Standing on a hill in my mountain of dreams

October 28, 2009 7:39 AM

Is California finished?
posted by shakespeherian (110 comments total)

7 pages? tl/dr
How about a more inside synopsis?
Personally, I think California will still be there until the "Big One", solvency not withstanding.
posted by Balisong at 7:47 AM on October 28

Not if the three marijuana legalization initiatives are passed, and state coffers begin to fill with bright, shiny new coinage.
posted by Gordion Knott at 7:47 AM on October 28 [1 favorite]

I'm finished with it.
posted by monospace at 7:50 AM on October 28 [3 favorites]

Unfortunately I don't think taxing pot will do quite enough to scratch their 40 billion dollar budget shortfall
posted by ghharr at 7:50 AM on October 28

I was unaware that there was any practical sense in which a U.S. State could end.
posted by lodurr at 7:51 AM on October 28 [3 favorites]

*sticks in a tofurkey thermometer*

Nope, it needs to stew in its own juice for another decade at least.
posted by FelliniBlank at 7:53 AM on October 28 [1 favorite]

more inside synopsis: no.
(just guessing, I didn't read it all either)
posted by yhbc at 7:53 AM on October 28

I was unaware that there was any practical sense in which a U.S. State could end.

That's because it's retroactive; once a state fails, we erase it from all the history books (and Wikipedia) to make sure the myth of American megasuperiority is untouched. If you head into certain small towns in the Midwest, you can still find folks who'll talk in quiet tones about New Jefferson, or the Commonwealth of West Dakota.
posted by Tomorrowful at 7:55 AM on October 28 [69 favorites]

*peeks outside*

Nope, still going.
posted by Ambrosia Voyeur at 7:56 AM on October 28 [5 favorites]

Read the pundits about California's economy, and you'll learn it is "collapsing," a "wreck," and indicative of a "failed state." This is the same kind of language one hears about Michigan or Pakistan.

I am certainly aware of the struggles of Detroit, but I don't think anybody is comparing Michigan and Pakistan.
posted by Horace Rumpole at 7:56 AM on October 28 [1 favorite]

Man, have you seen Michigan? It's just like Pakistan.
posted by adamdschneider at 7:59 AM on October 28 [14 favorites]

I've been to Michigan, and Pakistan has better Indian food.
posted by box at 8:00 AM on October 28 [20 favorites]

Is this a yes/no question? This article is framed by so much baby boomer nostalgia that I find it difficult to takes his points seriously and not just see it as more grumpiness over the end of the 60s.
posted by betweenthebars at 8:01 AM on October 28 [6 favorites]

If the state weren't economically viable, then maybe. This isn't the old rust belt. Cities like Detroit and Baltimore have little reason to exist; nothing on that order is happening in California. The problems here are primarily political.

I love living in the Bay Area - I'd rather be here than in Minneapolis where I grew up or Boston where I lived for four years. I won't be leaving anytime soon. [and for the record I love Minneapolis.]

Also what betweenthebars said.
posted by MillMan at 8:02 AM on October 28 [1 favorite]

California isn't finished, but the era of "low taxes for rich people == profit for everyone!" is.
posted by DU at 8:04 AM on October 28 [7 favorites]

Your favorite city has little reason to exist.
posted by Faint of Butt at 8:04 AM on October 28 [7 favorites]

9.5% is hardly low for state income tax, is it?
posted by jewzilla at 8:08 AM on October 28 [1 favorite]

I'm in Michigan, and there are fewer guns on the Pakistan-Afghanistan border.
posted by FelliniBlank at 8:09 AM on October 28

I love how conservatives have started coming up with the meme that California is ungovernable. It couldn't possibly be that they have an immature brat in charge of their state.
posted by dances_with_sneetches at 8:09 AM on October 28 [2 favorites]

Guhhhh

I love it all the same--especially the Bay Area

He starts to lose me right there in the first sentence. Loving the Bay Area best is just a specifically Californian kind of short-sighted liberalist privilege. Not a good attribute to demonstrate as a journalist. I mean, I love living there but that's not the same thing. So, this guy doesn't give as much of a shit about Lompoc and Monterey and Redding and Mammoth and Mecca? Well, fuck 'im then. He doesn't appreciate Cali's real treasure: the diversity and history of its native culture and environs.

I hope he's like "oh when I said 'The Bay Area' I meant Benecia, and especially Tracy." That would be hilarious.

Of course, later when he bemoans "only 30% of California's 19-year olds are in college," that liberal and elitist project is a bit cemented. Is going directly to college from high school really such a concern, an indicator... or a mandate?
posted by Ambrosia Voyeur at 8:09 AM on October 28 [12 favorites]

Twenty years ago this month, I watched a portion of the Bay Bridge upper deck collapse in the Loma Prieta quake.

Yesterday, I watched a portion of the Bay Bridge upper deck collapse during the rush hour commute. Next to the bridge is its replacement, twenty years in the making, still leading to nowhere.

That California requires more than twenty years to replace this crumbling structure is a perfect symbol of my state's failure.
posted by Chinese Jet Pilot at 8:12 AM on October 28 [8 favorites]

I've lived in Michigan and was born in LA and spent most of my life in California. I think it's safe to say, all snickering snarkety-snark aside, that neither is anything like Pakistan.
posted by blucevalo at 8:16 AM on October 28 [1 favorite]

I was about to post a sarky comment about having been there recently and all the roads seemed to go somewhere, so it seem pretty finished to me. But just having read Chinese Jet Pilot's post, I won't bother...
posted by jontyjago at 8:17 AM on October 28

... later when he bemoans "only 30% of California's 19-year olds are in college," that liberal and elitist project is a bit cemented. Is going directly to college from high school really such a concern, an indicator... or a mandate?

It's not a mandate and it might not even be a good idea, but it is a data point. It would be much harder to get a data point that really accurately reflects the degree to which Californians pursue post-secondary education. And if a state's population isn't getting post-secondary education, it doesn't bode well for that state's economic future.
posted by lodurr at 8:20 AM on October 28

So, what happens if the state goes bankrupt? Does it get condemned, and nobody can live there anymore?
posted by mccarty.tim at 8:22 AM on October 28 [1 favorite]

The fact that (Tomorrowful aside) states don't actually end makes Chinese Jet Pilot's observation that much more poignant.

