New GOP Govs. Eye Cal Biz

John Seiler:

The poaching of good California jobs and businesses has just begun. The new crop of GOP governors just elected across the fruited plain is looking to grab what they can from the anti-business Pyrite State. Jim Christie of Reuters reports:

“It’s a testament to California’s voters that they had the foresight to beat back the tidal wave of corporate-controlled candidates that swept much of the rest of the country,” said California Labor Federation head Art Pulaski.

But according to Somer Hollingsworth of the Nevada Development Authority, that makes California “even more fair game.”

Texas in particular has been busy scouring California for companies tired of high taxes and unpredictable regulations, and analysts see the Lone Star State as a lodestar for new GOP-led states eager to spur business.

“You can’t argue with success,” said Jonathan Williams of the American Legislative Exchange Council, noting Texas has weathered the recession far better than California, in part because of its aggressive business recruiting. Texas’ October jobless rate was 8.1 percent. California’s was 12.4 percent.

Texas has set its sights on companies in the Golden State because “California is a target-rich environment,” said Ray Sullivan, Republican Governor Rick Perry’s chief of staff.

BAD REPUTATION

California’s “green” technology enthusiasts, including many in Silicon Valley, say the state’s future is in that sector, which Governor-elect Brown has said he will champion.

At the same time Brown has not been deaf to concerns about the state’s business climate and has proposed a “strike team” to attract and retain jobs with incentives and other state programs. He has also proposed cutting “onerous” regulations and has not ruled out tax breaks for manufacturers.

Irvine, California consultant Joseph Vranich, who advises companies on relocation and other matters, said the state urgently needs to reverse its reputation. He noted Chief Executive magazine ranks the state as the worst for business.

California also failed to place in the top 25 metro areas in this year’s Milken Institute Best-Performing Cities Index. Eleven of its top 25 areas were in Texas.

“The presumption in Texas is if a business wants to create jobs, it’s good. That presumption doesn’t exist in California, it seems to me, to the extent it did 20 to 30 years ago,” said Milken economist Ross DeVol.

Comerica Bank economist Dana Johnson said California’s business climate has had a real cost: the state’s per capita income rank averaged tenth among states over the past 20 years, down from fourth in the prior 60 years.

“My sense is its rank will continue to slide unless the state creates a more welcoming business environment,” he said.

The “green” jobs are phony, of course, as we have detailed here many times on CalWatchDog.com. And who knows what Jerry Brown will do? How can anyone deal with a $25 billion budget deficit? He also strongly backs AB 32, the anti-jobs bill the state’s genius voters just endorsed by rejecting Prop. 23.

And note, especially, that California’s per-capita income is falling — fast.

On the positive side, Gov. Schwarzenjobskiller soon will be gone.

Nov. 30, 2010



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