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Joel Kotkin
The New Class Warfare « Back to Story

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I liked the article, the progressive hatred of the middle class is obvious to see. OWS has accomplished nothing even if they actually knew what they wanted to accomplish. I escaped California, many more will.
Kotkin's articles are always interesting but despite the serious downsides he explains, the liberal status quo still manages to win the votes to keep California on the path he decries.
There must be enough in the way the Green-Progressive alliance runs things to convince a majority of the electorate that it is in their economic interest to agree. Just like Chavez voters in Venezuala or the Putin electorate in Russia.
Granted the status quo is often a hard thing to shift, but if the situation were as bad as Kotkin and the OCR claim, it should be endangered. But it's not. Brown and Boxer romped home in 2010.
My point is there is something critical in this story that is not being told. What?
A very well written article that speaks to California's current malaise.
B. Samuel Davis June 04, 2012 at 3:49 PM
So typical - Democratic locusts, destroying everything their ancestors have built. California is the first state to be run like a Democratic city. Right now Democrats are making conditions impossible for Republicans, in an effort to 'cleanse' the state. Once the Republicans are gone or rendered powerless, the real consequences and Detroitification will begin.
Shame on you, as any green will tell you it is the country's CO2 that counts not global! Close a viable business in the US making wqidgets at 30T/ CO2 would be a "green" victory. The fact the same product is then made in Asia using 30T/CO2 (or higher due to electricty mainly generated from coal not gas), then add 2-3T/CO2 in transport to the US does count as US CO2. It makes no difference that closing the US factory without cutting consumption in all probablitity will increase CO2. Greens know all CO2 forms like a bubble over each country and doesn't move globally, therefore CO2 per country is all important.
Yes, it is crazy. I am all for house size control, better insulation and steadily rising efficiency targets for white goods and cars. All known targets set in the near future and givign firms clear fair targets. The US, EU and Australia etc are just being beyond stupid with this globalisation and green politics, hollowing out our industries.
Here's what to do: It's time for the rest of these United States to secede from California. That would put a stop to Californians migrating elsewhere and voting their horrible policies into place in any other State.

This would make it a lot harder for California to demand any kind of bailouts from the rest of us.
Great article,too bad it is not being read by our legislators, governor and most especially by the would-be middle class workers if the econony was booming. It bothers me that we have several tax measures on the ballot and not a single one of them offer any changes that would stimulate the economy by putting people back to work which means that when this round of taxes is exhausted, we can look forward to doing it all over again.
Dallas Management Property May 15, 2012 at 11:26 PM
It's a great article. Keep up the work!
Dallas Management Property May 15, 2012 at 11:24 PM
It's a great article. Keep up the work!
Salvador O'Brien May 15, 2012 at 3:18 AM
Those with teutonic DNA (Christian or Jewish) skew toward the anal retentive side of the ledger -- Arnold Schwartzenegger & Michael Medved.

This is harmless when it comes to organizing their sock drawer.

It becomes a problem when they enviro-grifters cleverly entice them with schemes organize all the carbon atoms in the world with a carbon trading scheme. They are drawn to it like a cat to a ball of yarn or an alcoholic to open bottle of tequila.

When the Mexicans take over California there will be lots of aid to unwed mothers, but very little environmental regulation. Viva la raza. Ich bin ein Mexicaner!!!
Every bit of this mess, as well as the pension bomb about to explode, is the result of the governance that Californians voted for. California is indeed a beautiful state that has the potential to thrive. Unfortunately, it has been cursed with Californians.
I agree with most everything except the criticism of the "strict rules against noncompetition agreements". This basically prevents large corporations from monopolizing and locking up talent ensuring an efficient market and ample supply of people to anyone who wants to start or expand a business and has the capital to hire.
The more I read articles like this and the ones by Harry Stein, the more that I think that this country needs a real "7 Days in May". It could be worse, but I believe that the military believes more in capitalism than our present local, state and federal governments do. I believe that once order is restored, the military will support a Constitutional Republic. I may be wrong.
If we can just drive out of the state all the "dirty" industries, we can all be green, working in techie jobs in pretty office parks. Of course the techies and engineers of the state are 99% white and Asian, so it's only those undesirable blue collar Hispanics and blacks who will lose their livelyhood.

There. I feel SO superior and progressive. Care for a latte?
California has the 2nd worst state income tax in the nation. 9.3% tax bracket starts at $48,029 for people filing as individuals. 10.3% tax starts at $1,000,000.