Similarly, Detroit or Baltimore or (tomorrow) Duluth may have no "reason to exist", but they're going to keep existing, and their residents (and the rest of the country) are going to have to keep dealing with the fact that they exist.
posted by lodurr at 8:23 AM on October 28 [1 favorite]

schadenfreude

As Michigander I was always jealous of my Cali relatives, who seemed to live in this warm, sunny, magical dream land I only saw on TV and movies.

Now look at you suckers!!! HA HA! You are almost as broke as we are!

(Except in Michigan, our industry moved out of the country. You guys are victims of your own out of control spending!)

/schadenfreude
posted by Acromion at 8:24 AM on October 28 [2 favorites]

Californians thought they could have it all - just like a movie! How cute!
posted by Acromion at 8:25 AM on October 28

Unfortunately I don't think taxing pot will do quite enough to scratch their 40 billion dollar budget shortfall.

I wonder. You might not understand how much pot is smoked here, at least here in San Francisco. On any given day of the week, say Tuesday afternoon at 2:30, I might be walking around and get a sudden huge whiff of pot smoke. I look around - no one is in sight. This happens at least 10 times weekly. And no, it's not me; other people have reported the same. And this is not in bad neighborhoods. It's just as likely to be Pacific Heights as the Mission.

But yeah, $40 billion in tax revenue from pot might be stretching it a bit, you're right.
posted by Barking Frog at 8:26 AM on October 28

It couldn't possibly be that they have an immature brat in charge of their state.

Related.
posted by exogenous at 8:27 AM on October 28

Unfortunately I don't think taxing pot will do quite enough to scratch their 40 billion dollar budget shortfall

Well, yeah, but the point is, what were we talking about?
posted by Flunkie at 8:27 AM on October 28 [1 favorite]

Summed up at the bottom of page six:

..."whoever succeeds Schwarzenegger is going to be faced with the same problems that he and past governors have faced: polarized parties, a deadlocked legislature, and a populace that, schooled in the initiative and referendum, is committed to a plebiscitary political culture that discourages democratic deliberation."

Author likes alliteration, wants double status bump for having been in the Bay Area in the sixties and for being able to use the word "plebiscitary" in an article.
posted by Graygorey at 8:31 AM on October 28 [1 favorite]

Barking Frog, the NYT article linked by Gordion Knott above cites an estimate of 1.4 billion in pot tax revenue.
posted by ghharr at 8:33 AM on October 28

That odd hum you hear in the distance? It's the sound of the populace of Colorado and Idaho grinding their teeth and wringing their hands.
posted by Ufez Jones at 8:33 AM on October 28

Acromion: if you really want to go german on us, then please spell Schadenfreude with a capital S. there are germans on here, ya know and you are hurting our Augen.

I also don't find this SL enough to merit an FPP on its own, which is why I resisted the urge to post Did Schwarzenegger drop 4-letter bomb in veto? this morning in spite of it being a great story.
posted by krautland at 8:34 AM on October 28 [2 favorites]

Yeah, when Judis starts getting misty-eyed about the Dead, Caffe Trieste, and On the Road, I lost interest almost immediately. I'm really tired of people who think that it's their mission in life to restore the Bay Area (not to mention the rest of California) to some pristine vision of what it once was, oh lo so many years gone, in the beatnik fifties or the flower-child sixties or the Silicon Valley proto-entreprenurial eighties. Because if you take a closer look at history, the Bay Area was not such a great place for everybody in the 1950s and 1960s or even the 1980s, and it's not such a bad place for certain people now. I miss the Bay Area, or certain aspects of it, but conflating the Bay Area with California is a huge mistake, and an elitist one at that (as Ambrosia Voyeur points out).

There are places in California's Central Valley, and in the exurbs where Countrywide, Wachovia, and IndyMac sold subprime mortgages, that look like downriver Detroit, but, in Menlo Park and in Oakland's Rockridge area, where I stayed during my recent visit, there were few visible signs of trouble.

God, Judis is being such a twit here. There's never any sign of trouble in Rockridge or Menlo Park because nothing ever happens there! (Actually, there's quite a bit of inconvenient violent crime that happens in Rockridge these days, spilling over from the crime that's plagued north Oakland for years, but I digress.)

I kind of doubt he's been to the Central Valley in any time in recent memory, except in his own fervent imagination.

In any event, why should anyone not take many of these musings with a grain of salt -- since they're from someone who hasn't, by his own admission, actually lived in California since 1977?
posted by blucevalo at 8:34 AM on October 28 [1 favorite]

the problem with california is the same as it is in michigan and the u s - a republican minority are obstructing the will of the majority

somehow we have got to get back to the idea that the majority have a right to govern
posted by pyramid termite at 8:37 AM on October 28 [4 favorites]

California isn't even close to finished. These sorts of things happen more often here, due to prop. 13 and the like, but the fact is, we've got some seriously talented, innovative workers here who aren't leaving, because they have an excellent quality of life.

There are tons of corporate HQs in California, so even though the economy as a whole is hurting, we're going to see a lot of good, high-end jobs come back here first, long before the failed technology centers of Podunk make a recovery.

Yes, we have big deficits. We also have much larger revenues than other states to pay our debts off.
posted by markkraft at 8:38 AM on October 28 [1 favorite]

I've lived in Michigan and was born in LA and spent most of my life in California. I think it's safe to say, all snickering snarkety-snark aside, that neither is anything like Pakistan.

That's where you are completely and totally wrong. Michigan, California, Pakistan...

Don't you see it? They all have the letters A, I, and N. Jesus, they might as well be clones of one another.

40 billion dollar budget shortfall

I realize that $40 billion is a serious amount of money, but doesn't California have a GDP of something like $2 trillion? It's one of the tenth largest economies in the world. I think it'll survive a bit longer, despite what TNR might think.
posted by quin at 8:43 AM on October 28

Yes, we have big deficits. We also have much larger revenues than other states to pay our debts off.

California also has a systematically dysfunctional government, and has for at least a decade, that will have a harder time than most "Podunk" state governments at getting its act together to do anything like pay debts off or spend revenue wisely.
posted by blucevalo at 8:49 AM on October 28

That's where you are completely and totally wrong. Michigan, California, Pakistan...

Don't you see it? They all have the letters A, I, and N.

it's a good thing the other guy wasn't elected in november, then ...
posted by pyramid termite at 8:51 AM on October 28 [1 favorite]

> As Michigander I was always jealous of my Cali relatives, who seemed to live in this warm, sunny, magical dream land I only saw on TV and movies.

