Obama Versus Job Creators

Captains of industry have begun, in uncustomary fashion, speaking up against President Barack Obama and his policies – and the chorus will likely grow louder going into next year’s presidential election, perhaps swaying independent voters. The president may dismiss the chorus as the rantings of greedy “corporate jet owners,” but he may soon see himself on a collision course with big job creators during his 2012 reelection campaign – a time when job creation and the economy well could be issues driving the electorate.

It is usually frowned upon – even looked upon as taboo – for CEOs of major U.S. companies, and especially multinational corporations, to openly criticize the president or show outright partisanship toward or against a political party. At least publicly. But recently – and, especially, within the past month – corporate leaders have begun to openly criticize administration policies as helping to depress the nation’s business climate.

In that time, three major business leaders spoke out against the Obama administration: Bernie Marcus, the co-founder of Home Depot; Andy Puzder, CEO of CKE Restaurants (parent of Carl’s Jr. and Hardee’s); and casino tycoon Steve Wynn, CEO of Wynn Resorts. They contend that President Obama has strangled the economy and hamstrung job growth in the country. As Puzder told me directly, businesses in the country “are being actually prevented” from creating jobs because of the administration.

CEOs are typically careful, measured and scripted when making political remarks, but that approach is changing, likely because of the Obama administration’s constant demonization of corporate America.

During a well-publicized company conference call last month, Wynn, a self-described Democrat and supporter of fellow Nevadan Senate Majority Leader Harry Reid, told listeners, “This administration is the greatest wet blanket to business, and progress and job creation in my lifetime.” He added that businesses “are frightened to death about all the new regulations,” singling out Obamacare as a major challenge for companies. Fear of the administration, he said, “makes you slow down and not invest your money.”

“And those of us who have business opportunities, and the capital to do it, are going to sit in fear of the president,” Wynn said.

And Wynn predicts things will not get better unless Obama is booted from office: “I’m telling you that the business community in this country is frightened to death of the weird political philosophy of the President of the United States. And until he’s gone, everybody’s going to be sitting on their thumbs.”

Bernie Marcus echoed the sentiments of Wynn and Puzder when he recently said “Home Depot would never have succeeded if we’d tried to start it today.” “[T]he impediments that the government imposes are impossible to deal with.” “Every day you see rules and regulations from a group of Washington bureaucrats who know nothing about running a business. And I mean every day. It’s become stifling.”

John Mackey, CEO of Whole Foods Markets, who made national headlines when he publicly came out against Obamacare, recently made similar comments about the stifling business climate in the U.S. “It was a lot easier for me to start my business 30 years ago than it is for an entrepreneur starting out today to do the same thing,” Mackey said in an interview with Bloomberg TV.

Numerous other CEOs, especially in the medical industry, have warned, albeit more passively, that the president’s policies will hurt job growth and the broader economy, especially in the aftermath of the passage of Obamacare last year.

Even with mounting backlash from business community against Obama, one wonders if more business leaders will join in. Marcus believes it is essential for more CEOs to speak out but understands why they might not: “They are frightened to death – frightened that they will have the IRS or [Securities and Exchange Commission] on them,” he said. “In my 50 years in business, I have never seen executives of major companies who were more intimidated by an administration.”

To combat this, Marcus founded a new organization – based in Texas – called the Job Creators Alliance. It aims to increase the number of business leaders and job creators publicly criticizing jobs-squelching public policy. He believes doing so will help preserve the free-enterprise system. If he succeeds, we could see more outspoken CEOs just in time for the election year.

Given the moribund state of the U.S. economy, stubbornly high unemployment rates and the recent gyrations of the stock market, having an army of boisterous businesspeople chiding his administration darkens President Obama’s reelection hopes – perhaps especially if the GOP nominates a candidate with a track record of job creation to brag about, such as the governor of a state like Texas, whose economy is flourishing and business climate is welcoming.

(This piece originally appeared in the Orange County Register and was featured on Real Clear Politics.)

National Popular Vote is bad for California, bad for the nation

Liberals have long sought to erode the checks-and-balances that guard against centralized government.  But, the current push to scrap the Electoral College by enacting a National Popular Vote (NPV) could be their crowning achievement.

Critics warn that once the Electoral College is out of the way, the big government progressives could conceivably engineer election victory after victory, providing a continual stream of chief executives far left of Barack Obama.

