Is state economy beyond point of no return?

Jan. 5, 2013

By Chris Reed

TaxiforniaIn September 2008, in his last major speech to the California Legislature, soon-to-be congressman Tom McClintock said the state government had turned the corner, and not in a good way.

“I believe we have now also passed the point where conventional budget reductions can restore our state’s finances. I believe we have now reached the terminal stage of a bureaucratic state where our bureaucracies have become so large and so tangled that they can no longer perform basic functions.”

Has the state’s economy also reached the “terminal stage” because of excessive taxes and regulations? Writing at NewGeography.com, Robert J. Cristiano, a California businessman and academic who has moved to Texas for tax reasons, believes that it has:

“The number 1 topic of conversation amongst the despised 1% in California today is when you are leaving California or whether you can leave. Property owners who cannot move their apartment building or office complexes can move their homes and change their residency. On a flight from Austin, Texas to Orange County last week, I sat next to the owner of a substantial manufacturing business whose plant is in the inland southern California community of Ontario. He lives in Austin, flies in on Monday and home on Thursday. He spends less than 180 days a year in California. His savings in state income taxes more than pays for his airfare, hotel and rental car expenses. His home and gas and energy all cost less in Texas. More significantly, he will not expand his plant in California and intends to move his plant and people to Texas over the next five years. …

“So many of the 1% are quietly leaving. The exodus has already begun. Spectrum Location Solutions reported that 254 companies left California in 2011. Despite claims of an upturn, a press release by the State Controller’s office last week revealed tax revenues from both personal income taxes and corporate taxes fell during the month of this November. Revenue from personal income dropped 19 percent below projections while corporate tax revenue was down a whopping 213.4 percent. Such declines will continue unabated for years to come as the California brain drain proceeds.

“When a government becomes a one-party state, nothing can stop the utopians and zealots of either party. In California, there’s no brake on progressives imposing its vision of Blue Utopia on its people. California may have clean water, clean air and green energy but at the expense of its people, prosperity and fiscal health.”

Read Cristiano’s entire lament about what California has become here.

 

11 comments

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  1. People Over Profits = A Better World
    People Over Profits = A Better World 5 January, 2013, 13:19

    From what I read, the progressives aren’t that upset that businesses are leaving for less enlightened states (when they actually acknowledge this is happening). The progressives are more interested in government-managed social progress than haphazard and uneven free market-based economic growth. They emphasize human development of the masses over profit for a few exceptional people. Isn’t that wonderful and democratic?

    Reply this comment
  2. SeeSaw
    SeeSaw 5 January, 2013, 20:09

    Homosexuality is not a “social idea”. It is a particular sexual orientation that is probably biological. I know such families, and they are not destroyed.

    Reply this comment
  3. Rex the Wonder Dog!
    Rex the Wonder Dog! 5 January, 2013, 22:09

    The progressives are more interested in government-managed social progress than haphazard and uneven free market-based economic growth.
    ==

    Yes, that EVIL free market where worth determines pay and comp! POP, you need to move to China 🙁

    Reply this comment
  4. johnnygeneric
    johnnygeneric 6 January, 2013, 00:00

    When you have Hollywood Leftists who admire the likes of Castro (loved by Ed Asner) and Hugo Chavez (idolized by Sean Penn) you really have to wonder where their line is as to what California should look like. If these nut jobs really like these dictators so much, are they aiming for CA to look like Cuba or Venezuela??? If so, you need to GET OUT NOW!

    Reply this comment
  5. Douglas
    Douglas 6 January, 2013, 01:10

    I met a man:

    ” He lives in Austin, flies in on Monday and home on Thursday. He spends less than 180 days a year in California. His savings in state income taxes more than pays for his airfare, hotel and rental car expenses.”
    ————————————–
    Nonresidents of California, defined for tax purposes as people who didn’t live in the state during any of the taxable year in question, must file a California tax return if any income comes from a source or sources based in the state, and if total income from all sources during the year was greater than the filing requirement amount for full-time residents of the state.
    ————————————–
    You can’t believe everything you read on the internet, or everything you hear on a plane from Austin.

    Bonjour

    Reply this comment
  6. SeeSaw
    SeeSaw 6 January, 2013, 10:00

    That person must file a tax return as a part-time resident in CA! And, his business that is based in CA owes taxes to the state.

    I have family and friends living in Texas, and they are happy in Texas. Why not? This is a free country. As for me, I will take CA, with its income tax, over Texas any day.

    You evidently believe all you read in the gossip rags, eh, Johnny? Ed Asner is a good actor and Sean Penn is a terrific actor. Sean Penn has done good works all over the globe. We’ll keep citizens like Ed Asner and Sean Penn. Perhaps you should be the one to move.

    Reply this comment
  7. Rex the Wonder Dog!
    Rex the Wonder Dog! 6 January, 2013, 11:12

    Revenue from personal income dropped 19 percent below projections while corporate tax revenue was down a whopping 213.4 percent. Such declines will continue unabated for years to come as the California brain drain proceeds.

    No problem, just rise the sales and income taxes to cover the shortfall, you KNOW that’ll work 😉

    Reply this comment
  8. Dirtbos
    Dirtbos 6 January, 2013, 11:18

    Robert J. Cristiano, in the full article, articulates a logical path to the “great California financial meltdown” I have predicted here before. Those on the left can remain in denial all that they want to, while the state’s future crumbles around them.

    “The progressives are more interested in government-managed social progress than haphazard and uneven free market-based economic growth. They emphasize human development of the masses over profit for a few exceptional people. Isn’t that wonderful and democratic?” Yep, it sounds utopian, but just who exactly is going to provide the necessary jobs and pay the bills? California WILL eventually “run out of other peoples money”.

    Reply this comment
  9. Donkey
    Donkey 6 January, 2013, 17:13

    For all their elightenment the “progressives” have no ability to perform simple math calculations.

    These words come from a Katy Grimes article written today: Monckton says, “To the global classe politique, the placemen, bureaucrats, academics, scientists, journalists and enviros who have profiteered at our expense by peddling Thermageddon, I say this. The science is in; the truth is out; Al Gore is through; the game is up; and the scare is over.” A I would add, the RAGWUS is digging its own grave at the same time. 🙂

    Reply this comment
  10. SeeSaw
    SeeSaw 7 January, 2013, 09:25

    A family can consist of any number of people who happen to live together and are dependent on each other, Livry.

    Reply this comment
  11. SkippingDog
    SkippingDog 7 January, 2013, 19:11

    Monckton was never more than a purse-carrier for Thatcher, and he’s now on the staff of WorldNutDaily. I love it when people like Donkey rely on him for authoritative comment.

    Reply this comment

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