Hehehe. I could pick some strawberries and tomatoes from my yard (they just grow, like gangbusters, yes, even at the end of October) and walk to the beach today in short sleeves (no tanktop though, it's super windy right now, almost chilly.) if that would clear things up for you, Michigander.

Say what you will about our fickle economy, the weather and beauty of the place are no fantasy. Nee. ner.
posted by Ambrosia Voyeur at 8:53 AM on October 28 [2 favorites]

Well, they didn't find Bin Laden in Michigan either. But then again, Michigan is shit at cricket.
posted by goodnewsfortheinsane at 8:54 AM on October 28 [1 favorite]

ghharr, you need to consider the amount of money that would be saved by the state in not having investigate, arrest, prosecute, imprison, and then enjoy the recidivism of non violent marijuana offenders in addition to the potential taxable revenue. It would not be near 40 billion, but it would be substantially more than 1.4.

These measures won't pass though, there are too many powerful lobbying groups opposed to it.
posted by BobbyDigital at 8:57 AM on October 28 [2 favorites]

Well, they didn't find Bin Laden in Michigan either. But then again, Michigan is shit at cricket.

oh, yeah? you should see how we are at football
posted by pyramid termite at 8:58 AM on October 28 [1 favorite]

Hearing "Rockridge" always reminds me of the town in Blazing Saddles and I want to go a-ridin' into town, a whampin' and whompin' every livin' thing that moves within an inch of its life. Except the women folks, of course.

That California requires more than twenty years to replace this crumbling structure is a perfect symbol of my state's failure.

It took three years and four months to build the original bridge.

Fun fact: the western span of the Bay Bridge is actually two suspension bridges end-to-end; the eastern span is a cantilever span and five truss bridges end-to-end.

I love it all the same--especially the Bay Area

Or, as Robert DeNiro said in Heat, "duh Bay Areuh."

Well, they didn't find Bin Laden in Michigan either.

"Sorry, you just missed us." -- Al Qaeda
posted by kirkaracha at 9:04 AM on October 28 [1 favorite]

Heh. I am from the Bay Area and it is not all that and a bag o' chips. There's plenty of nice areas of CA to check out, though, beyond it.

As for state failure, I'd say we're circling the drain, but not quite there yet. But really, what does "there" mean, anyway? Every single person in the state is going to have to move to the Midwest? What the hell does it mean for a state to fail, anyway? Rocks fall and everyone dies?
posted by jenfullmoon at 9:07 AM on October 28

if that would clear things up for you, Michigander.

I'm a California native and lived in the Bay Area for close to 20 years and would still pick Ann Arbor (or numerous other places in Michigan) over almost any place in California, so, to each his or her own.
posted by blucevalo at 9:09 AM on October 28

Hearing "Rockridge" always reminds me of the town in Blazing Saddles and I want to go a-ridin' into town, a whampin' and whompin' every livin' thing that moves within an inch of its life.

Believe me, Rockridge isn't even close to being that interesting. Mel Brooks would yawn and hightail it out of there.
posted by blucevalo at 9:11 AM on October 28

When I was getting my education degree, we fledgling teachers were taught that "California exists 10 years in the future." In the realm of education, if you want to see which way the pendulum is swinging for everything from standardized testing to school funding strategies, look at California.

For those of you who did not read the article:

For a lot of thinking people, California is the future; the state has always been an example of progressive thinking, wealth creation and innovation.

The article here is investigating whether or not that particular California has ceased to exist.

The most interesting observation in the article is that there are two California economies: a shrinking white-collar, "new economy" economy that is still robust (San Mateo County's unemployment rate is below the US national average), versus a growing service sector with wages that fall below $10 an hour.

This is an excellent article. Thanks for posting.
posted by KokuRyu at 9:11 AM on October 28

What the hell does it mean for a state to fail, anyway? Rocks fall and everyone dies?

Have you ever read "Virtual Light"?
posted by KokuRyu at 9:12 AM on October 28 [6 favorites]

This article was more insightful to me than most I've read about the state government of California lately, and I think those of you who write it off because the authors inserts his own personal experiences (or for whatever superficial reason) are making a mistake.

California creates something like 12-15% of the nation's agriculture, and the majority of the nation's "culture" (i.e. movies, tv, web sites, games). It's not going anywhere. But I think this article does a pretty good job of examining the cultural and political legacies of Reagan and Brown (Prop 13) on the sorry state of our government.

Where it falls short, I think, is analyzing the implications for the future and examining possible correctives.

I think the problems that California is having now--rising education costs, growing income disparity, governmental stalemate --will be echoed by other states in the future. The nation still follows California in many ways. On preview, what KokuRyu said.

(Rockridge and Ann Arbor are extremely similar college-town suburbs, imo. The biggest difference is that I'll take Rockridge's weather from September until May. I do not like snow on my birthday (mid-May). I also think that Rockridge is more interesting than Albany or Alameda, although I've only lived here 1 month so far.)
posted by mrgrimm at 9:24 AM on October 28 [2 favorites]

Cities like Detroit and Baltimore have little reason to exist

Baltimore is still a major port. In fact, the major mid-Atlantic port traffic that used to come into NYC has been coming in to Baltimore for decades.

Other than that, yeah, it's basically a place for people who want an office or a home in a "city" location but can't afford DC. And even then, people and businesses avoid it if they can.
posted by deanc at 9:26 AM on October 28

I believe the amazing wonderfulness that is The Wire justifies Baltimore's existence. Of course the show only existed because Baltimore has terrible, horrible problems which the show features unblinkingly. So, there's that.
posted by haveanicesummer at 9:30 AM on October 28

The post's editorializing reads like my Dad eyeing food on my Mother's plate after he has cleaned off his own. Somehow I think this matters.
posted by srboisvert at 9:30 AM on October 28 [1 favorite]

"As California goes, so goes the nation."

It was a good run, but in the end, meh.
posted by notyou at 9:30 AM on October 28

(Rockridge and Ann Arbor are extremely similar college-town suburbs, imo. The biggest difference is that I'll take Rockridge's weather from September until May. I do not like snow on my birthday (mid-May). I also think that Rockridge is more interesting than Albany or Alameda, although I've only lived here 1 month so far.)

