The Continental Economics Institute Currency Review
Tuesday, March 13, 2012
California in crisis
California's Greek Tragedy - No one should write off the Golden State. But it will take massive reforms to reverse its economic decline.
California's rising standards of living and outstanding public schools and universities once attracted millions seeking upward economic mobility. But then something went radically wrong as California legislatures and governors built a welfare state on high tax rates, liberal entitlement benefits, and excessive regulation. The results, though predictable, are nonetheless striking. From the mid-1980s to 2005, California's population grew by 10 million, while Medicaid recipients soared by seven million; tax filers paying income taxes rose by just 150,000; and the prison population swelled by 115,000.