Leaving California

A reader who lives in California sent this:

As a former Californian, it's easy to remember why we left...

Beyond extreme

I've been following with great concern the historic drought in California. The situation has moved beyond extreme into the classification of "exceptional" drought. I lived in California for twenty years and Don's and my families are still there, as well as innumerable friends.

We had a successful garden this year, but it goes without saying most of it is due to the fact that our water is abundant. Clearly right now a garden is an impossibility for most people in the Golden State.

Not only is surface water drying up, but so are the aquifers, which are being pumped dry by farmers desperate to keep their crops alive.

It's bad enough for those with annual crops; but for those who raise walnuts or peaches or other tree crops, losing entire orchards (which take years to establish) must be heart-breaking.

Water issues were one of the reasons we decided to leave California back in 1993. By no means was it the deciding factor, but it certainly contributed. Somewhere in the back of our minds we knew that if we wanted a homestead, we needed to settle in a place where water was, if not abundant, at least not a crisis point more times than not.

But we left when we were young, childless, and not yet rooted. It was hard enough to leave our family and friends behind. It's harder for folks with children who are surrounded by loving extended families. For most people, there are also employment issues to consider as well.

Should a drought issue suddenly plague north Idaho, it would be a FAR more difficult decision for us to up and move, since we now have an established farm and roots in our community.

But California may face a more serious issue than whether or not to grow a garden. There's talk about relocating people as communities run out of water. What happens then? It's not like anyone could hope to sell their home to someone moving in, if people are being asked to leave. There is speculation that this drought could continue for years. It's truly a crisis.

I know many readers of this blog either farm on a small scale, or someday hope to farm on a small scale, so water availability is doubtless high in their minds. What can Californians do? For those actually living in California -- will you stay or are you thinking about leaving? What are your thoughts on the future of the Golden State?

Why California is a mess

My husband recently found an interesting article entitled California Revenue Declines Since Passage of Prop 30.

Prop 30, it seems, was a tax-the-rich scheme that passed November 6, 2012 and which applies retroactively back to January 1, 2012. After it passed, business people wasted no time. Within a month, California State Controller John Chiang reported “that the total revenue for the month of November declined by $806.8 million, which is 10.8 percent below budget… The State of California experienced a decline in its revenue as several of the high income earners have relocated to other states, and have also relocated their businesses out of state. This led to a decline in corporate and income tax revenues by more than $1 billion.” [Emphasis added.]

A DECLINE of a billion bucks. And this article was written back in early December. Doubtless the businesses that left so quickly were either those that were small and light on their feet, or who were already in the process of relocating to another state. I’m guessing that in the next few months, California can expect to see an even larger exodus of businesses whose owners who aren’t interested in having every spare cent of their money confiscated against their wishes and redistributed elsewhere.

Even more comically, California bureaucrats are guilty of counting their chickens before they hatched. “With the expected increase in revenue to be derived from the passing of Prop 30, state bureaucrats increased deficit spending beyond the state’s $6 billion annual tax increase. The Department of Developmental Services and the Department of Health Services increased its spending in November by over $1 billion in comparison to its spending last year.” [Emphasis added.]

In other words, government goons – doubtless rubbing their hands together in lascivious glee – went on a spending spree without first finding out if they had any money in their checking account. And now California is more in debt than ever before. Surprised?

So what happened? Why didn’t the tax increase result in increased taxes? In an article entitled What Proposition 30 Means for California’s Entrepreneurs, Ethan Anderson wrote, “Nothing terrifies investors or entrepreneurs as much as the concept of expropriation. When governments decide to expropriate legally obtained assets, entrepreneurs who worked tirelessly to build businesses and investors who risked scarce capital end up with little to nothing for their troubles.”

