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California's job growth defies predictions after tax increases
- cnst 12y agoYes, there is still a net migration to California, and tax increases are unlikely to just kill it, but it is also revealing how many bigger businesses are relocating to elsewhere, like Texas or Tennessee. Both Google and Apple has lots of HR people in Texas. The Japanese auto manufacturers have since left SoCal, too: http://www.reuters.com/article/2014/04/28/us-autos-toyota-motor-torrance-idUSBREA3R1EW20140428 http://www.reuters.com/article/2014/04/28/us-autos-toyota-mo... http://www.forbes.com/sites/dalebuss/2014/04/27/it-makes-sense-for-toyota-to-leave-california-for-texas/ http://www.forbes.com/sites/dalebuss/2014/04/27/it-makes-sen... "254 companies left California in 2011": http://www.ocregister.com/articles/moved-342887-companies-texas.html http://www.ocregister.com/articles/moved-342887-companies-te... The housing prices in the greater SF Bay Area are simply ridiculous (even in the South Bay, where there's lots of empty or unused land, and East Bay, where there are few high-paid job opportunities), the housing and land speculation is quite out of hand.
- krisdol 12y agoWhat you say is absolutely true. I just want to give my perspective whose intent is not to counter your point or argue with it. As a tech worker, I'm migrating out of Texas soon. The influx of West Coast companies (and their jobs) to Austin is spiking up prices of, well, everything. There's no chance to ever stop renting as all of the Austin property is owned by investors, meanwhile we're being payed Texas wages for California jobs at a skyrocketing cost of living in a city with no infrastructure, what-so-ever, to deal with its own population density. I'm sure companies will continue to move here, but the higher standards of living and worker-friendly political climates of the coasts seem far more attractive. It's all just a cycle. Austin will get over-crowded and over-developed and some other neat hip cheap place to do business will spring up and companies will move again. Who knows, your hometown might be next.
- joelrunyon 12y agoWhere will you be heading next? I hear a lot of people talking about Nashville.
- muzz 12y agoNot sure where GP or GGP is headed, but it's clear where tech companies are expanding jobs-- in the Bay Area.
- muzz 12y agoAmazing how the kind of "predictions" mentioned in the article are still deeply held
- rgbrenner 12y ago"254 companies left California in 2011": This obviously has nothing to do with the tax increase in the article (voted on in 2012).
- jtzhou 12y agoActually net migration is negative for California within the United States -- 93,915 more people are leaving California for other US states than arriving there. Now, immigration, generally from poor countries, is still flowing through California but that does not mean that California is a more desirable place to live or raise a family in the middle-class, compared to other U.S. states. http://www.governing.com/gov-data/census/2010-census-state-migration-statistics.html http://www.governing.com/gov-data/census/2010-census-state-m...
- muzz 12y agoCalifornia attracts lots of well-educated people from India and China, although it certainly does lose natives who seek cheaper areas.
- seanmcdirmid 12y agoYou mean the poor Chinese migrant worker who is making $250K a year? Oh, and he can buy a house in some places for around $500-750K (assume east bay somewhere), which is way cheaper than Shanghai/Beijing. California is definitely desirable in terms of climate, quality of life, and job opportunities (if in tech); whether you can afford to live there is another matter.
- jtzhou 12y agoPerhaps in the Bay Area, but California-wide most of the newcomers are not highly paid skilled workers from China. California is a wonderful state, but mostly for the rich or early arrivals.
- bsder 12y agoAhem. ONE Japanese auto manufacturer's HQ and sales (not manufacturing) left California after Texas threw $40 million at them. http://bizbeatblog.dallasnews.com/2014/04/texas-enterprise-fund-will-grant-40-million-to-toyota.html/ http://bizbeatblog.dallasnews.com/2014/04/texas-enterprise-f... I wish Texas good luck, but I'm happy to see them leave California. All of the analyses show that business incentives are a suckers game--companies that move from incentives keep on moving every time an incentive pops up.
