There is nothing in the budget that gets to the root cause of the problem, which is that the State of California overspent when times were good and has no mechanism to rachet down spending when times are tough. Our legislature is at fault, both the Republicans and Democrats. The State simply is incapable of living within it’s means.
The tax increases will result in even greater loss of revenue because the there is even more incentive for productive individuals to leave the State. I personally pay over $1200/month in CA State tax. I will pay more with the recent increase especially when the additional taxes and fee increases are factored in. As much as I hoped the legislature would pull it’s head out of it’s ass and actually take the painful measures needed to fix the problem, I knew this budget would probably go into law.
Luckily I have a job that allows me to work anywhere in the Southwest. I have the luxury of being able to move quickly without having to look for a job and with no loss in income. Next week I’ll be in Henderson, NV looking at property, with plans to move by July of this year. Yeah, it’s only $14,400 a year California will be losing (along with my vehicle fees and such) but I would hazard that I am not the only one leaving the State.
Combined with the money I’ll save on housing I should easily have an extra $35,000 – $40,000 in my pocket. As much as I love California and San Diego in particular, it’s hard to argue with the economics of the move. I’ve thought this out for some time so this isn’t a kneejerk reaction, but I admit this latest display of governmental incompetence was the straw that broke the camels back.
And that is on a personal level. I also own a business that again, is luckily not tied to geography. I will be shutting down my CA corporation and reopening as a NV Corporation this year. When the tax increases are combined with inane and costly environmental regulations there are fewer reasons for business to locate or to stay here. We will lose jobs and more revenue.
The saddest part is that in a year, probably less, the State will be looking again to raise taxes because they can’t meet their expenses. Again we will be lied to and told that collapse and Ammageddon awaits if we don’t dig deeper and pay more. As nice as California is the people who live here and play by the rules are going to get screwed.
