Thursday, October 22, 2009

California - The Future of America

The Democrat Socialists that control the California State Legislature and Republican in Name Only, Governor Arnold Schwarzenegger have bankrupted the state of California. The Golden State is a now a state with a tin cup begging President Obama for help; but even Obama could only go so far. The California state deficit is about $53 billion depending on the source of information because it is a moving number. California just can't live on the $100 billion or so it collects each year from the highest taxes in the country. California has been borrowing its way out of deficits for years to fund annual operating expenses not just roads, schools and bridges, even though technically the state Constitution requires a balanced budget. I never could figure out how this is possible. Fortunately, California can't print money, thank God. The state just sells billions in bonds at very high interest rates because of the risk. At some point the balloon will just burst because the interest payments will not be sustainable.

California raised taxes $12.6 Billion last February. This will cost the average family an additional $1,100 a year to pay for about 250,000 state employees many of whom are union employees and all of whom get very high salaries, benefits and pensions. A recent state study showed that the cost of state regulations on business was $493 billion annually. The authors concluded that the annual cost per household was $13,801 annually. What is more frightening is that these regulations cost the state 3.8 million jobs. At 12.2% official unemployment and probably 18% unofficial unemployment in August, California had the highest unemployment rate in almost 70 years ranking fourth behind Michigan, Nevada and Rhode Island.

Environmental wackos have prevailed in California adding many job killer laws that have pushed jobs out of California. These laws in addition to impossible employment regulations and very high business taxes have resulted in California being rated number 49 out of 50 worst states in the country to do business by the Washington based Tax Foundation. I know this story first hand since though I live in Nevada, my business is headquartered in California. During the last five years we have moved all jobs out of California that don't absolutely need to be in the state including mine. And, we are not alone. Most California based companies, when faced with the need to expand, have either moved overseas or to other states.

Politicians in California who run the state just don't get it. They don't see the connection between their actions and job loss in California. Does this sound familiar? President Obama and the Democrat Socialists that control Congress somehow believe that they can raise taxes, increase regulations, pass HealthScare that will cost Billions each year, pass CAP and TAX that will impact the lives of every single American in a negative way and cost the average family $4,000 a year and somehow create jobs. It is unbelievable that any responsible politician of either political party can vote for annual MULTI-TRILLION DOLLAR deficits that will bankrupt the United States. That is the part I don't get. Democrat Socialists are either the dumbest people ever to hold office or the smartest, most devious people ever elected to Congress with a purposeful scheme to create "crisis" to warrant an even bigger government power grab. I believe this is a POWER GRAB and it is a malevolent scheme like nothing we have ever seen before in the history of the United States.

Just look to California if you want to see the future of America. California is in a death spiral. Democrat Socialists in California advocate raising taxes and more regulations, which just pushes more jobs out of California, which causes even greater deficits and so the vicious cycle continues. And, this is exactly what will happen in the United States if President Obama and the Democrat Socialists are successful in enacting their Socialist schemes. It is Government Gone Wild.

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