Rebane's Ruminations
May 2014
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George Rebane

It gives little pleasure to remind us all that progressives are socio-economically ignorant, incorrigible, and unrepentant.  The great escape of companies from the once Golden State continues unabated.  From Nevada County we see the next stage departure of our formerly iconic Grass Valley Group as its remnants are merged with Miranda Technologies.  It is yet one more piece of evidence that manufacturing things here for consumption elsewhere has become a fool’s errand in these Sierra foothills.  We have nothing to offer a manufacturer except great scenery and added delays and distance over which raw materials and finished goods must be transported.

On top of that, we are in a collectivist California that is successfully vying for being the most anti-business state in the Union when we pile on the state’s taxing policies, development fees, unionization, environmental strictures, and anti-growth regulations that generally dun all productive activities that create wealth and promote individual liberties.  All of these factors are not in the ken of liberals that range from the local lackeys to Sacramento’s ever leftward lurching and corrupt government.

The latest of the shoes we heard drop is Toyota’s announcement of its escape from soCal to Texas, which includes the moving of thousands of middle-class jobs out of the state that has finally become unendurable to a company that first set up shop here in 1957.  The reasons for leaving are more than abundant and understood by other equally iconic California companies that are quietly directing their growth and expansion to the nation's 'fly-over country’.  Only the well paid and politically blind workers will remain to enjoy our climate and scenery.  Such amenities are no longer affordable to growing businesses and middle class workers.


With California’s 16+% workers in unions (Texas 4.8%, Tennessee 6.1%), creating a business that will employ tens to hundreds of manufacturing and or service workers is more than a scary thing after factoring in a 50+% added tax burden over the states cited.  Also, our personal income marginal rate of 13.3% is the nation’s highest.  California’s collectivists believe they can spend your money more to your benefit than you yourself can.  That, of course, is one of the Big Lies foisted on the state’s nebbishes.  Ever greater fraction of the special purpose slated taxes are now directed into the state’s general fund, from there they are used to pay for the unfunded public service pension catastrophe that the state and its lower jurisdictions have yet to address (can everyone spell ‘Chapter 9’?).

We can go on with this litany citing insane environmental regulations, highest energy costs, and an illegal alien population whose true costs to California are in terminal denial by our leftwing leadership.  But the bottom line that demonstrates the massive failure of politics is the state’s employment and poverty numbers.  At 17.6% LA has the highest poverty rate of any major American city in spite of a ‘barbell’ workforce that grows only in the low paid and highest paid ends, and spreads devastation on the middle class workers.  (more here)

While Silicon Valley is an insular exception – no spread of wealth from there to the rest of the state – jobless rates in the Central Valley (13+%) and the large population centers of soCal (8-9%) tell the true story of a land that once was a mecca of productivity and growth, and the envy of the nation.  Now we are the butt of California jokes while our ‘what me worry’ governor this week dismissed the “few problems” and “lots of little burdens” driving the great escape of middle class jobs with the snide encouragement that those who remain are the “smart people (who) figure out how to make it.”

And all of these travails were foretold and predicted in a timely manner to ears that still will not hear and eyes that will not see.  But the real bottom line is that so many of us, especially in northern California, feel that we have no voice in Sacramento.  These feelings are real and bolstered by a daily stream of data that speaks to our disenfranchisement.  And these are the stirrings that give rise to today’s motives and initiatives to partition states – recall the proposed state of Jefferson – so as to generate jurisdictions that are ideologically more cohesive.  Perhaps this is another area of governance in which California can lead, and thereby find alternatives to the Great Divide.

Posted in , , , , ,

71 responses to “The Great Escape”

  1. fish Avatar
    fish

    Now we are the butt of California jokes while our ‘what me worry’ governor this week dismissed the “few problems” and “lots of little burdens” driving the great escape of middle class jobs with the snide encouragement that those who remain are the “smart people (who) figure out how to make it.”
    I’m not sure that these remaining few “smart people” will be sufficient to satisfy the obligations made by the Jerrys and Darrells in Sacramento.
    Still it’s going to entertaining to watch!

