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Richard Rider

Breaking Bad: California vs. the Other States – Revised 22 July, 2011

Here’s a depressing but documented comparison of California taxes and economic climate with the rest of the states. The news is breaking bad, and getting worse (I keep updating this fact sheet):

California has the 3rd worst state income tax in the nation. 9.3% tax bracket starts at $46,766 for people filing as individuals. 10.3% tax starts at $1,000,000 LINK

Highest state sales tax rate in the nation. 7.25% (as of 1 July). 7% is next highest (does not include local sales taxes)
LINK
Table #15

California corporate income tax rate (8.84%) is the highest west of the Mississippi (our economic competitors) except for Alaska. LINK #8 — we are 8th highest nationwide.

California’s 2011 Business Tax Climate ranks 2nd worst in the nation. LINK

Fourth highest capital gains tax 9.3%  LINK

Highest gasoline tax (averaging 66.1 cents/gallon) in the nation, (January, 2011).
LINK (also highest diesel tax – 76 cents/gallon)

California is ranked 14th highest in per capita property taxes (including commercial) – the only major tax where we are not in the worst ten states. But CA property taxes per owner-occupied home were the 10th highest in the nation in 2009. LINK and another LINK

California’s 2011 “Tax Freedom Day” (the day the average taxpayer stops working for government and starts working for himself) is the 6th worst date in the nation – up from 28th worst in 1994, but down from 4th worst in 2009. CA “improved” only because of our state’s soaring unemployment rate – the new tax dodge!  LINK

California has the 2nd highest state unemployment rate. (June, 2011) 11.8%. National unemployment rate 9.6%. National unemployment rate not including CA is only 8.8%, making the CA unemployment rate 34.1% higher than the other 49 states  LINK

California needlessly licenses more occupations than any state – 177. Second worst state is Connecticut at 155. The average for the states is 92. LINK

For the 2007-08 school year, the Los Angeles Unified School District spent $29,780 per student. The district also has the country’s second lowest graduation rate of 40.6%. LINK

CA public school teachers the highest paid in the nation. CA students rank 48th in math achievement, 49th in reading.
LINK
page 36

1 in 5 in Los Angeles County receiving public aid. LINK

California has 12% of the nation’s population, but 36% of the country’s TANF (“Temporary” Assistance for Needy Families) welfare recipients – more than the next 7 states combined. Unlike other states, this “temporary” assistance becomes much more permanent in CA.   LINK

California prison guards highest paid in the nation. LINK

For every dollar California pays to D.C., we get back 78 cents. We rank 43rd worst. LINK

California is the worst ranked state for tax administration – another anti-business factor. LINK

California now has the lowest bond ratings of any state, edging out Louisiana. LINK

The American Tort Reform Association ranks CA the worst state “judicial hellhole” – extremely anti-business.
LINK

America’s top 500 CEO’s rank California “the worst state in which to do business” for the 7th straight year (May, 2011).
LINK (It’s worth reading the short article, and especially the part about California.)

California, a destitute state, still gives away college education at fire sale prices. Our community college tuition is the lowest in the nation. How low? Nationwide, the average community college tuition is about three times higher than California CC’s. LINK. Chart 5 on page 8
This ridiculously low tuition devalues education to students – resulting in a 30+% drop rate for class completion. In addition, 2/3 of California CC students pay no tuition at all – filling out a simple unverified “hardship” form that exempts them from any tuition payment, or receiving grants and tax credits for their full tuition. LINK

On top of that, California offers thousands of absolutely free adult continuing education classes – a sop to the upper middle class. In San Diego, over 1,400 classes for everything from baking pastries to ballroom dancing are offered totally at taxpayer expense.  LINK

Protests about increased UC student fees too often ignore one crucial point — all poor and most middle class students don’t pay the “fees” (our state’s euphemism for tuition). There are no fees for California families with under $80K income. Moreover, Pell Grants and federal tuition tax credits covered the total 2009-10 fee increases for nearly 3/4 of all undergraduates with household incomes below $180K.
LINK and LINK

