Another Company That Might Leave California
158 companies have left California this year to relocate to other states, and here's a new story about another one that is seriously considering leaving after evaluating six key issues of concern.
CARPE DIEM
Professor Mark J. Perry's Blog for Economics and Finance
Tuesday, November 09, 2010
About Me
- Name: Mark J. Perry
- Location: Washington, D.C., United States
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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58 Comments:
Stick a fork in California. The voters just blew their last chance when they so wisely chose Governor Moonbeam.
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after 15 years in san francisco, i am leaving and taking my business with me.
the change in carried interest tax law simply makes it far too expensive for me to pay 10.6% state income tax.
park city here i come.
I live in a state that does not have an income tax and so I was unaware of state income tax on capital gains. This is especially onerous for business owners of course, who might want to sell some or all of their ownership in California. Florida and Texas are two states with an income tax but not on capital gains.
BTW, I suggest the company move to the state of Washington, where the voters just soundly rejected another attempt at a state income tax.
Brown has a tough job in California (I don't know why Whitman would spend $140 million of her own money for the job, unless she expected a big payoff :)):
June 2, 2010
Can Jerry Brown, first elected governor of California in 1974 at the age of 36, double back to Sacramento and revive a state economy with the lowest bond rating in the U.S. and an unemployment rate clocking in at 12.6 percent?
With the state facing its third year of multibillion-dollar budget deficits—the gap for the fiscal year starting on July 1 is $19.1 billion—California's gubernatorial election is shaping up to be a referendum on who has the best strategy for fixing the Golden State's $1.8 trillion economy.
"after 15 years in san francisco, i am leaving and taking my business with me."
Good for you. I'm amazed you've been able to tolerate the nuttiness in SF for so long.
I checked election results for the Peoples Republic of SF and my jaw just dropped. Not counting local candidates who I don't know, All but one result was the exact opposite of my vote or what my vote would have been, and by really wide margins.
When asked "should we spend more money we don't have?" SF voters shouted YES. When asked "Should we spend less, or make it harder to spend?" they shouted NO.
"Should we make it easier to do business in SF?" - NO!
What IS important to SF voters is that the mayor show up from time to time at City Council meetings.
I suspect that a lot of time effort could have been saved by lumping all measures into one item titled "Shall we move directly to a socialist form of government in SF?"
If all that isn't bad enough, I'll bet the last straw for you was that the City Board of Supervisors voted to ban toys in Happy Meals. The nanny state is truly alive and well in SF.
Here's the link to SF election results.
"Can Jerry Brown, first elected governor of California in 1974 at the age of 36, double back to Sacramento and revive a state economy with the lowest bond rating in the U.S. and an unemployment rate clocking in at 12.6 percent?"
Peak, the simple answer is no. Brown's solution has always been to spend more money, but that won't work now. He may be overlooking the fact that unlike the Fed, California can't just print more money. I don't see this ending well.
morganovich is leaving San Francisco and Happy Meals are banned in SF "for social justice". Is this a coincidence? Maybe not, because the current Happy Meal super-hero has a large Mon his chest that could represent morganovich.
Yeah, but try finding a bath-house in Park City.
ron-
one of the things people are underestimating about the last california election is how much the results were skewed by the marijuana proposition.
it gave the hippies a reason to vote, and vote they did, in large numbers (though, ironically, not large enough to win that one).
they lost on pot (which is a shame, it's a dumb law) but they were the pivotal votes on everything else.
buddy-
if mild mannered morganovich wwas really a superhero in his spare time, i certainly would not admit to it on the internet.
benji-
the local availability of bathhouses really wasn't a factor in my decision. but try getting 40 inches of wasatch powder in SF...
that, and my god is park city cheap compared to SF. the price of a decent 2 BR in SF buys a massive house with views and absurd amenities in PC. the tax savings alone pretty much pay the mortgage.