    Like

  2. Russ Steele Avatar

    Cost of U-Haul Trucks Leaving California Going Up as the Demand Grows.
    More details HERE.

    Like

  3. George Rebane Avatar

    fish 1136am – of course the alternative is that it is the smart people who are leaving California. From the history of our state’s voting record, it sure looks like a lot of that has already happened.

    Like

  4. Walt Avatar

    The LIBS in SAC still have plenty of work to do. Obviously there isn’t enough
    regulations on the books. ” Some” people are still employed. All the water has yet to be placed in government hands. We have some of the ECO gang demanding a mine stay closed “due to the drought”.( The way things are going, they will win that argument on that reason alone)
    On the local front, we have those pitching a bitch about the new “shopping center” next to the “new overpass”. What’s the gripe? Their not “mining”??
    ( your check book doesn’t count.)
    Even lumber is imported from somewhere else. ( how many mills used to be here?)
    The next victims will be the ” mom and pop” contractors. With the new regulations set to kick in ( Thanks to CARB) they will be priced right out of work. ” can’t use that truck,, can’t use that tractor… They are out of compliance..” (Except for one Kubota tractor owner up on the ridge.. That rule doesn’t apply to him.)

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  5. Walt Avatar

    At least SAC. hasn’t imposed an “exit” tax…( yet)
    But Ca. still collects an “employment” tax when an out of state “rep”
    shows up at any given business for an 8HR. visit. We never hear much about that.
    I wonder Why? Because the Bill get’s sent out of state?

    Like

  6. Todd Juvinall Avatar
    Todd Juvinall

    I saw all this in the early 80’s. Many of us who were elected then saw this coming and did the Paul Revere but no one listened. Even George Duemajian and Pete Wilson did not listen. When Arnie was Governor he opposed the Natural Gas Terminal in Long Beach! Those of us trying to stem the flow of this madness were called all kinds of derogatory names but we were right. I saw the devastation in the Fresno area recently. No water except for fish. No dams, no common sense on delta smelt, yellow legged frogs, vernal pools or CEQA. Onerous regulations. Hire one person as an employee and the government, state and federal own your ass.
    Now the dimwits in Sacramento want to put a tax on CEO’s who make more than X times the worker in a company! It is endless. I would like to see us go back to a county Senator for each county and if necessary, have a third branch of the legislature if two don’t make constitutional muster. Then the rural counties would be able to stop the craziness

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  7. Walt Avatar

    I have been out of the loop on just how many “high tech” manufacturing businesses have moved up here since IMM was chased out of town. I recall the
    “debate” well. They were supposed to be beating down the door to “move here”
    just as long as “the mine” didn’t open.
    Seems more have left than actually showed up. But it made for a great excuse
    to kill a private business, all in the name of ECO.
    The Tree hugger’s lies won the day. LIBS have a new ally in town. SEIU is looking
    to unionize one of the assisted living joints. Hello price hikes!

    Like

  8. Bill Tozer Avatar
    Bill Tozer

    Walt, “SEIU is looking to unionize one of those assisted living joints?”: Oh boy. Thank goodness this is not Michigan where the underhanded tactics and immoral schemes of the SEIU forced people like you who took care of elderly parents to be classified a government worker. No lol here.
    Imagine having a child with cerebral palsy and having have to pay the SEIU 30 clams a month just for being a righteous loving parent on top of making untold sacrifices of one’s life and livelihood to care for your loved one. Your reward is having financial stress added by getting hit up by the union thugs’ monthly extortion money so they can have their bigwig convention in Athens this year. Must be something in the water in Illinois, Michigan and CA.
    http://www.foxnews.com/politics/2014/04/30/seiu-membership-revenues-plummet-after-state-ends-underhanded-scheme/
    I know, that is Michigan not the Golden State. Michigan? Hmm, isn’t Detroit in Michigan? Isn’t SEIU in CA? Perhaps CA should up the minimum wage to 14 bucks an hour. That will help growth and the 2% who work full time on minimum wage and keep companies in CA. Not! Working minimum wage jobs will never lift anybody out of poverty despite the Progressives best efforts. Never, no matter how high you increase it.
    But that does not matter. The rich money hoarding businesses like local landscapers and architects will pay for it all and lift everybody out of poverty. Everybody will be lifted out of poverty and service sector jobs just by taxing the crap out of businesses and fining when they use 3 tissues of toilet paper instead of 2. Then everybody under the sun, including illegals, can afford to have solar panels of every rooftop and that will create billions of jobs and save CA from being the laughingstock of the nation. No lol here.

