So far this year, 69 companies have moved all or part of their California work and jobs to other states or countries, reports Irvine relocation consultant Joe Vranich. It's the fastest rate of departures since Vranich started tracking the exodus in 2009, he says. There have been an average of 4.7 moves per week from Jan. 1 through April 12, compared to 3.9 moves in all of 2010. The numbers are low, Vranich says, estimating that only one in five out-of-state moves is made public. In what he calls "disinvestment events," Vranich counts companies that move jobs, facilities or headquarters out of California. He doesn't count companies that invest outside the state for growth or marketing reasons. Among the 69 are some big names: CKE Restaurants, which started in Orange County and now is based in Carpinteria; Dunn-Edwards paints in Vernon; and eBay Inc. in San Jose which will add 1,000 high-paying jobs in Austin, Tex. after receiving government incentives to locate there.CKE is Carl Karcher Enterprises, the parent company of Carl's. Jr. But check the link to see the list of O.C.-based firms fleeing the state's inhospitable business climate. And here's the list of reasons:
Why do these and the other companies move out of California? Vranich has updated his top 10 reasons that California companies call the moving van. Number 10 is new: Energy costs soaring because of new laws and regulations. Commercial electrical rates are already 50% higher than the rest of the country, Vranich says, and Gov. Jerry Brown just signed a new law increasing the amount of power utilities must buy from renewable sources plus regulations for the California Global Warming Solutions Act will start soon.
Number 10 is new: Energy costs soaring because of new laws and regulations. Commercial electrical rates are already 50% higher than the rest of the country, Vranich says, and Gov. Jerry Brown just signed a new law increasing the amount of power utilities must buy from renewable sources plus regulations for the California Global Warming Solutions Act will start soon.
The other reasons, Vranich says, are:
9. High and unfair tax treatmentStill more at O.C. Register.
8. Regulatory burden
7. Unfriendly legal environment for business
6. Most expensive place to do business
5. Provable savings elsewhere
4. Public policies and taxes create unfriendly business climate
3. Uncontrollable public spending
2. More adversarial toward business than any other state
1. Poor rankings for California on lists ranging from taxes to crime rates to school dropout rates.
ADDED: Linked at Director Blue and Libertarian Republican.
Also, at Ace of Spades Headlines and Ed Driscoll, "California: ‘More Adversarial Toward Business than Any Other State’."
8 comments:
It might be a good idea for California to change its attitude towards the military. It may become the only organization that will add money to California's economy.
Eventually welfare states will fail because they will not longer have enough working people to support unions and those who are living off the government.
One wonders how much damage Califoria will do to itself before it realizes that Leftism does not work. It is a recipe for disaster.
When one sees the lawyers deserting California one will know the destruction of California is complete.
Just more evidence that the "egalitarian" party actually strongly believes in a business underclass.
Here in Ohio our new governor is convincing companies not to leave by his actions. He might just save this state against the wishes and work of the statists and unions.
It cost money, up front, to pick up and move. For California to make it worthwhile to do is telling, to say the least.
How long will it take for California to enact an "Exit Tax"?
On top of the businesses leaving, there are also the businesses that don't get started to replace business that end, whether because of outright failure, retirement of the owner, expiration of a lease, or any other reason. MrMaryk is absolutely right about the cost of picking up and moving. In the case of replacing businesses, the tendency may be in the opposite direction - why start a business if the state acts as if it doesn't want you to?
Most people would think this a disturbing trend, but the goofy, socialist CA politicians aren't worried. After all, there will always be enough businesses in the state to satisfy the pols' needs. And of course if there's a shortage of goods or services, powerful politicians will always get their needs satisfied first.
Should they worry that the exodus will worsen the state's financial crisis due to loss of tax base? Nah. They know King Obozo will never let the state shut down vital services, because it votes reliably Democratic, so Barry will open the federal treasury and let you taxpayers in flyover country bail out the socialist pols in CA.
Great system, eh?
Love the comment "How long before the state enacts an 'exit tax'?"
I'm not a Randian, but in "Atlas Shrugged," in response to more businessmen "going Galt" didn't the government end up issuing a "directive" forbidding businesses from closing? That's something I can see the morons in DC or Sac'to trying!
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