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"they lost on pot (which is a shame, it's a dumb law) but they were the pivotal votes on everything else.""
Agreed. That's the one result I mentioned that wasn't the opposite of my vote.
Good luck in your new location.
thanks.
park city is a great town. epic skiing and biking, good food, pretty, and a great airport.
it's all the best parts of a small town with all the cosmopolitan amenities (and a new whiskey distillery that is absolutely fantastic).
looking forward to it a bunch.
there are lots of things i'll miss about SF, but the politics and taxes sure are not among them.
Park City is a great place. A lot of guys move to Incline Village in Nevada too.
Still, CA is the best place to live in the USA. I realize that every time I eat in any of the other 49 states.
We have the best food, best weather, best-looking women..and the worst government.
Better than having $140m buy the Governorship or having a foreign country representative(Fiorina) in the US Senate. Hopefully one of the bureaucrats finds a snag in the paperwork.
This article is more reason for a scuttling/departure tax. Can't leave if you cant afford to leave and cant forcibly bankrupt oneself out.
Oh, and the out-of-touch madam that wanted to end unemployment extensions(without knowing the lack of jobs for those unemployed Nevadans) lost. Reid won, despite his faults.
"This article is more reason for a scuttling/departure tax. Can't leave if you cant afford to leave and cant forcibly bankrupt oneself out."
Sethstorm's layabout existence is one more reason for a Mother's Couch in the Basement tax.
Ron, California now needs a super-majority to raise fees:
"Proposition 25 undoes the two-thirds requirement only on budgets. It remains in place on taxes and under Proposition 26 extended to fees."
California may either have to cut spending or pray for a faster economic recovery.
I lived in California (East Bay) for about 6 months in the late 80's, but managed to escape when the guards weren't looking.
I think the voters in California may have done the rest of the country a favor. By maintaining their path to destruction, California will serve as a powerful example to the rest of the states and the federal government on the ultimate outcome of the Nannystate in the U.S.
Morganovich, come to Tennessee and bring your money with you. No general state income tax. Everyone pays the sales tax so all the people care how state government spends their money. We went from a 50-49 margin in the General Assembly after 2008 to 64-34-1 this election.
Morganovich,
SF doesn't deserve to have business owners hustling to make a living. Let them live with the consequences of their decisions. I agree with Junkyard, come to Tennessee for the reasons he said.
Morganivich:
After you get to Tennessee, enjoy the summers, winters and "food."
You know how you can tell you are in a "fancy" restaurant in Tennessee?
The guys turn the bills on their baseball caps to face forward.
It's amazing. Liberals turned Californians into conservatives, i.e. they conserve water, electricity, gasoline, etc., and now they're turning them to religion, because all they'll have left is a prayer :)
Religious Conservatives?!
"Better than having $140m buy the Governorship"
How is somehow less ethical to spend your own money on a political campaign than to have labor unions pay for it?
At least Whitman wouldn't have owed anyone any payback.
"Proposition 25 undoes the two-thirds requirement only on budgets. It remains in place on taxes and under Proposition 26 extended to fees."
Peak, I know this. Did I argue differently earlier? My memory must be worse that I thought.
"It's amazing. Liberals turned Californians into conservatives, i.e. they conserve water, electricity, gasoline, etc., and now they're turning them to religion, because all they'll have left is a prayer :)
Religious Conservatives?!"
We are clinging to our religion and our guns, as that's all that's left.
We are also conserving the Earth by rejecting any proposal to delay implementation of AB32 which will surely, all by itself, be enough to prevent global temperatures from continuing their alarming rise.
In the future we can look back with pride and say that Nov 2, 2010 was the day the seas stopped rising and the Earth began to heal.
Ron, right. California can't go on a Brown spending spree, can't print money, and it'll be tough to raise taxes and fees.