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  9. Russ Steele Avatar

    The FUE is pushing a Puff Piece on California jobs from the LA Times, but Pew States has some details that the LA Times leaves out. Note, while CA is creating lots of jobs, the jobs growth rate is slower than 14 other states with faster growth rates. As George noted Silicon Valley Boosts California:
    California, the world’s ninth-largest economy, missed making Moody’s list of the top 10 states for job growth, but at 15th it is expected to do relatively well. A recovering housing market and the high-tech industry in Silicon Valley are largely responsible for California’s bright outlook.
    California added jobs at a rate faster than the national average in 2013, including posting more new construction jobs than any other state in 2013, with more than 31,500 new jobs.
    The new jobs are largely along the coast, particularly Silicon Valley, which created payroll employment at twice the U.S. rate in 2013, according to the latest forecast from the UCLA Anderson Forecast.
    Jobs are more plentiful in the Bay Area, Orange County, San Diego and Ventura compared to the rest of the country, while the Sacramento Delta, the San Joaquin Valley and the Inland Empire are doing less well.
    Among the few bright spots inland in California are Kern County’s booming renewable energy sector; the new medical school at the University of California, Riverside that opened in 2013; and Amazon plans to open a 1.2 million-square-foot logistics center in Moreno Valley.

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  10. George Rebane Avatar

    Minimally fettered capitalism has produced robust economies, especially in America. Today advocates of advancing socialism mistake this robustness for the effects of their new policies that ultimately will derail such economies. Meanwhile the socialist crow as they point to the residual health of the economy as it struggles against the hobbles of collectivism (including redistribution). In countries where the economy was already on the ropes before the blessings of invigorated socialism, the socialists justify their ruinous policies by resorting to class warfare – they point to the remaining well-to-do as being the cause of the suffering their policies bestow. The astute observer on these shores will note the transition of the liberals’ apologetic from the former to the latter as our economy transits from robust growth to systemic lethargy.

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  11. Walt Avatar

    14 bucks for minimum wage?? Nope,,, the “new” demand is $26.00!!
    “California Democratic congresswoman Barbara Lee expressed support for a $26 minimum wage in her state ”
    http://dailycaller.com/2014/05/02/california-congresswoman-wants-a-26-minimum-wage-in-her-state-video/
    How will FUE ever afford the next drive-through tour of “the basin”?

    Like

  12. fish Avatar
    fish

    “California Democratic congresswoman Barbara Lee expressed support for a $26 minimum wage in her state “
    Right after she gets her rainbow colored, Skittle crapping Unicorn for a birthday present.

    Like

  13. fish Avatar
    fish

    Little Stevie judging selectively once again:
    The funny thing is that the very same people locally saying Texas is eating our lunch are ignoring the $40 million in tax subsidies that Texas provided Toyota. In any other circumstances [like if the Obama administration did it for Tesla] they would be calling it ‘crony capitalism’ and excoriating anyone proposing it, which just proves that hypocrites don’t own mirrors.
    Toyota in Texas won’t be getting my state tax dollars unlike the California Democratic Party propaganda production facility currently does.
    Apparently Toyota just wasn’t greasing the right democratic palms!
    Stevie….that shiny thing in the corner….yeah, the one on the wall…. where you cast no reflection….that would be the mirror.
    http://www.latimes.com/business/hiltzik/la-fi-mh-californias-hollywood-tax-giveaway-20140501,0,84888.column#axzz30flcEM3X

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  14. fish Avatar
    fish

    Completely OT but just to demonstrate what a great gut I really am!
    el jeffy…this should make your weekend!
    http://motherboard.vice.com/read/the-white-house-wants-to-issue-you-an-online-id
    Of course if it’s anything like the the Obamacare website rollout…….

