MARCUS: Let's focus on keeping retirees in Indiana

Morton Marcus
July 3, 2010
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Morton Marcus

“The edict came down just yesterday,” Sorethroat said. “From now on, all Indiana state government agencies are enrolled in the CARP program, the Campaign to Attract and Retain People. But I know the truth.”

That’s how it is with Sorethroat. He does know the truth. As one of the senior civil servants in state government, he has worked in many departments under all sorts of administrations and administrators. He has the necessary contacts and is the institutional memory of the Statehouse. Most of all, he remembers when he could smoke on the job.

“The truth,” he continued, “is that we’re not as interested in the people as we are in their money. Do you have any idea how much money Indiana loses each year because retired people move away from here?”

“No,” I admitted.

“Don’t worry about it,” Sorethroat said. “Nobody knows. But we have an indication from data published by the Internal Revenue Service. That wonderful agency reports annually on the migration of federal income taxpayers. We learn how many filers move from county to county and state to state and the amount of income they report.”

“That sounds like a gold mine of data,” I said.

“Yes and no,” he equivocated. “But listen to this: Between 2007 and 2008, taxpayers reporting more than $396 million moved from Indiana to Florida.”

“Do we know if these were retired Hoosiers?” I asked.

“No,” he said, “but who else with money moves to Florida? The telling figure is the net amount of money moving. Indiana had deficits (more money leaving the state than entering) with 36 states. Indiana’s greatest deficits were with Florida and eight other states known to draw retirees. Together, these retirement magnets accounted for 83 percent of our deficits.”

“Interesting,” I said. “Yet you said we had deficits with 36 states. What about the other 13 states? We must be gaining from them.”

“Right,” Sorethroat rasped. “Our neighbors (Illinois, Ohio, and Michigan) are our biggest surplus states. More money moves from these states to Indiana than leaves the state. There, the question remains how to retain Hoosiers who are moving across the Indiana borders while not discouraging people from those states to move to Indiana.

“In 2008,” he continued, “we lost a total of $2.9 billion as taxpaying Hoosiers left the state for life elsewhere. One-third of that sum went to our four adjacent states. These folks weren’t going to exotic locales like Arizona or Alabama.”

“You aren’t saying that our state government is going to interfere with the traditional American right of free movement across state lines?” I asked in mock horror.

“Of course not!” Sorethroat asserted.

“Then why don’t we do what is necessary to attract and retain people just as we try to attract and retain jobs?” I asked.

“That’s what CARP is all about,” he said. “After years of silliness trying to keep young people from leaving Indiana, we’re now going to make the effort to keep people who have incomes here.”

“That’s real progress,” I said. “We want young people to go elsewhere, to learn about other places and other ways. It is ultimately counterproductive to have Hoosier children stay in Indiana as young adults. Let them come back when they have something to offer the state, something like their income and our grandchildren.”

“Yes, but, how do we attract and retain people?” Sorethroat asked. “It’s hard enough to do it with jobs.”

“The answer,” I said, “is to make our communities good places to live. Maybe with CARP we’ll find that state government is committed to real community development, to improving the quality of Hoosier life.”

But maybe that’s as unlikely as a real CARP program.•


Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at mmarcus@ibj.com.


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