Californians fleeing our lovely state

Oct. 1, 2012

By Steven Greenhut

SACRAMENTO — Not long ago, I penned a case for staying in California, arguing that there’s nothing wrong here that isn’t fixable.

California, blessed by magnificent and varied geography, mild weather and an “anything’s possible” culture, suffers mainly from a political process controlled by union advocates hell-bent on protecting their power and privilege, no matter what that means for the state’s public finances and public services.

While still standing by this “we should stand our ground” point of view, I’ve found little to be hopeful about in the current political season, with polls showing Gov. Jerry Brown’s tax-increase plan (Proposition 30) holding a solid lead, an initiative that would chip away at union power (Proposition 32) failing, and President Barack Obama holding a 24-point lead in the presidential race in California.

Polling results on all three above-mentioned matters are not surprising, but they do suggest how far we are from the paradigm shift needed to get California back on a better track.

The most troubling thing I’ve seen is the delusion embraced by the state’s dominant Democrats, who really believe that California is only one massive tax increase away from being fixed.

“Maybe I know too much about this stuff, but we’re in a recovery, a slow recovery, and it’ll keep recovering with any luck,” Gov. Jerry Brown said in early September. “And if the Republicans would get out of the way and let, you know, the stimulus and the investment go forward, such as the Democrats have proposed, we’ll be better off.”

The state’s problems don’t bother me nearly as much as knowing that voters and officials here are in denial about the problem and have no clue how to fix it. It’s getting harder to blame Republicans for this any more, especially in California where they are an endangered species.

If voters approve Prop. 30, California’s income-tax rates will be the highest in the nation — 21 percent above the second-highest state of Hawaii and 34 percent above the third-highest state of Oregon, according to anti-tax activist Richard Rider of San Diego.

Taxes and regulations

California is high on the list of most other taxes and regulations, and its wasteful public services are not reformable because of union power.

Business owners talk not just about the costs, but about harassment by myriad government tax and regulatory agencies that often treat them like criminals.

Freedom is on the decline as government gains more authority to micromanage virtually everything. Just check out the kind of bills the governor is now signing into law. (I love Steve Breen’s cartoon, which says, “If you’re a Californian and want to start a small business, there are a number of different routes you could take.” It then shows the various interstate highways that lead to other states.)

Yet Brown insists that California is still “the land of dreams.” And some academics say the talk about a California exodus to other states is not true. In May, University of Southern California Professor Dowell Myers argued that we shouldn’t believe “the tales of gloom. Californians aren’t fleeing.” The main problem, he wrote, is Californians don’t spend enough public money on schools.

This is where I want to bang my head against the wall. There have been some reductions in per-pupil public-school spending from 2008, given California’s budget problems. But these reductions come after massive spending increases in previous years and Proposition 98 mandates 40 percent of the general fund goes to K-14 education.

Schooling is so important, yet California’s leaders have been resistant to imposing the real reforms that will improve schools through competition and teacher testing — ideas that run afoul of the powerful California Teachers Association.

New study

Despite these delusions, productive people are leaving and they will do so more rapidly if this “just tax and spend more” advice is followed.

A new study from the Manhattan Institute called “The Great California Exodus: A Closer Look” offers a reality check. Yes, Californians are fleeing mostly for pro-growth states with a better tax and regulatory climate. California used to be a destination state, but has outsourced 3.4 million residents in the past 22 years.

“The data suggest that many cost drivers — taxes, regulations, the high price of housing and commercial real estate, costly electricity, union power, and high labor costs — are prompting businesses to locate outside California, thus helping to drive the exodus.”

As authors Tom Gray and Robert Scardamalia explain, Californians are fleeing “chronic economic adversity,” congestion, and “constant fiscal instability” at the state and local governmental level, which “can be seen as tax hikes waiting to happen.”

All these reasons, even congestion, have a strong public-policy component. Businesses and individuals get tired of being viewed mainly as an ATM machine for government. If the state’s political leaders, most of whom come directly out of “public service” or the union movement, talked to business owners (and not just the crony capitalists they meet at the Capitol), they might learn about the trials of doing business here.

California is a highly urbanized state, and coastal metropolises are understandably crowded, but draconian land-use restrictions and misguided transportation policies (roads are bad, rail is good) exacerbate the problem. These “New Urbanist” policies embraced statewide have created unnecessary sprawl and congestion by pushing development far from job centers and into the Inland Empire and the Central Valley.

Governmental instability is an understandable reason to flee. In cities that have overspent on lush pensions and wasteful redevelopment projects, traditional public services (infrastructure, public safety, parks, etc.) suffer — something that will get worse as more localities file for bankruptcy.

The Manhattan Institute authors argue that California can be fixed if Californians have the “political will.”

Unfortunately, protests in Spain and Greece, much further down the same path California is taking, suggest that politicians can go many more years without showing the necessary political will to make necessary but tough reforms.

