Tag Archives: California

California Is Worse Than You Think, by William Anderson

Why do Californians keep voting for politicians who make their situation worse? From William Anderson at mises.org:

My colleague from the philosophy department was becoming increasingly angry.

He was trying to be polite, but it was clear that he was raging inside. After a few minutes, he smiled a very strained smile and excused himself.

Our conversation was about California, or to be more specific, California governance. As readers can imagine, he was bullish on how the Democratic Party governs the state, California being perhaps the most one-party state in the USA. Every statewide election has gone to a Democrat in the last decade, and Democrats have a supermajority in the state legislature, which means that there is no meaningful Republican opposition and whatever the Democrats want, they get.

Not surprisingly, California governance is squarely progressive. The unions representing government employees effectively run the legislature, and as a result, pay, benefits, and pensions for those workers increasingly are straining the state budgets. (Steven Greenhut, a libertarian journalist based in California has documented the unsustainable growth of government in that state for nearly two decades.) Yet, the state continues to march politically and economically in the progressive direction as though the laws of economics didn’t matter.

For the most part, I have observed progressive California from far away, but my life took a different turn a few years ago, and the state is becoming my new home. I married a retired nurse from Sacramento in 2018, and because of health issues with her adult daughter, she has had to remain in that city, something not in our original plans. Because our campus either has been closed or severely restricted during the covid-19 lockdowns, I have spent most of the past year working from my wife’s home.

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California “Techsodus”: Tech Companies, Billionaires, Millionaires, Tech Employees Flee San Francisco & Silicon Valley, by Wolf Street

Money and business do tend to migrate to where they’re treated the best. From Wolf Richter at wolfstreet.com:

And we coined “Management by Zooming Around.” Which is what Oracle’s Larry Ellison is doing.

When on December 11, Oracle disclosed that it “is implementing a more flexible employee work location policy and has changed its Corporate Headquarters from Redwood City, California to Austin, Texas,” it was another step in the process that we will henceforth call “Techsodus.”

The exodus of tech companies, executives, billionaires, millionaires, and regular tech employees from California, and particularly from San Francisco and Silicon Valley, is a combo of fleeing California and a shift to work-from-anywhere. Texas, Florida, Colorado, and other states have been among the destinations. Texas and Florida don’t levy state income taxes, so sure.

But Larry Ellison, co-founder and chairman of Oracle, isn’t moving to Texas along with the headquarters of his company. He has moved his primary residence to Hawaii, following Oracles new doctrine of working from anywhere. And Hawaii’s state income taxes are not far behind California’s.

Oracle already has a 560,000-square-foot campus in Austin, which it opened in 2018 – and moving its headquarters to Austin might not change all that much at first in terms of employment. Oracle said that it would “continue to support major hubs for Oracle around the world,” including its soon-to-be former headquarters in Redwood City. Oracle, founded in 1977, is one of the older tech companies that helped make Silicon Valley.

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California vs. Texas

California has had a nearly identical case trajectory as Texas.

In TX, schools are open. Businesses are open. People can go for a walk.

California’s Looming ‘Green New Car Wreck’, by Anthony Watts

The state that doesn’t have enough electricity is mandating electric cars. From Anthony Watts at wattsupwiththat.com:

The numbers don’t pencil out for the future where just 25% of cars in California would be electric.

Governor Newsom announces major climate initiative, September 23, 2020. (Screenshot via California Gavin Newsom)

On September 23, California Gov. Gavin Newsom issued an executive order that will ban the sale of gasoline-powered cars in the Golden State by 2035. Ignoring the hard lessons of this past summer, when California’s solar- and wind-reliant electric grid underwent rolling blackouts, Newsom now adds a huge new burden to the grid in the form electric vehicle charging. If California officials follow through and enforce Newsom’s order, the result will be a green new car version of a train wreck.

Let’s run some numbers. According to Statista, there are more than 15 million vehicles registered in California. Per the U.S. Department of Energy, there are only 256,000 electric vehicles registered in the state—just 1.7 percent of all vehicles.

Using the Tesla Model3 mid-range model as a baseline for an electric car, you’ll need to use about 62 kilowatt-hours (KWh) of power to charge a standard range Model 3 battery to full capacity. It will take about eight hours to fully charge it at home using the standard Tesla NEMA 14-50 charger.

Now, let’s assume that by 2040, five years after the mandate takes effect, also assuming no major increase in the number of total vehicles, California manages to increase the number of electric vehicles to 25 percent of the total vehicles in the state. If each vehicle needs an average of 62 kilowatt-hours for a full charge, then the total charging power required daily would be 3,750,000 x 62 KWh, which equals 232,500,000 KWh, or 232.5 gigawatt-hours (GWh) daily.