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  15. fish Avatar
    fish

    Completely OT but just to demonstrate what a great gut I really am!
    As much as I would like to claim that “great gut” was intentional it really should have read “great guy”!

    Like

  16. stevenfrisch Avatar
    stevenfrisch

    Posted by: fish | 03 May 2014 at 09:46 AM
    Fish, you have to admit that is funny that Rebane and Steele are touting the move as some failure of California when Texas is providing a huge tax subsidy.
    If you don’t recognize the hypocrisy in that then you are blind, or stupid….I prefer to think just blinded by stupidity.
    By the way, thought you might like this:
    http://www.latimes.com/local/political/la-me-pc-donnelly-expansion-film-industry-tax-credit-20140502,0,6401307.story?track=rss#axzz30adebIGh

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  17. stevenfrisch Avatar
    stevenfrisch

    Here is the post from over at Russ’ blog:
    “During the Prop 23 debate, local conservative bloggers pointed out that AB-32 would force many companies to level the state. At the head of this pack of lefties for sustaining AB-32 was Steven Frisch, Sierra Business Council. Now we learn that is Toyota bailing on California.
    The world’s leading automotive maker will follow the lead of its competitors and other large businesses, and leave California for better business climates elsewhere. Toyota had its US headquarters in Torrance for more than three decades, but now nearly 5,000 jobs will shift to Texas.
    Yes, Texas which has fewer regulations, does not have a legislature invested in stopping global warming, and very business friendly environment. I predict that more will follow. Stay Tuned!”
    Stay tuned indeed…..note no mention of the tax subsidy……:)

    Like

  18. Walt Avatar

    Speaking of “subsidies”,, Has GV been paid back yet? I recall a million bucks
    ( or an amount REAL close to that) was “loaned” to get all of 12 jobs to relocate here.. Some ” high tech.” outfit to “counter” IMM. Maybe they quietly
    folded up shop.. can’t have news of a blunder like that hit the press.
    So Texas uses a LIB trick,,, and LIBS whine about it.
    If Steve wants part of that action, N.Y. has ten year “tax free” arias for him to enjoy. They just don’t tell you what “your tax” will jump too after ten years.
    N.Y. has to do something to bring business back, since they are chasing out the resident job makers. The established gun makers are giving the finger to N.Y., and plenty of the employees are going with them.
    Seems N.Y. and Ca. are in a race to see who can drive away the most jobs, and put the most people on the dole.

    Like

  19. fish Avatar
    fish

    Fish, you have to admit that is funny that Rebane and Steele are touting the move as some failure of California when Texas is providing a huge tax subsidy.
    If you don’t recognize the hypocrisy in that then you are blind, or stupid….I prefer to think just blinded by stupidity.
    By the way, thought you might like this:

    It would seem Steve that Toyota just wouldn’t play the game like Hollywood and a host of other industries still will. Probably just a simple cost/benefit ratio calculation….the cost of buying politicians vs. a more favorable regulatory and tax environment.
    !’m fuzzy as to your position on the matter though….if Toyota elected to stay in California after being gifted with a raft of taxpayer dollars would you say that this was a good thing and evidence of a favorable business climate and a major industries commitment to the state or would you still rail against it as an example of state corruption?
    And finally, not a Donnelly supporter Steve. If you and the FUE Fighter can get him unelected ….(he’s certainly not going to be the Governor. We all know that Jerry knows just who he needs to buy to stay elected)….more power to you!
    Blinded by Stupidity….good line….but no….just utterly libertarian!

    Like

  20. stevenfrisch Avatar
    stevenfrisch

    Posted by: Walt | 03 May 2014 at 10:34 AM
    Walt, I am not whining about the Texas policy, I think using tax policy to incentivize business can be a good thing; I am pointing out the hypocrisy of being against using subsidies in one area while trumpeting the effect of subsidy in another, and the inability of our local economic brainiacs to recognize it.
    We subsidize all kinds of businesses and private activities; from water funded by federal and state governments so that a single almond that takes 8 gallons of water to grow can be exported to China, to commercial development that would not be viable unless government and thus taxpayers build freeway interchanges.
    One persons subsidy is another persons ox being gored. One can’t be simultaneously for it and against it.
    For every job we lose we will create new ones…that is the marketplace at work…creative destruction as Schumpeter defined it.