Delaware Senator, President Pro Tempore, and former IBEW Business Manager Anthony DeLuca said as much when he declared that, once the NPV passes, Republicans will never again elect a President.

Why would he say that?  The answer is simple.

In Federalist 10, James Madison argues that a system of “electors” safeguards the citizenry against those factions that seek greater governmental control.  Confining the influence of factions to single states protects against greater impact on the national election.

Today, these factions often manifest themselves through pockets of organized urban-area voter fraud.  Just as Madison predicted, the Electoral College limits to a single state the impact of corrupt political activities, such as Chicago’s notorious fraudulent cemetery voters.

Throw off the system of electors and you’ll likely see epic turnouts in heavy urban areas like Los Angeles, New York, and Chicago as Democrats pull out all the stops to nullify the power of smaller, rural states.  No longer would 50 states matter, but only huge urban regions would control the vote.  Chicago alone would bury the mid-west.

The fact is: the NPV movement was given new life when renegade billionaire Tom Golisano took over the fledgling campaign after the initial post Bush/Gore election drive faltered. Golisano is a seven figure donor to the Democratic Party, and he ran as an ‘independent’ not once, or twice, but three times against moderate Republican Governor George Pataki.  Golisano then moved to Florida and adopted NPV.

To promote the NPV, Golisano has hired an army of Republican lobbyists throughout the country, including the venerable Fred Thompson.  Golisano did not hire many Democrats, because they get the joke.  However, Golisano needed to mitigate potential Republican opposition, and so his army went to work.

Before the GOP was able to accurately assess the threat and produce a counter-effort, Golisano’s paid consultant army signed up scores of otherwise solid conservative Republican legislators, including some here in California.

But, in the last several months, conservatives have begun removing their names from the pro-NPV campaign.  And just last week the Republican National Committee overwhelmingly voted to oppose the National Popular Vote.

Our Nation continues to face unprecedented struggles posed by economic and debt woes. But, the NPV provides an even greater threat – one that could end the liberty and freedoms upon which our very system of government was founded.  We must remain vigilant to protect and preserve the American system of governance – one that has produced history’s most successful model of self-governance.

 

(Shawn Steel is a former Chairman of the California Republican Party, and currently serves as California’s Republican National Committeeman.  Learn more about Shawn Steel and Save Our Electoral College at www.savethecollege.com)

Budgetary Gimmicks Meet Economic Reality

Once again, California is already outside of its projected state budget, passed late last June.

How can Sacramento already be spending more than it expected to collect only two months since the budget was signed?

It is the economic assumptions that the state makes when planning the budget that are just as important as the application of rates of taxation and fee rates.  Is that boring?  Quite possibly.  But it speaks to the larger point that government is inefficient in determining future economic activity and, when possible, will make absurd assumptions when politically expedient.

And why is this important?

It is important because it allowed public officials to proclaim Californians will “live within our means” because the budget is now balanced – a refreshing headline!

But the “means” are the assumptions built into the budget.  In this year’s budget, Sacramento expected the economy to expand rapidly, despite a stubborn unemployment rate of 11.8% as of June and a willingness to drive away jobs. Thus, California is already ten percent below revenue projections, which amounts to a loss of revenue of nearly $539 million.

When sluggish economic reality meets the decree of Sacramento, automatic budget cuts are initiated, which insulates public officials from the criticism that comes with assembling a budget that truly reflects living within our means.

Regardless of nominal numbers, when a state spends more revenue than it takes in at an increasing rate, there will be a threshold where the state becomes insolvent.  Without quantitative easing or the ability to increase money in circulation, that state has no control over the currency it borrows and spends.  This makes every state a lot more susceptible to budgetary crises than sovereign nations.

Sacramento is in need of true budgetary solutions that reflect the state’s economic reality not rosy assumptions that politicians would like to see.  State government needs less economic delusion and more economic leadership. The first step is honest, household budgeting procedures.

 

Is a National Popular Vote Good for California and the GOP?

National Popular Vote is good for conservatives, the GOP, and public policy.  Period.

Having been active in support of the initiative for over a year now, I have met and talked to hundreds of conservative leaders, activists, and elected officials. I have found most of those who reflexively oppose it do so because they think it is a process to amend the Constitution, don’t understand how it works or how it would affect outcomes, or are convinced of some grand conspiracy to turn America into a permanent Democrat hegemony.