But Rockridge is much smaller than Ann Arbor. Not really geographically/political-subdivision-wise a suburb, per se, either. Rockridge is not its own political entity -- if it had its preference, it would probably do a Piedmont and secede from Oakland altogether. Ann Arbor is its own incorporated city and is 30 miles away from Detroit, so not technically a suburb of Detroit although many describe it as such.

I like the winter weather in Michigan, but then I'm a freak.

You may need to explore Albany and Alameda more. Lots there to enjoy, but some of it's off the beaten path.
posted by blucevalo at 9:33 AM on October 28

Unfortunately I don't think taxing pot will do quite enough to scratch their 40 billion dollar budget shortfall

Rough napkin math:

36 million people. Estimated 1/3 of them would be of age and willing to buy if legalized. 12 million pot smokers.

Market price for an eighth might be maybe $40, of which the state's taxes might be $10.

A person might personally go through that eighth in one month. Obviously some will smoke more, some less often. That's 12 purchases in a year.

12M*$10*12 = $1.44 Billion/year

It's enough to make a scratch, but that's about it. The state wouldn't be able to scratch out too much tax on each purchase before people start just growing their own. More people won't happen, and my estimate of frequency of purchase might be off a bit. So, maybe $5 billion as the high limit of the estimate. Quite possibly lower, and some of those "vice dollars" might come from people switching from alcohol to weed.
posted by explosion at 9:37 AM on October 28 [1 favorite]

Huh. I'm a native Michigander with loads of California relatives and most of their youngin's are moving back here to go to college. They like our seasons.
posted by Baby_Balrog at 9:38 AM on October 28 [1 favorite]

Ok, to really abuse any reasonable method of data collection and statistics and get a quick estimate of money saved on enforcement, this article says that in 2003-04 California spent roughly $25 billion on criminal justice, and in 2005 roughly 21% of California prison inmates were imprisoned for drug related offenses. So, maybe $5.25 billion not considering that many drug related crimes are probably more serious than marijuana possession / distribution etc.

Additionally, this CNN article from 2005 claims $14 billion nationwide with federal legalization, including taxes and reduced enforcement cost, though I don't think it includes state level enforcement.

And economist Jeffrey Miron, in this 2009 NPR article, states:

"Compared to the size of most federal government agencies, compared to the tax revenue from things like alcohol and tobacco, and certainly compared to the size of deficits that we have, this is just not a major issue, it is not a panacea, it is not curing any of our significant ills," he says. "There may be good reasons to do it, but the budgetary part is not a crucial reason to do it."

And he estimates around $20 Billion annually in taxes and savings, nationwide, including state-level enforcement. A tiny fraction of $2979 billion (not including Iraq and Afghanistan!) in annual federal spending.

I definitely think legalization is worthwhile, but it's not going to bail anyone out
posted by ghharr at 9:39 AM on October 28

Subtract billions for reducing paramilitary police forces and the private prison industry and releasing un-taxable non-violent drug offenders from prison, more billions from tax revenue for pot and for people not in jail who now have taxable incomes. Seems like win-win in every respect, even if it only covers a fourth or a third of the shortfall.
posted by Blazecock Pileon at 9:45 AM on October 28 [1 favorite]

A big part of the problem with California is the budgeting shortfalls combined with mandatory balanced budget requirements when multiplied by the economic downturn means that they are shortchanging their future. They've had schools which didn't work for decades, and now they've had to layoff, just in 2009, over 26,000 teachers and school staff, leaving their already overburdened, failing schools even more understaffed and doomed than before. Trading off budgetary concerns today for and even worse educated (and therefore lower earning and less able to support the state with taxes for services) populace in the future is NOT a winning scenario.

Someone upthread said something about CA needing to stew in its own juices for another decade or so. It will, and the results will NOT be pretty.
posted by hippybear at 9:49 AM on October 28 [2 favorites]

They like our seasons.

You know--I do love Autumn, but Spring kind of sucks, and seriously? Fuck winter. Hard.
posted by adamdschneider at 9:52 AM on October 28 [1 favorite]

California is kind of like our Italy. It is warm all the time, beautiful scenery and it is kind of the cultural heart of America. At worst it'll be a tourist location and the kind of place you sort of sigh about in the dead of winter, imagining yourself in a beautiful office overlooking Malibu and the beach.

The California rewrite of Bicycle Thieves sort of writes itself. At the end, the protagonist will stumble upon a hipster bar after a Critical Mass rally and steal one of the fixies from the pile outside. The skinny jeaned twenty-somethings notice and chase him in vein as he struggles to pedal uphill ... only to be hit at 45mph by a drunk Lindsay Lohan in a Chevy Suburban. Fin.
posted by geoff. at 9:54 AM on October 28 [7 favorites]

Here's what I propose we do, should California fail: The FTC comes by unceremoniously, divides up the assets, and starts auctioning off parts of California. The deserty parts no corporations want get put up for grabs under a new homestead act.
posted by mccarty.tim at 9:55 AM on October 28

.... and goes for a surprisingly high price, since it's now ideal for building solar power generation plants.
posted by lodurr at 10:03 AM on October 28

California is a garden of Eden, a paradise to live in or see;
But believe it or not, you won't find it so hot
If you ain't got the do re mi.
posted by squalor at 10:03 AM on October 28 [2 favorites]

Well, assuming we don't all bow ourselves up, all that Californians have to worry about is breaking off from the United States to go hang with Hawaii. Alaska can come too.
posted by clearly at 10:14 AM on October 28

Market price for an eighth might be maybe $40, of which the state's taxes might be $10. A person might personally go through that eighth in one month. Obviously some will smoke more, some less often. That's 12 purchases in a year.

First, legalized marijuana or decriminalized marijuana will not be $40. It'll probably be more like $10 for 1/8th. You won't find people smoking an 1/8th a month, that's quite a bit. In countries where marijuana is decriminalized the number of chronic users really doesn't rise that much, which shows that those who like marijuana generally have found it regardless of legality.

Revenues will not be like alcohol as marijuana is not addictive, and while there is some tolerance it is not enough to significantly increase consumption (unlike alcohol and opiates). It is also not a social drug and decreases the consumption of alcohol, so you really cut into the revenue streams of places like bars. It is also very easy to grow in the garden sense. You can't just throw a bunch of seeds in a field and not tend to it, but you can produce quite a bit of high quality with relatively little effort.

