And the Uber saga is just getting started. A fresh wave of initiatives — and the press to match — has touched off a fascinating phenomenon. Although a corporation weaker than Uber would be thought of as embattled, Uber’s tremendous appeal has proven strong enough to keep the company one step ahead of its detractors.

In recent years, critics and supporters of California’s ruling Democrats have voiced concern about the future of California’s unique cachet. On the right, observers have warned the Golden State’s tangled regulatory environment has choked off business development and sent residents packing for more economically friendly states like Nevada and Texas.

Many factors were behind California’s shift from a state that attracts new residents to a state that repels old ones. For the political psychology of elite Californians, however, the demographic change seemed to warn the state that it couldn’t count on its innate appeal to attract tourists and keep residents rooted for decades.

Reinforcing the troubling notion that California was losing its cool, key employers and industries began trickling away. From auto manufacturers like Toyota to Hollywood film and television producers, business leaders started shifting real jobs away from the West Coast.

The predictable result was political grandstanding matched with controversial incentive packages. Sacramento notched a small success in throwing valuable tax credits at production companies, but failed to muster enough sweeteners to satisfy the likes of Elon Musk.

The return of California cool

Much of Silicon Valley, however, seemed destined to stay put — thriving off the intimate relationships among the region’s venture capitalists, innovators, CEOs, students and high-demand employees. Although 2014 saw a wave of bad press for so-called “nerds” taking “revenge” on Californians who wanted affordable rents and a more traditional labor-reliant economy, Uber has proven to be the exception to the rule in some respects.

The company has been hit with a range of accusations — undercutting its competitors in dirty fashion, steering its drivers toward subprime loans, even taking advantage of drunk people with surge pricing.

Some other recent reports are more ambivalent. Uber’s plan to recruit 50,000 veterans, who sometimes find surprising difficulty securing employment, has been met with some guarded optimism. Uber has remained remarkably resilient, weathering these storms with a wave of good press.

In the latest prominent example, The New York Times ran an extensive, praiseworthy review of Uber’s role in revitalizing downtown Los Angeles. Importantly, the main reason for Uber’s success, according to the Times, was its cool factor.

In times past, California cool had practical applications. Rather than just whetting people’s appetites for glamour or fashion, the entertainment and tech industries actually secured residents in stable communities with great economic power. Uber, suggested the Times in its report, has started to do something similar, on a smaller scale, in downtown L.A.

According to the Times, “a growing contingent of urbanites” have now “made Ubering (it’s as much a verb as ‘Googling’) an indispensable part of their day and especially their night life. Untethered from their vehicles, Angelenos are suddenly free to drink, party and walk places. Even as their business models are evolving, these ride-sharing services, which include Lyft, Sidecar and others, have upended the social habits of the area, and rallied its residents to be more peripatetic.”

Big implications

The impact, said the Times, goes well beyond L.A.’s hard-to-navigate urban core. Not long ago, L.A. nightlife “used to involve negotiating parking, beating traffic and picking a designated driver. Excursions from one end to the other — say, from the oceanfront city of Santa Monica to the trendy Silver Lake neighborhood on the eastern side — had to be planned and timed with military precision, lest they spiral into a three-hour commute. More often than not, they were simply avoided.”

No longer. The whole city has won out — with big economic and social benefits that could be replicated across the state, or the country.

The Times report helps underscore the reason why Uber has become so consequential. Much like Apple, a pillar of the California economy, Uber has established a dual appeal — to everyday Americans on the one hand, and to fastidious elites on the other.

Despite excesses and mistakes, Uber’s ambitious use of practical cool has made it hard for critics, including regulators, to crack down. Ordered by the California Public Utilities Commission to cease its new carpool feature, Uber simply declined, proceeding with its planned rollout.

Regulators are still thinking over what, if anything, to do next.

With a unanimous vote, the appropriations committee passed a $300 million increase in tax credits for film and television, bringing the size of the controversial program up to $400 million. Assembly Bill 1839 is coauthored by Assemblymen Raul Bocanegra, D-Pacoima, and Mike Gatto, D-Los Angeles.

