The State of California spends 492 billion a year on state regulations. A full one third of its yearly gross domestic product. Keeping this in mind is there one single sane person in the entire United States who doesn’t instantly understand why California has a 12.2 percent unemployment rate.
When one third of the sixth largest economy on earth gets consumed by regulations can there possibly be any greater indication of government corruption or the affect that the Obama administrations ever increasing regulation of the entire rest of the United States economy is heading?
The common wisdom is that California is the Canary in the coalmine for the US economy, which is to say, as goes California so goes the US economy. To say that California’s economy is going to hell in a hand basket would be a profound understatement.
The solution to California’s economic problems mirror the solution the Americans economic problems. Reduce the rate of regulation to a rate that doesn’t strangle productivity, say 1/20th of the GDP.
The Elephant in the room is excessive government intervention into the regulation of lawful commerce, bring government intervention under reasonable control and the economy will thrive.