I have no doubt there will be a market for marijuana, I just don't think it would be a good source of revenue. You'd have a lot of thin profit market leaders like Phillip Morris and a lot of little craft beer type places creating the large profit items. You're simply not going to produce the revenues that you can throw huge taxes on. Those only work for inelastic goods. Marijuana would probably resemble a hobby industry in so much the people who consume the highest amounts of marijuana related revenue would also be a large producer.

Legalize marijuana because it puts a disproportionate amount of minorities in jail, creates black market distribution and crime, and because it simply is not that harmful. Don't legalize it expecting to solve any state revenue problems. That should never be the yardstick of legalization.
posted by geoff. at 10:14 AM on October 28 [1 favorite]

California is kind of like our Italy.

All mobbed up, with a buffoon of a chief executive?
posted by adamdschneider at 10:17 AM on October 28 [1 favorite]

To answer:
mccarty.tim
So, what happens if the state goes bankrupt? Does it get condemned, and nobody can live there anymore?

and jenfullmoon
Rocks fall and everyone dies?


California is broke - the bad thing that concerns many folks is if the state defaults on its bonds and other debt obligations or if people think that this might happen. Right now California is borrowing money to pay for cash it has already borrowed, and really needs to continue having credit. If the state can't get credit, or can't get enough credit to pay its bills then it will have defaulted and be in a bad place. And this is a lot more money that just 40 billion*.

Defaulting would mean a number of things - remember the state borrowed money to pay for all s sorts of things like pensions, buildings, bridges and pretty much every large scale capital project would stop. Some debts would have insurance (and/or things like credit default swaps) to cover such emergencies - so not everything completely fail or stop, in particular things like pensions ought to be covered in such a way. This assumes whoever provided that insurance can cover such large obligations - this is the sort of thing banks like AIG was/are big into, and would place a major strain on that system.

So the first thing is state infrastructure projects/maintenance would stop. Second, the state would run out of cash flow pretty quickly - non essential services provided by the state or funded by the state would stop or become severely reduced. There is special funds set aside to help prevent such happenings - but I am guessing only the Feds would have the resources to bail out California. When New York City defaulted on it's muni bonds - it was too much and the feds had to step in, and this is much much bigger. The feds coughed up under 2 billion for NYC, this would likely cause lots more than even covering just the 40 billion shortfalll*.

Third, the cost of borrowing money is very high, and with a default become insane. As it currently stands, California is the worst rated (ie: most likely to default) state in the nation, and must pay much more to borrow money. This means that more tax dollars have to be spent on paying interest, instead of teachers or roads. Residents of California would get less services for their tax money. That's today- if the state defaults the cost would be very high - and the state would be have

Forth: folks who lent the money to California get burned - and lost their shirts. Also: everyone gets sued, as investors will sue who-ever was dumb enough to lend California the cash (hindsight being 20-20 and all that), the investors sue the state, the state sues its insurance to get the cash and all the counter parties also line up for a piece of the corpse. Not pretty. It becomes lawsuit galore. Very large, very wealthy organizations could loose piles and piles of real money, that was "safely" put into California state bonds. A parking garage in Spokane WA turned into a blood bath of lawsuits. Also: all this is bad news for other states & cities (who use similar financing) as that pool of money sunk into California in is now gone, and the investors aren't going to be all that keen on investing in other states that also show signs of weakness.

That's just off the top of my head. I'm certain there is more.

*remember: this is a structural issue: they don't owe just 40 billion. Imagine your monthly credit card payment was 40 billion. You need 40 billion just to pay this month's bill, next month there will be interest on that debt, you are going to need more than 40 billion just stay afloat next month. This is the spot California is in. They need 40 billion just to tread water. Next year they will need more - the structure of their funding means they will be chronically short of cash and unable to even be able to service their debt.
posted by zenon at 10:18 AM on October 28 [5 favorites]

What the hell does it mean for a state to fail, anyway?

Huge earthquakes, riots, and giant wildfires.
posted by dirigibleman at 10:25 AM on October 28

But yeah, $40 billion in tax revenue from pot might be stretching it a bit, you're right.

Not as much as it seems--it's not just the tax revenue the state would receive directly, but you're talking about an industry with annual revenue somewhere north of $12 billion (even conservative estimates acknowledge that it is easily California's biggest cash crop), so if that's legalized you get all the benefits of those farmers and retailers becoming legit, and my understanding is that the BIG money is actually the money not spent in law enforcement, prisons, courts, etc.
posted by LooseFilter at 10:39 AM on October 28

blucevalo said California also has a systematically dysfunctional government, and has for at least a decade, that will have a harder time than most "Podunk" state governments at getting its act together to do anything like pay debts off or spend revenue wisely.

Absolutely. The state needs a Constitutional rewrite, and more people realize this. The initiative process and the budget process are the first things we need to get working differently. We need to stop peacemeal special interest-driven initiaties, and we need a structure to enable a legislature to pass a budget - - budgets currently require 2/3rds vote to be passed.

More here

The article is pretty interesting, if long. I find the criticisms based on the writer's insertions of his own experiences peculiar.
posted by artlung at 10:42 AM on October 28 [2 favorites]

Seasons are overrated.
posted by josher71 at 11:17 AM on October 28

Yeah, criticize the writer's style all you want, the issues he raises are legitimate.

I know we all like to dump on Prop 13 as the ultimate source of all evil, and as a liberal in good standing, I ought to do the same. And yet, I can't quite point the finger and say "here is the source". Sure, 13 is messed up - especially the commercial real estate tax part of it, where wealthy corporations like Disney get away with paying peanuts and are in effect subsidized by the the state. And sure, the political forces behind prop 13 were and often still are unsavory in the extreme.

And yet, we do ourselves a disservice by dismissing the sentiment behind prop 13 as coming from simple selfishness and shortsighted temper tantrum by the well to do. It is intellectually dishonest.

Let us remember how prop 13 started - little old ladies on fixed income were being pushed out of their homes by relentless tax increases funding an ever expanding cancerous bureaucracy that had zero incentive to control waste. Guess what, if you have a never ending supply of money through the simple expedient of increasing property taxes, you will never ever cut a single expenditure, no matter how wasteful. The bureaucracy has no incentive to stop growing. Short of money? Just increase the property tax - problem solved! How do you stop that? Efficiency experts will claim that you have to put limits on the ability to keep going to the well. Otherwise, it's like uncontrolled locusts, the entire landscape will be consumed down to the last seed. Only prop 13 wasn't so much driven by recherche theories of efficiency, as by simple self-defense - if you keep raising property taxes, at some point, nobody will be able to afford a house or property. There has to be a balance. Now, prop 13 was an over-reaction where the pendulum swung too far to the other side. Yet, it was a legitimate reaction to the pendulum's previous position - way too far on the side of irresponsible taxing and funding policies.