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  21. fish Avatar
    fish

    For every job we lose we will create new ones…that is the marketplace at work…creative destruction as Schumpeter defined it.
    Well you make sure to keep me posted on all the quality jobs created in California. And I’m totally serious Steve….if things improve substantially I’ll offer a mea culpa!

    Like

  22. Barry Pruett Avatar

    Steve: Where is the information on the tax subsidy from Texas to Toyota? I would like to read about it…

    Like

  23. stevenfrisch Avatar
    stevenfrisch

    Posted by: fish | 03 May 2014 at 10:49 AM
    Fish, clearly I would have preferred it if the Toyota jobs had stayed in California, but I think it is pretty clear they were looking to consolidate operations closer to their production facilities, which is a common business practice.
    To be clear, I am not against subsidies for certain economic activities. I think government has an appropriate role in encouraging economic activity.
    At the same time the Toyota administrative staff will be relocating to Texas manufacturing of the Tesla S and their new models, the Tesla Models E & X, will be ramping up in Freemont, which is ironically the former Toyota NUMMI facility.
    Creative destruction at work.
    http://en.wikipedia.org/wiki/Tesla_Factory

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  24. fish Avatar
    fish

    Okay Steve point awarded.

    Like

  25. stevenfrisch Avatar
    stevenfrisch

    Barry, you can find news coverage here:
    http://bizbeatblog.dallasnews.com/2014/04/texas-enterprise-fund-will-grant-40-million-to-toyota.html/
    and a direct link to the Texas Enterprise Fund press release here:
    http://governor.state.tx.us/news/press-release/19633/

    Like

  26. stevenfrisch Avatar
    stevenfrisch

    By the way, no where in Toyota’s communications about their rational for moving do they mention AB 32 or California climate regulation.
    Toyota claims 3 of the top 5 selling cars in California, the Prius, the Camry and the Corolla….sharing top of the market with similar Honda models (the Civic and Accord) all noted for being out front responding to the combined need to reduce emissions and increase mpg.
    If anything California’s AB 32 has expanded markets and enriched Toyota.
    And because California, as an individual state, is the #11 auto market in the world, and Toyota manufactures to California specifications, benefits from these models can be enjoyed by residents of the entire Unites States, even, dare I say, Texans!

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  27. fish Avatar
    fish

    By the way, no where in Toyota’s communications about their rational for moving do they mention AB 32 or California climate regulation.
    Nor would you expect them to be so impolitic to do so. They still have to deal with the government at multiple levels.

    Like

  28. Walt Avatar

    Steve. Texas can AFFORD the “grant”.. Ca. is BROKE.
    And those “Calif. specials”?? LOL! The same car is cheaper in other states
    because they don’t REQUIRE CA. BS. ” Calif. compliant” means extra cost.
    From anything with an engine to guns.
    So.. How well did that local “subsidy” play out? Since you didn’t pounce on it
    to score a point, I guess G.V. was on the losing end..(again) But we got a 50 grand rusty junk display..( Money well spent?) ( worth about 200 bucks in scrap at yesterday’s steal price.)

    Like

  29. stevenfrisch Avatar
    stevenfrisch

    Posted by: fish | 03 May 2014 at 11:22 AM
    Fish, my point was that although some have tried to tie the defection of Toyota to the Lone Star State to AB 32, like Russ did quoted above, Toyota has actually benefited from AB 32, as many California businesses have.
    I recently met with a representative of a very large timber company based in California.
    Our conversation was centered on the regulatory environment for timber companies and the relative competitive disadvantage of operating in California.
    During the conversation we found several areas of common ground, including loosening limits on tree sizes that can be harvested in salvage logging operations, reducing regulation on timber harvests where a portion of the product is dedicated to value added products including bio-energy, and creating market signals to increase markets for engineered wood products.
    This executive freely acknowledged that although they abhor regulation, it is not a determining factor in making California timber products less competitive, foreign competition, labor costs and transportation costs are actually a much larger factor, and in some cases regulation can make them more competitive.
    Engineered wood products are a great example.
    AB 32 implementation policy calls for a ‘life cycle analysis’ of CO2 equivalent emissions from the building sector, through Title 24 permitting.
    https://law.resource.org/pub/us/code/bsc.ca.gov/gov.ca.bsc.2013.11.pdf
    Steel and concrete building materials have about 5-10 times the carbon footprint wood does, thus the timber products industry is heavily investing in engineered wood products that can be used for large scale construction projects to replace steel and concrete.
    In this case regulatory policy is creating a significant market signal to spur the development of a new industry beneficial to California timber operators.

