Will your kids desert Oklahoma?

April 5, 2019

Trent England

Key Points

Why would Oklahomans, those with the highest earning potential and during their prime earning years, move away? And where are they going?

Norman NPR-affiliate KGOU touches on the first question but not the second. 

Oklahoma’s population growth rate is at its lowest since 1990 according to new study from the Kansas City Federal Reserve. That’s because Oklahoma lost more residents to other states than it gained over the past three years, with college graduates leading the way.

But never fear, OCPA's Curtis Shelton took up the topic last year. Using a fascinating data set, he shows that Texas is winning away wealth from Oklahoma. And Curtis points out one big difference between the two states: Oklahoma taxes productivity and Texas does not.

An Oklahoman can move to Texas and, everything else being equal, get a fatter paycheck. As it happens, total Texas taxes aren't much lower than Oklahoman taxes. But taxes are not created equal. Texas tends to tax consumption rather than productivity. That gives taxpayers more say over how much they pay and, at the same time, avoids creating a disincentive on work and investment.

Basically, we have two choices. Either hope that liberals take over Texas and make their tax policy as bad as ours, or reform Oklahoma's tax structure to be competitive with our southern neighbor.