The committee has put its fingerprints on the bill, tinkering with some key provisions. As Deadline Hollywood reports, the legislation now strips out at least one part of the current system — a complex lottery system that came in for criticism even from advocates of subsidizing production. “Applicants will be ranked according to the net new jobs created and overall positive economic impact for the entire state,” said Senate President Pro Tem Kevin de Leon, D-Los Angeles, calling the lottery “flawed and arbitrary.”

Lottery reform is designed to enable lawmakers to better prevent subsidy abuses by studios and production companies. Falsely inflated job creation numbers, for instance, would run afoul of the new incentive rankings, whereby recipients are chosen for a greater share of tax credits. De Leon explained that, under the new system, applicants for credits would be ranked according to jobs created and overall economic benefit to the state of California.

Having agreed on the legislative tweaks, the committee now sends AB1839 to the full Senate, as well as the Assembly floor, where it passed overwhelmingly in its original form.

There is some uncertainty as to whether Gov. Jerry Brown will extend his support, however. The governor has been silent on the issue for months. Pressed by Variety, Los Angeles Mayor Eric Garcetti sounded an optimistic tone. “I wouldn’t be naive enough to say that the governor is going to come down on that exact number,” he said. “But I have just watched the evolution, where this governor understands that this is a key industry, where he and his staff have told us privately we are not going to preside over its decline, and where understands it is no longer just a Southern California issue.”

An industry arms race

In addition to expanding the already sizable subsidy program, the bill would extend the program at least to 2019 — a concerted effort to stay competitive with the state of New York. Legislators in the Empire State maintain their own $400 million-plus Film Tax Credit Program, and ensure that TV production receives attractive credits as well. These measures have been so effective in luring production away from Hollywood that last year, for the first time on record, New York City surpassed Los Angeles in the production of hour-long pilot episodes of televised dramas.

To discourage jockeying across types of production and apples-to-apples competition for cash, AB1839 set up individual baskets of money for four categories of productions: independent films, TV pilots and renewed series, feature films, and — in a telling move — productions coming back to California from out of state.

A losing battle

Although AB1839 boasts powerful support in Los Angeles and Sacramento, evidence strongly suggests that California is fighting a losing battle — by fiscal standards if not political ones. A recent Legislative Analyst’s Office report concluded that the Golden State is actually failing to recoup its supposed investment in keeping the entertainment industry local, losing some 35 cents on the dollar.

As KPCC reported, the LAO admitted, “[I]deally, states would not compete on the basis of subsidies.” Nevertheless, the political pressure to spend anyway remained strong, “Given that other states and countries offer subsidies, it might be difficult for California not to provide subsidies and still maintain its leadership position in this industry.”

Unless Brown takes a firm stand against his own party, it’s likely that California’s entertainment industry subsidies will continue into the rest of this decade and beyond.

Now the Democratic Legislature is passing tax cuts for their buddies in the military-industrial complex:

“The California Assembly on Thursday approved a fast-tracked proposal to provide up to $420 million in tax breaks over 15 years for the aerospace industry.

“The bill by Assemblyman Steve Fox (D-Palmdale) would offer credits for an ‘advanced strategic aircraft program.’ The credits would be capped at $25 million annually the first five years, $28 million per year for the next five years and $31 million annually for the final five years.

“The tax credit program would expire after 15 years.

“The tax credits, should they go into effect, could help boost the chances for aerospace companies, such as Lockheed Martin, that are bidding for contracts for the Defense Department’s Advanced Strategic Aircraft Program.

“‘We need to pass this tax credit to make California bidders have a more competitive edge in the bidding process,’ Fox said.”

OK. Fair enough.

But that’s true for the rest of us as well. Everyone knows other states are “bidding” for our jobs and businesses with lower taxes and regulations. Toyota just moved its HQ to Texas.

So what we all need is tax cuts. How about starting by cutting the income tax in half for everybody?

