Cause and Effect
George Will has a good column out on California's economic crisis and its cause: the high regulatory and taxation costs levied by the state coupled with an exploding government bureaucracy.
California’s business costs are more than 20 percent higher than the average state’s. If, since 1990, state spending increases had been held to the inflation rate plus population growth, the state would have a $15 billion surplus instead of a $42 billion budget deficit, which is larger than the full budgets of all but 10 states.HT Instapundit
Since 1990, the number of state employees has increased by more than a third. In Schwarzenegger’s less than six years as governor, per capita government spending, adjusted for inflation, has increased nearly 20 percent.
Liberal orthodoxy has made the state dependent on a volatile source of revenues — high income tax rates on the wealthy. California’s income and sales taxes are among the nation’s highest, its business conditions among the worst, as measured by 16 variables directly influenced by the Legislature. Unemployment, the nation’s fourth highest, is 11.2 percent.