- cnst 12y agoNissan has already moved to Nashville, Tennessee a few years prior, in 2006. > All of the analyses show that business incentives are a suckers game--companies that move from incentives keep on moving every time an incentive pops up. Which analyses? All of these are one-time incentives, and they require substantial investment from the company of their own funds, so, if anything, they simply offset the cost of moving. Where do you expect they'll move to next, after Texas?
- muzz 12y agoIf an area actually provides a better environment for business, there would be no need to throw taxpayer money at businesses to attract them.
- cnst 12y agoAre you under the belief that everyone can just move between the states without any capital cost? If an area doesn't provide a better environment for business, no reasonably-available amount of taxpayer incentives would convince a business to move.
- muzz 12y agoDo you think that companies don't factor the potential costs when deciding where to locate and where to expand?
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- cynicalkane 12y agoHeadline should read "A single piece of uncontrolled data influenced by numerous causes must mean what I think it means". This article isn't information in the sense it doesn't tell us anything new about the world except that one event happened to be in line with the author's pre-existing opinion. Nobody seriously thinks that a tax increase, small relative to the entire economy, can stand in the face of all the various economic forces by itself.
- x0x0 12y agolord knows none of the anti-prop 30 campaigners let that stop them... feel free to also compare to austerity measures under brownback in kansas
- steveax 12y agoI think you missed the point, ie: refuting the dire predictions of the anti-tax crowd, none of which came to pass. This will no doubt fail to stop the usual hue and cry in the future, as that particular demographic seems to be evidence proof.
- adventured 12y agoDoesn't have anything to do with being in the midst of a temporary, extreme asset bubble for both stocks and real estate courtesy of trillions in Fed stimulus, does it? Let's look at how California did in the late 1990s and the lead up to 2008, and how it performed when those fake asset bubbles exploded. Then let's add in some computation for the downside risk to the current situation. The job numbers are the best case scenario, and only exist due to the largest stimulus program in world history. Someone should be asking: what happens when that doesn't exist?
- cynicalkane 12y agoI understand there's a tiny fringe of vocal people who are constantly predicting doom, for various reasons, but I don't understand how you can characterize these people being wrong as victory for your opinion, nor why this is, to quote the HN guidelines, "of interest to hackers". I think even the median Tea Partier, if you put the irons to his feet, would admit that tax increases cannot by themselves blast away several percent worth of economic growth. There is certainly some small minority of people who think otherwise, out of whom the author of this article would happily build a large straw man.
- javert 12y agoIf you take 3% more away from a million+ earner, they don't spend less on personal luxuries. They spend less on investment. So that is 3% that is not being spent on expanding production. (i.e. "Making the economic pie bigger.") Yes, the government will spend the money somewhere else, but typically it will go almost entirely to consumption, instead. That is redistributing the pie, rather than growing it. Note that growing the pie lowers the cost of things, so it inherently benefits everyone. There is no such thing as growing the pie and only benefiting the rich. In fact, not growing the pie disproportionately hurts the less well off. While the rich forego investments, the poor forego things that actually make their lives better.
- adamnemecek 12y agoTrickle down economics have been AFAIK demonstrated to be false. But that will be hard to argue with someone who judging by his HN about section is an Ayn Rand fan.
- jeffdavis 12y agoUnless you argue that everyone should be taxed 100%, then there is some economically-optimal tax rate schedule. It follows that the current rates might exceed the optimal ones, and therefore a tax reduction may be entirely appropriate. Calling every tax reduction for a higher bracket "trickle down" is simply name-calling. You can say that all the way up to 100%.
- adamnemecek 12y agoNice straw man argument you got there. There is a difference between a tax reduction and a tax reduction with the intent that the tax decrease will propagate to the rest of the society. As in, sure decrease taxes but don't claim that said tax decrease for the wealthiest is in the interest of the poorest.
- megablast 12y agoIt might also follow that a tax increase is appropriate. According to the economic indicators from California, there is some basis for this. Whereas you have not presented anything.
- tn13 12y agoI think the point being missed here is that without tax increases the job growth could have been even more higher. Also marginal tax increase is not going to reduce job marginally but it will be a more drastic change down the line.