I'm sure they've already read Obama's "The Audacity of Hope." So, it may be time for prayer :)
actually benji, the food in park city is pretty good. lots of former SF restaurateurs are bailing out and heading to places they can make money.
the new talisker property is excellent and spruce just opened a new spot. it's not SF, but PC has enough well heeled tourists to ensure a vibrant food scene.
regarding Tennessee, well, that's not really my gig. too hot and no skiing. i grew up in the humidity of the north east. no way would i move back to that.
i have the advantage of being able to work from anywhere, so might as well pick somewhere fun.
and ron, i agree with you completely regarding funding.
i would trust someone who is too rich too buy and can run on their own views and ethics long before someone who ran by selling out to unions.
Morganovich,
"i would trust someone who is too rich too buy and can run on their own views and ethics long before someone who ran by selling out to unions."
Brown didn't just sell out to the unions. According to the WSJ, he's the guy who actually gave collective bargaining to them when he was Gov back in the '70's.
And Californians just voted him back in. Amazing.
Its a slippery slope.
First municipal garbage collection, and then socialism.
Eat drink and be merry. Tomorrow you may be in Utah.
SF voters have the right to vote opposite of Ron H. Ron has the right to complain or relocate. Or run for office. They see things differently, for now. Why is Ron surprised?
I'm a Californian living in Silicon Valley. Yes, weather is good, salaries are good (I'm in HiTech) and its a nice place to live. With that said, yes, taxes are high, unions are strong. I've heard many small business owners (like Morganovich) complain about taxes, so I'm not surprised by the exodus. I didn't vote for either Gov. candidate as I didn't think much of either one. With all that said, it's not the end of the world here like some posts may indicate. I've been hearing the California bashing as long as I can remember and while some is justified, a lot is senseless babble. One more thing, probably won't retire here because of the taxes. But I'll have made a enough money that I give live very comfortably anywhere (even Tennessee).
Someone wealthy gets elected on " their own" money and all they have to represent is themselves and their own ideals.
Someone else gets elected with union money and other sources, and they represent thousands of working people.
Can't have that, can we?
Someone wealthy gets elected on " their own" money and all they have to represent is themselves and their own ideals.
Someone else gets elected with union money and other sources, and they represent thousands of working people.
Can't have that, can we?
I can work from anywhere.....
You must not have a lot of "stuff".
Property tends to turn into anchors.
When you get to Kentucky, go to a restaurant and order a grit.
brinker-
i don't think anyone is claiming that it's the end of the world for CA, just that taxes are high and going to get higher along with energy costs and innumerable regulations. this makes CA a difficult place to do business.
this will make it worse:
"California businesses already pay some of the highest unemployment taxes in the country – and the tab is likely to increase.
The recession and the Legislature's decision years ago to raise benefits have drained the state unemployment insurance fund, which now has a estimated $10.3 billion deficit.
The nonpartisan Legislative Analyst's Office, in a recent report titled "California's Other Budget Deficit," said the state will probably need to raise unemployment taxes on employers as well as reduce benefits to bring the fund back in balance."
hydra-
that's a very disingenuous notion about unions. rather than claiming to represent thousands, i think it would be more accurate to describe it as representing a small and privileged minority who routinely use political clout to raid the public coffers.
you seem upset about "rich" people getting represented, but are fine with the even smaller union minority getting theirs. at least the rich tend to create jobs and growth. unions do the opposite.
my business is a hedge fund. i just need to move desks and computers. we are leaving CA in droves. this is exactly what happened to new york (to the great benefit of connecticut).
a lot of us are looking at leaving the US entirely. there are numerous foreign citizenship available in countries with no income tax at all. sure, it's a pretty thermonuclear option, but at a certain point you'll do it.
keep in mind that the top 1% of US taxpayers pay over 40% of income tax. if 5% of that 1% get tired of being milchcows and head offshore, that's a 2% structural addition to the deficit.
perhaps we need a union of top taxpayers so we can engage in collective bargaining.
would you support the union candidate then?
