The CA economy isn't 1/7 of the country's for no good reason. The core components, inlcuding hi-tech, entertainment, aerospace, tourism and construction are all still here and 2nd to none. The underlying cause of this fiscal crisis is illegal immigration, pure and simple.
There's so much construction going on in Orange County and N. San Diego county, that, if this is a recession, I wonder what it's going to look like when the economy turns around.
The one thing you can never take away is the mountains, ocean/beaches and weather. This weekend was incredible, and for those back east watching the Raider game yesterday, yes, it really was 70 degrees and perfect at kick-off.
People will continue moving here, and business owners will continue starting businesses here, for the simple reason that this is where they want to be. (It's an old cliche about people moving back after a few years trying somewhere else.) Talk of businesses moving to NV, AZ et al typically address low-skilled positions for workers who are already in those states - technically skilled people and decision makers are staying put right here.
I can't speak about Arizona, but I do know that many businessmen who have relocated to Nevada have regretted it. Common complaints are the difficulty in finding stable competent employees and the negative effects of gambling.