locus communis

In other cases, the institutional environment in which a city finds itself can take some of the blame for the city’s economic problems. Part of the reason for the woes of cities in western and upstate New York is the state’s tax structure, which the Tax Foundation’s 2011 State Business Tax Climate Index calls the nation’s worst for businesses, with “the third worst individual income tax, ninth worst sales tax, and worst property tax.” The Big Apple may survive those taxes, but industrial cities like Syracuse and Buffalo are withering under them. The troubled condition of many American inner cities is similarly due in part to institutional factors: once wealthier residents start leaving for the suburbs, they reduce the tax base, which further harms city services and spurs still more residents to leave. That vicious cycle is almost unknown in Canada, not because Canadian politicians have demonstrated better leadership but because services are funded differently. Education, for example, is funded by the province, meaning that a small migration to the suburbs doesn’t spark a full-fledged exodus.