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  30. stevenfrisch Avatar
    stevenfrisch

    Posted by: Walt | 03 May 2014 at 11:38 AM
    First, the same car is not necessarily cheaper, the initial cost of the car may be cheaper, but not necessarily the cost of operation or the social cost passed to the taxpayer through externalities like pollution.
    Second, I have no opinion of the specific subsidy in Grass Valley, perhaps you could post more information.
    Finally, the point I am making is that clearly the issue is not the efficacy of subsidies, because in a myriad of ways those here seemingly opposed to subsidies support them if believe it serves their interest, it is what different members of our society would chose to subsidize.
    That is a values based judgement not an anti-subsidy position.
    What you guys are really objecting to is not subsidy, it is that you think the wrong things are getting subsidized. You are free to think that; the values of the broader society will determine what we value enough to subsidize.

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  31. stevenfrisch Avatar
    stevenfrisch

    “…if they believe it serves their interest…”

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  32. fish Avatar
    fish

    Steel and concrete building materials have about 5-10 times the carbon footprint wood does, thus the timber products industry is heavily investing in engineered wood products that can be used for large scale construction projects to replace steel and concrete.
    In this case regulatory policy is creating a significant market signal to spur the development of a new industry beneficial to California timber operators.

    You have to first buy the Global Warming/Climate Change premise before this can be argued honestly. I’m not yet convinced (but this has been covered on multiple occasions and I’m not sure either of us want to rehash it for the thousandth time on such a lovely day). Businesses adapting to accommodate regulatory policy based on science that may not be legitimate is a response to a false signal.

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  33. stevenfrisch Avatar
    stevenfrisch

    Actually, you don’t have to buy climate change to acknowledge that for a number of reasons Title 24 is the law, is being implemented, as is zero net energy policy, and that every new building built in California as of about 2020 for residential and 2030 for commercial is going to need to be zero net energy.
    If climate change were disproved in a flash tomorrow, zero net energy and Title 24 would remain, because the benefits, particularly around energy efficiency and taking load off the grid, would outweigh any other consideration.
    http://www.triplepundit.com/2013/11/title-24-launches-california-net-energy-buildings/?doing_wp_cron=1399144415.5169889926910400390625
    http://www.cpuc.ca.gov/PUC/energy/Energy+Efficiency/Zero+Net+Energy+Buildings.htm
    Business operates in a world that is, not a world as some would wish it to be.
    Contractors, builders, financiers and product manufacturers are gearing up to comply with Title 24, and new products, markets, and fortunes will be created, and fall, based on their speed of adoption and flexibility in the marketplace.

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  34. fish Avatar
    fish

    If climate change were disproved in a flash tomorrow, zero net energy and Title 24 would remain, because the benefits, particularly around energy efficiency and taking load off the grid, would outweigh any other consideration.
    In complete agreement. But again, reducing energy costs is an easy calculation and in an environment of rising prices would have likely been pursued without the need for government intervention. Additionally, there is an “externality” in the compliance and record keeping to demonstrate compliance with these laws. Compliance is never “free”.

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  35. George Rebane Avatar

    re stevenfrisch 1051am – This illustrates another irreconcilable difference between liberal and conservetarian mentalities – Mr Frisch calls opposing stupid California subsidies “hypocrisy” when some of us support wise Texas subsidies to attract tax paying, job creating businesses to their states. Toyota can make money in a range of regulatory and tax environments without subsidies; however, the cynically named ‘green industries’ cannot.
    Only entrenched, rank ideological calcification stops California from replicating and exceeding the benefits that Texas, New York (gasp!), Tennessee, Michigan, … and other states offer well-run businesses to relocate into their states. Such enlightened governance is good for all. California policies on the other hand are beyond butt stupid.