Governor Brown is putting on the ballot a prop to change the “millionaires’ tax” to 13.3%, starting at $500,000 – including capital gains. If approved, CA will be by far #1 in income tax rates. We will be 21% higher than the 2nd highest state (Hawaii), 34% higher than the third highest state (Oregon), and a heck of a lot higher than all the rest – including seven states with zero income tax.
http://www.taxfoundation.org/files/bp59_es.pdf
Actually there IS a grain of truth about many Californians being undertaxed -- at least when it comes to the state income tax. But it's NOT the rich who are undertaxed -- it's the middle class who pays surprisingly little state income tax. Consider:

A CA married couple with two minor kids. If they make $50,000 and take only the standard deduction (supposing they can't or don't itemize), they pay only 0.1 percent of it in income tax.

Yes, that's correct: 0.1 percent -- $73.

What if they make $60,000? They pay 0.8 percent in income tax ---- $498.

If the couple make $80K? They pay 2.1 percent.

$100K? They pay 3.3 percent ---- far less than the 9.3 percent the tax raisers love to claim the middle class pays in income tax.

As these figures demonstrate, the California income tax ---- considering the rates, exemptions and tax credits ---- is extremely progressive.

Many other states charge more income tax than California to people making less than $100K. It's the "rich" who already get soaked in the Golden State -- even before the new massive tax increases take effect (IF they take effect).

My sources? The California Franchise Tax Board website.
https://www.ftb.ca.gov/forms/2011_California_Tax_Rates_and_Exemptions.shtml

and

https://webapp.ftb.ca.gov/taxcalc/calculator.aspx?Submit=2011+Tax+Calculator&Lang=english&redirectURL=OTC
Joe Rolfe:

You don't fool me. Those are not the reasons. I live here.

LA is running a deficit because it hired people by the bushel even after the economy turned down. It promised them endless benefits that are paid for by cannibalizing repairs and services. So did the state, which has an unfunded pensions obligation in the hundreds of billions.

LA's Department of Water & Power has garage attendants making 74,000 a year, but we can't even get traffic signals that reset after storms and high winds, because unions oppose them.

Prison guards are paid over 30% more than other states, get "walking time" pay for walking to their post and over 8 weeks of vacation. Endless other benefits.

CHP officers take disability when retiring. Fine one day and on disability the next.

Pensioned retirement age for UC professors was pegged at age 55.

Of course the roads are crumbling: the money is being diverted to welfare benefits higher than the feds require, pensions and benefits for state employees.

The schools get enough money: but the teacher pensions (we somehow managed without them till the 70's) are taking the money. The kids are last on the totem pole. To fire a LAUSD teacher requires years and almost a million dollars and even then can be reversed by an arbitrator.

"We have elected the stupidest more shortsighted group of politicians in the country."-- He Wei Jin, April 30, 2012

This is the reason why the state is falling into disarray. Its time for the electorate to stop blaming the government and start taking responsibility themselves. Our elected officials are a reflection of who we are as a citizenry. Nothing more, nothing less.
Actually the total taxes paid in California put the state about in the middle of all states, which considering the higher cost of living puts us near the bottom. This is reflected in underfunded schools, and crumbling and overloaded highways, for starters.

Low skill industrial jobs have always moved to the place with the lowest wages. Look at where the shirt you are wearing was made.
B. Samuel Davis May 07, 2012 at 2:36 PM
Republicans need to wake up to the fact that Democrats are doing this on purpose - they know that taxes, over-regulation, unrestrained immigration will force Republicans to leave the state. As Republicans leave, control is consolidated, so that more anti-prosperity measures can be adopted, so more leave.

Soon you have a ruined state, like New York, and every ten years less representation in Congress.

What I would say to Republicans is this - get your message out, make it as simple as can be - show black people how Democrats have destroyed their community, show Latinos how Democrats will destroy them, don't get sidetracked by meaningless issues - even gov't workers can be convinced that Democratic policies will eventually destroy them as well.

But the message has to get out. And Democrats, corrupt as they are will respond with lies and scare tactics.

The other alternative is to let California die. It's Detroitification is already well along. Let it happen.
IT companies are run by super-rich managers/owners who can afford to live in California. Blue-collar workers have a tough time unless their wages are inflated. That's why the notion of 200K salary making someone a member of the 1% in places like Cal and NY are ridiculous; that's closer to minimum wage in Kansas. I choose to live in Cal because I consider the excessive taxation and regulation a "climate tax"; nowhere else in this country has better weather than coastal California.
When libs rule. And they have no concept of economics,or anything else for that matter. But they are arrogant.
With friends like the Democrats, the Middle Class needs no enemies.
SM and Tex Mex: its not the Mexicans, who are known to labor long and hard--ever see a white dishwasher leaving work at midnight? Or a white man on the street looking for work? Go downtown in Los Angeles: lots of the new shops are mexican owned and run, and are open on Sundays. I admire them.

