Texas and tax cuts suck; CA leads job growth

01.16.13 - 1:38 pm | Tim Redmond |

(37)

How many times have we heard that jobs are leaving California for Texas? How many times have big-business groups and the polticians who play to their needs said that lower taxes and corporate welfare make states more "competitive" and are good for the economy?

So look, for a moment, at California and Texas. Who has the lower taxes and the governor who will do whatever employers want? And who has the more robust job growth?

Just goes to show: Tax breaks do not a health economy make. What companies look for when the make location decisions is much more complicated. An educated labor force (which, by the way, means spending tax money on schools and colleges), access to transportation (again, a public-sector concern) and yes, a decent place where the executives want to live are bigger factors than things like the payroll tax.

That's what studies have shown repeatedly over the years -- and it's playing out now in CA.

Comments

It's true there are a variety of factors that determine

competitiveness. But it is naive to suggest that taxes, or any component of costs, is not a major one. OIt's just not the only one.

Oh, and that education of workers in CA has usually taken place elsewhere. Many knowledge workers in SF have degrees from "back east" or even Europe or Asia.

CA gets more than it's fair share of business because of of many factors but the high taxes still deter enterprise. And we saw with Twitter that our politicians understand that, even if you do not.

Posted by anon on Jan. 16, 2013 @ 1:54 pm

I seem to recall

A few short years ago we were reading blogs here saying that even though Texas was leading in job growth it wasn't an apt comparison because Texas sucks.

Posted by matlock on Jan. 16, 2013 @ 2:14 pm

I'm sure Texas thinks that California sucks.

Did George Bush EVER come here?

People choose to live in places that suit them, and hating on other places is all part of that.

What is sad, I think, is people who could not survive anywhere but SF. That's kinda lame.

Posted by anon on Jan. 16, 2013 @ 2:41 pm

Makes me wonder

If people live where it suits them, why do you and matlock choose to live in SF?

Posted by Greg on Jan. 16, 2013 @ 10:15 pm

Beat most of you

progressobots here.

The progressobot leader Avalos show up and want to tell everyone how to live. Avalos complained in a Guardian election interview a few years ago that he didn't like people coming here telling us how to live. Oh the irony,

Why do you live in the USA?

Posted by matlock on Jan. 16, 2013 @ 11:36 pm

Unemployment Rate: CA 9.8% National 7.8%

Any more questions?

Posted by Guest on Jan. 16, 2013 @ 3:45 pm

Texas unemployment rate 6.2%.

Texas unemployment rate 6.2%.

Posted by Demented, Yet Terribly, Terribly Persistent on Jan. 16, 2013 @ 6:07 pm

LOL. Current charge to rent a

LOL.

Current charge to rent a fourteen-foot U-Haul truck from SF to Austin: $1,445.

Current charge to rent a fourteen-foot U-Haul truck from Austin to SF: $627.

If job growth in California is so great, why does it cost more than twice as much to rent a moving truck from California to Texas, as the other way around?

Keep plucking that chicken, Redmond!

Posted by Demented, Yet Terribly, Terribly Persistent on Jan. 16, 2013 @ 6:54 pm

Texas still sucks, trust me

Texas still sucks, trust me on this. Why not move to that libertarian tax haven (not property taxes mind you) paradise if it is so desirable?

Posted by marcos on Jan. 16, 2013 @ 6:57 pm

I may not, but many other

I may not, but many other people clearly are moving to Texas, suckiness or no.

Blue state California is rapidly falling into three groups:

The truly rich, who are fairly indifferent to costs and taxes. Very visible in San Francisco, but of course SF is a big, big 2% of the population of California.

Extremely well-compensated government employees, who get a lot better pay (and especially benefits) then they could get anywhere else.

The poor - California has a third of the welfare recipients in the United States, and much better welfare benefits than most other places.

Everyone else is fleeing, particularly the middle class, who are sensitive to California's high cost of living, high taxes, and the relatively poor quality of governmental services.

Tim's paradise increasingly has the income distribution of Guatemala - Texas and most other states have much less income inequality than California does.

Posted by Demented, Yet Terribly, Terribly Persistent on Jan. 16, 2013 @ 7:13 pm

So you agree with SEIU and

So you agree with SEIU and the nonprofits that all of those tech workers are rich? Interesting.

Posted by marcos on Jan. 16, 2013 @ 8:19 pm

Tech workers are a tiny, tiny

Tech workers are a tiny, tiny fraction of the 38 million people in California.

Posted by Demented, Yet Terribly, Terribly, Persistent on Jan. 16, 2013 @ 9:30 pm

The full range of tech

The full range of tech workers are California's new middle class.

Posted by marcos on Jan. 16, 2013 @ 10:26 pm

LOL. So the one million or

LOL. So the one million or so tech workers are California's "new middle class".

