4 ms·

If California's a 'bad state for business,' why is it leading in job/GDP growth?

18 points by pbhowmic 10y ago

casylum 10y ago
California is growing in spite of its draconian business regulations. Perhaps things would be even better with more friendly laws for small businesses.
- vezycash 10y ago
  >in spite of its draconian business regulations. California is the most populous state, contains more people than the 21 least populous states combined. [1] Taking China and India as a reference, I believe population is a big reason for its growth. 1. https://en.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_population https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...
- deleted 10y ago
  [deleted]
gozur88 10y ago
Ah, Hiltzik. Never finds an answer he didn't start with. >The most obvious answer is that the business-friendliness and competitiveness rankings are pretty much baloney. No, the most obvious answer is California's built-in advantages are enough to overcome idiotic government. Trade with Asia mostly comes through Los Angeles and Long Beach, it doesn't snow in populated areas, and California's #1 population size gives it political clout other states don't have.
nickthemagicman 10y ago
Thank goodness places like Africa are THRIVING without all these draconian governmental regulations. I guess all this government funded: infrastructure, education, public transit, etc. aren't contributing AT ALL to California's success, they should really target Sudan as a model for small government success. </s>
- gozur88 10y ago
  You're making some unfounded assumptions in the construction of this straw man. The first being that "places like Africa" aren't thriving economically (twelve countries had higher GDP growth than California last year despite low oil prices). The second that businesses in less developed countries don't suffer under a lot of arbitrary taxes and regulations.
  - rndmio 10y ago
    Higher GDP growth as a percentage? Comparing developed economies to developing ones with that metric isn't particularly useful.
    - gozur88 10y ago
      I would argue it's the only number that's useful. Total GDP is a function of policies going back hundreds of years, which were likely to have been quite different.
    - blackflame7000 10y ago
      How else are you supposed to compare? Actual GDP? That certainly doesn't make any sense.
- germinalphrase 10y ago
  And that's the rub - finding that balancing point between 'gov't as long view investor' and 'entrepreneurship as short term implementer'. Mariana Mazzucato has a nice talk about this at the Long Now Foundation. http://longnow.org/seminars/02014/mar/24/entrepreneurial-state-debunking-private-vs-public-sector-myths/ http://longnow.org/seminars/02014/mar/24/entrepreneurial-sta...
gumby 10y ago
Compared with the other states I've lived in, California seems to have the least corrupt and most reasonable regulations. Sure I can find plenty of ridiculous stuff (the boneheaded 8-hr/day vs 40 hours/week rule) but by and large it's a great place to do business. Those ALEC, Heritage foundation etc clowns are welcome to stay in DC and screw up other states. Their arguments are always data-free.
youngButEager 10y ago
Why didn't Tesla build its largest-in-the-industry battery factory here? Why did Toyota move out? "Business relocation expert Joe Vranich has been counting. “I tracked for 2011, that 254 companies of all sizes and shapes and kinds left the state for primarily other states,” said Vranich, the president of Spectrum Location Services in Irvine. He told KCRA 3 that companies leave California for three primary reasons: “High taxes, excessive regulations and the threat of really ridiculous lawsuits.” Chevron is moving 800 jobs from their Bay Area headquarters to Texas, and Waste Connections shifted more than 100 jobs to Texas from Folsom. "Two dozen companies commit to leaving California -- Prop 30 triggers business backlash" http://www.kcra.com/news/Two-dozen-companies-commit-to-leaving-California/18533954 http://www.kcra.com/news/Two-dozen-companies-commit-to-leavi... Detroit took 50 years to crash. Not sure if most people are aware, but Silicon Valley led California with jobs growth, led California out of the recession. If the rest of Silicon Valley moves to Austin et al, California's highest-in-the-nation personal income tax will need to go much higher. As a small business owner, the taxes and regs just scream "don't hire anyone!" Arizona, Texas (no state income tax), Nevada (no state income tax) -- weather not too bad, real close to California.