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  36. John Avatar
    John

    Frisch, re: your 10:51. If commercial development on a freeway interchange is “subsidized” in your definition, then everything that fronts a road, or has access to utilities is also subsidized. There is nothing magic about a freeway interchange beyond the significant traffic that is generated. The buyers of interchange frontage land pay a dear price for the land because of the traffic counts. The owners of the land prior to the interchange construction are typically farmers or land speculators. In no reasonable definition can this be called “subsidized”. Made more valuable, yes. Subsidized, no.

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  37. Walt Avatar

    According to Steve, Libbyism is the cure for everything. It’s just the idiot Right that keeps getting in the way.
    Good God. We have our own version of jay “the” Carny. Hell.. Even Bagdad Bob has more credibility than the “Steve and Jay” shows.
    A little memory loss kicking in? Really? GV “loaning” big bucks to get a business to move here isn’t memory worthy? The anti mining gang was crowing about it.
    Speaking of “subsidies” IMM was all private money. No wonder our Lefties were so apposed to it. No government LIBS to syphon money off and LIB pals to run it.( into the ground)

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  38. stevenfrisch Avatar
    stevenfrisch

    Posted by: Walt | 03 May 2014 at 02:18 PM
    Walt, as I said previously, I am unfamiliar with the loan made by Grass Valley that you are referring to. Why don’t you refresh our memory or perhaps point to a source explaining the specifics.

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  39. John Avatar
    John

    Walt, I am also coming up with blanks as regarding Grass Valley loaning any money to a business to move to town. Not sure that what you are thinking about really happened. Do you recall approximately when or who?

    Like

  40. stevenfrisch Avatar
    stevenfrisch

    Posted by: John | 03 May 2014 at 12:56 PM
    Definition of subsidy from Investopedia:
    “‘Subsidy’
    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy is usually given to remove some type of burden and is often considered to be in the interest of the public.”
    When taxpayer funds are used to build a road or interchange AND land owners along the road or interchange benefit to a higher degree than the fees they pay, that is a subsidy.
    I am not saying that some level of subsidy is unwarranted, I support many subsidies, I am merely saying it is a subsidy, and as such, because some people think it is in the general public good, it is deemed warranted.
    If the property owner who benefits from the new infrastructure paid the full cost it would not be a subsidy, or every landowner paid the cost based on their share of benefit it would not be a subsidy.
    In many cases landowners do pay the full cost for transportation improvements, an example would be a property owner who must pay the full cost of installing a turn lane to access their property in order to obtain permits.

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  41. stevenfrisch Avatar
    stevenfrisch

    Posted by: George Rebane | 03 May 2014 at 12:54 PM
    All I can say George is that one persons ‘stupid” subsidy is another persons wise subsidy. As I stated earlier, every time we subsidize something it is a value judgement. California is merely doling out subsidies in another way. We can argue over the efficacy of that, but a subsidy, is a subsidy, is a subsidy.
    In the case of Texas they are paying subsidies to attract a certain set of businesses; California (and local governments) pays subsidies to attract another set of businesses. We subsidize agriculture, ranching, entertainment, energy, manufacturing equipment, capital investments in favored businesses, and even infrastructure.
    What you are arguing is not the inefficacy of subsidy, but what is subsidized. No libertarian high ground here, merely a societal value judgement.

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  42. George Rebane Avatar

    stevenfrisch 315pm – Agreed, these are indeed value judgments. And I am also arguing the efficacy and targets of subsidies. The value received for the things subsidized in no manner ties with their legitimate costs. (Legitimate costs in government are a rare find.)

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  43. Walt Avatar

    ” subsidies” seem to work better when done by Repub. operated government.
    When “subsidies” and LIB are used the mix,, the result is the likes of Solyndra,
    and such. ( a long damned list of “such”) the taxpayers lose every time when LIBS dole out the bucks. Seems the taxpayers of Texas don’t mind.
    That’s the diff. Steve, The end product of that money use. LIBS never deliver a “profit”.( except for themselves and their close friends.)

