California Dreamin'
I read Professor Rahe's post below with a mixture of delight and apprehension. Delight because, like any sane citizen, my greatest hope is to see the voters return Mr. Obama to private life come January. Apprehension because there is no telling what might happen when the reality distortion field hereabouts finally collapses.
Perhaps it's just been too long since the last Harry Potter novel, but the magical thinking of the local newspaper of record is breathtaking. Remember: California is in the vanguard of our national descent into insolvency, despite some of the highest personal income tax rates anywhere.
But why not go for pole position? Jerry Brown's brainchild is Proposition 30, a ballot initiative hiking California state income tax rates on those earning $250,000 and above to as high as 13.3 percent, edging out New York City's 12.696 percent for the highest-in-the-nation non-federal personal income tax rate.
We're number one, we're number one!
All this despite the many studies detailing the multi-year mass migration of businesses and residents escaping California's current tax rates.
But don't panic. Like a soothing balm from Professor Snape's potions class, the Mercury News front page assures us that millionaires and billionaires like paying higher taxes, or at least they don't change their behavior in any meaningful way. Left unaddressed is the response of those merely aspiring to become millionaires someday but already earning over the $250K threshold.
But leave all that for another day. For now, it is enough to support the common good by voting to tax someone else, allowing those lucky few to become--what is the president's term?--"economic patriots." And while you fill out your absentee ballot, enjoy the nearby journalistic comfort food about Obama running away in swing states as voters gain confidence in our surging national economy.
Whether it is President-elect Romney on November 7th or a debt crisis a bit further down the road, when reality finally bites it's going to hurt.
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Comments:
Sep '10
Re: California Dreamin'
return Obama to "private life" is an interesting choice of words, somewhere he has hardly been his entire adult life.
May '10
Re: California Dreamin'
I hardly believe a single thing I read in any California daily paper; even the sports scores are suspect.
Oct '10
Re: California Dreamin'
Californians get what they deserve. I only wish we could leave it at that.
But an Obama 2.0 administration will make sure the rest of us continue rewarding this Democrat/Public union-controlled state with freshly printed Greenbacks from the Federal kitty. There's no amount of fiscal irresponsibility that Obama won't underwrite if it will help his political cronies.
Do you ever hear about that from Romney/Ryan? How much of the Obama Porkulus went to State coffers so they could string out the fiscally addicted for another year of wasteful, unsustainable spending? Don't you think a compelling narrative could be developed that tied California to the larger national problem that Obama has created? The one which has us hurtling down the path toward Greece?
Can it be so terribly hard for smart people like Romney and Ryan to explain with a sense of urgency what "unsustainable" and "financial collapse" means to average citizens, when we have the Eurozone disaster staring us in the face? Look how well average Greeks and Spaniards are enjoying their lives these days ... nothing makes us immune from their fate. I think voters would respond to that dose of reality.
Mar '11
Re: California Dreamin'
One thing that cartoon on the front page doesn't show is millionaires lined up at the border marching confidently into the Golden Land of Dreams. They'll be there though, because ... well, because ...um... squirrel!
Mar '11
Re: California Dreamin'
George Savage: "Remember: California is in the vanguard of our national descent into insolvency despite some of the highest personal income tax rates anywhere."
Why are you so negative? Why, just a few days ago Victor Davis Hanson wrote this ever so uplifting piece just brimming with optimism for the Golden State. (sarcasm alert)
Mar '11
Re: California Dreamin'
There are none so blind as they who will not see. The people in this country won't respond to reality until it hits them, personally, in the face. It's almost something I wouldn't mind seeing, but I'm one of those who can see humor in most any disaster.
Jul '11
Re: California Dreamin'
"Jay, one of my partners finally got some sense and is leaving SoCal, I hope you have an opening for him and his wife, they're good people".
That is a conversation I had recently with a patient and it is not an isolated incident by any stretch. The "some sense" means the guy is sick of the government there bullying him, and the " good people" means they're conservatives which are my favorite people.
The exodus is a slow trickle but prop 30 will produce a money trail in to Texas and Nevada.
Jul '11
Re: California Dreamin'
George, there are some staying and paying. But paying to defeat this proposition. You'll see some opposition next week.
Edited on October 3, 2012 at 5:23pmMay '12
Re: California Dreamin'
Here is the graphic from the paper.
There are two problems with this: 1) It describes a dynamic, millionaires flocking to low tax states, using static data. Whether movement occured or not, this wouldn't show it. 2) It uses percentages but it really should use actual numbers because the populations of these states are very different.
If this were making the case for conservatism, the left would rip it apart.
Re: California Dreamin'
So true. I could run a similar column each day. Case in point: one day earlier, in the Sunday edition, the Merc ran the front page pictured above. For the uninitiated, Hetch Hetchy is a reservoir in the Sierra Nevada mountains that provides San Francisco and many nearby towns with drinking water and hydroelectric power. For decades, environmentalists have been agitating to have the dam torn down and the valley behind it restored to its pristine state. A measure on the ballot this fall is the latest attempt to get the demolition ball swinging.
But note the tenor of the headline: nothing about insufficient potable water or the destruction of a "renewable" energy source; just a feel-good "vision" of "rebirth." Seems positively religious, doesn't it?
And nearby another calming political article for the liberal cognoscenti. Meg Whitman infamously ran a disastrous gubernatorial campaign against Jerry Brown last cycle, sinking over $100 million of her fortune into the effort and coming away with bupkis. Too rich, too out-of-touch, yada yada.
Edited on October 3, 2012 at 6:43pmMar '11
Re: California Dreamin'
I have a few wealthy friends (very conservative) in San Francisco who will likely never leave simply because their income is location based and they have built a life around SF. But I am a recruiter and have already received several emails from California based executives who are upper middle class, but not filthy rich saying effectively, "with this new tax rate coming I am looking to get out. I'm open to new jobs anywhere else". We live in interesting times.
Re: California Dreamin'
George, thanks for your post and for pointing me to this Manhattan Institute study. Table 4 is particularly interesting. The bottom line number is that California lost over $26 billion on net due to migration in and out of the state between 2000 and 2010.
The striking thing is that the average person migrating to the state (most coming from other blue states) was richer than the average person migrating out (typically migrating to places like Texas, Arizona, or Nevada). Maybe the Mercury News is right that that rich people haven't left. But they left out the bad news that over the past decade, California has basically emptied out its middle class.
Edited on October 3, 2012 at 9:49pmRe: California Dreamin'
Jay, it feels as though the state is now touted as a lifestyle destination resort for the Merc's "superrich," with prices to match. Higher taxes fund benefits for the swelling ranks of the government-employee and client classes, keeping the latter marginally content In this context, Prop 30 is no different than a price increase at the beachfront Ritz Carlton: annoying but manageable.
However, as you point out, it is different for those in the middle--people who need to make economic progress rather than sit back and enjoy themselves--these folks are heading elsewhere in droves.
Re: California Dreamin'
George Savage
Jay, it feels as though the state is now touted as a lifestyle destination resort for the Merc's "superrich," with prices to match. Higher taxes fund benefits for the swelling ranks of the government-employee and client classes, keeping the latter marginally content In this context, Prop 30 is no different than a price increase at the beachfront Ritz Carlton: annoying but manageable.
George, this is exactly right. Of course, the corollary to this is that there are just not enough rich people in California to fund all the possible utopian schemes, much less to pay for the upkeep of roads, retirement packages for policemen and teachers, and the like.
Edited on October 4, 2012 at 12:29am