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Comment by chiefalchemist | Hacker News Reader

A state is not an economic business entity. It does not have to keep growing and growing. What it needs to do is serve the people who live there in way that align with tax revenue.

This dick-swinging my state is growing bigger than your state. Is unnecessary theatre and media fodder. Are the people being served - increases or decreases are irrelevant - or not? Let's focus on what matters for a change.

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Clearly the fact that people are leaving in such large numbers suggests that it isn't serving the current population very well.

India must be the most amazing country on Earth.

People leave India in large numbers also. Population growth due to sex is a different category.

Mostly it's out of control housing prices.

But the trendline outside of CA is even worse lately.

Maybe not. Maybe the leaving side has been what it's always been. Maybe there's no one moving in? And now the net is a loss?

Yes, could be for the same reason. Or it could be just the way things are. Given the USA's population is stagnent, perhaps CA isn't all that unique? Or is also an immigration issue (which "economic growth" is often used as a false proxy for).

Nonetheless, populations do decline. To make it sound like a "failing" - as if it were a business - is where I take issue.

To some degree isn't this people voting with their feet? A U.S. state does a lot of things in serving people, people are going to look at all of that collectively to decide if those decisions are in general good or bad.

I don't think collective decisions like this are the last word and it's probably hard to use the de-population to make some sort of judgement on any particular policy or aspect of California but I also wouldn't say it's impossible to draw conclusions.

Yes. But then say that. Using a business paradigm for a government entity, at least in this case, is a false god. Why go there?

Maybe CA is as big as it can be? God knows the droughts in the south of the state raise red flags about agriculture, population, etc. What's next? "CA grew and then it didn't rain at all"?

California has enormous pension obligations at every level of government to the tune of tens of thousands of dollars per household (maybe 77k!?). It will not meet that liability with a declining population, particularly if corporations and the wealthy do the leaving. It can’t legally shift money around, it’s all been allocated by the voters. The only option is to increase taxes, and probably by a lot, which would push more people out of the state given it already has the highest taxation in the country. If I were Ca, I’d be building as much new housing as I could as quickly as possible. Hopefully, declining housing costs (against inflation if nothing else) would make it a wash for future residents.

When a state increases its expenses every year, it has two choices, grow the tax base or rase the tax rates.

California is already one of the most taxed states and greater increases in tax rates will likely shrink its tax base.

The overall tax burden in California ranks 12th among the states, between Iowa and Nebraska. It is not a particularly high-tax state. The cost-of-living issues arise from the lack of housing. It is still a regulatory burden—the lack of housing is caused by bad local government—but it is not a tax as such.

Given that people make much more money in California than in Iowa or Nebraska, that is still a lot of taxes coming in.

Yes, but how is that related to the OP's Laffer Curve bullshit? High-income and therefore progressively taxed households are the only people still migrating in to California. Migration out of California has everything to do with cost of housing and nothing to do with taxation. The lower-income households that flee the state for Texas, the top destination, are more taxed in Texas than they were in California, but the people migrate anyway because the housing cost difference is larger than the tax difference.

Yes I agree. But when people say California is the most heavily taxed state in the nation, its usually a weasel interpretation where they mean California's pay the the most taxes not related to a percentage of their higher incomes. The real killer in California is simply the rent is too high (even food costs are pretty reasonable compared to other states).

I'm not saying that's inaccurate but figuring out tax burden - because of the distinction between rates and what's collected, the state and localities and the way benefits are allocated (among many other things) can be really confusing.

Do you have a source on the tax burden? I’m living in Massachusetts right now (notoriously called Taxachusetts by some here), and CA sales and income tax rates look to be about 50% and double the rates here, respectively. It looks like property taxes are about 50% higher here, but income and sales tax is way bigger than property tax in my experience. Not to mention California’s notorious gas tax.

Massachusetts has a much more noticeable personal income tax because it is not progressive, everyone loses 5% off their paycheck. In California a household with 2 children for example won't pay 5% until their income is > $200k.

I never said it was the top. being 12th out of 50 does make it a high tax state. Also, the high cost of living is not just the lack of housing. There is a massive regulatory burden on all aspects of california life.

Surely one can at least argue that it matters if people are voting with their feet? But on the other hand, it's not like the state is being brought to its knees. This decline of 138k people is minuscule, roughly a third of a percent. Should the trend continue, California will still, with 25 million people, be elbows deep in residents a hundred years from now.

Ca has a current deficit of at least 30 billion dollars with unfounded long term liabilities at as high as 77k per household. If the populace declined to 25 million, that number goes to 123k per household in current dollars which would be unserviceable.

It doesn't have to grow. But it definitely shows that people don't want to stay there.

Or maybe it shows some people cannot afford to stay there.

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