State Affordability Policies Fuel Migration to Free-Market States: Jonathan Williams on American Radio Journal

In the early weeks of 2026, what can we expect as it relates to the economy this year? Public debate remains focused on affordability. Americans are still absorbing the consequences of price increases that grew out of control during the Biden administration. In 2022, inflation never fell below 6.5% and peaked at an incredibly high 9.1% in June of that year. Americans noticed people balancing their budgets at their kitchen tables, watching groceries, rent, and utilities consume an ever-greater share of their income.

Yet our economy continues now to show indications of strength. Americans will see significant tax relief with the Working Family Tax Relief Act, which was signed into law by President Donald Trump in 2025. We will see gains in productivity, continued strong GDP growth in the last two quarters, and inflation that has cooled dramatically from its recent peaks during the Biden years.

However, what differs sharply across the country is not the national economy, of course, but state policies that have driven a wide economic divergence between rich states and poor states. Some states continue to position themselves as places where ordinary people can still get ahead. Others continue to enact policies that make basic necessities more expensive and economic mobility more difficult.

Of course, the most direct way for policymakers to leave more money in people’s pockets is to take less of it in the first place. That reality is reflected in human behavior. According to the recently released U-Haul Growth Index, which tracks the balance of inbound versus outbound one-way truck rentals, states with competitive tax policies that lead to more affordability continue to attract residents. Texas and Florida, two states without personal income taxes, again lead the nation in inbound movers. North Carolina ranks third, and Tennessee, another state without a personal income tax, ranks fourth.

At the other end of the list are California, Illinois, New Jersey, and New York. These four states, long committed to high taxes and heavy regulation, also lead the nation in outbound moves. This is not a coincidence. People respond to incentives, even when policymakers pretend otherwise. Such patterns are examples of Americans voting with their feet. Families and businesses migrate toward jurisdictions that allow them to keep more of what they earn and impose fewer regulatory obstacles. Human capital flows to where it can be used most productively, offering a clearer verdict on policy than any political talking point.

During the COVID period, when remote work expanded dramatically, many Americans discovered that moving could function as an immediate boost to affordability. Predictably, many did.

Affordability extends well beyond taxes. Consider even things like water and sewer costs, which are highest in states like Maryland, Washington, Hawaii, and Connecticut. Maryland residents pay, on average, more than three times what residents pay in the lowest-cost states: Alabama, Tennessee, South Carolina, and West Virginia. These differences do not arise from geography alone but from policy choices and regulatory structures at the state level.

Energy costs tell a similar story, depending on the choices of state policymakers. States that pursue government-directed ideas around energy as an overriding objective—through carbon taxes, cap-and-trade policies, or radical ESG ideology—have driven electricity prices sharply upward. California, Massachusetts, and Connecticut now charge more than 21 cents per kilowatt-hour for electricity. In contrast, states like Utah, Idaho, North Dakota, and Wyoming charge less than 9 cents, less than half as much. The consequences are borne not by slogans but by households paying monthly bills.

Housing costs are perhaps the most visible component of the affordability discussion. Prices have risen nationwide and strain household budgets. Some factors, like supply restrictions and property tax burdens, are driven by state and local government decisions, respectively. However, some cost drivers lie beyond state control. In much of the Western United States, large portions of land are federally owned and unavailable for development, creating supply constraints that no state legislature can easily overcome.

But state policy still matters greatly. Housing costs vary widely, even among states facing similar geographic limitations. California, again, stands out—and not in a good way. The average home price exceeds eight times the median personal income in the Golden State. While affordability challenges are real in many parts of the country, they are generally driven by failed big-government policies.

In contrast, we have some refreshing national tailwinds with federal tax relief and deregulation, driving costs lower. Free-market states are doubling down with policies that bring more affordability. As with our great experiment with federalism, Americans are free to choose—and they continue to choose states that value freedom.