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[jonesey]

From The LA Times:

In America's federal system, some states, such as California, offer residents a "package deal" that bundles numerous and ambitious public benefits with the high taxes needed to pay for them. Other states, such as Texas, offer packages combining modest benefits and low taxes. These alternatives, of course, define the basic argument between liberals and conservatives over what it means to get the size and scope of government right.

It's not surprising, then, that there's an intense debate over which model is more admirable and sustainable. What is surprising is the growing evidence that the low-benefit/low-tax package not only succeeds on its own terms but also according to the criteria used to defend its opposite. In other words, the superior public goods that supposedly justify the high taxes just aren't being delivered.

California's state and local government employees were the best compensated in America, according to the Census Bureau data for 2006. And the latest posting on the website of the California Foundation for Fiscal Responsibility shows 9,223 former civil servants and educators receiving pensions worth more than $100,000 a year from California's public retirement funds. The "dues" paid by taxpayers in order to belong to Club California purchase benefits that, increasingly, are enjoyed by the staff instead of the members.

None of this happens by accident. California's interlocking directorate of government employee unions, issue activists, careerists and campaign contributors has become increasingly aggressive and adept at using rhetoric extolling public benefits for all to deliver targeted advantages to itself. As a result, the political reality of the high-benefit/high-tax model is that its public goods are, increasingly, neither public nor good. Instead, the beneficiaries are the providers of the public services, and certain favored or connected constituencies, rather than the general population.

I'm posting this because, as a lifelong (until very recently) Californian now living in a Red state, I get the "what's wrong with your state?" question quite a bit.  Suffice to say, it's difficult for me to explain the mechaninations of California politics (even as a child of parents who worked in that system for years), but this article hits it on the head. 

I love California, but I'm not sure that I'll ever get to live there again. 

[lorelei]

I thought that piece seemed familiar: I read the original in City Journal a few weeks ago.

http://www.city-journal.org/2009/19_4_california.html

(this version goes into greater detail than the version in the LA Times).

One thing I was confused by: the article claims thousand of people are leaving California - why then is the population still apparently growing? (it can't all be undocumented workers, can it?)

[wannabeaphd]

I have to say that I think the article(s) above are really fascinating and mostly spot on. There are quite a number of ways that California makes things harder on itself (the referendum process and term limits which produce numerous ex-politicians all wanting salaries for life). However, there are also factors at work in the states-as-clubs-with-particular-benefits-packages argument that the article neglects to take into account. The California club may not be holding up its end of the bargain in terms of high taxes = high financial and social welfare benefits. However, there is more to choosing one club over another than simple finances. I would much rather be a queer woman and/or a woman of color in California than Texas. It is also worth it for me to live on the West Coast. I prefer earthquakes to hurricanes. For me, and millions of others, California has an allure that will never be matched by any other state. Certainly, thousand of people leave CA, but thousands will also keep coming in the hopes of living the California dream.

That said, I have also recently left CA (for SO's graduate school, not my choice). I am enjoying the NE, however, I daydream about life in California constantly and plan to visit as often as possible while I am away.

In short, there is much wrong with the golden state, but the things that are wonderful about it will always outweigh the negatives for me. I would much rather live as a pauper in California than as a prince in Texas.

All that said, I am considering Texas for future graduate school...

[navydad]

1. The ballot initiative process.

2. Gerrymandered legislative districts.

3. Term limits.

4. Recreational drug prohibition.

The problem with California is not that it is "high tax/high benefit." The problem is that the state government is structurally dysfunctional. California is not a good test of the high tax/high benefit model because the current system would fail with any model. To use a football analogy: you can't evaluate the effectiveness of the West Coast offense if the quarterback's hands are tied behind his back, the receivers' legs are shackled, and the linemen have to wear blindfolds.

[outlier]

I totally agree with navydad, and I'd add the 3 strikes law (which was a result of the ballot initiative process) as one of the major things wrong now. Still, hubby and I moved from northern California to present location last year, and we are getting out of here as soon as we can. California's not the only place we'd move, but it's one of the few. I'll take California, messed up as it is, over this place any day.

[inthelab]

1. The ballot initiative process.

2. Gerrymandered legislative districts.

3. Term limits.

4. Recreational drug prohibition.

5. The supermajority needed to pass budget increases.

6. - 13. Proposition 13.

[temporaryname]

The article referenced by the OP makes the error of generalizing from one case (California as a high-tax/high-services state) to a much broader claim (low-tax/low-services is better). The problem with such an approach is that all it takes is one counterexample to knock it down, and so I offer:

Florida.

Though, to be completely fair, it looks like both the high-tax/high-services and low-tax/low-services approaches are taking a beating in the current downturn. It appears that the best way to go is to provide a service that others want really, really badly and tax that to provide services (see petroleum products and Alaska), though that isn't foolproof (see gambling and Nevada).

[jonesey]

The article referenced by the OP makes the error of generalizing from one case (California as a high-tax/high-services state) to a much broader claim (low-tax/low-services is better). The problem with such an approach is that all it takes is one counterexample to knock it down, and so I offer:

Florida.

I'm in Florida (I know, out of the frying pan...) and our situation down here is more than just low-taxes/low-services.  Florida's economy is based on a Ponzi scheme; we're dependant on people moving/going on vacation here.  More people = more jobs, etc, etc.  When the economy tanked, people stopped moving here and stopped visiting.  When your economy is based on tourism and construction, you're setting yourself up for failure.  Florida needs to find something else to base it's economic well-being on other than immigration and vacations or its going to be in trouble for a long time.  We were trying to make this a medical and scientific research hub (Tampa, specifically) but our Red State political folks vetoed stem cell research and poof! it went elsewhere. 