Let’s hope California retains enough of its historic entrepreneurial spirit to muster the will to turn things around.

Steven Greenhut is vice president of the Franklin Center for Government and Public Integrity. He is based in Sacramento. Write to him at [email protected]

34 comments

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  1. The Africanized Swarm of Ted Steele System
    The Africanized Swarm of Ted Steele System 1 October, 2012, 08:15

    Greeny– Things will be fine……relax……………and in the meantime……..enjoy the smaller crowds! Nov 6? 4 more years for the President and yes on the temp tax hike/tax the rich Prop 30 !!!

    Reply this comment
  2. Rex the Wonder Dog!
    Rex the Wonder Dog! 1 October, 2012, 08:20

    Teddy, bring back Uhaul.

    Reply this comment
  3. Ulysses Uhaul
    Ulysses Uhaul 1 October, 2012, 08:33

    PACK AND SHIP!

    Special on packing boxes from China.

    Reply this comment
  4. Hondo
    Hondo 1 October, 2012, 08:42

    There was no reason for Campbell soup to leave. They were in the central valley, bread basket of the world, the closest to their food suppliers. All the farms that supplied them were just down the road, meaning much lower costs. And they were in the middle of the most populus state in the country, all their markets were just down the road.
    But now all of Campbell soup will be trucked in from the midwest, because its cheaper than dealing with the Kalifornia demoncrats.
    Those were good jobs for many democrat voting minorities. Now they just get an Obama phone.
    Hondo……

    Reply this comment
  5. BobA
    BobA 1 October, 2012, 08:53

    Hondo:

    Don’t forget all the free Obama goodies they get along with that free Obama phone. I’m a California native and even I’m preparing to cut ties with this wretched state. The liberals and the dependent class can have it.

    Reply this comment
  6. Ulysses Uhaul
    Ulysses Uhaul 1 October, 2012, 09:06

    BobA

    Don’t call us we don’t do moves to Cleveland!

    Reply this comment
  7. Monitor
    Monitor 1 October, 2012, 09:10

    I weep for the state I was born and raised in. I left to join the Army and always planned to go back someday.

    Unfortunately the cost of living never made that a feasible option. Still, I wish that someday I could afford to live there again.

    Reply this comment
  8. surfpunk
    surfpunk 1 October, 2012, 10:10

    You better leave soon,if you can.The bay mob is allready working on the new exit fee!,its not a tax!

    Reply this comment
  9. Dyspeptic
    Dyspeptic 1 October, 2012, 10:18

    Steven, do I detect a growing note of pessimism in your writing? Is the memory of those cold Ohio winters fading now? Finally, you seem to be waking up to the reality of Kalifornia. There is no fix. There is no miracle on the horizon. As I keep saying things will get a lot worse in this state because reality is the last thing people in Kali. are prepared to deal with.

    Jerry Clown, Mollie Mugger and Steinburp have a plan – keep doing the same thing often enough and eventually you will get a different result. Geniuses huh?

    The people who run this state are no different than those who have run Greece, Spain, Italy, Portugal, Ireland etc. into the ground. They lie, cheat, steal and buy votes with ridiculous promises that only a fool would believe. Kalifornia is the promised land for fools.

    Teddy, Uhaul, Queeg, please pop out of your jack-in-the-box and tell us how wonderful things will be when our taxes go up again.
    Tell us how wonderful our double digit long term unemployment is.
    Tell us how wonderful our $4.50/gal. gasoline is.
    Tell us how wonderful our skyrocketing electric rates are.
    Tell us how wonderful it is paying university tuition rates 75% higher than 5 years ago.
    Tell us how wonderful it is to live in a state where hoards of criminals are let out of jail to prey on the rest of us because you public sector parasites must have your pensions.
    Tell us how wonderful LAUSD is and how the city of Bell is just an aberration.
    Tell us how wonderful things will be when no one comes to bail Kali. out and your left with empty promises, crumbling infrastructure and no pension.
    Tell us how wonderful our credit downgrade is.
    Tell us how wonderful it is to have millions of unemployed third world peasants with anchor babies getting “free” welfare goodies we can’t afford.
    Tell us how wonderful it is to be the criminal gang capital of the world.
    Tell us how wonderful it is to be a super magnet for stupid people.

    And by all means, don’t forget to brag that in Kali. you can surf in the morning, ski in the afternoon and bump into a celebrity at the drug store. That always impresses the rube’s from back east.

    Reply this comment
  10. BobA
    BobA 1 October, 2012, 10:33

    Ulysses Uhaul:

    Cleveland?? Are you serious? Cleveland?? Of all the cesspools and crime ridden ghettos in in America, why would anyone want to move to Cleveland?? I must say, I like your sense of humor. Cleveland? That would be like moving to Oakland, CA.

