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Kissing Jobs Goodbye in California (by Ray Haynes)
ChronWatch ^ | February 26, 2004 | Ray Haynes

Posted on 02/25/2004 10:05:43 PM PST by calcowgirl

Ask friends of yours who happen to own their own large or small business, what has happened to their worker's compensation premiums in the last three years. Every one that I have spoken to has told me that his rates have at least doubled, and most businessmen have seen a 300 or 400 percent increases.

This problem has been around for at least two years, since ex-Governor Davis increased worker's compensation benefits in March 2002. Soon thereafter, insurance rates began to skyrocket.

For those who do not know, worker's compensation insurance pays for workers who are injured ''on the job.'' The problem in California is that we have the highest insurance premiums in the country. You would think that these high premiums would lead to lavish benefits for injured workers, but, interestingly enough, California pays out some of the lowest benefits in the country.

The reason? The people who make money off the system milk it for all its worth, and California business owners pay the bill. This week, the California Legislature started hearings to reform the system, since business owners have been complaining about the system for well over a year. Republicans in the Legislature have been calling for reform since August, 2002. Democrats have been stalling on that reform for the same length of time.

This week, the new speaker of the Assembly announced that ''we need reform'' but we ''need the time to do it right.'' This shouldn't be rushed, he said, because we ''can't afford'' to do it wrong.

I know that the new speaker has only been around for a few months, so he doesn't remember how we got into this mess. In March, 2002, in 48 hours, the Legislature, dominated by Democrats, and the governor, also a Democrat, met with the unions and the trial lawyers (no business owners allowed), cut a deal to increase benefits, and passed the bill. The meetings began Friday night, the deal was cut Sunday, and by Monday at 5:00 p.m., the bill was signed by Governor Davis. No need to go slow there, the Democrat speaker thought then, because the trial lawyers demanded action. They got it, and business owners were forced to pay the freight.

Last summer, the worker's compensation crisis reached critical mass. The Republican caucus introduced a comprehensive package of fixes, most of which were killed outright. In September, Arnold Schwarzenegger made reform a keystone of his campaign Immediately upon taking office in November, Governor Schwarzenegger called a special session of the Legislature to deal with this problem, but legislators left Sacramento for the year without holding a hearing. In his State of the State address, Governor Schwarzenegger demanded on January 5 that the Legislature act by March 1. Now, on February 11, the Democrats finally held their first hearing, and said that they needed until April 16 to finish their work.

Gee whiz, thanks guys. April 16 is the last day to qualify an initiative to fix the system if we want to get reform in the next two years. If we wait until then, and the Democrats do nothing, jobs will leave the state in droves, because business owners can no longer afford the insurance. Do you think they picked that date on purpose?

When trial lawyers wanted to stick it to the business owners, they asked the Legislature to jump. The Democrat majority asked how high. Now that the business owners are screaming about how badly they got stuck, the Democrats are saying that they don't see the knife. We have to study the injury, they say, because we need to see if it really hurts. We need to know if that big knife in the back of business is really real.

Meanwhile, California jobs are leaving the state. If we don't act quickly, the job that leaves might be yours. Your boss might take you with him to Arizona, or he or she might not. Make no mistake, we could fix this tomorrow if the speaker wanted to; he just doesn't want to. So if you lose your job because your boss moves to Nevada, you now know why.

Ray Haynes is the assemblyman for the 66th Assembly District in California.


TOPICS: Business/Economy; Editorial; Government; News/Current Events; US: California
KEYWORDS: calgov2002; california; jobs; rayhaynes; taxes; workerscomp
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1 posted on 02/25/2004 10:05:43 PM PST by calcowgirl
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To: *calgov2002; NormsRevenge; farmfriend; SierraWasp; Ernest_at_the_Beach; ElkGroveDan
ping
2 posted on 02/25/2004 10:06:43 PM PST by calcowgirl (No on Propositions 55, 56, 57, 58)
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To: calcowgirl
And a franchise tax? Now there's a poke in the eye for anyone who wants to start a small business in California.
3 posted on 02/25/2004 10:11:07 PM PST by TheDon (John Kerry, self proclaimed war criminal, Democratic Presidential nominee)
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To: calcowgirl
I like Ray Haynes.

The Republicans should take these issues to the people, most are totally unaware how underhanded the Dem legislature is.
4 posted on 02/25/2004 10:16:20 PM PST by FairOpinion ("America will never seek a permission slip to defend the security of our country." --- G. W. Bush)
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To: TheDon; calcowgirl; NormsRevenge; SierraWasp
Who needs small business. The rich guys and movie stars will help with Utopia here on the coast. /sarcasm
5 posted on 02/25/2004 10:23:41 PM PST by Ernest_at_the_Beach (The terrorists and their supporters declared war on the United States - and war is what they got!!!!)
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To: Ernest_at_the_Beach; calcowgirl
I don't live in Sodom, but isn't it true that the only small business left in California are Mexican Taquerias, Chinese Take out shops and Armenian cell phone stores?
6 posted on 02/25/2004 10:27:47 PM PST by Clemenza (I am a sick man...I am an unattractive man...I am an ANGRY man --- Doestoyevsky)
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To: Clemenza
No, there tons of small business out here,....... this year!
7 posted on 02/25/2004 10:31:37 PM PST by Ernest_at_the_Beach (The terrorists and their supporters declared war on the United States - and war is what they got!!!!)
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To: Clemenza
NO! I have operated a small business in CA since 1985, and I'm still in business here, but barely. I have seen my worker's comp double in the last two years. Increasingly, I have had to eliminate staff payroll to counter the effects of WC costs. The thing that really gets me is that I have had not one claim in the 19 years I have been in business.