It IS the upper class leftist mindset: taxing the productive to provide endless aid to those who are not; driving our businesses out with excessive pollution laws, crazy wage and hour laws, and unionized state and local employees sucking the lifeblood out of everyone else.

The air in malibu is flawlessly clean, but the jobs are gone.

LA cut off its coal fired electricity contracts--its gone green--and electricity rates are going up as a result. Malibu is happy. Manufacturers are not. But manufacturing jobs are a small price to pay for Barbara Steisband's peace of mind.

Employers can be sued for allowing an employee to work thru lunch and go home early. Or for not having a counter the right height.

Its all great fun, re-ordering the state. True, all the people who thought otherwise are gone. The business people. The ones that made things, supported charities and would never tolerate unopened pools, shuttered libraries and bad roads. The ones with jobs that paid mroe than minimum wage. But what did they know?

Our textbooks celebrate gays and women, and point out how oppressed everyone was. So they're fully PC and not embarrassing to a leftist. But LAUSD has a stunning drop out rate. Almost none know George Washington, or what federalism is. (they do know the name of every feminist since the 1800's).

Are they abashed? Not at all! They can't wait to remove Prop 13 to fund more intrusive programs. This is leftist government in all its glory.
Mexicans pour into California; Mexicans pour into Texas. The difference is that in California, they remain Mexican. In Texas, they become Texans -- because we demand that of them.

Hence, in California they are a burden, in Texas an asset.
RedStateResident May 03, 2012 at 8:16 AM
Dear California refugees,

When you flee to other states, do the right thing. We can (and do) keep you off our juries for what should be obvious reasons, but only you can stop yourselves from registering to vote and screwing up our state and local governments.

Thank you.

The Red States
Dear California,

Just keep doing what you're doing.

Yours truly,
Texas
@MIKE what a typical "progressive" argument. Nothing but a childish straw man argument with a side dose of an ad hominem. If you did your research on the author, you would find out he is a self described democrat. Everything in life requires trade offs. If you want draconian environmental regulations, be prepared for higher rates of unemployment. I laugh at the hardcore anti fossil fuel crowd. Oil and natural gas are more organic than your beloved inefficient solar panels.
CA is a beautiful place being ruined by liberals. I moved there in 1993 and loved the Bay Area until by 1996 when I realized I couldn't buy a home despite being in the top 2% of US income-earners. When CA voters elected Boxer to Senate and Davis as Governor in 1998, I decided the State's future was hopeless and moved out.

CA lunacy, coming soon to all states, unless Romney can pull off the upset.
The left is the party of misery and where ever they go, misery comes quickly. They are also the party of the elites all while keeping the elite a closed group, none of you uncleansed need apply. Their policies destroy economies and cultures, as they have consciously done with the black community in particular. Their followers are just unthinking and uninformed. Their leaders are more evil than Stalin or Hitler or any of the other murderers.
HOW TO DESTROY A STATE

STEP ONE: no constitutional limit on income tax: was less than 3%, now at about 10% on top of a sales tax of 9.75%, and all other taxes;

TWO: allow state employees to unionize: competent, fairly paid employees became unresponsive, highly-paid, fatly pensioned and unaccountable.

THREE: Have politicians bargain with unions: hence we have "walking time" from the parking lot to their post and 8 weeks of vacation for prison guards. They are the biggest source of illicit cell phones to prisoners--but cannot be searched because the unions demand that they be compensated for search time; 80% of the retirees in the Highway Patrol claim disability. etc.

FOUR: supreme court says all school funds must be pooled and distributed "fairly." Local school involvement withers, since schools are now financed elsewhere, where unions have a choke hold. Courses and school books are controlled by un-elected people with long agendas in Sacramento. History books are dumbed down, pander to gender and race agendas and students hate it more than before.

FIVE: teachers want to be "educators" meaning well-paid administrators. Teaching is for suckers.

SIX: the roads, schools and libraries decline, to keep pensions funded. Taxes increase for the same reason.

=California today. A shame. It was so nice.
independent skeptic: "Special Interests" run the politicians because the government has seized control over so much of the resources and economy, making politicians the ideal target for rent seekers and others looking for government advantages and handouts.

It is bloated government that has created an auction atmosphere in every statehouse and Washington, with everyone else forced and encouraged to bid for government largess.

The solution is to give the power back to the poeple, and take away government's ability to grant the tax breaks, money grants, eminent domain, anti-competitive or favorable regulations, and the host of other "benefits" for which people clamor as a means of distorting the market in their favor.