For purposes of definition, expropriation is “when a public agency… takes property for a purpose deemed to be in the public interest, even though the owner of the property may not be willing to sell it.” In other words, it’s state-sponsored theft. Company profits are being stolen in the name of “public interest.” The California government – apparently steeped in greed, welfare, mismanagement, and other vices – decided to “stick it” to the rich (y’know, those folks who EMPLOY people) by stealing their money.

If I lived in California, why should I start (or continue) a business when I know all my profits will be seized by the state? What’s the incentive to continue running my company? Answer: there is none. I’d leave and take my business, my profits, and my employment opportunities someplace where they’re more appreciated.

We can’t necessarily blame the voters for passing Prop 30. “As is the case with many propositions,” notes Anderson, “the voters may have been fooled by the governor and his allies who aggressively pitched it as a way to ‘save education in our state.’”

The trouble is, this proposition disproportionately affects many people who patently aren't rich. Again I quote Ethan Anderson: “California’s entrepreneurs are hit particularly hard by Prop 30. Why? Because entrepreneurs often invest their life savings and go for years with a low or zero salary. Most start-up ventures end up failing in the end. But in those rare cases when something of great value is created and a meaningful liquidity event takes place (usually in the form of an acquisition or IPO), nearly all the money earned from the undertaking hits at one time. Instead of the income being spread evenly over the life of the company (the average time to exit for venture-backed start-ups is 7 or 8 years), a single once-in-a-lifetime event occurs such that eight years of income shows up in the single year, making entrepreneurs highly vulnerable to the top marginal tax rate.”

Many entrepreneurs and businesses, unwilling to hand over all the hard-earned assets they worked their butts off to earn – especially since Prop 30 is retroactive for almost a year – simply choose to leave California. They migrate to other states which welcome them (and their employment prospects and tax revenues) with open arms. States where they aren't punished for being a business.

Now I ask you, what on earth would compel ANY business to move to California? And what kind of reverse impetus is the California government using to encourage businesses to LEAVE the state? Talk about screwy. A state which desperately needs money is doing whatever it can to drive away investors, employers, entrepreneurs, and businesses.

My husband pointed out how Prop 30 exemplifies three misconceptions politicians invariably fail to remember: (1) No business is obliged to remain in a state where taxes and expenses discourage success and decrease profits; (2) Government always makes the assumption that when it increases taxes, it will increase its revenues (which has been shown time and time and time and time again to be incorrect); and (3) Either government legislators are dumber than a box of rocks, or the concept of “sticking it” to rich people is more pleasurable than fiscal reality.

To modify Margaret Thatcher’s famous line, “The problem with socialism is that you eventually run out of other people's money. ” – I might add: “Or until you chase people WITH money out of the state.”

We lived in California for decades. We fled in 1993 – first to Oregon, later to Idaho – and have never regretted that decision. We left because California was too crowded, too expensive, too full of crime, and too high in taxes. Looks like not much has changed. California has one-eighth of the country’s population but one-third of the country’s welfare recipients. Something’s gotta give, and when it does it ain’t gonna be pretty.

I have no solution to this mess. I just wish my family wasn’t still there when the powder keg blows.

Home sweet home

Our girls are home!

Oh my goodness, did we miss them!  Ten days in California visiting relatives was fun for them and kind of a break for us, but we're SO glad to have them back!

And we weren't the only ones.  Lydia about went ballistic when they walked in the door.

Welcome home, kids!

Bashing California

Lately I've been seeing a lot of articles concerning the state of affairs in California, particularly with regards to the business climate, cost of living, quality of life, etc. I rarely see articles praising California; everyone seems to focus on bashing the state.

My family moved to California (from western New York State) in 1972, when I was ten years old. From day one, I hated it there. I'm quite certain my opinion of the entire state was terminally colored by the rotten elementary school I attended, where I was teased and bullied unmercifully for six months (while my parents had a house built) until I relocated to a different (and less hostile) school.

After that first traumatic year, I suppose you could say I got along okay in the Golden State, but I never felt settled or at home, and never had any intention of staying. Nevertheless, you know how it is: inertia goes a long way in keeping someone in the same spot for years and years.