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Will California Restore Affirmative Action? Probably not, by Ron Unz

Repealing affirmative action in California may not be the slam dunk people think. From Ron Unz at unz.com:

As everyone knows, over the last couple of decades California has become a one-party Democratic state. Democrats hold a better than three-fourths hyper-majority in the State Assembly and their control is nearly as overwhelming in the State Senate. California has our nation’s largest Congressional delegation, and of its 53 members only seven are Republican.

Not only is every statewide officeholder a Democrat, but no Republican has won such a race in almost 15 years, with many of the recent contests not even featuring a Republican on the November ballot. The once-proud Republican Party of Reagan and Nixon has been reduced to almost total irrelevance.

This same pattern has held in national elections, with Donald Trump losing the 2016 California vote by a remarkable 30 points and the most recent polling data suggesting a similar outcome this November.

Except for tiny Hawaii, California is now America’s most heavily non-white state, with our white European population reduced to little more than 30% of the total. But such demographic factors explain only part of those lop-sided 2016 election results since white Californians supported Trump at a rate 20-25 points lower than whites in the rest of the country. If America’s entire white national electorate had voted like its Golden State counterpart, Trump would have lost all fifty states, mostly by huge landslides, and suffered by far the greatest electoral disaster in American history. All the Trump-hating pundits would have spent Election Night laughing and saying “I told you so!”

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The Making of a Market, by Eric Peters

Where does a state governor get the power to wave a wand and decree that by 2035, there will be no gas powered cars on the roads? From Eric Peters at ericpetersautos.com:

Well, the other shoes has dropped. We now know how a “market” for electric cars will be created.

It will be done by outlawing the market for cars that aren’t electric.

Having trouble selling Tab?

Forbid the sale of Coke and Pepsi!

California Governor (and Gesundheitsfuhrer) Gavin Newsome has simply decreed – via “executive order” – that anything that isn’t “zero emissions” (at the tailpipe) must be “phased out” by 2035. This means only electric cars since they are the only vehicles considered to be “zero “emissions” by the regs – no matter their elsewhere emissions – including the substantial carbon dioxide “emissions” produced by the utility plants that generate the electricity they run on.

Which there will be more of when the only cars permitted on California roads are electric. But never mind. It feels good – to the Gesundheitsguv – like the wearing of any old rag to “stop the spread” of a virus you haven’t got.

The effects will also be felt a lot sooner than fifteen years from now.

And not just in California, either.

The car companies are going to stop putting R&D money toward cars they can’t sell in California – the biggest market for cars in the country – and toward the ones they’ll be forced to sell.  

In other states, too. Because it’s likely at least some will follow California’s lead – having their own Gesundheitsguvs in charge.

Development of new non-electric cars nationally will stagnate.

The ones that remain in production will sell for more, to offset the costs of developing electric cars. The more states that force-electrify, the more expensive the non-electric car will become – until the goal is achieved of making the non-electric car at least as expensive as electric cars.

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California Burnin’ – A Warning Against One-Party Rule, by Niall Ferguson

Liberals want all sorts of power but by and large, they do a lousy job of managing things. California is a perfect example. From Niall Ferguson at bloomberg.com via zerohedge.com:

Authored by Niall Ferguson, op-ed via Bloomberg.com,

Fires, blackouts, high taxes, poverty, scarce housing, urban squalor, lousy schools – it’s a wonder anybody stays.

“California, folks, is America fast forward.” Thus Governor Gavin Newsom, hoarsely, amid brown smoke at the North Complex Fire on Sept. 11.

“What we’re experiencing right here is coming to a community all across the United States of America… unless we get our act together on climate change.”

I was with him all the way until he said the words “on climate change.”

As my Hoover Institution colleague Victor Davis Hanson put it last month, California is “the progressive model of the future: a once-innovative, rich state that is now a civilization in near ruins. The nation should watch us this election year and learn of its possible future.”

Let’s start with the fires. So far this year, they have torched more than five times as much land as the average of the previous 33 years, killing 25 people and forcing about 100,000 people from their homes. At one point, three of the largest fires in the state’s history were burning simultaneously in a ring around the San Francisco Bay Area. According to the California Department of Forestry and Fire Protection, or CAL FIRE, of the 10 largest fires since 1970, five broke out this year. Nine out of 10 have occurred since 2012.

No doubt high temperatures and unusual thunderstorms bear some of the responsibility for this year’s terrifying wildfires on the West Coast. It is deeply misleading to claim, as some diehard deniers still do, that temperatures aren’t rising and making wildfires more likely. But it is equally misleading to claim, as the New York Times did last week, that “scientists say” climate change “is the primary cause of the conflagration.”

In reality, as Stanford’s Rebecca Miller, Christopher Field and Katharine J. Mach argue in a recent article in Nature Sustainability, this crisis has at least as much to do with disastrous land mismanagement as with climate change, and perhaps more. Anyone who thinks solar panels, Teslas and a $3.3 billion white elephant of a high-speed rail line will avoid comparable or worse fires next year (and the year after and the year after) doesn’t understand what the scientists are really saying.