At least Whitman wouldn't have owed anyone any payback.
Indeed, but it'd have amounted to something similar to the Chicago Way. If you want to object to unions, object to her as well.
at least the rich tend to create jobs and growth
...except that it's not happening, courtesy of the flatlined employment statistics.
seth-
those comments are incoherent even for you.
what basis do you have for your chicago way comment?
your comment about a lack of jobs is just nonsense. what, you think unions are creating jobs? it's a tough time right now, but look at the last 30 years and you see union industries (auto, aircraft, steel, airlines) go bust again and again while the "rich" have created an incredibly vibrant economic ecosystem founding companies and creating jobs.
unions prevent jobs by sucking up resources for a privileged few and jacking up wage costs and workforce size adjustments which encourages the substitution of capital for labor and inhibits hiring in boom times for fear of having too many workers in the next downturn.
"unions prevent jobs by sucking up resources for a privileged few and jacking up wage costs and workforce size adjustments which encourages the substitution of capital for labor and inhibits hiring in boom times for fear of having too many workers in the next downturn."
...thus pressuring the Fed, tasked with balancing inflation against unemployment, to constantly inflate the money supply to avoid unemployment.
your comment about a lack of jobs is just nonsense
It isn't. The lack of jobs being created in the US is what I am pointing towards.
your comment has no causality seth, hence, it is nonsense.
sure, jobs are tight right now, but that's a part of the business cycle.
i know that you believe that rich people ought to be required to pay you, but that's not how it works. companies hire when they have need. if they are unionized, they hire less.
your argument is the literal equivalent of arguing that the sun never provides light because it's dark right now.
"We have the best food..."...
I've hurled better looking meals than what passes for food in California...
How about those sushi shops?
Nothing like plunking down a load of cash for what most people would recognize as fish bait....
Can't have a cig in a bar?!?!
Who the heck wants to live in a state where Big Brother is always in your face?!?!
juandos-
here i have to disagree with you. san francisco, the bay area, and napa valley have the best food in the US. nowhere else even comes close. (though i do like eating in new orleans) we routinely have 2 or so of the top 10 restaurants in the world, and the neighborhood fare here beats anything in the states. the scene is vibrant, varied, and constantly evolving.
the lack of smoking is fine by me and most of us. nothing wrecks a meal like someone chainsmoking at the next table. even the french have finally cottoned on to that.
i have no problem with people exercising their freedom until it impinges on mine. i know all you smokers love to cry "fascism" and "big brother" when you are forbidden to light up, but that's because you have the wrong conception of rights.
i have the right to clean air and unmolested enjoyment of my meal. you do not have the right to engage in odious behavior to the detriment of my comfort, probable health, and dry cleaning.
if i came to a restaurant with my "comfort animal", a very nervous skunk, you'd agree that the stink i was creating was outlandish and inappropriate, even if it made me happy.
how is that any different than smoking?
at least skunk musk doesn't cause cancer.
Juandos,
Your comments are childish. I suggest you travel more and read once in a while. Remember, there is more to life than Kraft mac -n- cheese.
"i have the right to clean air and unmolested enjoyment of my meal. you do not have the right to engage in odious behavior to the detriment of my comfort, probable health, and dry cleaning."
This is a tough one for me, and I haven't totally resolved it to my own satisfaction. Although I personally (now) prefer a smoke free environment, I don't think I have a "right" to it in someone else's private business, and I object on principal to government regulation of behavior in a private setting.
I do support a restaurant owner's right to allow or disallow anyone they want, and whatever type of behavior they want in their restaurant, including smoking, loud talking, bare feet, obnoxious perfume or 'comfort animals'. I have always thought that this would have resulted in many non smoking establishments, without government regulation, as customers voted their preferences.
"here i have to disagree with you. san francisco, the bay area, and napa valley have the best food in the US"...
Ahhh no morganovich, not even close...