The Democrats now have had a change of heart. Reported the Times:

“SACRAMENTO — Proposed legislation aimed at providing more tax credits to attract so-called runaway movie and television productions back to the industry’s birthplace in California won initial approval from a legislative committee Tuesday.

“The proposal would renew and increase a state tax credit — amounting to as much as $400 million a year — to better compete with generous tax subsidies available in more than 40 states, including New York, Louisiana, New York and Michigan, as well as studios in Canada and Britain.

“The tax credit would allow most film and TV production companies to reduce their tax liability by 20% of the cost of many production expenditures.”

So Democrats actually admit that high taxes drive away business. And although Prop. 30 mainly was taxes on rich folks, $1 billion comes from a sales tax increase. So the poor and the middle-class effectively will be paying for that $400 million tax break for Hollywood investors, movie moguls and stars.

Assemblyman Richard Bloom, D-Santa Monica, gave this explanation:

“This is our industry to keep or lose. We need to send a message to New York, England and other states competing for our jobs and say, ‘It stops here.'”

But what about the rest of us? What about workers in manufacturing, or construction, or retail or lumber? Can’t we cut taxes for them and say to “states competing for our jobs,” such as Texas, “It stops here”?

By Katy Grimes

Alert the media! The Assembly Women’s Caucus is offended.

Seth MacFarlane, the creator of Family Guy, and a successful entertainer, actor, and writer, hosted Sunday’s Oscar awards show, with his usual snarky, brazen, naughty gutter humor. And in helping the Awards show achieve a much-needed ratings increase, McFarland managed to offend the feminists of the California Legislative Women’s Caucus. The women’s caucus sent a formal complaint Wednesday to the Academy of Motion Picture Arts and Sciences, complaining that McFarland “struck a new low in its treatment of women.”

Boo hoo. As if Hollywood doesn’t already reach record lows in taste and humor. Look at these dresses!

“In a world where women have historically faced challenges and obstacles when it comes to their portrayal in popular culture, Sunday evening was a setback for women fighting hard to gain appropriate respect as contributors in this industry and society and general,” read the letter from women’s caucus Chairwoman Assemblywoman Bonnie Lowenthal, D-Long beach, and Vice Chairwoman Sen. Hannah-Beth Jackson, D-Santa Barbara.

I’ll bet they hate that I called them “Chairwomen.”

I tend to take the approach to television that if you don’t like something, change the channel or turn it off. But that doesn’t work for the perpetually offended in society. What would they talk about if they couldn’t be offended?

“On Oscar night, when Hollywood seeks to honor its best, Seth MacFarlane’s monologue reduced our finest female actresses to caricatures and stereotypes, degrading women as a whole and the filmmaking industry itself,” the letter said. “To degrade women is totally unacceptable in today’s world.”

It’s not as if lawmakers have more pressing things to be very concerned about. Tuesday at a legislative hearing on the $68 billion-and-growing High-Speed Rail system, Lowenthal cut the microphone of two members of the public, when they dared to question the unholy alliance between labor unions and the High-Speed Rail Authority over the Project Labor Agreements.

We still don’t have any answers about the inflated PLA contracts, and the Legislature isn’t requiring the Rail Authority to answer.

Be very concerned when lawmakers attack free speech, even if you find it offensive. McFarland may be offensive to some, but others find him very funny, as evidenced by his phenomenal success. I´d rather be offended by a comedian than have Assemblywomen Lowenthal and Jackson claim they speak for me because I’m a women.

Lowenthal clearly doesn’t respect free speech — on the television or in her hearing room. Be very concerned when lawmakers attack free speech, even if you find it offensive.

By John Seiler

Throughout the whole phony “fiscal cliff” crisis Democrats kept saying the “rich” had to “pay their fair share” so the middle-class wouldn’t get a tax increase. Republicans insisted that they were against all tax increases.

Both Democrats and Republicans then sold most of us out by jacking up taxes on 77 percent of Americans to make sure pork-barrel funding went to Hollywood and other special interests. Now you know why Hollywood honchos and actors supported Obama: They got a tax break.

