This article offers some great ideas about how to curb the exodus of entrepreneurs from California, once considered the best place in the nation to build the American Dream for individual entrepreneurs.
An excerpt.
“On Jan. 24, 1848, James Wilson Marshall found gold at Sutter's Mill, in Coloma, Calif., sparking a mad rush of some 300,000 people desiring to strike it rich. San Francisco grew from a tiny hamlet to a boomtown in no time, and in 1850 California entered the Union as the 31st state.
“With this history at their back, state leaders might have understood that people have a propensity to get up and move when a better life is to be had elsewhere. But no. After more than 150 years of being a destination, California is becoming a place entrepreneurs, investment capital and the hardy workers who made it a global leader in agriculture, technological innovation and scientific research are fleeing. This exodus is the marker of something deeper than a national recession. It's a sign that the attempts by state leaders to spend their way back to prosperity are killing California.
“While it has the sixth highest tax burden in the nation, according to the nonpartisan Tax Foundation, California is facing a breathtaking $40 billion budget deficit this year. This comes on the heels of a decade-long spending spree. Last year the state budget was $131 billion, up from $56 billion in 1998.
“Citizens are burdened by all manner of state regulations. To mention just one example, this year a new law enacted by ballot initiative bans cages chicken farmers use on the grounds that it is inhuman to put birds in cages that prevent them from spreading their wings. Complying with the new law will cost farmers hundreds of millions of dollars, which will force many to leave the state. And that will force us to buy our eggs from other states and, possibly, others nations, such as Mexico.
“And just as a fallen tree can divert the flow of water in a creek, bad economic policies divert the flow of investment. Entrepreneurs and investors, seeking the path of least resistance, leave when it becomes easier to make a living in more business-friendly states. In 2000, according to the state's Department of Finance, about 150,000 people moved into California. But in the years that followed the in-migration slowed, and in 2005 it reversed, when a net 52,000 people moved out. In 2008, the outflow topped 135,000 people…
“Two broad reforms are needed. The first is that we must create a part-time, nonpartisan citizen legislature -- a model that has proven effective in states like Texas (part-time) and Nebraska (part-time and nonpartisan). Californians need to be able to elect leaders whose primary interest is public service, not furthering political careers.
“The second fundamental reform is on taxes and spending. Other states have passed a Taxpayers' Bill of Rights. We need to do the same, so I and others will soon be launching a campaign to enact the following:
“- Two-year budgeting. This would allow a part-time legislature the time it needs to hold hearings, conduct negotiations, and provide oversight to determine the state's spending priorities in the first year, while in the second, write and pass the budget.”
