Tax Cuts: Good or Nah?

Off Topic Politics and World Issues
626

Comparing CA and Texas is perfectly reasonable.

In terms of GDP, CA is number one, Texas is two. Big states with all the immigration issues that come with sharing a Mexican border.

OK. I know it looks like we’re all living like the Kardashians over here, if you’re watching TV. The Real Housewives of OC.

See stats on debt, and cost of living in my earlier post. Add to that… “In terms of population, CA has the 13th highest unemployment rate.” Just amazing considering the size of our economy.

"California’s real (“supplemental”) 2015 poverty rate (the new census bureau standard adjusted for cost of living) is easily the worst in the nation at 20.6%. We are 43.6% higher than the average for the other 49 states.
https://www.census.gov/content/dam/Census/library/publications/2016/demo/p60-258.pdf Table 4 on page 9

California has 12% of the nation’s population, but 33% of the country’s TANF (“Temporary” Assistance for Needy Families) welfare recipients. That’s a lot of poor people in BLUE utopia.

AND people ARE leaving. People don’t move out of a state unless they think they can do better somewhere else. And that’s not just the wealthy, and the retirees cashing out of their homes. The people migrating OUT includes working class families.

@ “Top CEOs rank CA the Worst place to do business for the past 12 years.”

It depends on if you’re interested in job creation. BUT I’m pretty sure a lot of the CA legislators agree with you on that! It’s fundamental to the way they view business. An unhappy CEO is like an unhappy meth dealer, an unhappy bank robber, or an unhappy pedophile. Making them unhappy is a moral good. LOL! The only problem is, if the meth dealers leave the state we’re happy about it. If businesses leave the state, we have no jobs. You can only hire so many people to work for CalTrans.

Regulation, bureaucracy, high costs to build, tons of fees on any business, if you’re lucky environmentalists protesting any new construction, regulation, more regulation, a climate that’s very friendly to lawsuits so as a business owner you can look forward to being sued frequently, I’m sure you’d love to move to a state with really high malpractice and lots of patient lawesuits, more regulation so as CEO of your medical practice you can give jobs to several more office workers to handle all your regulatory paperwork and compliance. Then your kids can’t afford to buy homes here, so they move out of state.

All a moral good for workers in the hypothetical sweatshop.

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627

Imagine that. The nerve of those legislators, refusing to allow CEOs to run their companies in a manner akin to how they’re run in Bangladesh. You must be one of those Coolidge-type libertarians. The business of America is business, right?

628

It is reasonable but Texas is the only place conservatives ever bring up. That’s because when you compare many of the places that have been long time places with a lot of conservative control the results have been pretty poor. My point is highlighting Texas is what conservatives do because they damn sure can’t highlight Kansas, Alabama, etc. All those super business friendly non liberal states.

California of course has a lot of issues just like all states. And given the massive population many of them aren’t surprising. Keep in mind when analyzing cost of living though…it’s always really high in places where people WANT to be. I mentioned SE Kansas where my Dad grew up. Cost of living there is incredibly low, but no one wants to live there.

Throw in some stats from this article (granted a few years old) and California is far from the list in terms of food stamps and dependency on the federal government.

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629

So, if I’m of the opinion that CA’s regulations, climate of lawsuits, and taxes are unfriendly to business… I’m in support of Bangladesh style sweatshops and zero regulation? Nice try.

Yeah, I think a lot of progressives see business and trade and capitalism as a fundamental evil. Having business people say that CA is the worst state do to business is not a societal good. Businesses are people. From the CEO, Owners, employees, suppliers, shareholders, customers, and communities that benefit from them.

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630

And yet yourself and more Americans live there than anywhere else. Must not be all bad. It is sad how many people have to move out of state because of the cost of living but there is a reason it is so high. It’s always high in places where people want to be.

And I’m not saying any of the things you listed are good. Merely the idea that no one forces people to go and stay in California.

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631

Of course it’s not all bad. It’s a gorgeous state, with beautiful weather. And many people have good jobs. There’s a HUGE ecomony here. And hey, if you make under $80,000 per year, your kids can go to college for free.

At the OC Register article, and migration. I’m not convinced, based on that article. There have been numerous articles over the years about net migration OUT, were it not for immigrants mostly across our southern border, but of course from everywhere. Not to mention looking at our friends and family. Nearly everyone we knew 20 years ago has moved, or retired elsewhere. You can buy a really nice home in Utah for $350,000. As more people can work from home, telecommute, the writing is on the wall. Anyway, I said we’d have a LOSS of citizens if it weren’t for immigration and births. I don’t think that article is really debunking that. At least, I’m unconvinced. I’ve seen to many numbers to the contrary.

632

From the article: No state had a lower per-capita movement rate than California. Yes, we Californians are the least likely to move out!

Maybe just the people you know and not on the whole? No idea I haven’t looked into it.

I think you also have to wonder if Some people moving out of the state is a bad thing. What should the goal be for everyone to live there? I don’t think you want it turning into the only state with people. A decreasing population will help with the housing issues as well I would think.

If not you can always move to Kansas. We have plenty of housing here

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633

Regulations make CEOs unhappy. You think happy CEOs are a sine qua non of an appropriate regulatory environment. I’m not sure what other conclusion I’m supposed to draw.

