Posted on 03/10/2010 7:20:06 AM PST by george76
California is doomed for two simple but profound reasons: the cost structure is too high for most businesses to survive, and a boom-dependent economy.
The dysfunctions crippling California would easily fill a volume: a dysfunctional Legislature that has been gerrymandered to protect virtually every seat; a dysfunctional proposition system which enables special interests to craft Protected Fiefdoms via the ballot box; recalcitrant public unions who don't see anything wrong with public servants getting 90% of top-pay in pensions while still earning big bucks as "contract employees," an enormous population of undocumented workers who pay only sales taxes, and whose employers pay no payroll taxes, either-- and that just scratches the surface.
a crushingly high costs structure and an economy entirely dependent on the next boom.
California is now the world capital of Denial.
Everyone from the State legislature to union officials to realtors to small business owners are hanging on, refusing to face the fact that there will be no boom to save them and the state, To survive one more year, they're borrowing money, hiding debts and real valuations, monkeying with the books and playing accounting tricks, borrowing from next year's revenues...
California is doomed to insolvency at every level, public and private.
(Excerpt) Read more at businessinsider.com ...
Why I left California after having lived there for 30 years.
Let’s pray that this cancer does not head east.
SJB—it only took the libs thirty years to ruin paradise: 1979-2009.
It’s already in the east... New York.
The only way out is a federal bailout. We need to help them perpetuate their bad policies and irresponsibility. It’s now a policy of the US. We did it for the banks, we did it for the auto industry, we did it for foreign dictators, surely we can throw a few billion (a year) to one of our own states.
Ten years from now, what will they be calling Detroit, New Orleans, and California?
It won’t head just east.
If they are the first to default, every state will chip in to bail them out. If a bank can be “too big to fail,” what about a state with a massive economy?
Nonsense. California will never go bankrupt for the simple reason that it’s a desirable place to live and always will be, barring some major earthquake that takes out the coastline. Plus all the foreign wealth that exists now and keeps pouring in. That being said, the next boom will many years this time, but it will come.
Technology and biotech have also shrunk in the state and “it ain’t” coming back. Defense also is less important. Obama is killing farming and the schools are not as good as they were.
You clearly have a point. Nonetheless, I cannot see too many state governors standing up and telling their citizens that state money needs to bail out California. More likely is a US taxpayer, that is Obama-style, bailout. If the day of reckoning is postponed, it will only be worse -- and that could spread the cancer east.
You too, huh.
I was born and raised in So. Ca., left after 40 years.
Truly sad, Ca was once a great State and place to live.
What’s gonna be the final stake is when Prop 13 is overturned.
The blog this comes from is excellent. It’s on my list of Favorites. You might want to note it:
http://www.oftwominds.com/blog.html
He’s not a regular on Business Insider, which is a lefty (kinda) financial site.
“SJB—it only took the libs thirty years to ruin paradise: 1979-2009.”
Well, for me it was (1976-2006)
In 1976, it was still “Reagan Country”. Paradise on earth, for a 22 year old, fresh out of college, with a high paying job in Los Angeles.
By 2006,much of Los Angeles had become a third world hell hole.
I sold out then, knowing the faux boom would bust.
I also got tired of tripping over illegal immigrants on the sidewalk ;-)
Not sure I agree with you.
Increasingly I’m leery of the prospects, of the entire US west coast, all the way over to Las Vegas. Everything in CA is at long term risk due to lack of adequately huge real sources of fresh water, illegal immigration, the northwest coast from that tiny matter of the Cascadia Subduction Zone.
Everything in the west, is dependent on the worst cases, not happening. I’m not sure that’s a safe bet anymore. No more are the economies and cities in the region robust and resiliant. The job situation is among the worst in the country, even though real estate costs remain almost astoundingly high.
The “reconquista” process is real. If your handle is an indication of where you’re posting from, you should see it all around you. At the moment there’s been a calm before the storm, because the imploding employment prospects have sent a lot of illegals back home. That’s temporary. And would suddenly and dramatically worsten, with any sort of political instability south of the border.
If Meg Whitman wins the election, the collapse will be delayed because she like Arnold, even as RINOs have veto power over the most goofy agenda items of the left. If Brown wins, CA’s pretty quickly toast imho.
I’m happy and grateful that my employer has seen fit so far to keep me gainfully employed, and that’s why I’m still here. Thanks employer :)
But if that ever changes, I’m so out of here.
It is worse than sad...it is trajic!
At least you and I got out before it imploded.
Nah, it’s that a majority of California voters think they can vote themselves into Paradise. They actually believe that bond money is free money, etc. The state will have to go into the shark tank for years, perhaps a generation, before the voters here will change.
tragic, that are ;-)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.