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California’s governor makes ominous prediction for America, by Simon Black

Is California what America has in store for itself. Let’s hope not. From Simon Black at sovereignman.com:

California’s governor made a rather ominous prediction this weekend when he told an interviewer that “California is America. . . fast forward.”

He was talking specifically about the wildfires that have ravaged his state– a warning that the natural disasters will soon plague the rest of the country too, thanks to climate change.

But his comment should really be taken more broadly… because California really is a snapshot of America in the near future.

Just like America, there are a lot of incredible things about California. It’s home to some of the biggest, most ‘innovative’ tech companies in the world. It has a large, educated, highly skilled population.

Just by itself, the state is the 5th largest economy in the world. It’s a powerhouse. Or, at least, it should be. It has all the promise of America– Hollywood, Silicon Valley, sunshine, Disneyland, and endless possibilities… the place where dreams can come true.

And then there’s reality.

Yes, the state is ablaze and air quality has turned toxic. But that doesn’t even scratch the surface of the problems.

(The wildfires are indicative of a bigger problem, though. It’s not like wildfires are a rare occurrence in California. They happen every year. Yet somehow this government always gets caught with its pants down.)

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California’s Odd Desire to Suffocate the ‘Gig Economy’, by Gerard Scimeca

California is trying to kill the gig economy of which it is arguably the birthplace. From Gerard Scimeca at realclearmarkets.com:

If our current economy were a swimmer paddling furiously against a surging tide, then California is determined to hand it an anchor. Millions of Americans who work to make ends meet through freelance work in the ‘gig’ economy were recently handed virtual pink slips through AB5, legislation signed into law last year by Governor Gavin Newsome forcing independent contractors to be treated as employees.

With other states now looking to follow suit, it’s time Congress address this atrocious assault on worker freedoms and economic innovation by enacting federal standards on independent contract work. It would be a shallow victory for our economy to rebound from Covid only to have workers tossed out of their freelance jobs by clueless politicians seeking to “protect” their rights.

It should surprise no one that AB5 set in motion a massive economic wrecking ball that already has rideshare giants Uber and Lyft packing their bags to leave the state. Requiring contract workers to be treated as full-fledged employees in California or any state will of course make dozens of similar gig platforms unprofitable, in effect deleting apps right off our phones. A court’s temporary pause of AB5 last week is now holding worker jobs by a thread, causing Uber and Lyft to temporarily suspend plans to leave the state. If the ruling doesn’t hold, over 200,000 freelance workers will be driven out of work and millions of consumers will be left on the side of the road.

It is startling that in today’s modern economy California would even attempt such a clampdown. The one-size-fits-all model of employee-employer relationship is a relic of the distant past. More than a third of the U.S. workforce is currently employed as either full or part-time freelancers. This is no longer an employment niche but a pillar of our current economy. Freelancers earn good money, often sizably more than their employee counterparts. And despite the complaints of some interventionist lawmakers, workers themselves are quite content with the freedom their work offers. In one recent survey, 71 percent claimed increased work opportunities over the previous year.

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California Set To Pass The Nation’s First Wealth Tax Targeting The Ultra Rich, by Tyler Durden

This is an idea that will catch on like wild fire among cash-strapped governments. From Tyler Durden at zerohedge.com:

It was about about nine years ago when consulting company BCG first suggested that in a time of out of control spending and soaring debt loads, the only fiscally sustainable “solution” was to implement a wealth tax (see “There May Be Only Painful Ways Out Of The Crisis“).

While the idea was well ahead of its time in 2011, and was quickly shut down in the court of public opinion, several years later none other than the IMF resurrected the idea of a wealth tax, which has only gained momentum in recent months, and despite widespread grassroots pushback, the concept of a “wealth tax” has moved front and center and most recently the chairman of Capital Economics, Roger Bootle, said that the world’s wealthiest could be subjected to higher tax rates as governments scramble to fund spending and repair their economies amid the coronavirus crisis.

Fast forward to today when the ultra-liberal state of California is now ready to take this “socialist” idea from concept to the implementation phase, with the SF Chronicle reporting that a group of CA state lawmakers on Thursday proposed a first-in-the-nation state wealth tax that would hit about 30,400 California residents and raise an estimated $7.5 billion for the general fund.

The proposed tax rate would be 0.4% of net worth (most likely ended up far higher), excluding directly held real estate, that exceeds $30 million for single and joint filers and $15 million for married filing separately.

Oakland Democrat Rob Bonta, who is the lead author of the wealth tax proposal AB2008, justified the wealth expropriation by saying that California is facing a big budget deficit because of the health and economic crisis brought on by the coronavirus, and “we can’t simply rely on austerity measures,” to close it. It wasn’t immediately clear why austerity doesn’t work considering that California has never actually tried it, but in any case the Democrat’s proposal was clear: “We must consider revenue generation.”

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