Pretty pathetic for a state with 38 million people in it.

Posted by Demented, Yet Terribly, Terribly, Persistent on Jan. 16, 2013 @ 11:23 pm

Please, move to Texas and

Please, move to Texas and show me who's boss.

Posted by marcos on Jan. 17, 2013 @ 10:38 am

"California has a third of the welfare recipients in the U.S."

Too bad DYTTP. Another blow to your already tarnished credibility.

Here's an idea: don't make any more statements of "fact" unless you provide a URL to back them up.

Just sticking to formulations such as "I think" or "I believe" will be fine -- and then you can go on as usual to tell whatever lies you like; but no more making pronouncements as though they are valueable, because it's just obnoxious.

Posted by lillipublicans on Jan. 16, 2013 @ 9:16 pm

Yawn - as if you always

Yawn - as if you always provide URL's, lilli.

I think that you would be proud that California treats a third of the nation's indigent population so well.

LA Times good enough for you?

"The debate was as much about ideology as finances, and it carried particular weight in California, which has one-third of the country's welfare recipients but only one-eighth of its total population."

http://articles.latimes.com/2012/jun/24/local/la-me-0624-welfare-20120624

Come on, you should be proud of this achievement!

Posted by Demented, Yet Terribly, Terribly, Persistent on Jan. 16, 2013 @ 9:40 pm

Lilli, you should get out of

Lilli, you should get out of San Francisco, and go to the San Joaquin and Imperial valleys- then you might start believing how many welfare recipients there are in California.

Once you get away from the golden coast, California is Mississippi.

Posted by Demented, Yet Terribly, Terribly, Persistent on Jan. 16, 2013 @ 10:03 pm

Honestly, the LA Dog Trainer* isn't what I'd call a preferred

reference.

On the other hand, I didn't make a really strong effort, but I wasn't able to find any primary source information either validating the claim or disproving it: so that suggests to me that it's still very much up in the air.

One source I came up with appears to show that welfare spending in California is in parity with its population.

http://www.usgovernmentspending.com/compare_state_welfare_spend

Obviously, if the money is in parity and benefits were particularly generous -- as I believe you also suggested -- then California's head count would have to be below average, not above.

Maybe different sources are claiming different things as welfare? Are food stamps welfare? Many states with Republican legislatures have drastically reduced welfare, but they still have hundreds of thousands of food stamp recipients.

*LA Dog Trainer, possibly copyright Harry Shearer

Posted by lillipublicans on Jan. 16, 2013 @ 11:26 pm

Income inequality is increasing throughout the country,

but varies state to state--Texas and California actually have very close Gini Coefficients, 43rd and 44th most unequal of the 51 "states" including DC:
http://en.wikipedia.org/wiki/List_of_U.S._states_by_Gini_coefficient

Here's a look at income inequality of the US over time:
http://en.wikipedia.org/wiki/Income_inequality_in_the_United_States

And a comparison between the US and other countries:
http://en.wikipedia.org/wiki/List_of_countries_by_income_equality

Using the World Bank Gini %, the US has about the same inequality as Turkmenistan and Mauritania. Some notable countries with a more equal distribution: Chad, Cameroon, Pakistan. The United States has the most income inequality of any country in the so-called developed world--Europe, United States, Canada, Australia, New Zealand. The numbers vary a little by the different ranking organizations and the different tables, but the US always comes out near the bottom of income equality of similarly situated countries. Click on the link and adjust the columns if you are interested.

In short, in the US, the rich are getting (way) richer, the poor are getting poorer, and the middle class is shrinking as its members move down towards poverty.

Posted by Eddie on Jan. 16, 2013 @ 10:48 pm

We should all be happy California is doing better

No matter our disagreements on the structural reasons why.

Posted by Lucretia Snapples on Jan. 16, 2013 @ 10:44 pm

I agree, but this interview

I agree, but this interview was pretty insightful regarding the problems facing California.

http://online.wsj.com/article/SB1000142405270230444460457734053186105696...

"As a result, California is turning into a two-and-a-half-class society. On top are the 'entrenched incumbents' who inherited their wealth or came to California early and made their money. Then there's a shrunken middle class of public employees and, miles below, a permanent welfare class. As it stands today, about 40% of Californians don't pay any income tax and a quarter are on Medicaid."

Posted by The Commish on Jan. 17, 2013 @ 12:03 pm

Agreed - the horizontal inequalities in California

are concerning. We should be looking at ways we can mitigate those because it's not good for anyone. Tim, of course, will look to expropriation using public employee unions as the solution - which he always does. But the real answers don't lie in the idea of stealing from the rich to help the poor - they lie in attempting to flatten opportunity and extend it in from the coastal areas.

