Monday, December 20, 2010

California Screamin and Mass Exodus

Many Californians are beginning to recognize the condition of their beloved state is in great decline, if not a death spiral.  Many thoughtful, well received articles are popping up everywhere like Missing the California of My Youth by Tim Daniel and Two Californias by Victor Davis Hanson with multitudes of thoughtful comments concurring the dire situation California faces.

As California moves towards what many view as an inevitable collapse, it may well become a death trap for multitudes of people.  Food, water and electricity may become scarce under any number of scenarios including a trigger of high priced and/or shortage gasoline.  Race riots may also break out. As a native Californian of 50 years, I'm preparing for a possible exodus to another state following the lead of some very wise people who read the signs a long time ago.

In his article Two Californias Victor Davis Hanson opens his article with a brutal assessment of a metaphoric schizophrenic state:
"The last three weeks I have traveled about, taking the pulse of the more forgotten areas of central California. I wanted to witness, even if superficially, what is happening to a state that has the highest sales and income taxes, the most lavish entitlements, the near-worst public schools (based on federal test scores), and the largest number of illegal aliens in the nation, along with an over regulated private sector, a stagnant and shrinking manufacturing base, and an elite environmental ethos that restricts commerce and productivity without curbing consumption." - Victor Davis Hanson, National Review
In a well written essay on Pajamas Media's site, Tim Daniel's Missing the California of My Youth sums it all up in one sentence:
"Atlas has shrugged and California has changed – government has ruined this place and I will never forget it." - Tim Daniel
Here are just a few stats to consider. (Please pardon the small font, there's a lot of info here)

The American Tort Reform Association ranks CA the second worst “judicial hellhole” – extremely anti-business.

America’s top 600 CEO’s rank California “the worst place in which to do business” for the fifth straight year (3/2010).  But here’s the interesting part – they think California is a great state to live (primarily for the great climate) – they just won’t bring their businesses here because of the oppressive tax and regulatory climate.
Consider this quote from the survey (a conclusion reflected in the rankings of the characteristics of the state):  “California has huge advantages with its size, quality of work force, particularly in high tech, as well as the quality of life and climate advantages of the state. However, it is an absolute regulatory and tax disaster.”

California has the 3rd worst state income tax in the nation.  9.55% tax bracket starts at $46,349 for people filing as individuals.   10.55% tax starts at $1,000,000

By far the highest state sales tax rate in the nation.  8.25%.  7% is next highest (does not include local sales taxes)  Table #15

California corporate income tax rate (8.84%) is the highest west of the Mississippi (our economic competitors) except for Alaska.   Table #8   -- we are 9th highest nationwide.

California’s 2011 Business Tax Climate ranks 2nd worst in the nation.

Fourth highest capital gains tax   9.55%

Highest gasoline tax (averaging 67.4 cents/gallon) in the nation, 4 cents above second place Hawaii (July, 2010).   (also highest diesel tax)

California is ranked 14th highest in per capita property taxes (including commercial) – the only major tax where we are not in the worst ten states.  But CA property taxes per home were the 10th highest in the nation in 2008.   and

One of the highest state vehicle license car taxes. 1.15% per year on value of vehicle, up from 0.65% in 2008.

California’s 2010 “Tax Freedom Day” (the day the average taxpayer stops working for government and starts working for themself) is the 7th worst date in the nation – up from 28th worst in 1994, but down from 4th worst last year  CA “improved” only because of our state’s soaring unemployment rate – the new tax dodge! 

In 2009, 24 states raised their taxes at least 1% to collect $28.6 billion.  California’s taxes went up about $11 billion – thus we were responsible for about 38.5% of all the state tax increases in the nation. 

California tied for 2nd highest state unemployment rate.  (November, 2010)   12.4%.  National unemployment rate 9.8%.

California needlessly licenses more occupations than any state – 177.  Second worst state is Connecticut at 155.  The average for the states is 92. 

For the 2007-08 school year, the Los Angeles Unified School District spent $29,780 per student.  The district also has the country’s second lowest graduation rate of 40.6%.

1 in 5 in Los Angeles County receiving public aid.,0,4377048.story

California has 12% of the nation’s population, but 36% of the country’s TANF (“Temporary” Assistance for Needy Families) welfare recipients – more than the next 7 states combined.  Unlike other states, this “temporary” assistance becomes much more permanent in CA.   

California prison guards highest paid in the nation. 

California is the worst ranked state for tax administration – another anti-business factor.

California now has the lowest bond ratings of any state, edging out Louisiana.

California, a destitute state, still gives away college education at fire sale prices.  Our community college tuition is by far the lowest in the nation.  How low?  Nationwide, the average community college tuition is almost four times higher than California CC’s.  This ridiculously low tuition devalues education to students – resulting in a 30+% drop rate for class completion.  In addition, 2/3 of California CC students pay no tuition at all – filling out a simple unverified “hardship” form that exempts them from any tuition payment, or receiving grants and tax credits for their full tuition.

On top of that, California offers thousands of absolutely free adult continuing education classes – a sop to the upper middle class.  In San Diego, over 1,000 classes for everything from baking pastries to ballroom dancing are offered totally at taxpayer expense.

California residential electricity costs an average of 30.1% more than the national average (far higher in San Diego County).   For industrial use, CA electricity is 60.8% higher than the national average (June, 2010).

I'd encourage interested parties to read the comment sections of the two referenced articles for genuine perspectives of native Californians who share their memories of the state's glory years.