"the lack of smoking is fine by me and most of us. nothing wrecks a meal like someone chainsmoking at the next table"...
I said a 'bar' morganovich, not a resturant...
Do you eat in bars?
"Your comments are childish. I suggest you travel more and read once in a while"...
ROFLMAO!
Well brinker boy I've had meals, many meals on every continent but the S. Pole so maybe its time for you to 'un-ass' from the couch and try a dose of reality...
"Remember, there is more to life than Kraft mac -n- cheese"...
I wouldn't touch that stuff with your lips brinker boy, its plainly repulsive just looking at it...
j-
i fear your smokers taste buds must be leading you astray. if you think that there is better food in the US... :-P
the exact same argument holds for bars. why should i suffer for the hygiene and health choices of others? you gonna pay for my dry-cleaning to get the smoke reek out? can i bring my comfort skunk?
i have no problem with people making their own choices as long they don't negatively effect others and their rights.
how is blowing smoke on someone any different from spraying skunk musk? (apart from the smoke causing cancer)
j-
so out of curiosity, where do you think the food is better, and if it is, why do we get some many more top restaurant ratings? (especially per capita)
i'll grant you that of uranium heavy butter and cream sauce is your thing, the bay are is not for you, but if you like fresh, ingredient forward food, it cannot be beaten.
the only 2 cities that can even be reasonably compared to the bay area are new york and new orleans. of the two, i'd take the big easy every time. new york food is oversauceed and under fresh. if i want to eat a stick of butter, i can do that at home.
"how is blowing smoke on someone any different from spraying skunk musk? (apart from the smoke causing cancer)"...
Obviously your experiences with skunk are probalematic at best...
If you think equating skunk musk with cig smoke then I think you have a problem with your olfactory setup...
Oh dear! morganovich also believes in the 2nd hand smoke scam...
"the exact same argument holds for bars. why should i suffer for the hygiene and health choices of others?"...
Well why should smokers who go to bars to drink and socialize have their rights impeded just because you have some sort bizzare health fetish?
"why do we get some many more top restaurant ratings?"...
Who does your ratings and why would I assign them any credibility for their alledged prowess of finding what they consider good food?
A food critic is your basic failed short order cook with a spell checker...
"but if you like fresh, ingredient forward food, it cannot be beaten"...
Complete and total BS...
Fresh food ingredients can be found most anywhere in this country and unlike San Francisco one doesn't have to wade through throngs of urine reaking beggars to get into the front door...
I used to live in New Orleans and compared to Chicago (except for a couple of local dishes) is was a supreme disappointment...
I'd put up Chicago's resturants (even the greasy spoon outfits) against anything and everything Frisco or New York as to offer...
Here in the St. Louis area there's not much to brag about though unless its Mexican food which is excellent and there are many, many choices...
There are also some very excellent resturants that specialize in foods from Chile and Argentina...
morganovich,
"i'll grant you that of uranium heavy butter and cream sauce is your thing, the bay are is not for you, but if you like fresh, ingredient forward food, it cannot be beaten."
I'm not yet quite awake as I read this, and it may be crystal clear later today, but I have to ask: What is "uranium heavy butter" and what are "ingredient forward foods"?
morganovuch said:
"the exact same argument holds for bars. why should i suffer for the hygiene and health choices of others?"..."
juandos said:
"Well why should smokers who go to bars to drink and socialize have their rights impeded just because you have some sort bizzare health fetish?"
In a less regulated world, business owners seeking their own best interest, would decide whether to allow smoking or any other behavior in their establishment, as customers voted with their dollars.
Juandos
"Well brinker boy I've had meals, many meals on every continent but the S. Pole"
I'm assuming you mean Antartica. I stand by my original comments.
"I'm assuming you mean Antartica"...
I just knew you couldn't leave that one untouched...
This is just to easy...
"I stand by my original comments"...
Well when YOU have nothing else going for you, you might as well stand by your clueless assessments...
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