Thread: California's economics leave a big impression

California's economics leave a big impression
By Gary Dickson -- Record-Bee columnist
Article Last Updated: 09/21/2008 05:57:40 AM PDT

I'm now into my sixth month of living in California. It's been mostly a positive experience. I imagine that many people who have never lived here have some preconceived notions about what California living is like.

Some of mine were right and some were wrong. One thing that hit me immediately was, of the six states I have called home, California is the most expensive. Food, fuel, utilities, housing and just about everything else costs more here.

So, in my early days in the state I asked myself and others this question. How can such a high cost of living place, with over 36 million people, ranking in the top ten economies in the world, be perpetually broke? The current state situation is a $15 billion budget deficit, state government is into the third month of the fiscal year without a spending plan and Governor Schwarzenegger said he will veto the Legislature's offering.

My question caused me to read what some Californians think about the problem. Fred E. Foldvary recently wrote that "California's budget problems go back to 1978, when voters approved Proposition 13 to amend the constitution to limit real estate taxes."

He added, "Local governments were deprived of its natural source of revenue, land value." When more power shifted to the state, sales and income tax increases started to erode California business. Foldvary claims that lost businesses and lost state income from those businesses is immense.

Dr. Madeleine Pelner Cosman claims that illegal immigration is a primary cause of California's financial crisis. Her assertion is that the "anchor baby" issue and its peripheral expenses are forcing state hospitals out of business and placing horrendous cost burdens on the state welfare system.

The current interpretation of the 14th Amendment makes the child of an illegal alien in the U.S. an immediate citizen, which provides permanent residency to the parents. Dr. Cosman wrote that, "At least 300,000 to 350,000 Anchor Babies annually become citizens in California "

All those births would be a financial boon to hospitals, if all the parents were paying the bills. They are not and Dr. Cosman cites this as the cause of about 50 percent of unpaid hospital monies and the closing of 60 California hospitals. The expenses don't stop at birth, either. Parents can receive up to $500 a month per child in welfare for a healthy baby and more if the child isn't healthy.

Another article that I read even took the approach that, while smoking bans might be good for the physical health of the citizenry, they have not been healthy for the state's economy. The author estimated that from 1990 to 2005 California restaurants and bars lost $34 billion in business because of the smoking ban movement.

These are just three of the theories I encountered. Economics 101 tells us that for an individual, family, business or government to be financially successful, the key is to bring in more money than spent. If that doesn't happen, individuals and families generally add credit card debt. Businesses cut expenses and consider raising prices. Governments borrow and raise taxes and fees.

California taxes and fees already appear to be too high. So, the state clearly needs to reduce expenses, especially welfare costs, and it must become more business-friendly to get back some of the private business that has been lost.

I lived in New Mexico from 2003 to 2006. Movies filmed there, just during that period, because Governor Bill Richardson wooed the California film industry, amounted to millions gained for the Land of Enchantment and millions lost to the Golden State. The just announced deal for Tesla, the electric car manufacturer, is a great example of what is possible for California, though.

The mayor of San Jose courted Tesla for months and the city is providing an 89-acre parcel of land, free for 10 years, for the 1,000 employee, "green" plant. California may be broke and, perhaps, a little broken, but, it's not beyond repair.

Gary Dickson is the publisher of the Record-Bee. He can be reached at gdickson@record-bee.com or called direct at 263-5636 ext. 24.
http://www.record-bee.com/ci_10523309

I'm now into my sixth month of living in California. It's been mostly a positive experience.

Oh, please! For the love of God, stop!

http://www.youtube.com/watch?v=XTHJdHNy_Zg

Taxes and prices are high for the owners, businesses, and landlords to take deductions on federal taxes which in turn passes to all Americans to pay for the problems in California.

The owners, landlords, and businesses in California are not hurting it is the private homeowners and other American who are being burden with the owners, landlords, and businesses forgoing cost to have an advantage due to tax deduction on federal taxes.

When unemployment reaches past 5 percent in the country tax deduction on the federal taxes should not be allowed.

All those births would be a financial boon to hospitals, if all the parents were paying the bills. They are not and Dr. Cosman cites this as the cause of about 50 percent of unpaid hospital monies and the closing of 60 California hospitals. The expenses don't stop at birth, either. Parents can receive up to $500 a month per child in welfare for a healthy baby and more if the child isn't healthy.

Invaders get $500 a month per anchor!! So three or four anchors, combined with a job using fradulent / stolen social security card. No wonder these criminals can afford to be driving around in new cars.

It's absolutely pathetic!

You might want to also take a good look at your politicans also...Pelosi. Boxer. Feinstein, Baca, the Villian Grossa etc. etc. etc..