Tuesday, August 18, 2009

"California Disease"

This story, which purports to show how "California Disease" is affecting Oregon, does a good job of summarizing the problems with California. Too bad it doesn't mention the only solution: a renewed respect for individual rights.

From the story:
Some might call this California disease. This refers to a chronic inability to make hard decisions as well as a general disregard for business and economic activity.

California's inability to plan or create new public infrastructure affects every part of the state's economy. California was once a leader in building infrastructure, but that was in Pat Brown's gubernatorial administration in the 1960s when California last planned a major infrastructure project.

There are consequences to California's inability to deal with infrastructure. Its freeways are parking lots. Its water problems are threatening the viability of Central Valley agriculture, one of the key drivers of the state's economy. Its electrical system is so bad that every summer brings the fear of interruptions in the supply of electricity. Its universities are in decline. Its prisons are overcrowded.

Another symptom of California disease is regulation and red tape that increases the uncertainty for any project and raises the cost.

California projects can be in planning for years, and at the end of that planning process they may still be denied. The long delays are expensive. And as many would-be California developers will tell you, the uncertainty is a strong detriment to economic activity and development.

We also see symptoms of California disease in tax policy. California no longer has the United States' highest income tax rate. Big deal. With a top income tax rate of 10.3 percent, sales taxes that can reach 10.25 percent and a 33.9 cents-per-gallon gas tax, its total taxes are among the highest in the country.

California's regulatory climate also reflects the disease. Even as the state endures its most brutal recession in decades, it persists in unilaterally imposing new regulation, making the state less competitive with other states.

3 Comments:

Blogger Doug Reich said...

Thanks for posting this.

California is a perfect example of the deadly consequences of environmental regulations. What most fail to realize is that such a result is not the unintended consequence of environmental philosophy - it is the explicit purpose of it, i.e., to return one of the most vibrant, technologically advanced economies in human history back to the stone age.

Environmentalists must truly rejoice at every delay, every step of progress not made, every job lost, every bit of human suffering that follows from their evil efforts to stifle human progress.

6:49 PM  
Blogger Amit Ghate said...

Thanks for the comment Doug. I agree completely.

7:44 PM  
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