So how do you achieve a balance between legitimate expenditures and cutting waste? The Republican response - and proposition 13 - is an essentially pessimistic response: "there is no hope of ever controlling the expansionists, and so we must put in a hard inflexible limit, no ifs buts or maybes". Republican: "he can't stop drinking - so I'm going to cut off all his money". Democrat: "how dare you cut off all his money, every man has rights and you are oppressively trying to deny someone the exercise of their free will". What we need: "drinking is a problem, but with no money at all, he'll starve to death". With increasingly polarized parties in the present political system, middle ground of What We Need is going to be pretty impossible.

We need to reform prop 13. No question. But for all that, we also need to address deeper problems of how we allocate money and how do we prevent waste, otherwise there'll just be another prop 13+ all over again, since it addresses legitimate issues, even if many of the original sponsors were pretty unsavory.
posted by VikingSword at 11:21 AM on October 28 [2 favorites]

7 pages? tl/dr

Seriously? Is Metafilter over?

OK, no, here's a good summary:

For a lot of thinking people, California is the future; the state has always been an example of progressive thinking, wealth creation and innovation.

The article here is investigating whether or not that particular California has ceased to exist.

The most interesting observation in the article is that there are two California economies: a shrinking white-collar, "new economy" economy that is still robust (San Mateo County's unemployment rate is below the US national average), versus a growing service sector with wages that fall below $10 an hour.

The other bit that's key is the observation that the high-tech industry has "extremely high rates of productivity, which means they increase their output without creating millions of new jobs. From 2001 to 2007, California's information industries increased their output by 21 percent, but lost 6.9 percent of their jobs. In addition, the jobs these high-tech industries tend to create directly are high-wage jobs that require advanced degrees, while the jobs they create indirectly are low-wage service-sector jobs at homes, restaurants, offices, and hospitals. So, by their nature, they exacerbate the segmentation of California's economy."

This is an interesting counterpoint to the popular wisdom that innovation will drive general prosperity and investment in high-tech / information economy skills is what will secure personal prosperity. The tea leaves quoted here seem to indicate that on the contrary, the prosperity yields go to a shrinking pool. We're following Manna-like tech and economic trends. And meanwhile combining them with politics that hobble the public sector.
posted by weston at 11:29 AM on October 28 [6 favorites]

Wait a minute, wait a minute ... there are places you can still get an eighth for $40?
posted by The Great Big Mulp at 12:00 PM on October 28

Maybe in Pakistan.
posted by Tacodog at 12:19 PM on October 28

Seasons are overrated.

I can't agree. I actually left California--the Bay Area, to be specific--because I missed the seasons. Where I grew up there were several times during each year in which staying outside too long meant almost certain death. I missed that, so I left.
posted by MarshallPoe at 12:40 PM on October 28

Is California finished?

If the answer is yes...I hope that means I can finally afford a house here!
posted by thisperon at 1:09 PM on October 28 [1 favorite]

Wait a minute, wait a minute ... there are places you can still get an eighth for $40?

I supposed that weed would cost $40/eighth if legalized, if only because the Fed and the state would each want a significant chunk of tax, both as a "vice tax" concession to those opposed to weed, and as a naked cash grab. It was just a number thrown out there to do some napkin math.
posted by explosion at 1:24 PM on October 28

The author treats California as its boosters and mythologists would like it to be treated: As an island.

Though, historically, it's often been so, it's worth remembering that the forces of globalization-- specifically, the fact that the KnowledgeWorker jobs that have added so much to the state's bottom line, and that have so often rescued it, have, by their very success, created competing tech industries all across the world.

Yeah, it's convenient to have well-trained, culturally similar employees just a Nerf football's throw away. But it's much, much more convenient to have guys who'll do pretty much the same caliber of work at twenty percent, or sometimes fifty percent, less.

Just as imperial Britain pretty much raised the bar for local governance (and mass atrocity)-- and then was sloughed off by its various colonies and holdings, the US has raised the bar for knowledge distribution, and is in the process of sloughed off by the rest of the world.

In a sense, the internet will probably be remembered as the US's crowning, and killing, achievement.
posted by darth_tedious at 1:29 PM on October 28 [3 favorites]

Where I grew up there were several times during each year in which staying outside too long meant almost certain death. I missed that, so I left.

Yeah, I wouldn't miss that. But, thankfully we can all have what we want.
posted by josher71 at 1:52 PM on October 28

We need to reform prop 13. No question. But for all that, we also need to address deeper problems of how we allocate money and how do we prevent waste, otherwise there'll just be another prop 13+ all over again, since it addresses legitimate issues, even if many of the original sponsors were pretty unsavory.

VikingSword: I'd mostly buy your analysis of Prop 13 except for one key point which you elide. Prop 13 doesn't just make it impossible to increase property tax rate, it also limits the increase in property taxes in absolute dollars regardless of how much your home value increases. Putting a hard limit on property tax rates would be fine with me, but you can't cap the rate of increase of the property tax or you end up with what we have now.

If your home value doubles, you should pay twice as much in property taxes. That's the entire point of property tax; to do otherwise creates all sorts of awful mess.
posted by Justinian at 2:19 PM on October 28 [1 favorite]

Yeah, criticize the writer's style all you want, the issues he raises are legitimate.

I'm not really criticizing the writer's style, per se, nor do I have an issue with his issues -- after all, I fled California myself. It'd be nice not to have him yammer on about how glorious California was in the Joan Didion heyday, but whatever. What bugs me some is that he hasn't lived in California since 1977. Isn't that more than a minor glitch? Of course you don't have to actually live in California to write about it, but -- you know what? It helps. Especially when you're going on about how much you once love(d) it (fire up the eucalyptus-scented incense and the well-worn copy of Heart Like a Wheel here) but that it's on track to become a failed state on par with Somalia.
posted by blucevalo at 2:22 PM on October 28

i'd rather be living in a beat up van in California than a nice home in the Midwest. I'd never have to experience another Chicago winter, or the 5 months of grey skies.

besides, it's not like the economic picture here is any better. any reasonable look at our stats yields unemployment reaching 10%, property tax spiking even with falling prices, and a metropolitan infrastructure that is literally falling apart.

i don't really care if california is failing financially. it will get resolved, somehow. i love it, i love the amazing and cheap pot, and the weather and the scenery are incredible. i think i'll start packing that rusty van now.
posted by ninjew at 2:46 PM on October 28 [1 favorite]

it's on track to become a failed state on par with Somalia.