The reality is the current system disenfranchises millions of conservatives from the process of electing the president, encourages pandering that transcends ideology (ethanol for Iowa, steel tariffs for West Virginia), and excludes 35 states from relevance in determining the Leader of the Free World. 

National Popular Vote is not ideological. In fact, both sides of the divide have found reasons to support the plan.  What else can explain the strange union of Tom Tancredo and (allegedly) George Soros?

But it’s complicated.  Since conservatives, me included, think “hell no!” the first time they hear about it, it takes time to understand it and realize how much it helps our nation’s governance and our movement’s objectives.  I have been in meetings with dozens of Republican legislators, spending hours going through how it works, constitutional history, Founders’ intent, and the impact it would have on the process.

Almost all of them begin the discussion opposed to the idea. After taking the time to learn more, I’d say 80% leave supporting it.  These policymakers were not brainwashed, but rather took considerable time to consider the plan on the merits.

The fact is, however, it takes 30 seconds to oppose National Popular Vote and 30 minutes to support it.  In today’s world, that’s a tough sell.

National Popular Vote has been signed into law in California, unfortunately without the Republican support it deserved.  A number of elected Republicans were subjected to threats and harassment for a bill considered to be a fait accompli, and it just wasn’t worth the political capital to remain in support. Such is the hallmark of the California Republican Party: it is better to fight each other over anything than fight Democrats.  It is this kind of intramural fratricide that has helped us become a party lacking any relevance whatsoever in public policy.

In 2008, California donors contributed $150 million to John McCain and Barack Obama.  Of that, a mere $29,000 was spent in the state.  Our irrelevance, as the largest state in the union and the 8th largest economy in the world, is terrifying.  Look around our state and see what unchallenged liberal governance has gotten us.

How’s the economy doing?  How about your tax bill?  Making a lot of progress on protecting the unborn?  Feeling a little bit safer with your concealed carry permit?  Proud of Senate and Assembly Republicans impact on the FY12 budget?

What Republicans have been doing in California is not working.  Forcing the RNC and our presidential nominees to commit to California and make the kind of infrastructural investment required to be competitive down ballot is critical to rebuilding our party.  Absent that, I guarantee you the movement to moderate the GOP to be attractive to independents will only increase, leaving conservatives in the dust.

Our ideas are right and we should not abandon them.

A New Chapter For California: Chapter 11

As a state, we take in about $70 billion a year. That looks like big number, except for one problem. We spend about $90 billion a year. You don’t have to star in Good Will Hunting to figure out that there’s a hole in that math and some blame to be placed.

Actually, there’s tons of blame to shovel around. You can go back to Gray Davis, who somehow thought that the rising tide of tax receipts from the Internet boom would last forever. Actually, he wasn’t alone–pretty much everybody felt that way, but pretty much everybody wasn’t Governor. With all that money flowing in, he was a laydown for the state unions that demanded and received all manner of salary increases, retirement goodies, and other means of reward not tied in any way to performance.

Once that particular beanstalk crashed to earth, California was stuck with enormous transfers to its unionized workers that it could no longer afford. But it had to pay them anyway.

Schwarzenegger followed, and we as a state are waking up from that political equivalent of a one-night stand with the same question on Schwarzenegger’s housekeeper’s mind–What were we thinking? Or were we just blinded by his muscular good looks?  He’s free, and we’re stuck with his love child, a $20 billion deficit.

Schwarzenegger’s next movie shouldn’t be a Terminator film. It ought to be a remake of Gulliver’s Travels, re-christened Governor’s Travels, or Governor’s Travails.  Here’s the plot:  Ahh-nold is tied down to a bed of concrete cigar boxes by a bunch of girly men playing the part of Lilliputians playing the part of members of the State Assembly and Senate. The only person who got more money out of Schwarzenegger than the unions will be Maria.

Then you’ve got the left, which has somehow made a moral issue out of violating borders and demanding handouts. Frankly, as a businessman, I’m astonished I have time to write this column. I’m so busy supporting not just my family but sixteen union workers and approximately forty-three undocumented individuals who are attending California schools and universities, benefiting from California hospitals, and otherwise enjoying the crumbling infrastructure of California, all on my dime.

I actually agree with one liberal shibboleth–people aren’t illegal. Illegal acts, however, are illegal. Breaking the law is illegal. If the numbers were reversed–if California took in $90 billion in taxes and only spent $70 billion–I might feel a little more charitable. As it is, I’m feeling a little pinched.

