A quarterly magazine of urban affairs, published by the Manhattan Institute, edited by Brian C. Anderson.
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Cali to Business: Get Out! « Back to Story
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I forgot, Texas here I come,
I am a business owner in So Cal. Lets see for 15years my job was to go to work in a firms mailroom and determine what changes areneeded to make the company run more effiencent. I got paid a commission which is determined at the end of three years, onhow much moeny I svaew the company. 50% of the monies saved and 10% for the following 2 years. My insentive was to svae as much money as possible, but I had to increase productivity, better quality of the product produced, renegociating contractfor office equipment and new equipement replaced showing the spending more money on new eqipement avoids downtime on machine failures.
I have saved a company as much as $500,000 inthe first year and productivity was increased by 30%. 100% of customers recieved 100% of materials ordered for thier companys on going training. Which the year priar to streamlining their operation, 85% of the material made it to the clients, 75% of the material unuisable, and only 25% m,made it to their smeenares on time. As a bonuse for the improvments made the customer service stronger and exsisting clients stayed and another 150 added in the following 2 years, a customers spends $50,000 minimume per year on training material alone and another $25-$50,000 on bells and whistls. WIth what was saved and new clients svaed and made the company $15,000,000 a year and saved them $500,000 a year in 6 months. for the next 2.5 yrs I trained a new manager to run it my way. I was paid $795,000 for the compamny running smooth as it should.
This company was 45 years old and employeed 300- it was a non profit, the first year following the transformation they almost filed taxes like a regular company but instead everyone got an equal bonus at the years end and then reduced what they charged customers %15 so they could maintain non profit status.
Not once did I see the city inspectors or code enforcment officers issuing tickets for unnessessary levies, ordinances issued by the city of MPLS, MN , or St Paul, in fact the city paid for our employees transportation to work if they rode pulic buses.
I have been issued fine after fine for selling on the side of the highway $600 each. I have recieved 5 fines for running my business out of my house, I pay my taxes quarterly,m last year $2,400in fines and fed/state tax. Now, I keep a record of business/personnal budget for the year and my yearly gross profit goal is too make only my budget and no more. My woife and I started this company 5 years ago as a single ownership under my wife name only, DBA and no startup money. I bought and sold my way to a place where money was just getting toi a point of bigtime profitablility. I was going to put us on a weekly paycheck of $500 each. Sinvce I wasn't a partner on paper for the business I called for information on taking taxes out for employees which woould have taking 45% of our checks on top of paying taxes. I made a discision right then and there, when I make my yearly goal, I dont work the rest of the year. So, I havent turned a profit in my company, I have hired no one becuase of that. I would have to increase 500% of what I charge for the used merchindise I sell. We have 300 new code enforcment office in Riverside Co that was just hired 3years ago. I happened to see what Code Enforcment Officer gets paid $127/hour. Federasl employees should not be able to live better than 60% of the population. They have made a case on everyone I have spoken to on our block, I have spoken to all people around my house and every section is bleeding from these bullies. I am afrad to leave my house. I have lived in my house for 10 year, I do not owe one dime on it and I am losing my house. Due to no permit, but we have an 20 year oilder trailer on property which was goiong was going to be its replacement when I had the $30,000 fopr the new permits. Why do we have to pay for a new construction permit fee for a fee already paid. I could handle paying for a replacement permit fee of $500 but nmot all of it again. So then we saved again and saved the $30,000 we went topay the fees and the said home was to old, That i couldnt replace the 1959 trailer which had black mold, water leaks, rats, wires exposed from years of abuse with a 1972 trailer totally rebuilt from pipes to wires, I foolishhly used that in my argumentand they said did i have a permit to fix my house up anbd they siad my house has to be less than 10 years old and thats final, wrote me a $1500 dollar fine for construciton without a permite . I wss doing back flips told them I am not moving becasue they would not issue a permit to fix the older house up, i was going to