I doubt if most individuals holding such views would describe themselves as progressives. Socialists, maybe. Or communists. Or adherents of certain religious faiths.

OTOH, I think it’s fair to say most libertarians see regulation as a fundamental evil.

634

@ Housing is expensive because everyone wants to live here.

Yes and no. We have the highest impact fees in the nation. On average you’ll pay $31,014 per standardized single-family unit. That’s just a tax that will be factored into the price of your home. Maryland and Oregon are distant second and third with the state averages of $16,557 and $15,550, respectively.

CA also severely restricts building, so the regulations here keep housing demand VERY high. They built more new houses in Houston in one year, than in the entire state of CA. We also have onerous zoning laws, and all the new construction in my area is subject to Mello Roos taxes, a little CA legislative trick for local governments to hike taxes in newer areas to get around Prop 13, which froze the rate of increase in property taxes for existing homeowners so CA residents wouldn’t be forced to sell their homes just to keep up with taxes. That still happens of course. With Mello Roos, residents pay extra taxes to government agencies for services from sewers to fire protection. This is common in new planned communities. If you buy a new home in neighborhoods near me, you’ll pay an additional Mello Roos tax of $4,000 to $15,000 per year, and that’s on top of your regular property tax bill and your HOA dues and fees.

The progressive answer to all of this? Instead of backing off with so many taxes, they want to build more rent controlled apartments like in NYC.

635

This is news to me.

I have no idea how you got that idea from what I said. Honestly. You said that having CEOs rank CA as the worst place to do business could be considered a compliment. It’s not a good thing to have businesses leave the state and take their jobs with them. If you feel the need to defend all CA progressive policies and regulations as a good thing? Knock yourself out.

636

Hold on. There is a big difference between CEOs grousing about a regulatory environment and CEOs taking their toys and leaving. Is there evidence that businesses/jobs are fleeing CA at an untoward rate?

I don’t feel a need to “defend all CA progressive policies and regulations.” In an equivalent vein, do you feel a need to attack them all?

637

I work with a few tech companies and have experienced the move away from Silicon Valley. Here’s a recent Huff Post article about it, hardly a conservative viewpoint:

I’m also from the Denver area and can attest to A LOT of California people moving there for a number of reasons. The change in tax laws will pile on. My ancedotals see a lot of movement away from the west coast. Austin, TX has been the “new” Silicon for a while, but Denver is a new hotspot. Salt Lake City is also rumored as a next possible hub because Denver can’t keep up with the influx.

I will say my experience is fairly tech specific.

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638

Imo that makes pretty good sense. For YEARS Silicon Valley was basically the “validation test” for these high level tech companies. To be worth half a shit in the eyes of the world, you better have a silicon valley address.

As tech companies boom and prices at Silicon Valley goes through the roof, it becomes less and less worth it to meet that validation test. Couple in the number of tech companies and Silicon Valley having a finite amount of space and you’re forced to go elsewhere. Then success elsewhere becomes proof of concept and BOOM, migration happens.

Seems like the value of Silicon Valley was (and is) purely based on the perceived value of being there. Too many dumbass tech companies with more money than sense.

639

Assuming there indeed is such an exodus (no evidence to that effect is presented in the article): Per the piece, the reasons for it have nothing to do with taxes and/or the regulatory environment.

640

It’s also important to remember (to my knowledge) there isn’t anywhere near an inability by Silicon Valley to fill those spaces once people leave. Might be driving the prices down, but Silicon Valley continues to be saturated as hell.

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641

I went with HuffPost for obvious reasons. If you’re not convinced there’s a lot more showing that it is happening.

Well, the tax changes aren’t in effect yet. There are probably a few people being proactive, but the impact isn’t there yet. If you are making high income (I think it was over $150k) the state income tax deduction will get maxed and those high state taxes will hurt. If cost of living is already an issue (taxes play a roll in that), it will even more. The main driver of cost of living mentioned is real estate prices, and while there are numerous factors that impact that market, regulations are certainly one of them. I think @anon71262119 posted regarding that a while back.

Article is a bit old: https://www.inc.com/jeremy-quittner/silicon-valley-loses-residents-as-regional-costs-soar.html

I’m not pretending Silicon Valley is dead, far from it. But it has changed, and with the cap on state tax deductions it should compound the many forces that are already making people leave Silicon Valley.

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642

Ah that’s my bad. I was referring to companies coming and going, not residents.

Good point though. Bleeding residents is almost always a bad sign.

643

I don’t think the companies would 100% leave, probably just expand elsewhere. To be fair, there are many incentives towards doing this well beyond an “exodus”. Expanding your talent pool by getting out of the west coast isn’t a crazy concept for a company like Google or Apple.

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644

The HuffPo piece is about companies leaving the valley. The substantial business tax breaks in the recently-passed bill should make businesses less likely to leave, not more.

Yes, that is what the HuffPo piece indicated.

I would venture that, vis a vis the price of real estate in the valley area, the influence of demand swamps any effect of regulations.

Driving talented people away from a nexus of innovation does not seem like good economic policy to me. Per you, this will be the effect of the Trump ‘revenge’ tax policy legislation.

645

Cost of acquiring good talent and relocating with Silicon Valley’s cost of living CAN’T be cheap.