I don't think he's talking about that. He's talking about the end of California a microcosm of the American dream, not a complete social breakdown.
posted by weston at 2:47 PM on October 28

First, legalized marijuana or decriminalized marijuana will not be $40. It'll probably be more like $10 for 1/8th. You won't find people smoking an 1/8th a month, that's quite a bit.

[citation needed] Plenty of people could go through that much in far less than a month. I'd bet it'd be more like coffee or booze, a wide range of prices and quality. That being said, my experiences with decriminalized buying -- dispensaries and in Amsterdam -- showed that it wasn't all that much of a bargain. Most of the legalization plans for CA are flawed in their lack of planning for cultivation and distribution: Farmer John is still not in a position to replace his tomatoes with Monsanto cannabis so it'd still be a criminal enterprise to some extent, as it is in Amsterdam.

No discussion of decrim would be possible without referencing loquatious's take on it.
posted by Ogre Lawless at 2:48 PM on October 28

I've never lived in CA, but I do live in the state that it displaced as the most populous and most important (NY). California's probably going to suffer the same fate as the Empire State - a long slow decline (that's still going on here) that will hopefully be buffered by the state's strengths, and prevent it from hitting rock bottom. The out of control spending and calcified political system will also prevent any meaningful reform in the short term (it's not a mirror image of New York, they're dysfunctional in different ways, but the important word is dysfunctional). Texas will probably be the new top dog soon, and CA will watch its cousin on the Gulf lap it, much as NY from 1960-on saw it's own fall from the top. The whole thing about a failed state, blah blah blah is a bunch of melodramatic crap - even now, after it's fall from the top, NY is still an important state, and many young folks still look to move here - I can't see it being any different for CA.
posted by Calloused_Foot at 2:50 PM on October 28 [1 favorite]

I don't see Texas as the top dog. It has many dysfunctions of its own.
posted by blucevalo at 3:08 PM on October 28

Wait a minute, wait a minute ... there are places you can still get an eighth for $40?

Guy who used to live above my sister-in-law sold it for $50 a quarter. (!) He claimed it was "organic." Uh-huh. It was pretty good (and pretty great for the price).

A person might personally go through that eighth in one month. Obviously some will smoke more, some less often.

I think the average for regular marijuana users would be considerably higher, likely double or triple that, especially as more users turn to vaporizers. But yeah, nowhere near $40 billion unless the taxes are 50%+.
posted by mrgrimm at 3:32 PM on October 28

Given that California is well-situated to lead the way on green energy and biotech, I suspect that we will grow our way out of the deficit problems we are facing.

I think it will help that we're likely to get Jerry Brown as our next governor, too. He'd be far more likely than Schwarzenegger to be able to turn the budget around.

Not to put the blame on him, but Brown's the one who created the huge budget surpluses that gave conservatives justification for passing prop 13 in the first place.

While some candidates are talking about fixing California by getting rid of prop 8, I am actually more impressed by Brown not depending on a cure-all. I'm sure he would get rid of prop 8 if he thought it was either likely or practical to pass, but I think it would be beneficial to have a realist in power.

He knows how to work within limits.
posted by markkraft at 4:17 PM on October 28

heaves a mefi sigh adn settles in for the night
posted by infini at 4:43 PM on October 28

You won't find people smoking an 1/8th a month, that's quite a bit.

hahahahahahahhahahahhahhahhahhhahaahah!
hohohahahahaha!
posted by Meatbomb at 5:30 PM on October 28 [9 favorites]

Oh, man, thanks, Meatbomb, I missed that comment. That's the funniest thing I've read all day.

Not to get all Cheech and Chong, but plenty of folks smoke single blunts with an eighth in 'em.
posted by box at 5:51 PM on October 28

Yes, legalizing/taxing weed is a great way to improve the economy and restore educational superiority (sarcasm).
posted by niccolo at 6:03 PM on October 28

While some candidates are talking about fixing California by getting rid of prop 8, I am actually more impressed by Brown not depending on a cure-all. I'm sure he would get rid of prop 8 if he thought it was either likely or practical to pass, but I think it would be beneficial to have a realist in power.

8? You mean 13? I don't think there's a single candidate who thinks all CA econ problems will disappear if 8 is gone, though without question it would be economically beneficial to get rid of that vile thing. I think it's more like getting rid of 13 is seen as the cure-all by the left, and that too overstates things.

I'd mostly buy your analysis of Prop 13 except for one key point which you elide. Prop 13 doesn't just make it impossible to increase property tax rate, it also limits the increase in property taxes in absolute dollars regardless of how much your home value increases. Putting a hard limit on property tax rates would be fine with me, but you can't cap the rate of increase of the property tax or you end up with what we have now.

I'm not eliding anything. Prop 13 is a right mess. I just didn't want to discuss all the various ways in which it is messed up - it's shooting fish in a barrel. I thought it more important to point out that we're kidding ourselves if we think we can simply make 13 disappear and everything will be hunky dory - it won't because there were some legitimate reasons why it was (and to a degree) still is such a popular measure - it was a response to some real problems (even if not quite a proper response). If 13 disappeared tomorrow, we'd simply be back to the situation which gave rise to it in the first place, which would only generate a son-of-13 which might be even worse. The patient is sick. The quacks are prescribing bloodletting (prop 13). The response by reasonable people cannot be "take away the leeches, you're healthy" - it must be "yes, you're sick, but the leeches are the wrong prescription, however here's what we need to do, because indeed you are sick". We need to control our crazies, even if the Repubs cannot control theirs.
posted by VikingSword at 6:05 PM on October 28 [1 favorite]

Putting a hard limit on property tax rates would be fine with me, but you can't cap the rate of increase of the property tax or you end up with what we have now.

If your home value doubles, you should pay twice as much in property taxes. That's the entire point of property tax; to do otherwise creates all sorts of awful mess.

No, the original point was to allow old people to keep their homes. I don't think you realize how much property increased in value in the 60's and 70's. My parents bought their home in 65 for $18,000. By the time of Prop 13's passage it was worth $110,000. It is now worth $350,000.