Republicans down here think the answer is offshore oil drilling and new nuclear power plants.  It'll be interesting to see how things shake out in the next few years.

[post_functional]

1. The ballot initiative process.

2. Gerrymandered legislative districts.

3. Term limits.

4. Recreational drug prohibition.

5. The supermajority needed to pass budget increases.

6. - 13. Proposition 13.

I completely agree, but Prop 13 is still the third rail of California politics.  Touch it and you're dead.

[ucprof]

Prop 13 is why, as a recently new homeowner, I am paying top dollar for taxes on my house while the house next door to me is held in a family trust and being put on the rental market as `income property' for which the family will make a lot of money because they pay a fraction of the taxes I pay.  On top of that, my town recently voted some add on taxes based on `assessed value' which means we got a 25% increase in our property taxes, which were already maxed out at top value.  Another house across the street is also income property.  And this is in a neighborhood where lot value is over $1M.  Neither house has been occupied by elderly people on fixed income.  In one case the prior property owner passed away but the house is kept in the family, none of whom live anywhere near the property.  Something is wrong with this broken system.  At the very least they could tax rental income at a rate that is commensurate with the tax break people are getting from prop 13.   

[embitteredhistorian]

People tend to forget that California is highly schizophrenic. Inland California from north to south is a highly conservative, Republican area and about half of the state vehemently fights the politics of the other half, with precious little productive dialogue and everyone going home feeling right.

For example, see the '08 election results county by county: http://www.usatoday.com/news/politics/election2008/ca.htm

California's not blue, nor is it red; it's purple!

[mad_doctor]

CA is too big.  I once heard someone say that if CA were on the east coast it would be Florida, Georgia, North & South Carolina, and Virginia.

[temporaryname]

CA is too big.  I once heard someone say that if CA were on the east coast it would be Florida, Georgia, North & South Carolina, and Virginia.

Probably actually an even weirder mix--North and South Carolina, Virginia, West Virginia, Maryland, Delaware, and New Jersey. Try governing that!

[alleyoxenfree]

I maintain that both the UC and CSU problems could be solved with some creativity, and without the multi-million-dollar consultants, who have been hired to give the chancellors the reports that draw the conclusions they want drawn.

Instead, I propose something like the following:  The system's highest paid professors should go on retreat to the Awahnee in Yosemite and come up with a proposed plan.  Simultaneously, the faculty of all the UCs and CSUs should convene on a date - say, Boxing Day - at their nearest Starbucks, and come up with plans.  All the plans should be emailed to a jury composed of a cross-section of 12 college-educated voters with degrees from the UC or CSU systems.  That jury should choose the elements that make the most sense.  A second jury of similar composition should simultaneously choose new chancellors of each system to implement these.  The runners-up in the chancellor search should be hired to run BofA.

Alternative suggestions?

[aandsdean]

Prop 13 is why, as a recently new homeowner, I am paying top dollar for taxes on my house while the house next door to me is held in a family trust and being put on the rental market as `income property' for which the family will make a lot of money because they pay a fraction of the taxes I pay.  On top of that, my town recently voted some add on taxes based on `assessed value' which means we got a 25% increase in our property taxes, which were already maxed out at top value.  Another house across the street is also income property.  And this is in a neighborhood where lot value is over $1M.  Neither house has been occupied by elderly people on fixed income.  In one case the prior property owner passed away but the house is kept in the family, none of whom live anywhere near the property.  Something is wrong with this broken system.  At the very least they could tax rental income at a rate that is commensurate with the tax break people are getting from prop 13.    

I was in high school in LA when Prop 13 passed.  It was catastrophic almost immediately in the public schools--out went art, out went music, up went class sizes, etc., etc.

The situation that UC prof mentions is real.  My folks house--for which they paid $23,000 in 1963, and which they remodeled and added a pool in the summer of 1975 (I remember it well--the summer between 6th and 7th grade!) for $20,000, was reassessed back to its 1975 (pre-remodeling, oddly) value in 1978.  They paid, get this, something like $420/year in property taxes until they sold the house in 1992 (in the midst of a downturn) for $218,000.  The people who bought it in 1992 still live there, if Google is to be trusted, so they've been paying in the neighborhood of  $2,200 in property taxes, without increases, since then.  Houses in the neighborhood two years ago were going for the mid-500s to mid-600s (this is astounding, as it was a crap neighborhood of late-50s ranch houses with nothing particular to recommend it), and thence new buyers then were paying $5,500-$6,500 in taxes.

Years ago, the Supreme Court rejected a case that challenged this situation on equal protection grounds.  I wonder about that.

Wannabeaphd, when I moved from California to Virginia in 1985, I felt the same way you do.  I was grouchy when my folks moved to the Twin Cities in 1992 (thank God my research at the Huntington and Clark was done!).  But, grouchy as all that, I've been back there exactly twice, in 1995 and 1997, and frankly no longer could care less. The problems just aren't worth it, though I do miss the weather and am certainly glad I grew up and went to college there.

Finally, for the contrast between low tax/low service states and high tax/high service states, you need to add at least a third element--high tax/low service states like Oklahoma.  It partly explains the state's nutty conservatism:  you pay those taxes, and get THAT government, no wonder you'd think government is the problem.