Campaign finance "reform" is a band-aid on a torn aorta. The problem will only be fixed when politicans no longer have the ability to pick winners and loosers.
Mike & elizabethbennent: If you think you're getting environmental protection by living in California, then think again. Protecting the environment is a luxury that rich economies enjoy, and that isn't happening in certain areas of California (read Victor Davis Hanson re central valley). Also, excessive regulation leads to people operating entirely outside the law - very common in some areas and industries in California.

kalendjay: The 8 hour overtime rule required me to tell some employees they couldn't take time off for to attend school and make it up later, because it raised labor rates too high. I also had to scrap a program of giving every other Friday off (by working an extra hour for the previous 8 days). Our business charged time and materials, and I couldn't pass on the mandated extra costs to the customer, so my employees got screwed. Welcome to California.
B. Samuel Davis May 02, 2012 at 3:51 PM
Take a good look at Mexican economy of the 60's and 70's and you will see California of the next decade. Poor, rich, a few corrupt government workers, and that's it. With people fleeing to other States, and States erecting walls on the border.
Amen, best review I've seen yet. California has been taken into the tank by Progressive Lefty Democrats who only love to spend our money and money we don't have. We are at the edge of the clift and they are all smiling as they push us over the edge. They are brain dead I guess.

Seems to be an epidemic as it has happened in other places like DC where the guru of spending Obama resides, and other progressive states. I pray for a cure this coming November--get out and vote them all out and get us back to living within our means.
They didn't destroy the Middle Class. They destroyed the entire state. They took the world's 8th largest economy down the tubes like they are taking the world's largest economy down the tubes.
independent skeptic May 02, 2012 at 1:14 PM
The core of California's problems are the same as they are in any other state or nationally - politician elections are funded by corporations and special interest groups and few wealthy individuals. Elected leaders don't represent people anymore - they represent special interests or corporate interests.

Solution: Make all political races 100% funded through public funds, double the salaries of elected officials and create a law that makes private campaign contributions of any type a felony with mandatory jail sentences.

That is campaign finance reform that would benefit us all, not just corporations or special interests.
I wonder how many lunches and breaks Mr. Kotkin gets during the day or during a typical week. Also, how many people want to live in Louisiana and Alabama after the next big oil spill. Calif. can be the one state that will be environmentally safe to live in. I don't see Mr Kotkin living near Love Canal. or moving there any time soon. If we offer to buy him a house there can we get him to move and take the Koch brothers with him.
Great read. Someone has done some homework.
I live in Colorado, a place that used to be built on rugged individualism and entrepeneurship. Unfortunately, about two to three decades ago Californians started moving here en masse to get away from the absurd regulations and policies in CA. But they brought them here! While I would enjoy the idiots in California imploding as they should, it just means that they export their idiocy to the rest of us. Please stay in California, build a fence to keep yourselves in, and leave us sane states alone. That's about as much goodwill as I can drum up for you goofballs.
I was not aware that charging overtime after an 8 hour shift was a burden: I never lived in a locality where there was an exemption to the rule.

That said, I wish Mr Kotkin would write about New Jersey. Since my youth, the state was looked at as a refuge from the "New York Disease" of regulation and governmentalism. Gov. Tom Kane presented the state as a paragon of blue blood suburbanism. Bob Brennan (the fraudulent Madoff of the time) presented it as a land of hard money opportunity. And none of this was destined to be true.

The problem here is much the same as California: a need to play to endless "diversity" of interest groups and euphemize pocketbook issues as an imperative to "reach out" to "those in need" and dismiss anger against government with the words, "We've got work to do."

Don't think things have changed under Christie Creme. All he did was emancipate the municipalities to hike their own school taxes, break state law on pay and other civil service benefit restrictions, and go fish in Wash DC in slightly different ways. Unemployment and business development have not improved. There is not the slightest suggestion that Senators Menendez and Lautenberg do not represent us and that different plans should be made for taxes lost out of state -- at a higher rate than California.

Cali is not alone as a national pariah, nor was it necessarily first or last in that category.
Dear Californians,

Please stay in California.

