A fifth-generation
Californian laments his state’s ongoing economic collapse.
It’s not easy watching
California self-destruct. After all, my four sons are 6th generation
Californians. One relative of ours journeyed here prior to the Gold Rush when
the state population was just a handful of people. Family lore has it he was a
gunslinger who, victorious in a gun duel, headed to California to avoid the
law. He ended up ranching on what is now known as Mammoth Mountain. Other
family members took part in the gold rush and one ended up discovering gold in
1895 in the Mojave Desert. My grandparents arrived in Kern County in the 1930s
and worked as teachers educating the children of oil workers shortly after the
discovery of oil in that region.
Proud of my heritage, I had
this urge to run for the state legislature, so I did and I won. I was hoping I
could do something in Sacramento to slow the decline of the Golden State. But
it was not to be. I quickly discovered that the legislature was so dominated by
far left ideologues, there was nothing that could be done to reverse course. My
Democrat colleagues were not concerned one bit about how their policies were
destroying the economic golden goose that made California so famous worldwide.
Indeed, they actually believe their big government and nanny state policies
have made California the model of how progressives can succeed in governing.
Seriously.
The entire time I served in
Sacramento, the Democrats were focused almost exclusively on legislation which
either had to do with wealth redistribution or creating new “rights” for
alleged victims such as illegal aliens, criminals, union members, homosexuals,
transgenders and other “oppressed” groups. And it’s no different today. The
reality is that the average middle class Californian hasn’t had representation
in the halls of Sacramento for decades. Indeed, I predict the destruction of
California will, unfortunately, be one of the great legacies of the progressive
movement.
Indeed, the Democrats hold
supermajorities in both legislative chambers. The Assembly has been in
Democratic hands since the 1970 election, except for 1995-1996. The Senate has
been controlled by the Democrats continuously since 1970. As for the Governor,
well, the last semi-real Republican Governor was Pete Wilson, who ended his
term in 1999. However, action superstar and former champion body builder Arnold
Schwarzenegger, a Republican, did serve as Governor from 2003-2011 but
essentially governed as a Democrat, even to the point of hiring leftists to be
his key staff. So much for his tough guy image. Progressive hero Jerry Brown
has served as Governor since 2011.
Sure, the liberals like to
claim California socialism is working by pointing to the much heralded
statistic that “California’s economy is the 6th largest in the world”
as calculated by the state’s Department of Finance. Indeed, California’s $2.62
trillion economy is larger than that of France, Canada, Brazil, Russia, and
Italy. However, that GDP stat does not factor in California’s cost of living,
which is 36.2% higher than the national cost of living. As Carson Bruno writes in Real Clear Markets,
“using the cost of living adjusted data from the International Monetary Fund
and adjusting California’s GDP data provides a better snapshot of California’s
economic standing in the world. Doing so shows that California is actually the
12th largest economy — a drop of 6 spots — and actually puts
the state below Mexico.”
Moreover, as Bruno points
out, Silicon Valley “accounted for 50% of California’s private industry real
GDP growth.” In other words, without a few dozen mega profitable high-tech
Silicon Valley firms such as Apple, Google, and Facebook, California’s GDP
would be significantly smaller.
However, as economic
blogger Richard Rider points out, the aggregate GDP statistic is really not a
good indicator of a state’s economic health, especially since one industry
appears to be propping up the “6thlargest economy” myth.
California has over 39 million people, more than any other state, so a far more
accurate assessment of its economy, Rider writes, would be per capita GDP
as compared to the rest of the country. After adjusting the GDP figures to
account for the cost of living (COL), the Golden State ends up with a paltry 37th place ranking within
the U.S.A., with a $45,696 per capital GDP. Even rustbelt states, such as
Michigan and Ohio, have a higher adjusted per capita GDP. Despite Silicon
Valley’s high-tech giants, California barely squeezes past impoverished New
Mexico. Rider also reports that when one looks at per capita GDP stats for the
rest of the world, California ranks 19th, but those stats don’t
factor in the COL data; if they did, California would be even further down the
rankings internationally.
One should not also assume
that high-tech companies are a permanent feature of California’s economy.
Already, the extremely high cost of living in Silicon Valley has, since 2016,
caused more Silicon Valley employees to leave the state than it has attracted.
With a few high-tech companies having left California for other states such as
Virginia, Texas and North Carolina, it’s only a matter of time before this
turns into a flood.
But it’s not just Silicon
Valley employees fleeing California; it’s productive — and job-creating —
citizens from all over the state. As Joel Kotkin and Wendell Cox wrote in
the Mercury News last April, “the largest group of outmigrants
tends to be middle-aged people making between $100,000 and $200,000 annually.”
Indeed, California has done
everything possible to make it difficult for businesses and employers to
produce goods and services. California now has the highest state income tax
rate and the highest state sales tax rate in the country. Our gas tax rate is
fourth-highest, but if you add in the 10-12 cent “cap and trade” cost per
gallon, we have the highest gas tax in the country. Based on 2014 numbers,
California’s single-family residence property tax is the eighth highest in the
country with the median homeowner property tax bill 93% higher than the average
property tax bill for the other 49 states. As for the state’s corporate income
tax rate, it is also eighth in the country. And let’s not forget our small
business tax, a minimum of $800, even if no profit is earned.
Overall, the Tax Foundation
ranks California as fifth worse in overall tax burden, but the state is
especially hostile to its high earners who start businesses and create most of
the jobs. Indeed, the top 1% pays 50% of all state income taxes. Moreover, the Small
Business and Entrepreneurship Council ranked California as having the worst
anti-business climate in the country; the American Tort Reform Foundation ranks
the state as the “worst state judicial hellhole” in the U.S. and the national
Chamber of Commerce rates California as having the fourth-worst business
climate.