Now, get this. Reports the Mail online:

“Middle-class workers will take a bigger hit to their income proportionately than those earning between $200,000 and $500,000 under the new fiscal cliff deal, according to the nonpartisan Tax Policy Center. 

“Earners in the latter group will pay an average 1.3 percent more – or an additional $2,711 – in taxes this year, while workers making between $30,000 and $200,000 will see their paychecks shrink by as much as 1.7 percent – or up to $1,784 – the D.C.-based think tank reported. 

“Overall, nearly 80 percent of households will pay more money to the federal government as a result of the fiscal cliff deal.”

It wasn’t a “fiscal cliff deal” but a plain old ripoff. The whole months-long drama about the “fiscal cliff” was just a misdirection as they prepared to rob us again.

Why do we put up with it?

By John Seiler

Hollywood usually backs left-wing causes, such as tax increases and politicians who increase taxes. For example, Steven Spielberg and Barbra Streisand are big fans of President Obama. They agree with him that tax increases will spur growth, rather than retard it.

But Hollywood does insist that tax cuts boost growth for one group: themselves.

Here’s Amy Lemisch, executive director California Film Commission, writing a letter to the Wall Street Journal:

“Gov. Jerry Brown’s recent decision to extend our film and TV tax-credit program for an additional two years was supported by a uniquely broad bipartisan coalition of legislators, as well as business and labor groups from across the state for one simple reason: It works.

“Unlike the Massachusetts program referenced in your editorial, California’s tax credit is highly targeted and applies only to “below-the-line” spending, such as wages paid to carpenters, electricians and other crew members. Not a single dime of our tax credit goes toward salaries of highly compensated ‘above-the-line’ talent—in other words, those referenced in your editorial as ‘Hollywood’s mendicants.’

“Furthermore, independent studies (not just the ones you selected to reference) show that our program more than pays for itself in state and local tax revenue, not to mention direct and indirect jobs. Producers can’t claim a dime of our tax credit until after they pay their workers and complete all their in-state spending.”

A reader named Gary Stutz from Ben Lomond replied in another letter:

“Amy Lemisch, executive director of the California Film Commission, writes in her letter (Oct. 18) regarding tax credits for Hollywood that ‘our program more than pays for itself in state and local tax revenue, not to mention direct and indirect jobs.’ So, lower tax rates result in higher tax revenue and more jobs. Who knew?”

Of course, it’s total hypocrisy. Hollywood backs Brown’s Proposition 30 tax increase. In return, he backs continuing the tax cuts for Hollywood.

In the Hollywood movie “The Distinguished Gentleman,” Eddie Murphy learns how the same thing is done in the U.S. Congress:

By John Seiler

The Democrats in the Legislature are backing Gov. Jerry Brown’s $8.5 billion tax increase, Proposition 30 on the November ballot. They’re saying it’ll increase jobs by “investing” in California’s future.

But they’re also saying that tax increases kill jobs and that tax cuts are needed to promote jobs — for the powerful Hollywood film industry, whose leftist producers, directors and actors give big Spacebucks to Democats. What a coincidence.

The story:

“The California Assembly overwhelmingly approved a bill that would preserve funding for the state’s film and television tax credit.

“The Assembly voted 70-4 in favor of the bill, which extends funding for the program another two years. California allocates $100 million annually toward tax credits, which are doled out by lottery because of limited funds. Funding was due to expire next year.

“The film industry had been pressing for a five-year extension to show the state’s commitment to the industry, which is being lured away by other states with strong incentives. But that proved a tall order in light of the state’s budget woes.”

The left-wing Directors Guild of America, left-wing Teamsters union, and left-wing SAG-AFTRA (screenwriters) union said in a statement:

“Without the extension, the State of California will have no chance of competing with more than 40 states and many foreign countries that offer generous incentive programs to retain and attract qualified motion pictures and television programs, resulting in the loss of tens of thousands of middle class jobs and all the ancillary economic benefits that a thriving entertainment industry brings to the economy.”

