CAL EXODUS–Will You Join It?

In 2015, 61,000 more people left the State of California than came into the State.  Those coming in include illegal aliens.  Those leaving were mostly well pay professional and professional people wanting a better lifestyle and a cheaper one.  Now we find that businesses are quickly leaving the State.  They are taking with them very well paid employees and executives—who pay high taxes, spend a lot of money and create jobs.

Thank you for reading this post, don't forget to subscribe!

“Not every company quitting California is a big name or an international firm. Small companies have left, too. Orange County relocation specialist Joe Vranich said late last year that 9,000 California businesses had left altogether or partly relocated over the previous seven years – and most went to Texas.

It’s not hard to understand why companies are leaving. Vranich points to Chief Executive Magazine ranking California – for the 11th straight year – the “worst state for business” in the country in 2015, as well as the state’s placing of 48th in the Tax Foundation’s State Business Tax Climate Index.”

California likes regulations and taxes, Texas prefers opportunity and freedom. Which do you want?

los-angeles-freeway-helicopter-1

CAL EXODUS

By Kerry Jackson, PRI Capital Ideas,  6/28/16

If California had an official state vehicle, it should be the moving van. Nothing could better illustrate the exodus from the Golden State by companies looking for a friendlier business environment, and individuals seeking job opportunities.

Already California has lost Toyota’s U.S. headquarters to Dallas, the company said it is moving “substantial parts” of its operations from Torrance. Carl’s Jr. and Jamba Juice also moved out of the state.

Now it is losing Jacobs Engineering Group. The $6.3 billion Pasadena firm that has more than 230 offices across the world, employs 60,000 and generates $12 billion in annual revenue recently announced that it is relocating its headquarters to, yes, Dallas.

Not every company quitting California is a big name or an international firm. Small companies have left, too. Orange County relocation specialist Joe Vranich said late last year that 9,000 California businesses had left altogether or partly relocated over the previous seven years – and most went to Texas.

It’s not hard to understand why companies are leaving. Vranich points to Chief Executive Magazine ranking California – for the 11th straight year – the “worst state for business” in the country in 2015, as well as the state’s placing of 48th in the Tax Foundation’s State Business Tax Climate Index.

Vranich also quotes Larry Kosmont, publisher of the Kosmont-Rose Institute Cost of Doing Business Survey, who said that California’s business tax climate “compels businesses to reconsider their relationship with the state and look elsewhere for a lower-cost solution.”

The problem isn’t new, Vranich says. For about 40 years, despite reassurances to the contrary from elected officials and bureaucrats, “California has been viewed as a state in which it is difficult to do business.”

As businesses depart, so do people and jobs. The American Legislative Exchange Council’s “Rich States, Poor States” shows that California lost almost 1.3 million individuals from 2005 to 2014.

“It’s a good bet these California refugees didn’t leave for more sunshine or better weather,” Stephen Moore, one of the report’s co-authors along with the Pacific Research Institute’s Art Laffer, wrote last fall in the Washington Times. The “refugees” are moving to states where taxes are low and, not coincidentally, jobs are more abundant. And the future more promising. California ranked 46th in economic outlook in ALEC’s 2016 report, falling from 44th in 2015. It’s ranked in the bottom 5 five times in the last seven years.

Decades of flawed public policy went into producing this poor economic outlook. California is last in personal income tax rates, last in personal income tax progressivity and 49th in minimum wage law. It is also dead last in average workers’ compensation costs and right-to-work laws – which means that employers are operating under conditions that discourage them from hiring. Despite the bleak future, California has been building. Though not in proportion to its status. In 2014, it ranked 12th in the number of new facilities built, according to Conway Inc.’s, with 170. Not bad. But the state that is the most populous in the country and is third-largest in size – and once had a long history of being the land of opportunity – should do better. Sadly, it doesn’t. When measured on a per capita basis, California is 48th in new facilities.

The governor’s office, which has the unenviable task of trying to counter California’s new reputation as a bad-for-business, economic wreck, frequently resorts to citing the state’s job creation numbers: 2 million new jobs since 2011. But it’s important to note where and what these jobs are.

The state’s job growth has been mostly limited to the tech sector. The Economist reported that without growth there, “California’s much-vaunted recovery would look a lot shakier.”

The high-paying jobs? Investor and entrepreneur Tim Draper told Bloomberg news earlier this month that, like businesses, they are being lost to other states. This is backed up by Vranich’s report, which is loaded with references to companies leaving California and creating high-paying jobs in their new locations.

It’s unlikely to get any better. The California Employment Development Department projects that the five jobs expected to grow the fastest by 2022 will be low-wage jobs – those paying less than $12 an hour.

It’s not for nothing that California has been called the “sick man of America.” It doesn’t have to be, though. There is a road to health. If lawmakers would read Laffer’s Eureka!: How to Fix California,” they’d have a clearly marked map showing which tax policies and regulatory reforms they need to steer toward.

About Stephen Frank

Stephen Frank is the publisher and editor of California Political News and Views. He speaks all over California and appears as a guest on several radio shows each week. He has also served as a guest host on radio talk shows. He is a fulltime political consultant.

