Dan Walters: Study of exodus from California doesn't prove its point

dwalters@sacbee.comOctober 21, 2012 

California's right-wing blogosphere has been all atwitter recently about a lengthy, data-packed monograph from the Manhattan Institute about what it calls a "great ongoing exodus" from California to other states.

The article proves, those on the right have been chirping, that California's liberal politicians have made it a hellhole that drives productive, law- abiding residents to other, more favorable climes.

But it doesn't prove that at all.

The article's numbers, derived from the Census Bureau, the Internal Revenue Service, the state's own demographic bureau and other sources, appear to be accurate. Over the last two decades, several million Californians have moved to other states.

But the out-migration has not been consistent. Rather, it has coincided with the three serious recessions that hammered the state during that period, one in the early 1990s, one a decade later and the latest, triggered by the bursting of the housing bubble, that still afflicts the state.

The most dramatic outflow occurred two decades ago, when the end of the Cold War resulted in a massive downsizing of California's once-huge military/ aerospace industry.

About 1.4 million Californians, mostly defense industry workers and their families in Southern California, sought jobs in other states.

That had nothing to do with California's political or economic climate.

The Manhattan Institute article concedes the state's economic cycles but then speculates that state and local government "fiscal instability," relatively high taxes, dense regulation and housing prices contributed to the outflow.

And what evidence does it provide that those latter factors played some major role? Essentially none.

A decision to leave a recession-stricken state to find work elsewhere is an absolutely rational and commendable act and new job data indicate that California's workforce is shrinking as some of the unemployed pull up stakes and decamp.

We should cheer their enterprise, be thankful that they don't remain in the state as consumers of welfare services, and appreciate that their departure makes our recovery from recession that much easier.

That said, there are legitimate doubts about California's ability to attract the job-creating investment capital we need to emerge from recession because of the aforementioned regulatory climate, high taxes and other factors, such as poor-performing schools and congested transportation.

How fast we recover economically – or whether we do – is a much better measure of our viability than whether California is gaining or losing in the movement of people from state to state. And by the way, California's population never stopped growing, and is, in fact, about 8 million persons higher than it was in 1990.

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