Sincerely,

The rest of the country
It's clear that the poorer areas of the state will never escape progressive cash and influence. They are going to have to try and break away and either form new states or perhaps leave California and join Nevada, Arizona or Oregon.
Joe lives the old Orange County way of low taxes and cheap labor. OC was responsible for the passage of prop 13 back in the 1970's. lowering tax revence this was fine when most of the state was white and middle class since the school age population was going down. Then the heavily hispanic immirgation that was mainly in La in the 1970's started to appear in Orange County. Poverty rates in both Santa Ana and Anaheim surge and schools that once had only 10 percent of the children on the school lunch program went up today as high as 90 percent. Joel believes in the cheap labor of mainly hispanics and some asians that Orange County has done the past 30 years. He favors Texas since it practices the same model and Poverty rates in Houston,Dallas and even Austin are higher than even in Anaheim and Santa Ana in Orange County among hispanincs there is also a Republican elite in both Texas and California that have like this cheap labor for 30 years.
elizabethbennett May 01, 2012 at 1:26 AM
lose the either/or binary thinking, joel. there are ways to promote business without trashing the environment. better to suffer a little while we thrash it out to devise those ways now rather than later, when everything is even more trashed than it is at present...
I'm an employment-law partner in a California office of a world wide law firm. My clients are among the largest employers in the world. When determining where to hire new employees, they all follow the "ABC Rule": "Anywhere But California". As one other commentator noted, the tip of the iceberg is business moves out of California. The far greater problem for job creation is the fact that businesses won't locate here if they have any choice.
A lifelong Californian, I've reached the conclusion that it isn't possible to stop the decay. Rather than continue my futile attempts to delay the progressive agenda in a county where Democrats outnumber the rest by over 2-to-1, I'm thinking of joining Lavaux, voting in favor of Moonbeam's tax hikes, and hastening the final collapse of the state. I can think of no other way to conclusively discredit the progressives and enable the recovery of the state.
I moved to California, the state of Ronald Reagan, in 1985. Oh, it was great. But every year, it slipped a little more until the state I had moved to no longer existed. The air has improved, but everything else has become worse. Worse regulations that make everything more expensive (except wine), worse taxes (I make more now then in those days), far worse schools, less respect for personal and private property rights, and the place is becoming Mexico. I could no longer take it.

I moved to Texas. Wow, what a difference! It is the way California used to be. Business friendly, good schools in affordable areas, no state government telling you how to live your life, lots of activity going on. I don't know whether I escaped from California or was run off. Either way, if there are any business owners left, I suggest you get out while you still can.
The one thing you can't count is the number of businesses that decide not to move to California. It isn't just the number of businesses leaving California. California now has the reputation of Michigan, Illinois, or New Jersey, and so, people will no longer want to move there. California will now be a permanent welfare state, destined to continually cut spending like Michigan. It will continually lurch from crisis to crisis like Greece
The progressives in California get hysterical over developing land, yet more than 45% of the state is government (federal, state, county, municipal) owned. Most of this is park land (Yosemite, Death Valley, GGNR, etc.) Some is military (Travis, Vandenburg, Pendleton, etc.) And some is just squares of buildings (government bldgs, courts, police, fire, etc.) Most of it, however, is federal park and BLBut still, 45+% of over 163,000 square miles is nothing to sneeze at. And yet the Occupiers get histrionic over a small experimental farm plot in Albany as if it were the last plot of land on earth.
Occupy = Dependency
California is just another North Korea. A Hermit Kingdom with Jerry Brown-Un as "fearless leader", who is promoted and protected by a militant oligarchy of wealthy "non-profits"(?), public employee unions and ethnic group associations. When it will end is anybodys guess. How it will end will be, in the Oriental philosophical sense, "interesting".
The problem with the middle class (as far as the limousine liberals are concerned) is that they have the means to make their own decisions and form their own opinions independent of what the rich progressives want. Therefore, they necessarily destroy the middle class in order to force their wants/desires on the poor who are 100% dependent upon their largess. I just moved to California from Texas and the depth of the anti-business/anti-capitalism environment is astonishing. The people try to vote their minds (ie, the death penalty has approval of close to 65% of the people), yet the libs in Sacramento create so many barriers and hurdles that they've in effect neutered any deterrent it might provide (and then they faux complain about the complexity and costs of putting someone to death when they're the very ones who have created those barriers and hurdles). It's a sick society and it's obvious CA is rotting on the vine.
The California Senate has appointed a Select Committee on Restoring the Middle Class. I don't know of any legislative proposals made by them. However, the State Building and Construction Trades Council of California argues that "California must invest in the middle class now!" How? "Bold new job-creating, life-enhancing public works investments." How to pay for these? "By restoring fairness to our economy and revenue collection. Polling shows overwhelming support for the Governor's proposed income and sales tax changes to restore fairness to all and make the rich pay their fair share once again." Over at the Daily Californian, the Berkeley collegians argue that "Students must stand together against corporate America's attack on the middle class" (April 24). What attack? "Major out of state corporations have banded together to create a deceptive campaign against California's middle class families by attempting to stop the passage of Assembly Bill 1500", part of the Middle Class Scholarship Act, which would be funded by higher corporate taxes. The California Labor Federation promotes a "Middle Class Bill of Rights", including such rights as "the right to a good job that includes a living wage and adequate benefits" and "the right to a just system of taxation that ensures wealthy corporations are paying their fair share for the services that are necessary to run our state." With so many California organizations, including the state Senate, agreed on the need to redress the state's loss of its middle class and with such unanimous agreement on the solution--"Tax other people more to benefit us"--no doubt the middle class exodus from California will soon come to an abrupt halt and begin to reverse.
The eradication of Progressives and of Democrats is necessary before progress is possible. I suggest a civil war, with Nukes.
So is anyone surprised that the nerds of today are getting revenge on the robber barons of yesterday. These kids want the place all to themselves and that evil profit motive has given them the opportunity to buy it one legislater and one ballot measure at a time.Whats funny to me about all this is these same smart folks dont see John Galt working right under thier noses. But sadly the pols are mostly correct in that someone will always be trapped in a life/work chioce prison there and be forced to support this dystopia.
A poster child of all this can be made of the fiasco that Marin County (a very well off county just north of the Golden Gate Bridge) put George Lucas through when he tried after years and years to expand his movie studio in the bucolic country side of this county. He was fought every step of the way by bananas (Build absolutely nothing anywhere near anyone) and finally after millions were spent, he threw up his hands and said he would go elsewhere. One location was Vallejo, which would gladly open their bankrupt arms - except for when the environmental police pull out their handcuffs, we'll wait and see. But it's very obvious that Marin only talks the talk, as does the state of California.
Kotkin plows new ground with every article and despite being a self-proclaimed "Truman Democrat" is the single most valuable asset for conservatives, whose views he buttresses with his data, whether or not he knows it much less likes it. In this regard, he's much like Walter Russell Mead in being the right's best friend by simply telling the truth, regardless of his personal politics. And like Mead, Kotkin highlights the stark difference between yesterday's sensible liberals and today's wild haired, wild eyed progressives who are anything but progressive.
How odd that Kotkin lauds Silicon Valley in one breath -- and lambastes the fact that non-competition agreements are unenforceable in the next.

There's a lot of research that says this one factor, more than any other, is responsible for Silicon Valley. Your startup needs engineers who want to take a risk? No problem -- hire 'em from Google, who can't stop the engineers from jumping to a start-up.

Try that in Europe, with its three-month notice periods and taut non-competes.
I wonder what happens when California inevitably goes bankrupt and pitches the Feds for a bailout? Should the rest of us pay for their "choices" to ignore abundant resources and implement business-killing regulations?
There is a natural limit to how far the Progressives can screw up California, as in order to survive, California has to compete with the other 49 States. Right now California is losing that competition as it is making doing business in California more expensive, while other States are working on making it easier and less expensive to do business there.

The bottom line is very simple. If government makes something (growth and employment) harder and more expensive, we get less of it. If government makes these things easier and less expensive to accomplish we will get more of them.

Obama needs to be tossed out of office in November for failing to understand this most basic principle of economics. We have had our experiment with socialism at the Federal level and it did not turn out so well. Hopefully enough people in CA will wake up soon enough to toss their socialists out of office before it is too late.
and they like the illegals they employ. No need to pay them much.
Brought to you by ExxonMobil, thanks for reading - vote GOP!
Wherever liberals exist and thrive they will continue to destroy economies until voters become truly desperate, if not destitute. They never believe it is their policies that are at fault, only the way the policies were managed or implemented. Even without any real political opposition they often successfully blame their opponents, because those who believe in the liberal ideoology do so as a matter of religious faith. Of course, the really sad thing is that many of these same liberals pack up and leave only to carry their religion elsewhere.
all fine, except this guy voted for moonbeam.
You are all hypocrites. How many of you saw Avitar? If you did, you are not only putting money in Cameron's pocket, but every Democrat he contributes to. You cannot just vote in November, you MUST vote everyday with your money. You have to educate your kids why they shouldn't see the latest movie, listen to certain music, etc. because of where that money is going. If you don't stand up with the little things, our country will be lost forever.
Mr. Kotkin did not talk about the elephant in the room. The ethnic demographic changes. As poor Hispanics become the majority very soon,it will be even worse. This is what happens when we have an immigration policy that imports uneducated and unskilled people. They never rise up. California is finished. Let's stop pretending otherwise.
Joel Kotkin wrote:
"...a pro-growth strategy could help reverse California’s current feudalization."


But progressives want feudalization.
@ Mike

Careful what you wish for. If California falls too far, that just means the liberals and parasites will flood out across the Rockies to infest still functioning states and drag them down in the same way they killed Cali.
I read that the govt classifies garbage men and trash haulers as "green jobs". If so, this is a fraud on the public, because these jobs probably account for up half of the so called green jobs. M
Oh, I dunno. They way that Hollywood and the rest of the Left Coast's radicals holds in contempt and speaks to with condescension all of middle America, I think I'll rather enjoy watching their economy collapse. It puts on display the failure of their vision, the failure of their economic ideas and the hypocrisy of their lives.