What these left-wingers really are saying is: “Cut our taxes and pay for it by raising taxes on everybody else, including the sales-tax increase in Prop. 30.”

But if tax cuts are good for left-wing Hollywood, then what the rest of us need is tax cuts — not the Prop. 30 or other tax increases.

By John Seiler

Hollywood’s leftist elite are big supporters of such causes as raising taxes and President Obama. The president is planning more events there in the fall to troll for campaign cash among the glitterati.

Despite their socialist preening, the Hollywood bigshots still like to make a buck. Which is why they’re fleeing California for states with fewer left-wing policies:

“The five broadcast television networks will be rolling out 23 new one-hour dramas for the upcoming season. That would normally be good business for Hollywood’s hometown industry — with bookings for soundstages and plenty of work for the costumers, camera operators and caterers needed to put a show on the air.

“But not this year. Just two of the 23 new fall and midseason shows will be shot in Los Angeles County, as cost-conscious producers seek tax-friendly production havens in New York, North Carolina, Georgia and other states….

“Fewer than 10% of new network dramas this season are based in Los Angeles, down from 50% in 2010 and nearly 80% in 2005.”

When rainy, snowy, cold, high-tax New York is a better place to produce a TV show than California, you know the business climate here is toxic.

By Joseph Perkins

The California Film Commission is holding a lottery next week for filmmakers and television producers. The lucky winners will share $100 million worth of taxpayer subsidies.

It’s part of the state’s three-year-old Film and Television Tax Credit Program, the purpose of which is to prevent rival states from luring productions away from Hollywood.

Since the program’s inception, tax credits have gone to some 165 productions, according to Amy Lemisch, the Film Commission’s Executive Director. Those “incentives” have generated nearly $3 billion in spending here in the Golden State, she said, and created nearly 30,000 jobs.

The Film Commission is hopeful that the Legislature will approve a bill, introduced by Assemblyman Felipe Fuentes, D-Sylmar, which would extend the tax credit program, scheduled to expire next year, until 2018.

The measure passed the Assembly Revenue and Taxation Committee last week. It remains to be seen if it ultimately finds its way into the state budget the Legislature sends to Gov. Jerry Brown.

Tax Credit Program Does Not Reap Promised Benefits

Lawmakers just might consider the tax credit a luxury the state treasury simply cannot afford, giventhe $16 billion state budget deficit.

And especially considering a recent report by the UCLA Institute for Research on Labor and Employment suggesting that the $100 million-a-year state giveaway does not yield the payoff claimed by Lemisch and other less-than-objective boosters.

The report, authored by Lauren Appelbaum, Chris Tilly, and Juliet Huang, studied the economic and production impact of the state’s film and television tax credit. It concluded that the return on the Hollywood subsidy program is, at best, an economic wash for the state.

According to the report, in order for the state to break even on the tax credit, at least 88 percent of productions applying for but not receiving the credit would have to film outside of California. But of the sample the authors studied, 36 percent of productions passed over for state tax credits nonetheless filmed in California.

That’s because, while film and television producers are only too happy to take state subsidies, the handouts are not the lone determining factor in where motion pictures and TV shows are made.

Other important factors cited by the report include production crew depth and quality, technological expertise and a critical mass of production and postproduction facilities.

That echoes a 2010 report prepared for the Los Angeles Economic Development Corporation by the Kyser Center for Economic Research that listed those factors, as well as California’s unique confluence of well-regarded film schools, entertainment community and film industry suppliers.

All of those factors work in California’s favor, wrote UCLA’s Appelbaum, Tilly and Huang, and tend to keep film and television here in Golden State.

There is one tangible benefit of the film and TV tax credit, at least at the margin: and it helps to offset the high cost of doing business in California, includes state and local taxes, labor costs and regulation.

However, if the cost of doing business in California was average for the 50 states — rather than ranking worst among the states — it would have far more impact than tax credits on the share of films and TV shows produced in California, compared to other states.