If you've lived in Humboldt County for a good while, then you have noticed the trend. Long time Humboldt residents are making the difficult decision to leave, for other states like Oregon, Washington, Idaho, and Texas. We've talked about the reasons for this migration to greener pastures, but I believe there are three more monumental changes affecting California's future that will turn this trend into a permanent exodus that will be noted by future historians.
The problem when good, hardworking people leave an area should be obvious. When the middle class leaves its hard to imagine how local school enrollments will stay up, how suitable taxes will be collected for local infrastructure and how the local traditions of the community will stay in tact.
With the California legislature running as a wild Progressive dream, here are the three things that would permanently cripple California. Rent controls, reversing Proposition 13 and a hostile takeover of Pacific Gas and Electric.
Let's take a look at all three.
Once considered a third rail of California politics, and untouchable fortress, Prop 13 could be overturned by the radical left-wing establishment in California Congress. Politicians once feared crossing this threshold that caps property taxes, and allowed for average people to flip their long time homes into good money-making rental properties. Besides restraining government spending, prop 13 was a strong protector for incentivize rental housing. A quick look at the Tax Foundation's 50 state survey shows that California is one of the worst states in the Union when it comes to taxes, but thanks to Prop 13, it only ranks #16 for best property taxes, while it ranks #49 for nearly the highest income tax. My point is, California is killing us on sales and income taxes, and thanks to prop 13, we are still at least surviving with manageable property taxes.
Overturning Prop 13 would lead to housing shortages for multifamily and single home locations. Overturning Prop 13 would scare away potential home investors from buying homes in the state.
The next issue that threatens to close down California's economy would have a similar impact on rental properties, and that is if the state and local governments start practicing rent controls. Rent controls ironically do not help the poor, rather they help the privileged. We saw this in New York in the 1980s when vast apartment spaces in expensive high rise buildings were rented out to single people that locked in the low rent for many years. By artificially keeping rental prices low, the rent control law takes away all the profits for the landlord. No profits mean no improvements, no investing and certainly: No new homes.
The last and most current issue that threatens to shut down our state has to do with electricity and PG&E. The power company has made some very poor PR decisions lately, as paying out the corporate bonuses when they should have fixed infrastructure rubbed a lot of people the wrong way, and of course we are all upset that our power was shut off for no good reason. However I urge caution against the voices arguing for a state takeover. While there are public utilities in other parts of the country, please remember that our state government is very short on successes, and has no recent accomplishments that it can point to. I don't think the radical left congress in California has the talent or skills to run electricity up and down the coast......Also I haven't seen much research on just how over regulated PG&E is, but i bet the blame for last months outages is shared by Sacramento.