California is a lesson for us all.
The local libs are marching around the Redondo Beach power plant like Joshua around Jericho in hopes to tear down a productive clean generator of electricity (the facility uses natural gas) and replace it with a park. It's been there for most of a century with technology updates along the way. But IT NEEDS TO GO they say.

Meanwhile, we're supposed to drive electric cars while Obama's stated policy is to have "electricity rates necessarily skyrocket."

You see, to libs, electricity -- perhaps man's greatest invention -- comes out of the wall magically. It's not generated by dedicated, talented people managing amazing machines that work around the clock to generate that electricity.

The lib mantra: "Drive electric cars! Tear down generation stations! Cover the desert with solar collectors! Don't harm the fragile desert! Build more windmills! Don't kill the birds! Don't make eyesores!"
Though they say otherwise, liberals hate people who work. From Marx to this administration, hatred of the producers is a central theme. This is why they don't care that manufacturing and farming jobs are being destroyed nor that energy costs are wrecking other business. Its just hurting people who *shudder* work. How inferior to who make laws and regulate and make fancy new toys that seem to be free (Google and Facebook).

They just don't understand that money and things have to come from somewhere. That somewhere is hands and minds of the blue and white collar people who work at productive jobs. Not politicians. Not bureaucrats. Not even most musicians or college professors. These people are the Middle and Working Classes the liberals so hate.
I dare anyone to open a factory in California... especially anywhere near the coast.

A coffeeshop, maybe, but the regulations will get you if you try even that.

A liberal friend tried to open a photo gallery -- a gallery! No manufacturing or processing involved -- in LA and faced a $7,000 process before he could begin application for the permit(s). The building now lies fallow. No rents, no taxes, no productivity. Typical.
curmdg sorry to say but there is difference between science and science fiction. cars just don't run on unicorn flatulence and neither do power plants.
the best revenge for the republicans if they win a home run in november would be to impose the Eisenhower era taxes on the entertainment industry, force cable companies to unbundle their packages and curb the the hollywood friendly copyright rules and excemptions. throw in a serious irs auditing of the studios and the sreams will be a joy to hear. the ultimate revenge would be if the supreme court upholds the aca in full granting the government far greater power over the states then the romney administration after repealing the aca could go after california and the other blue states hammer and tongs about virtually anything state and local government have done that impedes economic growth since virtually everything can be reduced to an economic transaction and all economic transactions have a national effect.
And guess who voted for Jerry Brown? Joel Kotkin. And every other idiot Dem in the state of CA. Congrats, progressives. The rest of the country get to watch you doing what you do best. Buggering yourselves and everyone else in the country, to boot.
It won't be long until California is left with just three classes of people:

The poor, who pay little or no taxes and who consume the bulk of expensive social services,

The stubborn rich who won't see sense and refuse to leave a state that sees them as suckers to be soaked, who individually pay outrageous taxes but who, in aggregate, pay relatively little of the total tax revenue,

And public-employees, who will be the biggest single bloc of voters/taxpayers. Basically, these people will have to vote to tax themselves to pay themselves, as well as to pay the poor for being poor and, for some reason, I can't see them doing that.
James Cameron, “It’s so heretical to everybody trying to recover from a recession economy—‘we have to stimulate growth!’ ” says Cameron. “Well, yeah. Except that’s what’s gonna kill this planet.”

This is interesting talk from a guy who has spent a great deal of time exploring the Titanic wreck site and the Marianas Trench. If he's so worried about the planet, why is he contaminating formerly pristine ocean areas by visiting them?
> The state has strict rules against noncompetition agreements,

While the other measures retard growth, the limitations on non-competes help CA grow. Non-competes keep folks tethered to firms. Restricting them means that folks can leave to do better.

There's a fair compromise - if a firm wants a non-compete, it can pay the employee to sit out the non-compete. And no, it can't claim that it did so during employment.
Just a personal observation, but a dynamic middle class is the single biggest threat to an entrenched upper class.

With a functional middle class, the cream can rise to top the old money's. Without it, old money is the only source of capital for any forms of growth or development, and so they control it all.
If something can't go on forever, it won't. After California's collapse and re-occupation, the oil and other natural resources will pay for reconstruction. Until then, they might as well stay where they are, California as it is now would just squander the money and be no better off.
It's called pulling up the ladder.
I can totally relate to this article. I moved back to Indiana in 2009 after losing my house in California and living there for 30 years.

My ex-husband, a life-long Californian, and his wife, are selling their house and moving to Oklahoma.