18 points by pbhowmic 10y ago

California is growing in spite of its draconian business regulations. Perhaps things would be even better with more friendly laws for small businesses.

vezycash 10y ago
>in spite of its draconian business regulations. California is the most populous state, contains more people than the 21 least populous states combined. [1] Taking China and India as a reference, I believe population is a big reason for its growth. 1. https://en.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_population https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...
deleted 10y ago
[deleted]

gozur88 10y ago

Ah, Hiltzik. Never finds an answer he didn't start with. >The most obvious answer is that the business-friendliness and competitiveness rankings are pretty much baloney. No, the most obvious answer is California's built-in advantages are enough to overcome idiotic government. Trade with Asia mostly comes through Los Angeles and Long Beach, it doesn't snow in populated areas, and California's #1 population size gives it political clout other states don't have.

nickthemagicman 10y ago

Thank goodness places like Africa are THRIVING without all these draconian governmental regulations. I guess all this government funded: infrastructure, education, public transit, etc. aren't contributing AT ALL to California's success, they should really target Sudan as a model for small government success. </s>

gozur88 10y ago
You're making some unfounded assumptions in the construction of this straw man. The first being that "places like Africa" aren't thriving economically (twelve countries had higher GDP growth than California last year despite low oil prices). The second that businesses in less developed countries don't suffer under a lot of arbitrary taxes and regulations.
- rndmio 10y ago
  Higher GDP growth as a percentage? Comparing developed economies to developing ones with that metric isn't particularly useful.
  - gozur88 10y ago
    I would argue it's the only number that's useful. Total GDP is a function of policies going back hundreds of years, which were likely to have been quite different.
  - blackflame7000 10y ago
    How else are you supposed to compare? Actual GDP? That certainly doesn't make any sense.
germinalphrase 10y ago
And that's the rub - finding that balancing point between 'gov't as long view investor' and 'entrepreneurship as short term implementer'. Mariana Mazzucato has a nice talk about this at the Long Now Foundation. http://longnow.org/seminars/02014/mar/24/entrepreneurial-state-debunking-private-vs-public-sector-myths/ http://longnow.org/seminars/02014/mar/24/entrepreneurial-sta...

gumby 10y ago

Compared with the other states I've lived in, California seems to have the least corrupt and most reasonable regulations. Sure I can find plenty of ridiculous stuff (the boneheaded 8-hr/day vs 40 hours/week rule) but by and large it's a great place to do business. Those ALEC, Heritage foundation etc clowns are welcome to stay in DC and screw up other states. Their arguments are always data-free.

youngButEager 10y ago

Why didn't Tesla build its largest-in-the-industry battery factory here? Why did Toyota move out? "Business relocation expert Joe Vranich has been counting. “I tracked for 2011, that 254 companies of all sizes and shapes and kinds left the state for primarily other states,” said Vranich, the president of Spectrum Location Services in Irvine. He told KCRA 3 that companies leave California for three primary reasons: “High taxes, excessive regulations and the threat of really ridiculous lawsuits.” Chevron is moving 800 jobs from their Bay Area headquarters to Texas, and Waste Connections shifted more than 100 jobs to Texas from Folsom. "Two dozen companies commit to leaving California -- Prop 30 triggers business backlash" http://www.kcra.com/news/Two-dozen-companies-commit-to-leaving-California/18533954 http://www.kcra.com/news/Two-dozen-companies-commit-to-leavi... Detroit took 50 years to crash. Not sure if most people are aware, but Silicon Valley led California with jobs growth, led California out of the recession. If the rest of Silicon Valley moves to Austin et al, California's highest-in-the-nation personal income tax will need to go much higher. As a small business owner, the taxes and regs just scream "don't hire anyone!" Arizona, Texas (no state income tax), Nevada (no state income tax) -- weather not too bad, real close to California.