    Reply this comment
  11. BobA
    BobA 1 October, 2012, 10:44

    Ted Steele :

    Bye Ted. Call me on your Obama phone when things go from bad to worse and you need a Uhaul trailer. Have I got a deal for you! Sorry, cash or gold coins only. No food stamps or EBT cards accepted.

    Reply this comment
  12. Dyspeptic
    Dyspeptic 1 October, 2012, 11:01

    Oh, I forgot to mention:
    How wonderful it is having 12% of the countries population and 30% of it’s welfare cases.
    How wonderful it is that you can have your welfare and unemployment checks direct deposited into your BOA bank account with free debit card!
    How wonderful it is to destroy the worlds most productive agricutural sector to benefit an obscure little minnow in ‘Frisco Bay.
    How wonderful it is watching the states manufacturing sector evaporate.
    How wonderful it is living in a state where Democrats gleefully re-elect dead politicians (I’ve heard of zombie voters but in this state we go one better – zombie politicians 🙂
    How wonderful it is living in a state where illegal aliens get in-state tuition subsidies, drivers licenses and defacto amnesty. Who knew being a barbarian invader could be so rewarding. The Visigoths and Vandals never had it so good!
    I’m afraid it’s all just too wonderful for me.

    Reply this comment
  13. SeeSaw
    SeeSaw 1 October, 2012, 11:40

    Why don’t you select another state to your liking, and move there, Dyspeptic. You don’t seem too happy to be in California. Your glass is oh, so….half empty. Be sure to keep plenty of cheese on hand.

    Reply this comment
  14. Dyspeptic
    Dyspeptic 1 October, 2012, 12:27

    @ SeeSaw,

    So it’s Kalifornia, love it or leave it, is that right?

    I have a better idea See-No-Evil. Why don’t you and your likeminded legion of sucker voters leave so the rest of can begin rebuilding Kalifornia into something that actually works. Go back to New York or Chicago or Mexicali or whatever nest you fouled before you came here and ruined paradise.

    Reply this comment
  15. queeg
    queeg 1 October, 2012, 12:29

    This guy is a perfect future resident of downtown Oakland or Stockton….then he can moan and groan with his tin cup out on the curb next to the 12 Month Santa Clauses…

    Reply this comment
  16. BobA
    BobA 1 October, 2012, 14:31

    Dyspeptic:

    That’s for saying that to this @seesaw character. I’m well traveled and very familiar withe the various regional accents in this country and I can attest to the fact that almost every rabid liberal I run across in our state is almost invariably an east cost liberal transplant.

    The few libs that I know in my neighborhood are from the east coast. They’ve ruined their places of origin and then they bring that same mentality with them to the west coast and have ruined California.

    Reply this comment
  17. The Africanized Swarm of Ted Steele System
    The Africanized Swarm of Ted Steele System 1 October, 2012, 15:21

    Dyscleptic and Bob0—– Seriously men, you sound tense…relax…..things will work out……yikes……..have you guys tried meditation or psych meds?

    Breath deep……….let it out……..slow down…….maybe a guided Ted meditation?

    Reply this comment
  18. Ulysses Uhaul
    Ulysses Uhaul 1 October, 2012, 17:43

    Teddy is the sage of CWD. His advice is timeless and precious. His patience with the tense,knotted up and misinformed CWD deliverance boys is remarkable.

    Reply this comment
  19. BobA
    BobA 1 October, 2012, 17:50

    Ted Steele:

    Things will work just as soon as Sacramento bleeds California tax payers dry and the state has to default on its debt. Then the state will ask for and get get a federal government teat to suckle on. The state will be on easy street from there on out until the federal teat runs dry.

    Reply this comment
  20. Ulysses Uhaul
    Ulysses Uhaul 1 October, 2012, 18:33

    The pie is growing. Ask that Laffer guy….the poor will get their fair share!

    Reply this comment
  21. Ulysses Uhaul
    Ulysses Uhaul 1 October, 2012, 18:34

    And so will hard working state and local workers.

    Reply this comment
  22. C-Lion
    C-Lion 1 October, 2012, 20:00

    The spending-per-pupil argument is a complete fraud.
    California is the most populous state. Therefore, using real-world economic principles, it SHOULD be spending less per pupil.
    For instance, when you go to the grocery store, thanks to the price labels on the shelf, you understand that if you buy the 32 oz. bottle of Brand X, your per-ounce cost will be LESS than if you bought the 24 oz. bottle.
    But, of course, we are talking about government so common sense and logic are MIA.
    The corruption and ignorance is truly beyond belief. We ARE screwed.

    Reply this comment
  23. Ulysses Uhaul
    Ulysses Uhaul 1 October, 2012, 21:25

    PACK SHIP BE HAPPY!

    Our food stamp in trade program has fallen flat….they are STAYING..
    they say they are happy in California; they love being called 99’ers.

