Tags: california | economy | taxes | public spending

California's Economic Illiteracy on Collision Course With Reality

California's Economic Illiteracy on Collision Course With Reality
(Usa Pyon/Dreamstime.com)

By Monday, 12 February 2018 02:16 PM Current | Bio | Archive

Turning points in history are seldom recognized as such until long after they have passed and it may well be that 2018 marks the beginning of the collapse of the progressive left’s aspirations for "transforming" American society.

California is the epicenter of 21st Century liberalism; Hollywood, sanctuary cities, supermajorities in both legislative chambers and a Democratic governor all call the Golden State home. The economic illiteracy of California Progressives will soon tear the California liberal status quo asunder.

In keeping with Progressive orthodoxy that the "rich" pay for free stuff for everyone else; the top 1 percent of taxpayers supply 48 percent of California’s income tax revenue; the top 10 percent fork over 79 percent and the bottom 60 percent send only 2 percent to Sacramento.

To be a "top one percenter" in California a taxpayer has to earn $556,000 per year and to be in the top 10 percent one has to earn $149,000 per year. With a tax base this small it doesn’t take many of those evil "millionaires and billionaires" to leave to blow a huge hole in California’s budget. Thousands of physicians, entertainers, software engineers, and entrepeneurs have a huge incentive to head for the exits.

The prospect of the golden tax geese flying the coop is political peanuts compared with the Progressives’ spending plans for California. In 2008, California voters approved a bond measure for high-speed rail between northern and southern California. Voters were sold on a $40 billion price tag; but estimates are now that it will cost $64 billion and be years behind schedule with fares that are barely competitive with flying on Southwest. And these are the revised estimates supplied by those that are running the project.

No progressive dream would be complete without Single Payer health care; and squeezed by a coalition led by the California Nurses’ Association, the California Senate delivered in 2017 (SB 562). Even The Los Angeles Times reported that implementation would require $200 billion in new taxes. All of this is somehow supposed to happen in a state where the 2018-2019 Governor’s General Fund Budget is $131 billion.

The collision between the dreams of the Progressive Machine in California and economic reality is coming sooner than most political observers think and it is not going to be pretty. When the politicians in Sacramento fail to deliver on the undeliverable the strange crunching noise emanating from west of the Sierras in may well be the sound of California Democrats eating their own.

John Jordan serves on the Hoover Institution Board of Overseers, and is a regular contributor for Fox News Channel, Fox Business Channel, and "The Alan Nathan Show." After graduating from Occidental College with a degree in Economics, John received his J.D. from Empire College School of Law and his M.B.A. from the University of San Francisco and is a Member of the California Bar. John has also served as a Commissioned Officer in the United States Naval Reserve and is fluent in both German and Russian. A long time pilot, Mr. Jordan holds an Airline Transport Pilot Certificate with multiple Type Ratings and is a Certified Flight Instructor. During the day John is the CEO of Jordan Vineyard & Winery. He shares his hillside home in Sonoma County, California, with his three rescue dogs. To read more of his reports — Click Here Now.

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JohnJordan
The economic illiteracy of California Progressives will soon tear the California liberal status quo asunder.
california, economy, taxes, public spending
559
2018-16-12
Monday, 12 February 2018 02:16 PM
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