Toxic State Syndrome
http://www.thedailybeast.com/articl...drome-as-california-declines-texas-rises.html
Once the state of opportunity, California is now veering on a cycle of decline that will be difficult to reverse.
After World War II, California was where Americans went in search of a better life—the state with more jobs, more space, more sunlight, and more opportunity. But since 1990, Californians have gone elsewhere for opportunity, with the state losing a net of more than 3.7 million people to other states.
The Great California Exodus: A Closer Look. During the first decade of the 2000s, according to IRS data on the movement of income-tax filers, California saw a net loss of 635,000 people and aggregate income of $14.7 billion to just three states—Texas, Arizona and Nevada. Texas was the leading destination, with about 225,000 Californians relocating there.
Californians needs to ask if the state has started a cycle of decline, in which a loss of jobs to other states leads to a loss of tax-paying residents, and in turn to
a deterioration of the public services that make the state even less desirable for businesses. This “toxic state syndrome,” as it might be called, could be very difficult to shake. The businesses that bring jobs (or take jobs with them when they leave) look for certain things: A skilled work force, relatively low costs, sound infrastructure and public services, and—maybe most important of all—some assurance that these conditions will stay the same.
A state in chronic fiscal distress can’t offer such predictability, and California is a very distressed state. For most of the past decade, its credit rating has been at or near last place in the nation; currently it is rated the lowest by Standard & Poor’s.
What may be most damaging about California’s tax debate is its tone of desperation. The state is like a man at the end of his rope who has taken hostages – in this case, the schools. Meanwhile, Texas and other states are poaching California jobs with tax incentives at a scale that California state and local governments can’t afford, most recently with the $36 million package of tax breaks and investment funds that convinced Apple Inc. to expand in Austin and add some 3,600 jobs.
California doesn’t do such things, and it’s not out of libertarian principle. It’s because the state just doesn’t have the wherewithal. And it never will, if it can’t learn to live within its means. If the data from migration and job creation send one message above all, it’s that fiscal discipline matters. States that cannot pay their bills lose jobs, people and wealth to the states that can.
Folks do it all the time ....