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The author cites a variety of statistics regarding California's government programs and poverty rate, then draws the completely unsupported conclusion that the

The author cites a variety of statistics regarding California's government programs and poverty rate, then draws the completely unsupported conclusion that the one creates the other. Generally, the conservative argument against taxes and regulation is that they handicap business and consequently hurt economic growth. It's hard to make that argument for California, which has had one of the strongest state economic growth rates in the nation despite being the largest state economy. Faced with this clear contradiction, the author simply dispenses with any kind of coherent theory and simply takes as a given that California's poverty must be due to taxes and welfare programs.

rayiner 8y ago
California does not have particularly strong economic growth. From 2003 to 2013, it slightly trailed the country in GSP growth per capita and personal income growth: https://www.heritage.org/sites/default/files/~/media/infographics/2015/05/sr152/bgredstatesbluestatestable3825.jpg https://www.heritage.org/sites/default/files/~/media/infogra.... (To calculate GSP growth per capita, divide the GSP growth column by the population growth column.) More recent data also shows pretty middling results: https://www.bea.gov/news/archive?field_related_product_target_id=461&created_1=All&title=&=Apply https://www.bea.gov/news/archive?field_related_product_targe.... Adjusted for cost of living, California's income level is about in the middle too: http://i.imgur.com/WdfQqJR.jpg.[1] http://i.imgur.com/WdfQqJR.jpg.[1] The idea that California is a prosperous state is a myth. California is a very expensive state, with higher salaries that do not compensate for the cost of living. And it has a few very rich people (in tech, entertainment, etc.) that don't do much to move the needle on averages. [1] One can debate the relevance of the cost-of-living adjustment for engineers making $400k/year, but in the middle class salary range, where groceries and rent make up a bigger fraction of expenses than toys or savings, cost of living is a driving factor.
- JauntTrooper 8y ago
  California’s GDP is almost $3 trillion per year. That’s larger than the U.K.’s (the world’s 5th largest economy) with far fewer people (40M Californians vs. 66M in the U.K.) Of course it has its problems. The cost of living is high especially in the cities. Still, it’s a real stretch to say it’s not a prosperous state.
  - rayiner 8y ago
    I mean relatively to other U.S. states. The U.K. has lower GDP per capita than every single U.S. state: https://www.forbes.com/sites/timworstall/2014/08/25/britain-is-poorer-than-any-us-state-yes-even-mississippi/#5deccdce35ef https://www.forbes.com/sites/timworstall/2014/08/25/britain-.... Nobody would say "Mississippi is a prosperous state" but it is in fact richer than the U.K.
- vannevar 8y ago
  According to the Bureau of Economic Analysis at the US Department of Commerce, California is in the top ten US states for per-capita GDP growth since 2009. Not 'middling' at all, particularly considering it was the country's largest state economy to begin with. And a big reason the cost of living is high there is precisely because the economy has been so good. The middle class hasn't been hurt by taxes and regulations, it's been hurt by low wage growth as the top 1% of the population has absorbed a grossly disproportionate share of the robust economic growth. The same problem shared by the rest of the country. Taxes aren't too high, they're much too low, particularly on the wealthy. Not sure where your numbers came from (the link at the bottom of the image, referencing a report at alec.org, is broken).
  - rayiner 8y ago
    The specific ordering is somewhat sensitive to the specific date ranges. Looking at the BEA data: https://apps.bea.gov/regional/histdata/releases/0616gsp/index.cfm https://apps.bea.gov/regional/histdata/releases/0616gsp/inde... If we use 2009 to 2015 as the data points (which is the most I have on this chart), the following states grew faster than the U.S. average: North Dakota 1.37 Texas 1.16 Oklahoma 1.16 Michigan 1.15 Ohio 1.13 Pennsylvania 1.11 Indiana 1.11 Nebraska 1.10 California 1.09 Iowa 1.09 Minnesota 1.09 Tennessee 1.09 Wisconsin 1.08 Massachusetts 1.08 Illinois 1.07 Kentucky 1.07 I wouldn't call growing at about the same rate as Iowa and Tennessee as being particularly exceptional, even if it's technically in the top 10. More important, because cost of living continues to explode, California continues to be middling in terms of purchasing power: https://spectator.org/adios-california/ https://spectator.org/adios-california/ (California 37th in GDP per capita adjusted for cost of living). For real people, that's the most important benchmark of economic health. (Which is why when you're comparing different countries, you always use PPP-adjusted numbers.) Note that this particular problem isn't something you can fix through redistribution. California's COL-adjusted GDP per capita being in the middle means that, no matter how you distribute it, California's on average just can't buy as much stuff (food, housing, etc.) as Iowans.
    - vannevar 8y ago
- tabtab 8y ago
  Re: From 2003 to 2013, it slightly trailed the country in GSP growth... CA was one of the hardest hit states in terms of the mortgage bubble, and thus had a slow recovery. Newer data would probably show better results as the effects of the bubble are dissipating. But the hollowing out of the middle is a common pattern just about everywhere in the "mature industrialized world". The loss of factory jobs and loss of mom-and-pop stores due to the Internet is part of the reason, but may not be all of it. It seems to be growing into a winner-take-all world. Warren Buffett admitted his fund can take risks others can't because it has lots of companies in it to buffer against specific losses. And the big tech co's have a big portfolio of patents to use against startups that threaten them. Even if the claims are dubious, the sheer volume of lawsuits can end a smallbie: "courtroom DOS attack". Being big helps you to get bigger.

