California is Toxic for Business
Just as it was in the 60s, much of the world looks toward California, the Golden State, as some sort of bless by God entity. The state offers just about every type of terrain and climate one would like, it has always been the "cutting edge" and leader where much of the USA and world longs for. Trends start in California first.
One trend that the State should not be happy with is its government which burdens the population with America's worse taxes and heavy regulators for business creation and jobs. What usually happens is that firms start here, become huge, and move away from the State to continue growing (Apple, Yahoo, Monster...). California is toxic for business. A recent poll of business execs shows that 84% said that if their business was not already here, they would NOT start here. They go to Oregon, Arizona, Texas where labor costs and taxes are so much lower. Thus, the jobs go there also. Carls Jr. restaurants have now stopped opening new ones in the State because it can take up to two years to get approval, yet, 300 will open in Texas and the average time for approval is only six weeks. In the Golden State, regulations cost the businesses $493 billion. Even the solar industry is moving to other states to avoid excessive regulations and building costs.
California taxes make little senses. Those who are millionaires are taxed at 10.3%. Those earning $47,000 and up, pay 9.3%. The corporate tax in California is also the highest, almost 9%.
Making the mire even worse is the legal system in the state that allows consumers to sue firms for just minor violations of labor and environmental regulations. California also allows for plaintiffs to sue for damages if accommodations are not made for disabled people at business establishments. One person sued 1000 businesses and won an average settlement of $4000. This lawsuit allege the business did not provide enough seats for all employees.
The overall environment for business creation is as bad as in New York, the equation is complex but without new businesses starting in the State, job creation will be flat and decline.