    CIAO

    Reply this comment
  24. Fred Mangels
    Fred Mangels 2 October, 2012, 08:13

    Steve wrote, “Not long ago, I penned a case for staying in California, arguing that there’s nothing wrong here that isn’t fixable.

    I missed that one. Good to see you’ve come around and realize this state isn’t fixable. It will have to collapse completely before it can be turned around.

    Reply this comment
  25. Ulysses Uhaul
    Ulysses Uhaul 2 October, 2012, 09:13

    The collapse is in CWD posters’ attitudes….the House of Gloom and Doom!

    Reply this comment
  26. Ulysses Uhaul
    Ulysses Uhaul 2 October, 2012, 09:29

    I love moving articles….good for business.

    Reply this comment
  27. SeeSaw
    SeeSaw 2 October, 2012, 10:17

    Dispeptic, I came from WY, a red state. Raised on a farm–left when I was 20, and I fouled nothing while I was raised there. I have been in CA since 1956, worked in a national defense corp for a year, married and raised a family, worked for a municipal government, have five beautiful grandchildren, and I am here, still in CA. I have always conducted myself properly–never had so much as a traffic ticket. You would have been damn, lucky to have known me along the way, you insolent jerk! What have you done to maintain and protect the places you have passed through, except being a pathetic whiner!

    Reply this comment
  28. Jackie
    Jackie 2 October, 2012, 10:50

    MILD weather?!? It was 106 in Burbank yesterday. HARDLY tolerable… 😉 Just sayin’. 🙂

    Reply this comment
  29. The Africanized Swarm of Ted Steele System
    The Africanized Swarm of Ted Steele System 2 October, 2012, 12:35

    SeeSaw–OOOOOUCH—- Please don’t slam the rightie trolls like Dyscleptic…..he’s sensitive.

    Reply this comment
  30. Tom from Oregon.
    Tom from Oregon. 4 October, 2012, 01:54

    Yahoo. Finally someone we’re (Oregon) economically competitive with. Not that I am gloating. We’ve been where you are going. Still we are finally gaining on the Demos here. Our strategy has been to save our state one county at a time. 2 examples. 1) To keep Portland Oregon green they agreed to make coos bay the port of the state and not Portland. Since that deal democrat Portland has stagnated and republican coos bay has increased in size and population by 5 times what it was. 2) In Washington County (next door to the people’s republic of Multnomah county, where Portland is.) the county and city governments gave up charging property taxes (for ten years) on any employer who moved in with a 100 or more jobs. As a result we went purple in the last election. Our house of reps is now permanently a 50/50 split.
    So focus on saving your county and city republican areas and let the Democrat areas fend for themselves.

    Reply this comment
  31. Thomas Molitor
    Thomas Molitor 4 October, 2012, 16:05

    “Let’s hope California retains enough of its historic entrepreneurial spirit to muster the will to turn things around.”

    Entrepreneurs cannot not “turn things around” anymore than an Olympic swimmer can win a gold medal with his or her hands tied behind his or her back.

    What can “turn things around” is the neutralization (or elimination) of the State’s power to paralyze the efforts of an entrepreneur who simply seeks to create products and services that satisfy the wants and needs of a marketplace. As the brilliant economist Ludwig Von Mises stated, “the real bosses, in the capitalism system of market economy, are the consumers.”

    We Californians are the consumers and we are the bosses and we need to push back and demand that the bureaucrats (the State, the Unions) step out of the way (or, better yet, disappear permanently) and make way for the true driver of innovation, spirit, and creativity: the entrepreneur. As I like to say, “Red tape keeps businesses in the red.”

    Reply this comment
  32. Winghunter
    Winghunter 6 October, 2012, 00:24

    “We have tried spending money. We are spending more than we have ever spent before and it does not work. After 8 years of this Administration we’ve just as much unemploymnt as when we started -And an enormous debt to boot!” – Henry Morgenthau, Secretary of the Treasury under Franklin D. Roosevelt and one of FDR’s closest advisers. http://bit.ly/9169Lh

    The Left: Where Greed Meets Envy http://www.americanthinker.com/2012/06/the_left_where_greed_meets_envy.html
    “Real trouble begins when those who crave power gain it by manipulating resentments. It is where greed meets envy — the structural foundation of the political left. When stripped of its many pretenses, the political left’s objective is control. It goes about trying to gain that control using a very simple formula: creating an enemy, and creating resentment in as many people as possible against that created enemy. It seeks to exploit envy to satiate its greed for power and never lets a crisis (real or imagined) go to waste…”

    Reply this comment
  33. donald sawyer
    donald sawyer 13 October, 2012, 00:22

    Hondo where does campbells get all of it’s autoxins msg from? that can’t be right up the road. the soup is full of things like corn syrup etc.

    Reply this comment

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