just eight days, he wound up paying $70,000 to win the Super Bowl. All right, just to pause here for a super quick moment, I'd like to introduce our sponsor and my own personal gold dealer, American Hartford Gold. Now, as soon as the latest round of tariffs hit, almost immediately, the stock market hit some serious waves, we could say. It became super turbulent, very volatile. And of course, these conditions don't just affect Wall Street, they affect all of us with our investments and our retirement accounts. That's why I want to introduce a company that I trust and I use myself to help secure my own savings, American Hartford Gold. They specialize in helping Americans move their assets into something tangible, something you can actually hold, physical gold and physical silver. Two precious metals that help me sleep better at night, knowing that I have a hedge against all those brilliant decisions being made over in Washington. Now, they have an A-plus rating with a better business bureau, they have thousands of five-star reviews, and they make the whole buying process super simple. Your metals can be shipped directly to your doorstep, or you can transfer your current retirement account to a tax-advantaged gold IRA. And the best part is that right now, American Hartford Gold is offering an exclusive buy one, get one deal for my viewers. When you call them and mention my name, Roman, for every one ounce of gold that you purchase, you can get one ounce of free silver. And so, take advantage of the special offer, either call 866-242-2352, or simply text Roman to 65532. That's again, 866-242-2352, or text Roman to 65532. I'll also throw their information, it'll be down in the description box below. Now, these types of high-profile cases involving athletes, they obviously don't apply to the everyman. But actually, these cases are just the most visible examples of this phenomenon. A phenomenon, I should mention, that does apply to normal people over in California. You see, California's recent batch of new taxes, they have essentially led to an exodus of both wealthy tax-paying individuals, as well as corporations moving out of the golden state. You have Tesla, SpaceX, the Boring Company, Oracle, Hewlett-Packard, Chevron, Public Storage, Charles Schwab, Realtor.com, Yamaha, as well as over a hundred, I think hundreds of smaller businesses you might've never heard of, leaving California and moving to what they consider more business-friendly states. Over the last six years, from the year 2020 up until 2026, Texas has been the biggest beneficiary of this exodus, followed by Florida and Tennessee. And what's happening with businesses and corporations is also being mirrored by the individual residents as well. To that end, you have data from both U-Haul alongside the California Department of Finance showing that last year, in 2025, 216,000 residents left the state, which was similar to the 239,000 that left the year before that. In fact, California is one of the few states in America to actually be losing population year after year. And that loss of able-bodied humans translates to a loss, a real-world loss of tax revenue. Tech investor Chamath Palihapitiya estimates that the total wealth that has left California in the past month is $1 trillion. That was back in January of 2026. He wrote that we had $2 trillion of billionaire wealth just a few weeks ago. Now, 50% of that wealth has left, taking their income tax revenue, sales tax revenue, real estate tax revenue, and all their staffs and their salaries and income taxes with them. California is estimating budget shortfalls this year of $3 billion to $18 billion. Mr. Palihapitiya noted that California billionaires paid 13.3% of their income to the state every year, and with them gone, the middle class will have to foot the bill. Seemingly understanding this, California's middle class is also fleeing. Last year marked the sixth consecutive year that California ranked first among the nation's states in terms of outbound migration, with more one-way U-Haul customers leaving than arriving. The Golden State has led the nation in outbound migration for six years in a row. And indeed, it is this exodus of corporations, wealthy individuals, as well as regular middle-class Americans that's causing the state to rake in somewhere between $1 billion to $2 billion less per year in taxes. And so it's a bit ironic. The government wants to take in more money, so they raise taxes to do so. People leave because they just don't want to get taxed anymore, and then the government winds up with less money than if they did nothing at all. This concept, by the way, it does have a name in economics. It's called the Laffer Curve. It shows the relationship between the tax rate and the tax revenue. And so basically, if the tax rate is 0%, then the government obviously gets $0. But then if the tax rate is 100%, the state also gets $0 because people stopped working at that point. And so somewhere between those two points is the optimal tax rate. Now, where that exactly is on the curve, it's hard to perfectly determine. There's a lot of different variables to consider and to factor into any specific situation. And so you can test and see what happens. And judging by the exodus of wealth, both corporate and personal, out of California, it looks like they might have found themselves on the right side of the curve, taxing more but getting less. But hey, let me know your thoughts on the subject. I know a lot of you watching this program, based on the metrics I can see on the back end, happen to live in California. And so what do you think about the tax situation? Is it really as bad as the data makes it seem? Do you think you get enough services and amenities back from the state to justify the high cost? And also, are you yourself considering moving? Please leave your thoughts in the comment section below. I'll be reading them tonight as well as into the week. Also, all of my research notes for today's episode will be down in the description box below, which is that same description box right below those like and subscribe buttons, both of which I hope you smash, so this video can reach ever more people via the YouTube algorithm. People who perhaps might be thinking about moving themselves to California, not knowing about the tax situation, so you might be helping them out by smashing those like buttons. Thank you so much for that. And then until next time, I'm your host Roman from The Epoch Times. Stay informed, and most importantly, stay free.