rayiner 8y ago

California does not have particularly strong economic growth. From 2003 to 2013, it slightly trailed the country in GSP growth per capita and personal income growth: https://www.heritage.org/sites/default/files/~/media/infographics/2015/05/sr152/bgredstatesbluestatestable3825.jpg https://www.heritage.org/sites/default/files/~/media/infogra.... (To calculate GSP growth per capita, divide the GSP growth column by the population growth column.) More recent data also shows pretty middling results: https://www.bea.gov/news/archive?field_related_product_target_id=461&created_1=All&title=&=Apply https://www.bea.gov/news/archive?field_related_product_targe.... Adjusted for cost of living, California's income level is about in the middle too: http://i.imgur.com/WdfQqJR.jpg.[1] http://i.imgur.com/WdfQqJR.jpg.[1] The idea that California is a prosperous state is a myth. California is a very expensive state, with higher salaries that do not compensate for the cost of living. And it has a few very rich people (in tech, entertainment, etc.) that don't do much to move the needle on averages. [1] One can debate the relevance of the cost-of-living adjustment for engineers making $400k/year, but in the middle class salary range, where groceries and rent make up a bigger fraction of expenses than toys or savings, cost of living is a driving factor.

JauntTrooper 8y ago
California’s GDP is almost $3 trillion per year. That’s larger than the U.K.’s (the world’s 5th largest economy) with far fewer people (40M Californians vs. 66M in the U.K.) Of course it has its problems. The cost of living is high especially in the cities. Still, it’s a real stretch to say it’s not a prosperous state.
- rayiner 8y ago
  I mean relatively to other U.S. states. The U.K. has lower GDP per capita than every single U.S. state: https://www.forbes.com/sites/timworstall/2014/08/25/britain-is-poorer-than-any-us-state-yes-even-mississippi/#5deccdce35ef https://www.forbes.com/sites/timworstall/2014/08/25/britain-.... Nobody would say "Mississippi is a prosperous state" but it is in fact richer than the U.K.
vannevar 8y ago
According to the Bureau of Economic Analysis at the US Department of Commerce, California is in the top ten US states for per-capita GDP growth since 2009. Not 'middling' at all, particularly considering it was the country's largest state economy to begin with. And a big reason the cost of living is high there is precisely because the economy has been so good. The middle class hasn't been hurt by taxes and regulations, it's been hurt by low wage growth as the top 1% of the population has absorbed a grossly disproportionate share of the robust economic growth. The same problem shared by the rest of the country. Taxes aren't too high, they're much too low, particularly on the wealthy. Not sure where your numbers came from (the link at the bottom of the image, referencing a report at alec.org, is broken).
- rayiner 8y ago
  The specific ordering is somewhat sensitive to the specific date ranges. Looking at the BEA data: https://apps.bea.gov/regional/histdata/releases/0616gsp/index.cfm https://apps.bea.gov/regional/histdata/releases/0616gsp/inde... If we use 2009 to 2015 as the data points (which is the most I have on this chart), the following states grew faster than the U.S. average: North Dakota 1.37 Texas 1.16 Oklahoma 1.16 Michigan 1.15 Ohio 1.13 Pennsylvania 1.11 Indiana 1.11 Nebraska 1.10 California 1.09 Iowa 1.09 Minnesota 1.09 Tennessee 1.09 Wisconsin 1.08 Massachusetts 1.08 Illinois 1.07 Kentucky 1.07 I wouldn't call growing at about the same rate as Iowa and Tennessee as being particularly exceptional, even if it's technically in the top 10. More important, because cost of living continues to explode, California continues to be middling in terms of purchasing power: https://spectator.org/adios-california/ https://spectator.org/adios-california/ (California 37th in GDP per capita adjusted for cost of living). For real people, that's the most important benchmark of economic health. (Which is why when you're comparing different countries, you always use PPP-adjusted numbers.) Note that this particular problem isn't something you can fix through redistribution. California's COL-adjusted GDP per capita being in the middle means that, no matter how you distribute it, California's on average just can't buy as much stuff (food, housing, etc.) as Iowans.
  - vannevar 8y ago
tabtab 8y ago
Re: From 2003 to 2013, it slightly trailed the country in GSP growth... CA was one of the hardest hit states in terms of the mortgage bubble, and thus had a slow recovery. Newer data would probably show better results as the effects of the bubble are dissipating. But the hollowing out of the middle is a common pattern just about everywhere in the "mature industrialized world". The loss of factory jobs and loss of mom-and-pop stores due to the Internet is part of the reason, but may not be all of it. It seems to be growing into a winner-take-all world. Warren Buffett admitted his fund can take risks others can't because it has lots of companies in it to buffer against specific losses. And the big tech co's have a big portfolio of patents to use against startups that threaten them. Even if the claims are dubious, the sheer volume of lawsuits can end a smallbie: "courtroom DOS attack". Being big helps you to get bigger.