Indiana might want to consider a different use of the proposed $774 million cut in state income taxes.
The other day I was looking at a map of the United States. The state of Indiana is the heart of the six Midwestern states: Wisconsin, Illinois, Kentucky, Ohio and Michigan.
Indiana has a population of about 6.3 million. If you look at the large cities in contiguous states that border Indiana, the population of Louisville and Owensboro, Ky., Cincinnati and Dayton, Ohio, Milwaukee and Chicago combined is easily 1.5 times that of our entire state (9 million people).
We might want to use the tax money to create incentives for retirees to stay in Indiana and to have retirees relocate from those population centers.
The baby boomers (1946-1964) population is about 80 million. The population of the United States is 313 million. Add four years to the baby boomer demographics (1944-1966) and the population increases to almost 100 million, almost one-third of the U.S. population.
At the end of the 2011, there were 46 million people on Medicare. By 2030, it is estimated 80 million people will be on Medicare. The largest job growth industry in the future is health care. What would this do for hospitals and health care jobs in Indiana? The revenue from the federal government would be immense.
Households headed by people age 65 and over spend $39,000 annually, add 1,000 retired families to Northwest Indiana every year, and it is like a company with a $39 million payroll.
Retirees moving to the The Villages in Florida add $1.5 million per month in new Social Security income. If that amounts to one-half of the income, it is equivalent to a company with a $36 million payroll; and it happens every year.
Retirees don't burden our schools, the largest budget expense of most towns and cities. Other advantages are that they don't use cars at 8 a.m. or 4 p.m., they use only 20 percent of the water and sewage of a family of five, and require less police protection.
As our population grows and the average lifespans increase, this market will go on for many, many decades.
In a recent survey of baby boomers, they stated they want to stay close to their families and grandchildren. Indiana offers many areas for boomers to live close to neighboring cities and living here for less could attract a lot of boomers.
Recruiting retirees is an attractive growth alternative to creating jobs. There is a designation, Certified Retirement Community, that is recognized and promoted by various state agencies. Often criteria such as low crime rates, low taxes and quality medical care must be met. Other criteria include entertainment events and sports at all levels. Northwest Indiana certainly qualifies on all of these points.
If Indiana would budget the $774 million tax cut into encouraging boomers to relocate to Indiana from the populous contiguous cities and retain our own retirees, I feel we would get a much bigger economic bang for our buck.
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