I am under constant pressure from competitors. And it is no surprise that the biggest competitor comes from Florida.

Norge
8 posted on 02/25/2004 11:33:26 PM PST by norge
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To: norge
I don't see how we are going to break the hammerlock the leftists have on the state!

9 posted on 02/25/2004 11:40:54 PM PST by Ernest_at_the_Beach (The terrorists and their supporters declared war on the United States - and war is what they got!!!!)
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To: norge
Forgive the phrase, but I feel your pain. New York is no paradise to run a business in either.
10 posted on 02/26/2004 12:29:43 AM PST by Clemenza (I am a sick man...I am an unattractive man...I am an ANGRY man --- Doestoyevsky)
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To: doodlelady
WOOHOO!

... Ray Haynes bump :-)
11 posted on 02/26/2004 12:47:13 AM PST by Tamzee (The Democrat Party...... Kerrying water for Communism since 1971)
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To: FairOpinion
Yep... and he did a splendid job taking it to the people and showing them exactly how this issue threatened them directly... all thanks to the DimBulb-ocrats ;-)
12 posted on 02/26/2004 12:48:40 AM PST by Tamzee (The Democrat Party...... Kerrying water for Communism since 1971)
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To: onyx
Did you see this? :-)
13 posted on 02/26/2004 12:49:05 AM PST by Tamzee (The Democrat Party...... Kerrying water for Communism since 1971)
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To: FairOpinion
The Republicans should take these issues to the people, most are totally unaware how underhanded the Dem legislature is.

I totally agree .. take it straight to the people

14 posted on 02/26/2004 12:56:01 AM PST by Mo1 (" Do you want a president who injects poison into his skull for vanity?")
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To: TheDon
And a franchise tax? Now there's a poke in the eye for anyone who wants to start a small business in California.

I closed my small consulting business last year. In truth, it was over about 2000, but I kept the corporation open expecting to return to consulting after my kids left High School. My plan remains unchanged, but I've decided that there is absolutely no way I can afford to run any sort of a business in California. My "competition" works out of state for half the rate I must get to pay off California, or worse, overseas for $5 an hour.

My new Corporation will reside outside California. There is nothing, absolutely nothing to prevent me from doing a day or so of "marketing" in the California market, while signing contracts and executing the work in Nevada. Any client who wants me or my employees on site in California will have to pay between $150 and $250 per hour, and half that rate will go to pay California taxes (i.e. as a "Foreign Corporation") or related costs, and for subsisting in the high-tax driven California economy. It's no wonder jobs are leaving in droves. It's not just the direct, immediate taxes that make California a tough business climate, but every service and product purchased in California passes their taxes along. The Democrat leftists think "big business" just "absorbs" taxes. Most are too simple minded to figure out that half the cost of a new home is DIRECTLY related to California taxation and regulatory policy, that almost $0.50 per gallon of gasoline is Federal, State, and Local taxes, and that they are playing TEN TIMES the rate for power to their homes or business ...again, directly attributable to the California State Legislature.

I'm a life-long Californian.. have two kids in school, and as soon as they graduate, I'm out of CA forever. I can pay cash for a house twice the size of mine in about 15 Western States from the hyper-inflated "equity" in my current house, and my savings in income tax and power costs alone will pay any mortgage. I'll restart my business there, and begin the long slow climb towards a retirement savings .. starting at age 50. My years in California have been a total a loss (more so if the Real Estate market crashes before I can get out), and I have the California Democrats to blame. It's all on them .. every law and policy for the past 20 years. If the try, they'll have trouble finding enough Republicans to blame (Davis tried that) around the Capital; they are extinct.

SFS

15 posted on 02/26/2004 12:57:50 AM PST by Steel and Fire and Stone (SFS)
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To: Tamsey
Thanks. I would have otherwise missed this.

We are leaving the state. CA will soon be missing one medical doctor and his family. :)
16 posted on 02/26/2004 1:51:44 AM PST by onyx (Your secrets are safe with me and all my friends.)
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To: norge
In 1994 they revamped the workers comp laws here. I know lawyers whose practices disapeared overnight. It USED to be that cases had a cashout settlement value that made a case worth litigating. Now the cashout provision was eliminated. So a case worth 100000.00 dropped to virtually 10000.00.

The EXTRA point that had NOTHING to do with lawyers that helped is the investigations AFTER the claims. Video of crippled for life people doing heavy work.

Some examples of the rampant abuse would really help. Whenever there is a government system, the system will be manipulated.
17 posted on 02/26/2004 2:37:36 AM PST by longtermmemmory (Vote!)
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To: Ernest_at_the_Beach
I would say if eastern CF petitions to form their own state.
18 posted on 02/26/2004 2:40:11 AM PST by longtermmemmory (Vote!)
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To: onyx
We are leaving the state. CA will soon be missing one medical doctor and his family. :)

Hope you are moving to the South! If not, consider it!

Medical jobs are the biggest sector for our state of Tenn. Especially in the Nashville area. And you can buy a mansion for what you'll get selling your home in CA! And we don't have an income tax! Not for their lack of trying though!

19 posted on 02/26/2004 2:44:11 AM PST by Fledermaus (This Tagline For Rent!)
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To: Fledermaus

Oh yes, moving South. Vicksburg, Mississippi. Going in late April to buy a house. Been working with realtor for 3 months.

20 posted on 02/26/2004 2:46:31 AM PST by onyx (Your secrets are safe with me and all my friends.)
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