That’s why I say it’s time for California to declare bankruptcy. A clean slate. A fresh start. Just like you see on those late night infomercials. California ought to go to one of those bankruptcy guys you see advertised on the backs of buses and declare itself bankrupt, for the low, low fee of $249.00, plus filing fees. If we did that, what would we get?

We’d get a chance to start over. We’d get a chance to rewrite all the agreements with the unions, and maybe we’d have enough money left over to buy back some of the legislators whom the unions currently own.

We’d be able to reallocate spending in this state, so that there’s more of a connection between who earns money and whose kids get educated.

We would no longer be tied to the craven, secret giveaways that governor after governor has offered to special interests in exchange for campaign contributions, cigars, hookers, junkets, or whatever the currency of Sacramento really is.

With that kind of clean slate, we’d be able to pay people what they are worth, instead of what their union leaders have been able to carve out for them over decades of wheeling and dealing.

We’d be able to pay our prison guards what they would make in other states, which would allow us to build more prisons and arrest more bad guys to fill those prisons.  We might even have enough left over to hire some more prison guards.

As a result, the state and municipalities might not be so broke that they have to spend all their time nickel and diming businesses to wring out every ounce of tax revenue to pay for the bloated expenditures that are destroying our state.

There might even be enough money left over to re-open the courtrooms, libraries, and emergency rooms that have been shuttered by our endless financial emergency.

Would it be a black eye for California if we went bankrupt? Yes, but compared to what? The knuckleheads in Washington, who nearly took down the world economy and may have torched America’s fragile economic recovery in the name of scoring a few points during the debt ceiling fiasco? Compared to Portugal, Italy, Ireland, Greece, and Spain–five European nations who make Arnold Schwarzenegger and Jerry Brown look like Thomas Jefferson and Alexander Hamilton?

Although, come to think of it, Thomas Jefferson died broke, so maybe that’s not the best analogy.

You get what I’m saying. As one economist put it, “Things that can’t go on, stop.” It’s time we put a stop to the idiotic, seemingly unstoppable spending that is bankrupting the state, driving businesses to Texas or other healthier, more business-friendly locales, and get things headed in the right direction.

Going bankrupt, for California, would hardly be a badge of shame compared to what’s been going on in Sacramento for decades. It would be a situation where the state finally told the truth.

 

Michael Levin is a New York Times bestselling author and runs BusinessGhost.com, America’s leading provider of ghostwritten business books.

Green energy boondoggle raises costs while killing jobs and birds

You have to wonder if most California politicians simply can’t stand the notion of a thriving economy.  In a move that will have a devastating effect on jobs and on the pocketbooks of regular citizens, Jerry Brown recently signed legislation that will dramatically increase the amount of costly “green” energy California’s citizens will be forced to purchase.

In this time of record high unemployment, the political class should focus on stimulating the economy to create jobs.  Instead, the politicians have imposed a new mandate called “renewable portfolio standard” or RPS which decrees that 33% of our energy needs to be green by 2020 – as of right now, we have not even met the 20% target that was set for 2010.

Statistics from the Department of Energy show that renewable energy, as defined by the RPS mandate, can cost three or four times as much as traditional energy on a per-megawatt basis.  Higher electricity bills will further strain taxpayers’ budgets and lead to even more job losses.  The US Bureau of Statistics just released a report saying California lost 572,400 manufacturing jobs over the last decade, and our unemployment is now a full two percentage points worse than Michigan, a state famous for Detroit and its poorly performing economy.

In fact, California’s environmental regulations are so extreme that the majority of the renewable power we will be forced to buy will not even be produced in this state but imported from Mexico, Canada and other states.  While the political class likes the idea of green energy, getting any type of power plant built in California is difficult in a state as tangled in government red tape as ours.

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Don’t Let Rural Jobs in CA become Extinct

If a tree can’t be cut down on rural property because of unjustified federal rules, and no one’s around to hear the owner’s frustrated grumbles, do they make a sound?

The question occurred when I read the headline on a magazine item about the regulatory manacles imposed on landowners by the U.S. Endangered Species Act: “Boring but important”

It’s true that the minutiae of environmental restrictions on farms, forests and undeveloped land is not the sexiest of subjects, even for many conservative/libertarian activists who are passionate about opposing the advance of big government.

