A long-standing bit of wisdom suggests that our 50 states are “laboratories” – important centers of experimentation that can try out public policy, before the entire nation risks taking the plunge.

Massachusetts for mandated health insurance, Wisconsin for welfare reform – there are many examples of states taking the lead, for better or worse, on risky, interesting initiatives, while the rest of the nation watched in awe or horror.

In addition, one of the charms of having 50 principalities around and about is the economic competition that is created, pitting one against another for consumers and businesses and population growth.

Human and financial capital are free to roam among the 50 states, looking for love, economic energy, low taxes, job opportunities, and, of course, cheap liquor in New Hampshire. And no sales tax in New Hampshire. And no personal income tax in New Hampshire. And, in case you forgot, cheap liquor in New Hampshire.

In response to the Massachusetts sales tax-free weekend last month, New Hampshire Gov. John Lynch fired off a ha-ha missile across the border, suggesting that if Massachusetts residents enjoyed shopping with no sales tax impediment, they should simply come to New Hampshire.

And, the governor went on, it would be helpful to New Hampshire if Massachusetts kept up its tax-and-spend ways, because every time taxes went up in the Commonwealth, it helped New Hampshire, as consumers and businesses crossed the border in underground tunnels and never returned home again.

This kind of sparring goes on in other places as well. South Dakota, with no income tax and lots of buffalo and pheasants, wiggles its hips suggestively and beckons neighboring overtaxed Minnesotans to come on over.

Until Connecticut lost its way and established an income tax in the 1990s, it enticed New York City folks to come on over and settle down in snobby bedroom suburbs.

Even at the city and county levels in many states, jurisdictions promote their various tax enthusiasms and perceived school quality, in competition with each other.

All of this is an irritant to the tax-and-spend crowd and assorted “regional planners,” who dream for the day when we all live in regional dictatorships from which taxpayers can’t easily escape by changing addresses.

Move On

Complicating research on all this has been the dramatic population shift from older cities in the North to Sunbelt havens, a trend that may well have been sustained these many years by lower taxes and more friendly regulation, but was initially spurred by the industrial decline of the Rust Belt – due only in part to state and local governance.

As early as1980, a presidential commission appointed by Jimmy Carter recommended that the nation smooth the way for the inevitable migration from North to South.

The one tiny bit of good news to come out of the recent recession for the industrial Northeast was a slowdown in the loss of population, as homes in the North became harder to sell and job prospects dimmed a bit down South.

But the hunt for greener pastures never goes away, even in the most micro of circumstances. Who wasn’t entertained by Sen. John Kerry, as he attempted to explain why his yacht was housed in Rhode Island, rather than in Massachusetts, which had a property tax blood-lust for expensive boats?

The population-shift variables, beyond such obvious factors as taxation, housing costs, and (as Massachusetts love to point out) “quality of life,” are, for the most part, rooted in a modern economy that no longer generates loyalty for a particular locale. The instinct was captured quite well in a book published last year, “Next Stop, Reloville: Life Inside America’s New Rootless Professional Class.”

But there is persuasive evidence to suggest that high taxes and unfriendly government do drive away population and prosperity.

The syndrome can be a vicious circle, as described by American Enterprise Institute analyst Michael Barone in the journal, National Affairs: “as increasingly liberal states institute increasingly liberal tax policies that drive out workers inclined to resent high tax rates,” lower-tax states tend to attract those more conservative voters inclined to “press to keep taxes low.”

New Hampshire knows how the game is played. “Live Free or Die.” Well, maybe not free, but cheap. Probably good enough.