California residential electricity costs an average of 32.4% more than the national average (far higher in San Diego County). For industrial use, CA electricity is 70.8% higher than the national average (May, 2011). LINK

It costs 38% more to build solar panels in California than in Tennessee – which is why European corporations have invested $2.3 billion in two Tennessee manufacturing plants to build solar panels for our state. LINK

Consider California’s net domestic migration (migration between states). From April, 2000 through June, 2008 (8 years, 2 months) California has lost a NET 1.4 million people. The cumulative net annual income lost from this 8 year out-migration comes to about $26 billion. Net departures slowed in 2008 only because people couldn’t sell their homes. In 2010 we lost “only” 72,000 net people to domestic migration. Again, note that this is NET loss. LINK and LINK

These are not welfare kings and queens departing. They are the young, the educated, the productive, the ambitious, the wealthy (such as Tiger Woods) – and retirees seeking to make their pensions provide more bang for the buck. Some of these departing seniors are retired state and local government employees fleeing the state that provides them with their opulent pensions – in order to avoid the high taxes that these same employees pushed so hard through their unions. And once they move out of California, our state can no longer tax their California-paid pensions.

As taxes rise and jobs disappear, we lose our tax base, continuing California’s state and local fiscal death spiral. This downward spiral must stop NOW.

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5 Responses to “Breaking Bad: California vs. the Other States – Revised 22 July, 2011”

  1. Robert Bosich Says:

    Recent Org. Cty city regulation revisions for routine a/c change out. Hmmmm….

    Scenario: Replace existing roof a/c. Must get structural engineer drawings and calculations…cost $350-1000. City charge to review structural engineer’s work….$110. Per hr. with two hour minimum. Then regular City permit cost and expensive duct testing/remedial repair of any notable duct leaks. And $150. for inspector normal inspection of work…

    Time delay prior to commencing a routine a/c change out…..est. up to two weeks. Revised regulations costs…totals to the moon!

  2. Richard Rider Says:

    These local “fees” are spreading and GROWING like wildfire.

    I put in solar electricity on my roof in 2009 and the city charged me a $100 fee for “review and inspection,” though no city inspector ever appeared.

    (BTW, the REAL solar inspection is done by the local utility, which has genuine concerns about DC power coming back into the grid during a power outage. It’s a doozey of an inspection and, like many solar installations, we “failed” the first time, so we had to improve and be reinspected by SDG&E. All well and good. And free for the resident (it’s probably subsidized by state and/or federal government — or other utility customers.)

    The next year the city adjusted their solar fee for the cost of living — it went from $100 to $600. And they still do nothing except shuffle paperwork, I’m told.

    Similar dramatic rate increases have occurred for installing a new water heater and other instances — I don’t even want to know what they now charge for a room addition.

    Remember Dukes of Hazzard? Boss Hogg always trying to figure out how to gouge money out of the populace?

    Welcome to Hazzard County.

  3. Robert Bosich Says:

    Local fees and regulations are fleecing contractors of time, long term viability and competiveness

    Grey market operators are taking over the construction trades….they have declared economic war on government in a battle for survival similar to in third world economies.

    Grey market louts have no insurance, accountants, bank accounts, worker safety training, benefits or career paths…

    Yes…they do roof work in 110 degree heat for $14.00 per hour as a big time political advisor recently quipped….what does “play by the rules” mean anymore?

  4. Richard Rider Says:

    Oppressive taxes, “fees” and regulations have unintended consequences. Perhaps it’s time for the business community to actively take more pro-taxpayer and pro-consumer positions.

  5. Robert Bosich Says:

    Consumer groups hide big salaries behind nonprofit status! Most are in the cart begging for goodies too! Example; health groups gain favorable benefits from Obamacare….

    Business groups neutered and ineffective from media bashing….corporate jets, luxury boats, loopholes! Big salaries and lots of banquets, golf and prime rib….your at SUBWAY quaffing a five buck foot long grinder!

    Who do you trust?