I can quite honestly say the best thing that I ever got out of California was my husband. I've been eternally blessed by marrying this most wonderful man.

When we got married in 1990, it didn't take us long to start devising a plan to leave California. By that point we didn't really have much of a quarrel with the state. We were both well employed, we were renting a nice house with a spacious back yard for our dogs; in short, we were doing fine.

But both of us had the yearning to leave. It just seemed California was too crowded, too expensive, too regulated, and (for me) too hot. The state seemed to stifle independence and self-sufficiency. We weren't sure exactly where we wanted to go, but we knew we needed to get out of the urban zones for which California is justifiably famous and have room to stretch our legs and be more independent. We considered the northern portion and/or the eastern section (along the Sierra Nevada chain) but in the end we up and moved to southwest Oregon in 1992, where we happily stayed for ten years before moving yet again to Idaho.

So my roots in California are fairly deep. My family still lives there. So does Don's family. We have endless dear friends who live there. But neither of us has the slightest desire to ever return (except to visit, of course).

It seems California's regulatory nature and hostile business climate have worsened in the two decades since we left. My older brother is particularly faithful about filling me in about California's woes, and although he's firmly entrenched in that state, he has no illusions about its problems.

Supplementing my brother's emails, I've also been seeing more and more news articles about California's problems. A WND columnist wrote two pieces (here and here) outlining some of the issues. It seems the state is beyond fixing because its issues are too big. What will become of it is anyone's guess.

It's well documented that businesses are leaving California in droves due to the hostile climate and high taxes. Other states have proven more welcoming and enticing, with far lower costs of living as well as more favorable tax incentives. "The Golden State's fastest-growing entity is government and its biggest product is red tape," notes Allysia Finley in a Wall Street Journal opinion piece in which she interviews urban studies Professor Joel Kotkin. Dr. Kotkin notes that the high home prices keep many young people out of the housing market (I can testify!).

The cost of living in California is so astronomical that the middle-class can't afford to live there. Let's put it this way: if Don and I tried to acquire in California what we have here in Idaho -- namely, twenty acres with a good-sized house and a barn -- we'd be spending upwards of a million dollars, easily. And we'd have a mortgage to match. But we spent one-tenth of that by moving to Idaho instead. And we bought this place solely on the income from a home craft business, for Pete's sake. Try doing that in California.

Ironically the state is a magnet to those unable or unwilling to work because the welfare benefits are incredibly generous. This contributes to the income disparity and overall decrease in the tax base for the state, which is why the state continuously increases taxes on the middle class. Catch-22 anyone?

Someone sent me an interesting article on InfoWars (a site I normally avoid because I dislike its conspiratorial they're-out-to-get-us mentality) entitled Sixteen Reasons to Move Away from California. I found I couldn't disagree with a single one of them.

California is a state with a staggering amount of beautiful natural terrain. Ocean beaches, dry hot desert, flat valley floors, high mountains, lush forests, temperate woodlands... it's astounding how many different biomes can be found in one state. There are also pockets with low population (notably the northern-most areas). But the long arm of government reaches every single one of those isolated pockets. No matter how far away from urban areas someone might live, they will still be taxed and regulated to a far higher degree than almost anywhere else.

It saddens me to watch California's slow-motion crash-and-burn. It saddens me that a state which was once a golden land of opportunity for millions -- including my parents, back in 1972 -- is now a state people must flee in order to seek opportunity.

And it saddens me even more that California politicians -- both Democrat and Republican -- don't get it. They don't get why people and business are leaving. They don't get that higher taxes are not greeted with cries of joy from the overtaxed. They don't get that more red tape and higher regulations don't entice businesses to be creative or innovative. They. Just. Don't. Get. It.

So despite the distance from beloved family members, I sure don't regret leaving the Golden State.

The definition of insanity

We used to live in California. We don't anymore. A little too much insanity down there.