If California is such a
prosperous state as liberals claim, why does it have the highest poverty rate
in the nation? According to the Census Bureau, the poverty rate is 23.4%, which
is 17% higher than second place Nevada. Indeed, while California has 12% of the
nation’s population, it is home to 33% of the nation’s TANF (Temporary
Assistance for Needy Families) welfare recipients, more than the next seven
states combined.
What’s clear is that the
producers are leaving the state and the takers are coming in. Many of the
takers are illegal aliens, now estimated to number over 2.6 million. The
Federation for American Immigration Reform estimates that California spends $22
billion on government services for illegal aliens, including welfare,
education, Medicaid, and criminal justice system costs. Liberals claim they
more than make that up with taxes paid, but that’s simply not true. It’s not
even close. FAIR estimates illegal aliens in California contribute only $1.21
billion in tax revenue, which means they cost California $20.6 billion, or at
least $1,800 per household.
Nonetheless, open border
advocates, such as Facebook Chairman Mark Zuckerberg, claim illegal aliens are
a net benefit to California with little evidence to support such an assertion.
As the Center for Immigration Studies has documented, the vast majority of
illegals are poor, uneducated, and with few skills. How does accepting millions
of illegal aliens and then granting them access to dozens of welfare programs
benefit California’s economy? If illegal aliens were contributing to the
economy in any meaningful way, California, with its 2.6 million illegal aliens,
would be booming.
Furthermore, the complexion
of illegal aliens has changed with far more on welfare and committing crimes
than those who entered the country in the 1980s. Heather Mac Donald of the
Manhattan Institute has testified before a Congressional committee that in
2004, 95% of all outstanding warrants for murder in Los Angeles were for
illegal aliens; in 2000, 23% of all Los Angeles County jail inmates were
illegal aliens and that in 1995, 60% of Los Angeles’s largest street gang, the
18th Street gang, were illegal aliens. Granted, those
statistics are old, but if you talk to any California law enforcement officer,
they will tell you it’s much worse today. The problem is that the Brown
administration will not release any statewide data on illegal alien crimes.
That would be insensitive. And now that California has declared itself a
“sanctuary state,” there is little doubt this sends a message south of the
border that will further escalate illegal immigration into the state.
Indeed, California goes out
of its way to attract illegal aliens. The state has even created government
programs that cater exclusively to illegal aliens. For example, the State
Department of Motor Vehicles has offices that only process driver licenses for
illegal aliens. With over a million illegal aliens now driving in California,
the state felt compelled to help them avoid the long lines the rest of us must
endure at the DMV. And just recently, the state-funded University of California
system announced it will spend $27 million on financial aid for illegal aliens.
They’ve even taken out radio spots on stations all along the border, just to
make sure other potential illegal border crossers hear about this program. I
can’t afford college education for all my four sons, but my taxes will pay for
illegals to get a college education.
And let’s not forget the
impact illegals have upon employment and wages. Illegal aliens are driving down
wages across the board in California, especially in the service and
construction industries. The people who suffer the most are legal citizens who
lose out jobs to illegals willing to work for rock bottom wages. What most
people do not understand is that illegals enter the country without their
families and as many as ten of them will pile up in a cheap apartment. With
very few expenses, they are able to bid on jobs at a rate most legal citizens
cannot afford to work for.
I served for six years in
that God forsaken capital, Sacramento, and the one thing I found most bizarre
was the intense focus by my Democrat colleagues on creating agencies and
programs that cater to illegal aliens and thus attract even more illegal aliens
to California. Such pro-illegal alien policies undermine the hundreds of
thousands of legal minorities who work in the service and construction
industries, but strangely the biggest boosters of such policies were the
Democrat legislators of Hispanic descent. It’s as if the entire Hispanic
delegation in both houses made a concerted decision to abandon legal Hispanics
and to represent only Mexican citizens. I find that odd and a violation of
their oath of office, but I also believe that this is all about political
power. The more illegals, the more registered Democrats.
But one can’t be too
surprised; many of these Hispanic elites have little in common with middle
class Californians. While in college, many belonged to a Hispanic separatist
movement called Movimiento Estodiantil Chicano de Aztlan (MEChA), which
believes our borders should be eliminated and that the entire southwest USA was
stolen from Mexico. In other words, these extremists do not even believe in the
notion of citizenship or borders.
With the state now funding
over 250 agencies that intrude into every aspect of its citizens’ lives, it is
clear that government spending is completely out of control. California
political writer Steve Frank estimates that the real state government debt is
$2.8 trillion. Since the state can’t print money like the feds do, it’s only
option is to assess its overtaxed citizens more fees and taxes. The truth of
the matter is that California would be far better off if they randomly selected
120 people out of the phone book to serve in the Assembly and the Senate, since
that way, many will actually be normal people with private sector experience.
As it stands now, many state politicians have never held a real job and have
little in common with the vast majority of hard-working Californians.
Today, large sections of
California look like a Third World country with ramshackle buildings, junky
cars and trash strewn everywhere. We even have outbreaks of Hepatitis A, just
like the Third World has. A state cannot chase away the producers and attract
the takers year after year without economic consequences. That doesn’t end well
so there’s little doubt California is headed toward economic disaster. Perhaps
it is time for conservatives to support California’s succession movement before
the state completely collapses and comes begging the federal government for a
bailout.
https://spectator.org/adios-california/?utm_source=American+Spectator+Emails&utm_campaign=6e1b467cf4-EMAIL_CAMPAIGN_2017_10_20&utm_medium=email&utm_term=0_797a38d487-6e1b467cf4-104289085
