Starving the Future in California

When Joel Kotkin asks "Where did California go wrong?" it's like when Jerry Lewis sings "You'll Never Walk Alone." You've heard it done before, and you know the lyric pretty well. But you still have to hear the man sing the song he was born to sing.

For a précis of what's eating the land of the nuts and the fruits, I recommend Kotkin's latest, "The Golden State's War On Itself." Starting from the premise that Cali flourished under the mobility-and-business progressives of the mid-20th century, Kotkin charts the decline:

Between 2003 and 2007, California state and local government spending grew 31 percent, even as the state's population grew just 5 percent. The overall tax burden as a percentage of state income, once middling among the states, has risen to the sixth-highest in the nation, says the Tax Foundation. Since 1990, according to an analysis by California Lutheran University, the state's share of overall U.S. employment has dropped a remarkable 10 percent. When the state economy has done well, it has usually been the result of asset inflation—first during the dot-com bubble of the late 1990s, and then during the housing boom, which was responsible for nearly half of all jobs created earlier in this decade.

Since the financial crisis began in 2008, the state has fared even worse. Last year, California personal income fell 2.5 percent, the first such fall since the Great Depression and well below the 1.7 percent drop for the rest of the country. Unemployment may be starting to ebb nationwide, but not in California, where it approaches 13 percent, among the highest rates in the nation. Between 2008 and 2009, not one of California's biggest cities outperformed such traditional laggards as New York, Pittsburgh, and Philadelphia in employment growth, and four cities—Los Angeles, Oakland, Santa Ana, and San Bernardino–Riverside—sit very close to the bottom among the nation's largest metro areas, just slightly ahead of basket cases like Detroit. Long a global exemplar, California is in danger of becoming, as historian Kevin Starr has warned, a "failed state."

What went so wrong? The answer lies in a change in the nature of progressive politics in California. During the second half of the twentieth century, the state shifted from an older progressivism, which emphasized infrastructure investment and business growth, to a newer version, which views the private sector much the way the Huns viewed a city—as something to be sacked and plundered. The result is two separate California realities: a lucrative one for the wealthy and for government workers, who are largely insulated from economic decline; and a grim one for the private-sector middle and working classes, who are fleeing the state.

The diagnosis here is a lethal and self-perpetuating mix of anti-growth policies, taxes and fees, identity politics and massive public-sector commitments. That's familiar territory, but Kotkin takes a special interest in the way the progressive dream seems to exclude everybody except the super-rich. California is, as you have probably heard, extremely difficult for normal people to live in.

That can't end well, as (thanks to the increasing fluidity of high-paying tech and brain-economy jobs) it's even getting harder to be super-rich in California. It's also bad democracy. One of the cool things about California is that it's still a place where you see cars on cinderblocks and chicken coops in yards. I suspect what motivates the New Urbanists is not some jones to take light rail to strolling malls with high-end retail. It's something more basic: aesthetic revulsion at the unsightliness of their neighbors. If you apply that premise to progressives more broadly, many perplexing behaviors—socialists living in gated communities, hostility to small business, even L.A.'s racist one-cock-per-person regulation—begin to make sense.

Take it away, Jerry: