Time to give up on California?

The job statistics for January have been released, and for California it is grim. Overall, the State unemployment rate was 12.5%, the highest ever recorded since the State began keeping records in 1976. In Orange County the unemployment rate jumped from 9.1 percent in December to 10.1% in January. Clearly, OC is no longer a job paradise.

In other parts of the State it is worse, particularly in the state’s 500 mile long Central Valley that stretches from Bakersfield in the south to Redding in the north. Unemployment in Colusa County is 27.4%, the highest in the state. Sutter County 21%, Yuba County 20.4%, Stanislaus County 18.1%. Even Santa Clara County, the home of the famous Silicon Valley, is hurting with a 9.7% unemployment rate.

And, these numbers do not include those who have been unemployed for a long time and have literally given up looking for work. Some estimates are that these numbers could nearly double if those “structurally unemployed” were added to the list.

The economy-driven revenues flowing to local and state government – the money that funds our schools, prisons, roads, transit systems and myriad other services – has been on the decline. Sales tax, a strong indicator of the health of commerce in our state, dropped 47% in 2009 below the level of 2007. Many homeowners who have seen the value of their homes plummet are seeing lower property taxes as a result. While that may be comforting to those homeowners, it is but another blow to the ability of State and local government to finance operations. No wonder the State budget seems to be in perpetual deficit, and we read about government layoffs, furloughs, pay and benefit cuts and other constrictions of government at all levels.

It is getting depressing, and businesses and individuals are leaving California. Often the destination is not only a state with a better economy, but also a state like Nevada, Texas or Florida that does not have a state income tax. One person I know who picked up a bargain distressed home in Las Vegas said he is enjoying the additional $1,000 per month he has in his pocket that in California went for the State income tax.

Is there light at the end of the tunnel? We have been hearing things have hit bottom, and may actually have turned the corner. Yet the January unemployment statistics seem a shock back to reality. Plus, it is looking like the number of unemployed will rise over the next few months as counties, cities, school districts and other government entities eliminate jobs in what is sounding more and more like an economic death spiral.  You may enjoy seeing government cut back and public employees laid off, but it is more bad economic news for us all.

In an atmosphere best described as a blame-game for what ails California, three names have risen to prominence in the race to be California’s next Governor (in alphabetical order): Jerry Brown, Steve Poizner and Meg Whitman. Pick the one you would most like to torture and vote for that person – the job of California Governor in 2011-2014 will indeed be tortuous and could just be impossible.  I most certainly would not wish it for a friend.

About Over But Not Out

A retired Orange County employee, and moderate Republican. The editor seriously does not know OBNO's identity as did not the former editor, but his point of view is obviously interesting and valued.