You have not seen anything .. As of 2013 ... Small and Large Business , Individuals will receive the largest taxes since Carter and that is not counting huge Obama care bills and the growing prices of Food , electricity , Home heating and Now the 55 % Death Tax .
What does that simply mean ? The Jobless will grow meaning Home sales will continue to drop .
Who is ever dumb enough to vote for Obama and Politicians that ''Tax and regulate " them to death .If they don't vote them out .Deserve no better .
Dear Mr. Kotkin, Could you please use your next column to explain why you vote for these people.
Excellent article that summarizes California (and Progressives) situation very well.
California sounds horrible. Why doesn't Kotkin just leave?
Dennis Stillings April 30, 2012 at 9:38 AM
Stop immanentizing the eschaton!
Obama should not be reelected: he is a disaster for our country. After reading the articles on city-journal.com, the Wall Street Journal, listening to Mark Levin, Sean Hannity, and others, I've come to the conclusion that we must dump this current administration.
Excellent piece.

There's a line in there that I found hilarious:

"Apologists for the current regime also claim that the state’s venture capitalists will fund and create new companies that will boost employment."

So, from the same crowd of people who scoff at the very idea that wealthy people or groups are important job creators, comes the thought "So what if we run businesses out of the state? We'll just get some of our rich people to start new ones!"

I think it takes special kind of mindset to see the trainwreck coming, know that they could prevent it, and do nothing simply because they don't want to get off the tracks.
I wonder when the Democrats are going to realize that they can't balance the demands of their red (unions/entitlements), green (enviros) and brown (racial identity/welfare/no immigration enforcement) factions.

Let's say that the Democrats decide to cater to the green faction's dearest desires: Reduce carbon emissions and impose green energy on America. To make green energy competitive with carbon energy in the near term, oil, gas and coal will have to double or triple in price, which will cripple the economy. But a crippled economy can't produce enough jobs and tax revenues to keep the red and brown factions fat and happy, so they revolt and sweep Democrats from office just as in the 2010 midterms but now on a consistent basis.

So now let's postulate instead that the Democrats realize that a booming economy will provide them with sufficient tax revenue to buy enough red and brown votes that they can do without the greens' money and votes. Sunny bipartisanship breaks out because the Democrats and GOP begin cooperating to grow the economy and cultivate jobs by taking substantial power and money away from the EPA and the 50 SEPAs, reducing and streamlining job and growth killing regulations, rationalizing the tax code, and getting debt and spending back under control. The voters begin to believe again that the Democrat Party and government are worthy partners in their pursuit of the American Dream and reward them with votes and confidence.

Which future will the Democrat Party embrace? We'll see once they realize that they can't balance their factions.
It truly is a shame what we are doing here in California. We have elected the stupidest more shortsighted group of politicians in the country. It matters not to them that they have conspired to make the economic situation worse and have stolen billions in earned and potential income from the people of California.
We get the government we deserve and I despair that the electorate will pull the blindfold aside and change the legislature.
My company is expanding in Texas and I pray that my wife's moves there as well or transfers her overseas. The is little opportunity in California and not much prospect of improvement.
California used to be the Golden State, but we have debased and ruined it.
Most conservatives would offer knee-jerk opposition to California's progressives and their policies, and rightly so - they're destroying a beautiful state. But this conservative favors giving the progressives full sway without opposition for experimental and pedagogical reasons. I'd like see to how fast progressives can turn California into Greece, and then when it collapses, hold it up as an object lesson to all Americans as to why they shouldn't ever let progressives near power and money.
California could fix its tax policy and so forth, without abandoning its push for green energy. Ultimately, green energy will prevail. It has to. And California will then be ahead of the curve, with adequate electricity and no fuel bills to speak of.
The phone number for the Alabama development agency is 800-248-0033 . Join Mercedes Benz , Hyundai and Honda in business friendly easy living Alabama . Or stay and watch Caly slide into the morass :your choice .
Mr. Kotkin lists the non-enforceability of non-competition agreements in California as one of the many regulatory burdens that California businesses suffer. I'm not sure that's correct. There are some studies that claim that such non-enforceability was a key factor in the long-term success of Silicon Valley versus Route 128 in Massachusetts. Both Silicon Valley and Route 128 benefit from their close physical relationship to world-class scientific and engineering schools. But one has become an economic giant and the other hasn't. The questions is why. One theory looks at the fact that Massachusetts courts enforce reasonable non-competition agreements in employment agreements; California courts do not. The theory is that the California law has facilitated the type of employee mobility that drives the growth and creation of new companies.
MAY 1 Taxpayer's Rebellion. I hope Law Enforcement Officers will stand in solidarity with the 99ers demands for criminal prosecution of the embezzlers who have stolen their/our retirement money to fund the bank bailout and record bonus'.

The Police Union should instruct their Brotherhood to do everything 100% by the book and then to do it again extra careful and a third time just to make sure it takes even longer. Or just have a case of Blue Flu on May 1. Fidelis ad Mortem Centurions.