A new joint effort by the Kersten Institute and Paramount Communications, called “Leadership for California’s Future PAC” has come under fire from some in the far-left Democrat political establishment for advocating for more aggressive strategies to improve the California economy and create jobs in the Golden State.
If you listen to or talk to leaders of the Democrat-controlled political establishment they suggest that the California economy is perfectly fine and suggest that additional tax increases and regulations are necessary to somehow further improve “investment” in California.
California Democrat leaders even go so far as to claim credit for extraordinary economic growth in a few Bay Area counties, while the majority of the state languishes in economic mediocrity to downright 3rd world poverty and economic collapse.
Recent analyses in this column of U.S. Dept. of Commerce data as found that when exclude the Bay Area, California's economic growth, as measured by real gross domestic product (GDP), actually averages only 0.3% for 2008-14--equal to only 1/3 of the 0.9% growth for all metro areas in the United States over 2008-14 period. (Note: real means inflation adjusted dollars, 2009 base year)
Furthermore, in economic terms it is really the Bay Area that is the exception, not California. The two Bay Area metro areas represent just over 1/4 of the state's economy, but more than half of the state's economic growth, even more depending on the time period. (the two Bay Area regions for this analysis are San Francisco--Oakland--Hayward and San Jose--Sunnyvale--Santa Clara)
The Governor’s January 2017 Budget summary fails to breakout GDP estimates for California compared to the nation. But states that U.S. real gross domestic product growth is estimated to average about 2-2.2% per quarter on an annualized basis.
The bottom line is that California’s real economic growth averages 1-2% per year at best for the vast majority of the state, excluding the Bay Area.
The U.S. Congress is currently debating pro-growth packages that seek to return national annualized economic growth to 4% real economic growth—roughly double the current and projected levels of growth.
The question becomes what can be done to improve economic growth in California? The short answer is a lot, but there are very few true advocates for increased economic growth in California.
The vast majority of the state’s liberal business elites and the Democrat political establishment claims to be for increased economic growth but the result of most of their actions and policies appear to support the status quo—characterized by escalating tax rates, increased regulation, and lower economic growth.
Any plan to increase economic growth in the Golden State must start with a realistic, broad-based political strategy that aims to elect more favorable political leadership that will advocate for better economic policies at the state and local levels of government.
The current Democrat-controlled political establishment is clearly not getting the job done and has continued to both directly and indirectly promote candidates and policies that serve to make the state’s business climate even worse.
Another piece of conventional wisdom that must be dispelled is that California cannot have a healthy economy alongside a viable welfare state and environmental protectionism, among other “progressive” policies. These policies appear to be mutually exclusive under the existing political regime, but do not necessarily have to be so.
I would argue that the most urgent thing the Golden State lacks is a viable plan to get it’s economy and political system back on track, and that is a key issue that “Leadership for California’s Future PAC” seeks to address.
This plan starts with ideas, big ideas, and ideas that challenge both the Democrat-controlled status quo and the failed policies of the liberal elites who control California politics.
Many of these policies are common sense—limiting out of control taxation and regulations, improving education and government effectiveness—but perhaps most importantly California needs new political leadership that makes these policies a priority as opposed to just paying lip service to improving California’s political economy and business climate.
That is why the number one priority for “Leadership for California’s Future PAC” is the recruitment of a new crop of political leaders in California that can actually turn California’s economy and political system around.
For more information on the PAC and our effort please visit: http://www.kersteninstitute.org/leadership-pac.html