Tuesday, September 25, 2012

So, Why ARE People Leaving The Once Golden State?

It is very depressing to know that the place I call home, California, is descending into Greece of the United States Left Coast.
And, because of the overwhelming power of the California Democrats, there seems to be no relief in sight.
But at least this study by the Manhattan Institute gives some insight as to a real serious part of the problem.
In a nutshell, the very people that we need are leaving because of high taxes, over regulation and a deteriorating overall quality of life.
California's population that is leaving is moving to surrounding states, by and large. According to the report, Texas, Nevada and Arizona are the leading places where those that leave move to. Then there is Oregon, Washington, Idaho and Utah. And two Southern states, Georgia and South Carolina, are a pretty big draw for fleeing Californians.
There is a lot a data to digest.
One aspect of this is that the migration to other states began in 1990. That is partially due to the restructuring of the military and closing down bases and research facilities. A lot of those people decided to pull up stakes.
What is replacing those that leave?
Sorry but it is illegal aliens.
Now most are coming to attempt a better life than they have it where ever they are from. But they are not the job producers.
So, for individuals, what are the reasons to move from this state?
Here is directly from the report:

I: Jobs
A closer look at movement to and from the top three destination states for Californians— Texas, Nevada, and Arizona—shows the impact of the 2008–09 recession on migration in general. People simply did not move as much because there were fewer jobs to attract them. But even with the recession impelling people to stay put, Texas had a relatively strong pull on Californians. Texas’s net inflow from California between 2009 and 2010 was 14,963. That’s small compared with the population of either state but is impressive in the context of a major economic downturn. According to the IRS data, the next biggest beneficiary in that period for net migration from California was Oregon, at 5,708 net gain, followed by the state of Washington, at 4,741. Arizona and Nevada, the two most popular destination states at the start of the decade, netted only 3,653 between them from California in the decade’s last year. This is consistent with our hypothesis that these states are destinations for retiring Californians, as the economic crisis put retirement plans on hold for many who suffered losses in real estate or the stock market.

There is more, but again this is a highlight. It behooves you to read the whole study.

2. Taxes
Most of the destination states favored by Californians have lower taxes. Even Oregon, with income-tax rate like those of California, has a more business-friendly tax code. On the other side of the migration ledger, the states that are still net senders of people to California range from near the middle of the tax scale to the very top. As a general rule, Californians have tended to flee high taxes for low ones.

As you read on, this is somewhat harder to quantify as this being a separate reason. But it must be for some people.

3. Other Costs
Employers may be especially sensitive to California’s tax bite because the state’s other business expenses are so high. One 2005 study, by the Los Angeles–based Milken Institute, ranked California fourth-highest in the nation on a broad cost-of doing-business index. (The Milken Institute’s last survey of this type, in 2007, used slightly different methodology but put California almost as high, at sixth.) Among other factors, California’s 2005 electricity-cost index was 168.0, on a scale in which 100 was the U.S. average. Industrial rents were 36.8 percent above the national average, and office rents were 36.3 percent higher. The state’s tax-burden index was not as outsize—111.1—but combined with the other factors, it helped push the state to an overall cost index of 124.2.

Yes, there is a substantive price to live in California. As I see it, if you own a car here, cost, registration and annual renewal taxes, and gasoline add to the cost much more than other states.
The study does hold out hope that somehow, the politicians and the people can stop this decline.
Regrettably, I am doubtful.
One of the reasons that Republicans are finding it difficult to fight against the Democrats is because many of those leaving the once Golden State are, Republicans. It is harder to gain more in a party that has ran on being the strict parent. The Dems, they are the cool parents. They are the ones to promise the moon. The Republicans try to say that there is a cost to those promises.
But, Republicans are just as guilty as Democrats in creating this mess. From former Gov. Pete Wilson, to Gray Davis, to Benedict Arnold Schwarzenegger to the retread Gov. Jerry Moonbeam Brown. All at one point ended up raising taxes or trying to. None made the kind of tough choices that are desperately needed to get out from under.
And we are all losing.
What we need is for someone to tell the truth. To stand up to the state employee unions. To those that feed off of the state government teat. To stop this train wreck from continuing. To not just try to raise taxes but cut government. Merge departments. Get rid of redundancy. Eliminate unnecessary boards. Get a part-time state legislature.
I offer a bit in the last paragraph, but again, it is truth.
We do not need to raise taxes as much as we need to realize our state government is too big, too burdensome and a real danger to business large and small. As well as farmers and ranchers.
I hope that people read this study because it is the truth. It is a starting point to discuss a real way to reform that helps all people and stems the tide of domestic migration away from California.

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