California’s Golden Goose Getting Throttled

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Our once Golden state continues to bleed entrepreneurs, productive citizens, large businesses like Toyota, and small businesses too numerous to count.

In case you’ve been asleep for 30 years, California’s economy is not what it used to be. A generation ago, California had the sixth most productive economy in the world as compared to other nation states. That position has slipped to ninth; and for anyone with an inkling of knowledge of economics and the indispensibility of free markets, it’s not difficult to understand why.

California state income taxes are the highest in the nation, topping out at 13.3% (on top of federal income tax rates). After income is earned, it is taxed at the checkout stand with sales taxes ranging from 7.5% to 10%. The corporate income tax rate – 8.84% — is the 5th highest in the nation, while the $800/year business tax, imposed without regard to profits or losses, kills companies in their cradles.

Professional athletes such as DeMarcus Cousins of the NBA contemplate the half-million extra tax dollars it costs him every year to play for a California team instead of being traded – or moving the whole team – somewhere else, say, Seattle.

That’s the tip of the tax iceberg. Here’s a tip of the results iceberg: Golfers Tiger Woods and Phil Mickelson bug out. Bank of America and Wells Fargo lay off California workers. Mattel ships 100 jobs from El Segundo to New York. Campbell Soup closes its oldest facility in the country and shifts production to North Carolina, Ohio, and … drumroll please … Texas. Boeing announces it is laying off 1,000 workers at its Long Beach facility in 2015. Apple Inc. expands domestic manufacturing…everywhere but California. Raytheon pulls out of El Segundo for…Texas.

Not all businesses are leaving for other states. Superior Industries of the San Fernando Valley relocated to Chihuahua, Mexico. Apparently, a nation under siege from drug cartel wars is a more hospitable place for business than California. Low hourly wages alone cannot explain dumping some of the most productive workers in the world; the excessive costs of employing Californians over and above their wages and salaries has to be recognized.

In all, between 2011 and 2012, Bloomberg estimates a loss of 73,000 businesses in California, a 5.2% drop. The tax and regulatory environment has not improved since then, so there’s little reason to expect change for the better.

All these businesses leaving California leaves the state with one of the highest unemployment and poverty rates in a nation with an already abysmal average, thanks to the most anemic recovery in 50 years fostered by unprecedented hostility to wealth creation and entrepreneurship emanating from our nation’s capital. The unemployment rate might be higher except that thousands of productive, employable people are leaving the state along with those thousands of businesses for greater opportunity elsewhere.

And the taxes keep coming. Proposition 30, Assembly Bills (AB) 8 and 241, and Senate bills 622, 782, 768 and many more continue to pile taxes upon taxes.

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This post originally appeared on Western Journalism – Informing And Equipping Americans Who Love Freedom

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Comments

  1. Edwardkoziol says:

    California is run by a bunch of loosers mainly the democrap party. They're more interested in political correctness then doing what is necessary to keep the state solvent.Look who you have Moonbeam Brown,Nancy Poopalosi,Diane Feinshit running the state.This is what those liberal entertainers did to Calif.

  2. The signs of the end times are everywhere…

    As we witness such things as the spread of globalism, the building of a one-world church, the increase of wickedness, the breakdown of the traditional family, the destruction of that priceless bastion of liberty called America, the normalization of homosexuality, the callous murder of babies, the filthy pop culture, the breathtaking increase in governmental surveillance, we become fearful, uncertain, frustrated, angry, and discouraged, but this is because our minds and hearts are too focused on things of this world rather than things above. Too often we have the same short view that “conservative” unbelievers have rather than the long view that comes from the light of Bible prophecy…

    The devil is the god of this world, and his handiwork is evident everywhere, but he is not God and he is not in control of the times and the seasons.

    “Daniel answered and said, Blessed be the name of God for ever and ever: for wisdom and might are his: And he changeth the times and the seasons: he removeth kings, and setteth up kings: he giveth wisdom unto the wise, and knowledge to them that know understanding” (Dan. 2:20-21).

    We should stand in the confidence that the present evil is exceedingly temporary and will soon be cut down.

    Please visit my Bible prophecy website at: itshallcometopass.org

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