be homeless, unkless I bought a brandnew home and then I would be in debt once again. At night I worked on the older home, replaced evewrything with no permits and when they came to issue another ticket, i told them I only cleand it, repalced carpet with tile and painted. smoke and mirris only, I said they will have to bury me 6 feet under b4 i buy another house here Riverside ca, riverside county. The cops, fireman, code enforncement officers, and city & county worker are paid way too much, these people live i the 750,000- 1,500,000 dollar homes and they are telling us what to do on our properties, who tells them. They are f__king bullies, the cops take your car for 30days and $1,800 to get it out, if you dont have a licsence $600 tickit to go with it. The tow company has to give the city half for that 1800, code inforcement is trying to take our houses, and our businessand our cars when does it end. They dont feel the ressession like the civilians do, they get paid the same no matter what, in fact thier jobs, is not civil service, or they are not protecting and serving the community the double up on fines, on us, I bet not one government employee has fines to pay, they get a reduction in thoier taxes, when they puirchase homes they pay below market value and 0% interest loans. they get car allounces150,000 a years per gov empl. we dont need to be told how to live at home, I should be able to be proud of my workday and be safe at home, I am not and i am tired, i have no more money to give, I am done. I am tired. if I dont pay they put a lien on my property, so what but what pisses me off they charge 10% interest, so you cant fight it in court so u have to opayt it before your lisence is suspended and you loopse your car. what can i do..I need a civil rights atty....but no $$$$$$$
Great article. We are actively considering moving out of state for precisely the reasons above- high cost of living, difficulty finding a good job in other than govt service, and the inevitable decline of civic services due to union pay and pensions crushing cities and states.
It is very simple. Democrats 'love' workers. They hate everyone who signs the paychecks.
FRANCHISE TAX BOARD OF CALIFORNIA v. HYATT 538 U.S. 488 (2003) is well worth a read. The FTBC was alleged to be committing torts in Nevada against a former resident of California.
It sounds like California and Omama/dims have much in common. The US economy and the California ecomomy have much in common. Over taxed, over regulated, over unionized and shedding jobs.
Pure capitalism not crony capitalism is the answer and having a national right to work law,cut taxes and regulations. Not to mention drill baby drill and stop our dependence on foreign oil. Throw in uncontrolled spending and you have the situation Omama has our nation in. Spendind is the problem, think you're not being taxed enough? Unless you're among the approximately 50% that don't pay Federal Income Taxes.
Verfy before you can get a job,buy,sell,get a license or get any tax payer money or benefits. If you found your way here illegally you can find your way back. How much money would that save?
This sounds like our conversation earlier today.
Now I undestand why Russian Communists( or the ex-ones, as you like it) believe in the slow desintegration of the U.S.A.
You still have some independent media a schools where the danger can be reflected and translated in a plausible strategy for the lower classes...
Alena Hromádková, Prague
Boohoo, stop crying and pay taxes you communist bastards!
Mister Edwards, possibly the lobbyists are the only protection of business from the pillaging by the political class. ( I know I am grasping . . . )
If government was less into the affairs of business there would be less, if any, need for lobbyists. A reprehensible group of the lawyer class.
Let's eliminate lobbist of any kind and see what difference it makes with our lawmakers who are so indebted to them. It is my understanding many of the lawmakers become lobbists. What a vicious circle!
We may not be able to do the same with the unions, but the lawmakers have got to stop taking favors from them and stand up to them.
When will the citizens of California, after they have collapsed their State’s economy, request the prudent and frugal citizens/politicians of the rest of the U.S. to bail them out?
But then, when Californian’s were prudent and frugal, how many State’s did they help bail out?
We are the U.S. after all. We can turn on a dime if the political class just gets the right kick in the seat by the electorate.
Remember Dr. Klahn's quote "Take him to Detroit!" from the "Kentucky Friend Movie"? I think we could update like this: "Take him to California!".
Insightful and very informative, California used to be a great state and now people and businesses are fleeing to get out....that is too bad the government doesn't leave well enough alone.