It is not by any stretch of the imagination a McMansion; it is just a crummy tract home with little insulation, on a small lot, built shoddily and cheaply to house the huge masses of people moving to Calif in the 50's. The only reason my mother (now in her 70's) can afford to live there on her nurse's pension is because the property tax is fixed at the $110,000 evaluation established when prop 13 passed. Sure, if the taxes go up she could sell the house, but at her age that would be a major tragedy. She would be leaving the neighbors she has known for 44 years and leaving the church that she has attended for nearly the same length of time. All she wants is to pick the lemons off her tree and cultivate the roses in her backyard until she is too old to wield a pair of clippers. She is hoping to die in her own home and thanks to prop 13 she can manage it on her fixed income.
posted by Secret Life of Gravy at 7:10 PM on October 28 [4 favorites]

So, if I send California, like, twenty dollars, can I get a deal on an apartment in the Bay Area? Or more to the point: how broke does California have to be before I can afford to live in San Francisco?
posted by thivaia at 8:18 PM on October 28

No, the original point was to allow old people to keep their homes.

And it's legitimate to ask whether letting old people keep their homes is worth the price of the state defaulting on its debt (or even having to put more money toward servicing that debt because its bond rating gets downgraded).
posted by oaf at 8:28 PM on October 28

Ha, I notice how people say "shucks, I want to move to California" while what they really mean is "I want to move to San Francisco, WEST Los Angeles, the Coast." I suggest raising taxes on those places. Palmdale/Lancaster, East LA, Fresno, Bakersfield, Stockton, Barstow or Redding? People would rather move back East apparently.
posted by peppito at 9:06 PM on October 28

The Liberal/Socialist parasite requires a healthy conservative host to feed off of.
posted by HTuttle at 9:10 PM on October 28

"If 13 disappeared tomorrow, we'd simply be back to the situation which gave rise to it in the first place, which would only generate a son-of-13 which might be even worse."

It's hard to imagine son-of-13, if it happened, being worse. Mandatory annual reductions in tax paid would seem to be the only way. At least assessments would reset giving the state a little breathing room.

Some of the key problems with prop13 as I see it in no particular order:

• It encouraged abuse of eminent domain laws to both clear out old, low turnover neighbourhoods and also to develop sales tax generating areas.
• Tax value is inheritable. If your mother dies and leaves you her house it doesn't trigger a re-assessment.
• Growth was capped at a fixed number instead of being adjustable in some manner. A couple years of 10+ % inflation (79-81) and budgets relying on that income are boned.
• Slumps in the real estate market immediate claw back assessment caps
• It applies to commercial properties and especially larger companies who benefit the most from the distortion that a shell company owning say a shopping mall can be sold without triggering a re-assement even though the shopping mall has defacto changed hands.
• While property taxes aren't all that progressive they are much better than sales taxes which have gone up due to lack of property tax revenue. This is also a concern for poor school districts who benefited from the supreme court cases providing equal funding in the 60s who are now less able to procure special assessments.
• Passing of legislation in the early 80s allowing special targeted property taxes, commonly know as Mello Roos, which aren't subject to the limitations of Prop13 reduced much of the benefit of Prop13 while still enabling the class segregation that was part of the trigger for passing of Prop13 in the first place.

thivaia writes "how broke does California have to be before I can afford to live in San Francisco?"

This will be an interesting question. California is already visibly suffering from the budget lock up. Stuff like the recent bay bridge colapse being the most visible if relatively minor examples. The state is rapidly approaching the point where only legally mandated services will provided and that doesn't include much basic infrastructure. Property values will rapidly decline once the road network falls into such disrepair that people can no longer get to work. Another break point will be in primary education. It'll be interesting to see how high student:teacher ratios can climb before a mass exodus starts.

Secret Life of Gravy writes "No, the original point was to allow old people to keep their homes."

While that may have been one of the talking points Prop13 is an extremely blunt instrument to do so. For example the state could instead issue rebates to low income homeowners effectively capping their tax increase. This is sort of what BC does. This would avoid much of the negative effects of a blanket cap and allow the Bradys to down size from from their nine person SFH to a easy to maintain retirement villa while still keeping their taxes low.
posted by Mitheral at 9:17 PM on October 28 [2 favorites]

Ha, I notice how people say "shucks, I want to move to California" while what they really mean is "I want to move to San Francisco, WEST Los Angeles, the Coast." I suggest raising taxes on those places. Palmdale/Lancaster, East LA, Fresno, Bakersfield, Stockton, Barstow or Redding? People would rather move back East apparently.

The Liberal/Socialist parasite requires a healthy conservative host to feed off of.

Ha, I don't know if that was aimed at my comment, if it wasn't please disregard this one.

Not really, I wouldn't consider coastal Orange County to San Diego or Palo Alto to western San Jose very liberal, yet they're economically robust. And geez, what would you make of Fairfield to Sacramento? Also, Barstow and Bakersfield "healthy"? I'll have to ask the child beggars I see at the gas stations there about this. Anyways, people want to move to 'pretty' places (read: expensive places).
posted by peppito at 9:35 PM on October 28

And it's legitimate to ask whether letting old people keep their homes is worth the price of the state defaulting on its debt (or even having to put more money toward servicing that debt because its bond rating gets downgraded).

It doesn't have to be an either/or situation as others have pointed out, it just has to be rewritten so that the tax break is only available to those who have lived in their homes for 20 or more years and are retired. Why should commercial property fall under this umbrella? Why should inheritors be protected?

Not really, I wouldn't consider coastal Orange County to San Diego or Palo Alto to western San Jose very liberal, yet they're economically robust.

Orange County, home of John Wayne Airport and the Richard Nixon library, is notoriously Republican.
posted by Secret Life of Gravy at 7:00 AM on October 29

Now look at you suckers!!! HA HA! You are almost as broke as we are!

California has been through this before, many times in fact. It's a boom-and-bust state since the original Gold Rush. I left in 2005 and missed it a lot for a while. Still kinda do, but I'm not tempted to go back right now and try to find employment in this type of environment.
posted by krinklyfig at 12:58 PM on October 29

Couldn't California just pass an income tax?
posted by Monday, stony Monday at 12:38 PM on October 31

They're doing something sneakier.
posted by oaf at 12:51 PM on October 31

A bit of pessimism on the subject of muni's over here: note in particular Sheehan’s article that is embedded in the post.
posted by zenon at 12:33 PM on November 3