Friday, April 22, 2011

A big duh! to California

An envoy of California politicians headed by Lt. Governor Gavin Newsom has headed to Texas to try to figure out why businesses are leaving California in droves and heading to Texas. The numbers are significant.
The contrast is undeniable. Texas has added 165,000 jobs during the last three years while California has lost 1.2 million. California's jobless rate is 12% compared to 8% in Texas.
Newsom says he's "sick and tired" of hearing about businesses going to Texas and how well Governor Rick Perry has done at luring businesses to relocate in his state. While they were there in Texas, insult was added to injury as yet another business announced it was leaving California.
Hours after the legislators met with Mr. Perry, another business, Fujitsu Frontech, announced that it is abandoning California. "It's the 70th business to leave this year," says California business relocation expert Joe Vranich. "That's an average of 4.7 per week, up from 3.9 a week last year." The Lone Star State was the top destination, with 14 of the 70 moving there.
Liberals are so clueless that they need to go on a junket to another state to find out what everyone else knows - California has a terrible climate for businesses between all their regulations and taxes. Conservatives have told liberals for years what would be the result of piling on all their desired liberal regulations of businesses, but liberals figured that it just didn't matter as long as they were doing Good. Er, no.
Andy Puzder, the CEO of Hardee's Restaurants, was one of many witnesses to bemoan California's hostile regulatory climate. He said it takes six months to two years to secure permits to build a new Carl's Jr. restaurant in the Golden State, versus the six weeks it takes in Texas. California is also one of only three states that demands overtime pay after an eight-hour day, rather than after a 40-hour week. Such rules wreak havoc on flexible work schedules based on actual need. If there's a line out the door at a Carl's Jr. while employees are seen resting, it's because they aren't allowed to help: Break time is mandatory.

"You can't build in California, you can't manage in California and you have to pay a big tax," Mr. Puzder told the legislators. "In Texas, it's the opposite—which is why we're building 300 new stores there this year."

Other states are even snatching away parts of California's entertainment industry. The Milken Institute, based in Santa Monica, Calif., reports that 36,000 entertainment jobs have left the state since 1997. The new film "Battle: Los Angeles," which is set in California, was filmed in Louisiana.

"The red tape is ridiculous," says Mark Tolley, the managing partner of B. Knightly Homes, which relocated to Austin from Long Beach in 2005. "Regulators see developers as wearing a black hat and the environmental laws have run amok."
But all the liberal interest groups don't really care about the effects of their desired policies. All they care about is passing the regulations that benefit their group or advance their issues. Jobs, schmobs.
California, by contrast, seems to constantly lose focus. Several Democrats who agreed to go on the Texas trip were pressured by public-employee unions to drop out—and many did. And just as Texas business leaders were testifying about how the state's tort reforms had improved job creation, word came of California's latest priority: On April 14, the state senate passed a bill mandating that all public school children learn the history of disabled and gay Americans.

One speaker from California shook his head in wonder: "You can have the most liberated lifestyle on the planet, but if you can't afford to put gas in your car or a roof over your head it's somewhat limited."
California won't change. The voters just selected leaders who vowed not to change such policies. The state will continue to bleed jobs and run up insurmountable debts. Eventually the whole house of cards will come tumbling down into a massive crash. What a tragedy it is to witness the destruction of what used to be the "golden state" flush with jobs and great schools. It's almost a joke to remember that past today. And these politicians can ask Texas what they should be doing, but they won't make all the necessary changes. And they'll continue to export jobs out of their state. The only hope is that other states that have not traveled as far down the road to destruction as California will learn from the contrast between these two states.