Sadly here in the other Washington we are just a few steps behind California.
See this---Plenty of low-tax spots, moreover, boast congenial lifestyles and great weather, just as California does. Take Colorado Springs, which has made poaching Golden State firms a specialty. The area’s economic-development agency estimates that 30 percent of its relocated firms come from Southern California.
Obama is trying to make the entire US into California.
Long article, but a good read.-LG*
I strictly recommend not to hold off until you earn big sum of money to buy different goods! You can just take the business loans or short term loan and feel yourself comfortable
Yes, but we have sun almost year-round...;)
Not one single word on immigration or illegal aliens and their anchor babies and the huge social and economic costs and drains they have produced on California. The whole quality of life has suffered as this state, 80% white as recently as 1970, has become an overcrowded third world Mexifornia.
This can't be...Harry Reid just assured us today that all the claims of over regulation are simply Republican political stunts.
Jerry Brown is quoted as saying he "has seen rescessions, and CA always comes back."
That faith, in the grit and ambition of others, relieves Brown and others of considering he might be leading the parade off a cliff. It is a profoundly self-absorbed and ignorant state of mind.
This is not going to end well, and my remaining tenure in the state is going to be as short as I can make it. My business is going to move or I will fold/sell. It is a waste of time for me to pay for such a government, and the time for talking to them is over. I hope they are happy with what they bring to pass.
In a recent letter, I wished Brown a very long life here in CA, so that he could lose his pension when the state is finally broke.
I'm rather amazed by this article. Our company started moving out of California in the 90's. Took us 5 or six years but 3 out of 3 plants were moved to other states. I frankly cannot imagine other companies took so long to see what doing business in California was going to be like. Great employees; the attitude, work ethic and intelligence were impressive. But the regulations, no.
The voters in California wanted it like this.
Sorry, but I have no sympathy for voters who vote themselves into a hellhole, like the Argentnians under Christina Kirchner or Bolivians under Evo Morales, or Californians who are just dreaming of Utopia.
We are dying by 'a thousand cuts'. As the unending string of 'do-good' laws comes in folks leave but it is so marginal each year that we become oblivious. The state is run by Democrats in all statewide offices, by a media that is Liberal as it comes and by Republicans who don't have a resonating message nor a messenger.
But now we are falling off the cliff. The October 2011 tax revenues vs October 2010's were -21% with sales taxes and income taxes down even more. This is after the state declared that we were going to have increased revenues to cover our budget so it didn't have to be cut.
You are right, folks are voting with their feet. The bad news is that they are the ones that would oppose the current power structure leaving the Democrats with even larger majorities.
The only thing that can save California is to import a new population. The vast majority of the public are clueless idiots who believe everything they hear on tv. You need look no further than electing Brown and passing the high speed rail boondogle.
Here in San Diego they are building a new central libray we can't afford and are seriously dicussing a footbal stadium.
It's lunacy for any business that is not a retain storefront to locate or remain in CA.
What a great piece! Should be delivered to every puddin-head congress person.
Any state dumb enough to elect and re-elect the Brown Moonbeam is irremediable.
Decades ago, Democrats took control of California's educational system and eliminated the ability of students to think critically. Mirabile dictu! The sheep now are easily shorn.
And to think I'm about to start a small business. Thanks California!
This is why I moved my business from California to Salt Lake City in 2008. Well that and a few other reasons - for instance: California is now run by a bunch of lunatic leftists who care nothing for individual liberty and freedom. Individual liberty is sacrificed on the altar of social justice "equality" and other code words for collectivism. No Thanks.
Calisolar is a Sunnyvale, not Santa Clara, based company and they are building a plant in Mississippi, not Canada.
As I've said before, the Democrats in control of California could care less about economic conditions. At some point there has to be an understanding that all of what's being done by Democrats to make it tougher for the private sector is intentional, the aim being to drive Republicans out of California and to solidify the Democratic hold on power. Any loss of population can be offset with immigration, since new immigrants tend to vote for Democrats in the mistaken belief that Democrats favor the poor.
