As Dan Walters reports in the Sacramento Bee, a new report co-authored by the famous economist Arthur Laffer, “Rich States, Poor States,” ranks California 43rd out of 50 for “economic outlook.” The entire study by the American Legislative Exchange Council focuses on California as explained in the Executive Summary:
The Golden State is only our nation’s largest state in most every economic metric, it also has a highly volatile political climate. California can move from Karl Marx to Adam Smith and back again in what seems to be the blink of a political eye. California’s experiences from its radical shifts in policy are the very essence of what we mean when we write “policy matters.”
Walters quotes from the special section that compares California to Texas:
The decline of California is probably the best evidence that we can present as to the impact of poor state policy making on the economic pulse of a state,” the report says. “California continues to increase regulations, raise taxes and spend profligately. Texas, on the other hand, has a pro-growth economic environment with a competitive tax system, sound regulations and spending discipline that will help Texas maintain its superior performance well into the future.
Wow – the excerpts being posted from this report implies that the blogger is promoting a political agenda that is somewhat inappropriate. First, Arthur Laffer’s supply side economics is discredited by the reality of current events. I know that he has reinvented himself as a public policy guru, but his credibility is severely damaged and he is all about promoting the political agenda that markets are perfect and all knowing, and government intervention in the market is always bad. Just look around and see what that theory has done for us.
Regarding California vs Texas – yes they are different words – Texas is pro-growth and anti-government. In fact, I have worked in the Texas Rio Grand Valley where the Texas pro-growth land subdivision laws allow property owners to subdivide into 500 sf parcels, and sell the land to very low income people with absolutely no water, sewer or any other kind of services. The Colonias there are no different than 3rd world slums.
I am glad I live in chaotic California and not the pro-growth Texas.