|California: First in Liberalism, Last in Everything Else|
By Troy Senik
Thursday, August 09 2012
If the United States were a high school, California would likely be the quarterback of the football team. Blessed as it is by geography, climate, culture and natural resources, it is a state that takes success as a given. And why not? How many other states can boast of an appeal so widespread that it gives birth to a notion as storied as “The California Dream”?
Success, however, often breeds complacency, and that’s where the Golden State finds itself today. With decades of success earned with seemingly little effort, California seems to have decided that it can rest on its laurels. But the days when the state could live off of its looks are quickly drawing to a close, as a bevy of recent statistics show.
Every year, CEO magazine – a publication targeted at the nation’s captains of industry – ranks the 50 states based on how friendly their respective economic climates are for business. In 2012 – for the eighth straight year – California finished dead last.
As JP Donlon put it in the piece accompanying the magazine’s rankings, “Once the most attractive business environment, the Golden State appears to slip deeper into the ninth circle of business hell. The economy, which used to outperform the rest of the country, now substantially underperforms. And its status as the most ruinously contentious place to operate remains undisturbed.”
Harsh words, but hardly a new diagnosis from America’s business community. In 2010, the magazine called the Golden State “the Venezuela of North America” for its overt hostility to any commerce that doesn’t originate via legislative fiat. If this were the diagnosis of a single, industry-specific publication, perhaps CEO’s condemnations could be taken with a grain of salt. But the numbers bear out the magazine’s claim at every turn.
Pick a metric for public sector performance across the 50 states and it’s likely you’ll find California at or near the bottom. The Tax Foundation ranks the state 48th in the nation for its overall business tax climate, and 50th for individual income taxes. The state has the highest number of public employees (nearly 2.5 million according to a 2011 report by MarketWatch) in the country.
The Mercatus Center at George Mason University puts it 48th in the nation for economic freedom. In its 2011-2012 rankings of “Judicial Hellholes,” the American Tort Reform Foundation ranked the Golden State second, noting, “perhaps no other state more clearly illustrates the direct impact of excessive litigation on job creation and the ability of businesses to survive and thrive.” As a result of these and other factors, the state’s unemployment rate for June was 10.7 percent, third-highest in the nation.
Cite these statistics to the liberals who control most of the Golden State’s levers of power and they’ll often tell you that California’s prosperity can’t be measured in simple terms of dollars and cents; it also has to include the public services that the state’s exorbitant tax rates go toward financing. But even by that measure, the state’s taxpayers are still getting ripped off.
In the 2011 National Assessment of Educational Progress, California students ranked 47th in the nation – ahead of only Washington, D.C., and a handful of states in the Deep South – in math and reading proficiency. The state has the second-lowest percentage of adults with a high school diploma in the country.
San Francisco ranks in the top 10 nationally for the worst traffic congestion; Los Angeles is in the top 5. The American Lung Association’s rankings of the nation’s top 10 worst metropolitan areas for air quality featured eight locations in California. And while the Golden State boasts about 12 percent of the nation’s population, it’s also home to about one-third of the country’s welfare recipients. Despite liberal protests to the contrary, it seems clear that the one thing the state’s tax dollars aren’t buying is a better standard of living for its nearly 38 million residents.
These grim statistics have birthed even more ominous offspring: figures that show that the comprehensive failings of California’s public sector are fueling an exodus of people and jobs. The American Legislative Exchange Council’s recent “Rich States, Poor States” report noted that, “California suffered a net loss in domestic migration of 1.5 million people from 2001 to 2010 [second highest in the nation], as well as 2.5 percent non-farm employment loss.” And those who are coming only compound the state’s existing problems.
A jaw-dropping column by the Hoover Institution’s Michael Boskin and John Cogan that appeared in the Wall Street Journal in March observed that, “From the mid-1980s to 2005, California's population grew by 10 million, while Medicaid recipients soared by seven million; tax filers paying income taxes rose by just 150,000; and the prison population swelled by 115,000.” At that rate – one and a half new taxpayers for every 100 new residents – California’s experiment in unalloyed liberalism is likely to implode sooner than even its most vociferous critics believe.
Like that high school quarterback, California is now realizing charm and sex appeal can only take you so far. Those traits may have masked the state’s sins in the past, but the sheer scope of dysfunction is now too glaring to ignore. Without a renewed focus on economic growth, limited government and a lean, effective public sector, the state’s tailspin will continue unabated – and the “California Dream” will increasingly come to resemble a nightmare.
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