Therefore, calls on Democrats to do things to make the state more business friendly always fall of deaf ears - Democrats will make a show of taking this issue seriously but in the end nothing will be done. The reason for that is simply this - the Democratic party has nothing to gain from prosperity, since those who are most successful understand that Democrats are anti-business and vote accordingly. Why make conditions better if the result is loss of power?
As an example, take the African American experience with the Democratic Party. Since in or around 1960 African Americans have voted Democrat in overwhelming numbers. And the Democratic Party is and has been in control in virtually all of cities with large African American populations since the 1970's. In addition, hundreds of billions of dollars have been spent in anti-poverty programs aimed at improving conditions in the African American inner city communities.
Given the foregoing, if Democrats were truly interested in bettering the community, African American inner city communities should be wealthy, the population should be well educated, and there should be little or no crime. In fact of course, the opposite is true - despite being firmly in control for say 50 years, African Americans in the inner cities are subject to unbelievable amounts of crime, the education achievements are less than dismal, poverty is the rule and wealth the exception, and the African American family is in tatters with an 80% out of wedlock birth rate. All of this while at the same time, African Americans year in and year out vote close to 100% for Democrats. In fact, as shown by the NAACP, the black leadership now almost completely co-opted by and identified with the Democratic Party, upon which it depends for money and power.
At some point there has to be an understanding that all of the foregoing is is intentional, that Democrats have hit upon a formula for maintaining a huge proportion of the vote while at the same time delivering no benefit at all to the community - in fact, ensuring that the community remains poor, uneducated and the family unit non-existent. Under these circumstances one would expect that the community would look to someone else, but the Democratic lock on the media has adopted a political correctness standard under which none of the failures of the Democrats is not mentioned. In other words, don't look to a "60 Minutes" expose' of Democratic failures in the inner cities. Under the standard adopted by the Democratic media, to even mention the awful stats in the community is deemed racist.
How does the foregoing apply to California? First, Democratic leaders are applying the same permanent impoverishment techniques used successfully in the African American community to Latinos. And, the anti-business policies are driving Republicans out of the state. The terrible part of this is that no matter how bad economic conditions get Democrats never get the blame - the protections afforded by a firm control over most of the media ensure this, along with the usual race and ethnic baiting.
Is there any hope for California? Not under these circumstances. Absent an awakening by the public to the institutional corruption that has taken hold of the Democratic Party - where the party has hit upon a steady source of funding by funneling taxpayer dollars through public unions - California can expect a steady economic erosion, with finger pointing at everything but the real cause.
The surprise in all of this is how Democrats have been able to get away with this all these years. How is it that no one has noticed that, despite full control by Democrats for decades, the African American community in the inner cities never achieves wealth, education and low crime, while immigrants cycle through the community? (that's another issue - how Democrats sacrificed jobs traditionally held by African Americans in order to get votes from new immigrants). The excuses of these leaders are thin indeed, along with the corruption of those in the leadership - Marion Barry, Sharp James comes to mind.
We recently published an article looking at the slowing growth rate of the entire U.S. economy, of which California is a driving force. Taking a 60 year view, it sure looks like our economy is maturing and slowing to a stop. Considering the decades of failing education, the ever-growing body of regulation, and the ever-growing burden of government, it's not surprising. http://bit.ly/sSCZjN
Very Interesting Article. Great Job.
Three groups run California: The Sierra Club, the Trial Lawyers Association, and SEIU. The problem is, they talk. If the Sierra Club identifies a problem, they turn it over the the Trial Lawyers, who figure out a way to make money suing over the problem. They write a new rule that allows unlimited nuisance suits. SEIU goes over it to add requirements to hire more gov't employees to deal with the issue. The gov't, controlled exclusively by Democrats, rubber stamps it. The businessman subjected to these rules .... Sucka!