I'm always fascinated by the left's yearning for a return to the storied past of WPA programs and massive infrastructure improvements like the Interstate system and the trans-California canal. Those were not built using expensive union labor nor were they built under today's egregious public bidding rules which are designed to ensure wealth trickles upwards to the same sordid consortium of construction companies and union bosses. Had the rules we now have in place been there in the 30s, 40s, 50s and 60s - none of our major infrastructure projects would ever have been built. It's why we don't build anything right now and if we do it's hideously expensive and takes decades.

Posted by Lucretia Snapples on Jan. 17, 2013 @ 12:12 pm

Union labor is only expensive

Union labor is only expensive in the private sector because productivity gains have gone to the business instead of being split with labor.

I'd be surprised if the interstates and post war infrastructure was not built by union labor.

Posted by marcos on Jan. 17, 2013 @ 1:02 pm

Remember that state government didn't allow collective

bargaining for state employees until the 1970s, which coincided right with major increases in population and property values - creating the perfect storm which led to Prop 13. Pat Brown did not have to deal with state-mandated rules on EIRS, collective bargaining, minority-owned businesses or anything else. If he did nothing would ever have been built. You think the environmental movement today would even allow discussion of a canal moving water from northern to central & southern California? The golden age of California didn't end because of Prop 13 - it ended because too many people wanted their sticky little fingers in the pie and eventually there was none of the pie left for anyone but those specific constituencies.

Posted by Lucretia Snapples on Jan. 17, 2013 @ 1:18 pm

Private contractors, rather than state employees,

build large infrastructure projects. Hence, it is possible, if not likely, that union labor built the highways and canals. I'm almost certain union labor built the Golden Gate and Bay Bridges.

Posted by Eddie on Jan. 17, 2013 @ 3:10 pm

Iron Workers unions I believe

Definitely.

Posted by Lucretia Snapples on Jan. 17, 2013 @ 3:24 pm

Trust me I live in TX, born an raised here, lived in Los Angeles for 3 years and now I'm moving BACK to California, this time the Bay Area. Texas is not all that. Sure you can live comfortably and buy a 5 bedroom house for under $500K. But property taxes are high, homeowners insurance is high and the cost of living is rising here. If you have a family and want home it's the place to be, but the weather sucks. There are way too many conservative closed minded morons with guns mind you. And it's hot as heck. So Texas is not all that. Plus we have a governor that does not think education is important. Depends on what suits you. I'm at a stage in my life that I don't need a big house, apartment life suits me just fine (plus I own a home here in TX). So I will forgo living large, for better weather and less backwards yahoos.

Posted by TXNative on Jan. 24, 2013 @ 8:05 pm

And then there's the fahr aints...

And then there's the fahr aints...

Posted by marcos on Jan. 24, 2013 @ 8:21 pm

And the roaches, and the mosquitos, humidty. And despite what people say, Texas does not have the most friendliest people. I think its due to the huge egos.

Posted by TXNative on Jan. 25, 2013 @ 6:21 am

Omg, yes, I absolutely agree,

Omg, yes, I absolutely agree, they actually are very mean especially the women, and this is coming from a Los Angeles native

Posted by Guest on Mar. 04, 2013 @ 8:03 am

Trust me I live in TX, born and raised here, lived in Los Angeles for 3 years and now I'm moving BACK to California, this time the Bay Area. Texas is not all that. Sure you can live comfortably and buy a 5 bedroom house for under $500K. But property taxes are high, homeowners insurance is high and the cost of living is rising here. If you have a family and want a home it's the place to be, but the weather sucks. There are way too many conservative closed minded morons with guns mind you. And it's hot as heck. So Texas is not all that. Plus we have a governor that does not think education is important. Depends on what suits you. I'm at a stage in my life that I don't need a big house, apartment life suits me just fine (plus I own a home here in TX). So I will forgo living large, for better weather and less backwards yahoos.

Posted by TXNative on Jan. 24, 2013 @ 8:09 pm

Fire Ants.

Fire Ants.

Posted by marcos on Apr. 30, 2013 @ 10:52 am

Haha, what a ridiculous piece

Haha, what a ridiculous piece of socialist propoganda. I know first hand of several businesses that are FLEEING communist CA this year for Free States all over the country.

Posted by Guest on Feb. 07, 2013 @ 5:56 pm

No you don't.

No you don't.

Posted by Guest on Apr. 30, 2013 @ 10:39 am

Living in TX is like living

Living in TX is like living inside rectum. It stinks in all directions. By far the worst place on earth.

Posted by Guest on Jun. 18, 2013 @ 11:36 am

And yet TX has higher growth rates

and no fiscal deficit problems on the scale of CA.

They're doing something right.

Posted by Guest on Jun. 18, 2013 @ 11:48 am