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  44. Walt Avatar

    DAMN!!! And I had all my money on Uncle Si!!
    Half way through the race he wanted to stop to take
    a’ pee…..

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  45. stevenfrisch Avatar
    stevenfrisch

    Posted by: George Rebane | 03 May 2014 at 03:46 PM
    I think we are actually in substantive agreement. The issue is how do we measure the “value received”. But in general I agree with you that the value received should be greater than the subsidy.
    I think the most important thing about subsidies is that they should be designed to be as temporary as possible; the utility value of the subsidy should be greater than the opportunity cost lost if the money had stayed in the taxpayers pocket; they should be designed to transfer knowledge, information or products to the private marketplace to advance the diffusion of innovation; they should be deployed in places where the private marketplace does not have the staying power to participate or there has been a market failure [think long term financing of infrastructure or investment in certain types of research and development or ‘rural electrification’]; and, there should be measurable outcomes, so we learn as we go.

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  46. Todd Juvinall Avatar
    Todd Juvinall

    So if 50% of the taxpayers are paying 100% of the taxes does that mean the 50% paying the taxes are subsidizing the non paying taxpayers military costs?

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  47. stevenfrisch Avatar
    stevenfrisch

    Posted by: Todd Juvinall | 03 May 2014 at 04:59 PM
    50% of the taxpayers are not paying 100% of the taxes.
    The number you want to be quoting is “47% percent of taxpayers owed no federal income tax in 2011.”
    That number is up from 40% of taxpayers who owed no federal income tax in 2007. The main reason it is up is that the American Recovery Act exempted the first $2400 in unemployment benefits from federal income tax. The number is gradually declining as first the unemployment exemption was eliminated and second the economy began to recover.
    A recession is after all a recession.
    These number also only represent federal income tax, it does not cover the numerous other taxes people pay. For example only 17% of wage earners do not pay payroll taxes, which are a more substantial burden on lower wage workers. The figures do not cover federal excise taxes for items like gasoline, also a disproportionate impact on low wage earners and rural residents.
    As a matter of fact the non-partisan Congressional Budget Office data shows that the poorest fifth of households paid an average of 4.0 percent of their incomes in federal taxes in 2007, the latest year for which these data are available — not an insignificant amount given how modest these households’ incomes are; the poorest fifth of households had average income of $18,400 in 2007. The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10.6 percent of their incomes in federal taxes.
    The figures do not include sales and use taxes, state and local taxes, special district taxes. Data from the Institute on Taxation and Economic Policy show that the poorest fifth of households paid a stunning 12.3 percent of their incomes in state and local taxes in 2011.
    These figures also do not calculate tax exemptions, tax shelters, or untaxed income, which higher income earners take significant advantage of.
    If all taxes paid and exemptions were added together we would find that:
    The bottom 20% pays 12.3% of the income in taxes.
    The next 20% pays 11.7% of their income in taxes.
    The middle 20% pays 11.3% of their income in taxes.
    The fourth 20% pays 11.2% of their income in taxes.
    The next 19% pays 10.5% of their income in taxes.
    The top 1% pays 7.5% of their income in taxes.
    So, in short, you are repeating a meme without doing your own research to find out whether it is true or not.
    Main sources: http://www.cbpp.org/cms/?fa=view&id=3505

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  48. George Rebane Avatar

    stevenfrisch 449pm – Sounds like a good start.
    ToddJ 459pm – Instead of ‘subsidizing’ (reserving that for government transfers), I would use the phrase, ‘paying their share of’.

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  49. stevenfrisch Avatar
    stevenfrisch

    Posted by: stevenfrisch | 03 May 2014 at 05:29 PM
    Oh, a clarification, the number in the ersatz chart are from 2011, thus the discrepancy with the CBO numbers.

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  50. George Rebane Avatar

    Report out tonight from the CBO – raising the minimum wage to above $10 would cost the nation over 500K jobs. As long known by all thinking people, including Democrats, the minimum wage benefits no one except elected Democrats. Question for extra credit – how many lamestream outlets will report this news which should be banner headlines across the nation, given what lies have been told about the bounties that the minimum wage bestows?

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