You've heard about Calif. being the 10th largest economy in the world? In 10 years, it will be the largest third-world country in the world. It will be the first state in history ejected from the United States by unanimous vote of the other 48 states (I don't count Vermont as a real state).
I will probably be sweating out my retirement in Texas, not my beautiful and beloved Culver City, by then. Damn, now I'm sad...
a different view...
What needs to be done is the abolition of all regulations!
I came to California from Virginia in 1975 for graduate education and never left. If my wife and I did not have kids and grandkids here we would seriously consider leaving California. Taxes are horrible, the roads have more and more potholes and our educational system is in shambles. Set up a small business and you are guaranteed city taxes, state taxes, tons of paperwork. The middle class is leaving and all that will be left will be the very rich and the poor immigrants who serve them
and then there's the hire spanish speaking illegal aliens for cheap...
Not one word in the article about California's high housing costs for employees, which is probably the most significant factor in companies relocating out of the state. This was a polemic screed, not serious journalism.
California is a prime example of liberal policies gone amok. When you allow unchecked liberalism to make the rules, business will not survive. That increases the unemployment and welfare roles and that means more people on public assistance paid for by fewer and fewer taxpayers. When the tipping point is reached, someone has to give. Freeloaders who have the entitlement mentality won't. Why would you work, when others will and will pay you to sit home and do nothing? This spells disaster for America and California will be one of the first to go bankrupt. I say, so be it.
If I were you Id get the heck outta there, abandon ship matey! Would'nt you like to live on the ocean (realestate is cheap here right now) warm gentle breezes, people who want to work!Come join us and be a friendly floridian!lol
@TMD: the enclaves of the rich will be paradise on earth, but unless someone is planning some sort of mass kill-off (and I don't rule that out), there won't be "just enough servants", but rather teeming hordes of poor people eeking out some sort of miserable existence. California, like the USA as a whole, is becoming like Mexico. It is the middle-class who will be wiped out, not the poor.
Honest businesses which provide decent paying jobs will flee. Crooked businesses, which can always find some way to evade the law, will remain. So what if there are strict rules about disposing of waste? Just don't report yourself as being in business. Pour the waste down the nearest toilet and be done with it. If and when the government catches up, just move down the street. This is how they do things in Mexico, or southern Italy, or China. The problem is not one of excess government, it's a problem of corrupt government. The government is corrupt because the voters are corrupt, and there is no easy solution to the problem of corrupt voters.
Does anyone from California read these pieces.
Oh, the fun things that happen when a socialisst entity runs out of other people's money.Soon, there will be so few adding to the economy there won't BE any economy. The only ones left will be politicians, lawyers, and those on the dole. What a fun place it will be THEN.
sloppy work...where did the 350 jobs in Ontario from Calisolar come from? In fact, they are laying off in Ontario AND in California, have 1/2 the peak of 350 employees, and will surely declare bankruptcy in the near future. Please don't make up facts to suit your premise, easy to call the company or other sources and have reasonably validated info. Shame on you!
While I agree with over 90% majority of this article I also know that California has been pronounced dead before. In the words of Churchill "This too shall pass". Taxes are high and doing business here is difficult but better the devil you know and you can't buy our weather anywhere!
Learning to live and prosper where you are has magic. In the article "Acres of diamonds" you learn that things always appear better next door and it is seldom true!
I work with California business people and business people from Nevada, Illinois, Florida, Arizona and Georgia and they all have like complaints and challenges. Learn to rise above these and win with the rules you are given. It can be done and I help owners get there.
Want more? www.assaultmarketing.com or call me at 916-230-0176
They are creating paradise on earth. At the end will be a beautiful land, with no low class worker type people to deal with, no noisy and dirty production factories, no heavy traffic on the highways, the mountain roads and ocean drives will be free of all commercial traffic. And finally the population will consist of only people who have made their fortunes and moved there including just enough servents to tend to their toys and bodies.
It is time that our elected officials realize to stop the issuing of new regulations and to scale back existing ones.