Comments

  1. I say give CA back to Mexico. They deserve nothing less. When their state becomes bankrupt (it already is) they will come to us to bail them out. I say “you got what you deserve.” CA is a shining example of what happens when you allow Communism to rule. Let the Communists in Hollywood put out their money to save their state if they want to. They will NEVER get one dime of my money. I say ALL decent Americans that want to save the rest of the country should stop paying taxes. The reason they get away with what they do is because we continue to feed them what they need to destroy us. We need to stop paying for our own demise. Time to STARVE THE BEAST

    • Yes, STARVE, the BEAST. The communist, ungodly beast has been stealing the blessings we’ve been given by God, and have worked for. Until this country turns back to God’s Word, laws, it will continue to decline.

  2. Sally Rapoza says

    The reasons that people are leaving California are similair to the reasons the Brit’s voted themselves out of the EU. High unemployment, excessive regulations, an immigration crisis and debt woes. All of the issues will be addressed and made better in the State of Jefferson. Why wouldn’t people move here instead of going to Texas or Idaho? We have entered Phase II of the process of becoming the 5 1st state. Our case is Lack of Representation and Dilution of Vote which due to the lack of representation, will be heard in the courts.

  3. Greg Erickson says

    My wife and I are two of the 61K that left. Both CA natives that never dreamed of leaving, but SO happy that we did. There is a better life, with a less expensive, higher standard of living beyond the “Tarnished State”. No, it’s not Texas….

  4. Sally, you are right. Better to split off the liberal A—H’s that have destroyed the State. Give them L.A. and San Francisco and any other area that votes liberal democrat and see which “State” stands or falls..

  5. Randy Townsend says

    Unless and until the exodus from CA by high-end earners/businesses reaches tsunami levels, it will have no no effect on anything Sacramento does. The pols have already demonstrated a willingness (actually it’s eagerness) to run massive deficits, the people keep reelecting the same litter of mongrels each time they get a say, and it’s been this way for decades. We’re out in 4 years, nobody will notice or care (well, we will when our cost of living is exponentially smaller – and we’re the only ones that matter to us) and life goes on. CA is lost and those that can should leave.

  6. We’ll be out of here in less than a year.

    The wife retires early next year, and as soon as we can pack up and sell the house, we’re OUTTA HERE!

  7. It is usually a better idea to stay around and fix things.
    But! With the legislature we have, the voting culture we have, California is doomed to an economic collapse and the other states, if the wrong government get’s elected, will pay for every debt that California owes.
    I’m a native Californian, third generation. I see our personal wealth and freedoms being attacked and robbed daily by this state and thinking maybe that it’s time. I certainly don’t want to pay for this states mistakes!

  8. Bayne Just says

    My wife and I left last year. The only regret is we did not leave sooner.

  9. David Ruegsegger says

    The voting base is San Diego, L.A. and surrounding areas, Sacramento and San Francisco. All Liberal cities. Most vote Democrat. The rest of the people in the state have no say therefore, no representation. That is why they are leaving. Now, with new taxes and bond issues coming next year, I suspect even more people will leave. Including me. My house is officially for sale.

  10. California was home. Family on both sides goes back to before the Gold Rush. But we escaped, and will never come back. This is going to escalate over the next few years, and it will begin to show up in the state coffers: fewer paying or even able to pay the bills, and more and more with their fingers in the big pie, or on the dole for a free slice of it.

  11. Jose Curveball says

    The new house is being built and we are within six months of leaving for greener pastures…
    Time to head to at least a PURPLE state and do our best to turn it back RED…
    California is a LOST CAUSE….it’ll be nice to vacation in and visit friends (those that decide to stick around til the bitter end…and it WILL be bitter) but LIVE HERE??? No way…
    Between illegal (and legal)immigrationi from third-world countries, bringing their third-world cultures and not assimilating, high-taxes, hot weather, INSANE traffic on roads that are not repaired and looming pension failures…and the KICKER is seismic risk, as we’re about due for another BIG shaker….
    2017 cannot get here quickly enough…..

  12. Totallyfedup says

    Keep voting for Democrats you stupid Californians and it will only get worse. Them and the airhead, moron environmentalists have destroyed this once great state. For all you other states, wise up before it happens to you too.

    • Totallyfedup, Unfortunately all of the contributors to this article vote conservatively. But there is not enough of us. I envy you who are or have left. My family came here at the turn of the century (the 20th) and have been here over 100 years. I’d leave but I’m in my mid 80’s and don’t think I could hack it. If “assisted living” hoves into view you can damn well bet it will not be in CA-CA land!

  13. I would love to. However, I can’t get the weather I have here between Santa Barbara & LA too many places. No huge bugs, no real humidity, no snow/ice to scrap. It’s really hard to beat the climate. and the roadside stands. and one child lives nearby. BUT WE CAN RECLAIM THE STATE BY VOTING OUT THE LEFTOCRATS.

Speak Your Mind

*