But attention needs to be paid. If we want California to become a land of promise again, we need to liberate not just the over-encumbered entrepreneur, the overburdened employer, and the overtaxed working men and women in our cities and suburbs, but also the enterprises rooted in the soil — the forestry, agriculture, timber and land-development industries that were the foundation of the state’s prosperity from the beginning.

– Item: Record snowfalls blanketed the Sierras this year — but farmers in the agricultural Central Valley were still squeezed on water supplies for much of the winter.

The reason: federal “fish before people” policies under the Endangered Species Act. Over the past two years, a misguided scheme to revive a declining three-inch fish, the Delta smelt, caused draconian cutbacks in pumping from the Sacramento-San Joaquin Delta into the San Joaquin Valley and Southern California. Hundreds of thousands of farm acres were fallowed and thousands of jobs went down the drain.

Although the media now tell us “the water crisis is over,” that’s only half right. If the drought of snow and rain has ended (for now), the regulatory crisis continues. In explaining why water users still aren’t getting their full allocations, the California Department of Water Resources fingers the feds: a May 2 DWR press release said that a 100% allocation is “difficult to achieve even in wet years due to pumping restrictions” for ESA-protected fish.

Those regulations flow from “sloppy science,” Fresno-based Federal Judge Oliver Wanger found. No wonder that the smelt population has continued to evaporate. All that was achieved was to turn green fields brown in one of the most fertile agricultural regions in the world and a historic backbone of California’s economy. Look for more of the same in future dry years, if the feds’ don’t flush their scorched-earth formula for fish protection.

Item: In 2006, a federally commissioned study concluded that the valley elderberry longhorn beetle no longer needed ESA coverage, and land-use limits could be lifted on private property up and down Central California, from Redding to Bakersfield. Five years later, the feds still haven’t acted; the beetle remains designated as “threatened” – flouting their own scientific findings.

The victims include businessman and environmentalist Bob Slobe, who wants to put up a small, environmentally sensitive office park in Sacramento County. His land has been labeled “critical habitat” for the beetle, so he can’t disturb a bush or tree without paying a massive sum for “mitigation.”

Slobe spends his time and resources shooing away and cleaning up after transients who camp on the land that he’s forbidden from putting to productive use.

The beetle regulations also bug flood-control agencies. They can’t easily fix or build levees where elderberry bushes are present. Levee improvements in Yuba County were delayed for months last year, and the current cost to mitigate for one bush along a Sacramento levy exceeds $160,000.

Says Rep. Dan Lungren: “There is no failure to thrive on the part of the beetle, only a failure to act on the part of [federal officials]. We could not afford it five years ago, and we certainly cannot afford it now.”

Item: Federal officials insist on keeping the California gnatcatcher on the ESA protected status – even though the small, insect-eating bird can be shown to be part of a species that flourishes in Mexico.

The listing ropes off nearly 200,000 acres in San Diego, Orange, Riverside, San Bernardino, Los Angeles, and Ventura Counties. The Fish and Wildlife Service admits that the economic hit from these restrictions is nearly $1 billion – quite a price to safeguard a species that isn’t in peril.

All these useless regulations offer a reminder: The recovery route for the Golden State has to run through Washington, D.C. Unless the federal government adopts a more balanced, people-friendly – and scientifically defensible – approach to environmental protection, California’s rural economy – and probably the state’s larger economy as a result – will linger on the endangered list.

Harold Johnson is an attorney for the Pacific Legal Foundation

Why California is Losing the Competitiveness Race in Education

California’s education establishment dislikes competition but the most recent research shows that, in the education marketplace, competition works.  A March 2011 study by the Foundation for Educational Choice (FEC) analyzed the results of all empirical studies that used the best scientific methods to measure how school-choice vouchers affect the academic outcomes of participating students.  The results should serve as a beacon as California policymakers debate ways to improve the state’s poorly performing government-run school system.

Under voucher programs, a state attaches funding to a student, which he or she can take to the public or private school of his or her choice. The study concluded, “Contrary to the widespread claim that vouchers do not benefit participants and hurt public schools, the empirical evidence consistently shows that vouchers improve outcomes for both participants and public schools.”

According to the FEC study, nine out of the 10 studies found that vouchers improved student outcome measurements such as test scores in the core subjects and graduation rates.  In addition, by increasing competition between public and private schools, voucher programs forced public school systems to improve.

Eighteen of the 19 empirical studies that looked at how vouchers affect public schools found that public schools improved their performance in the face of the increased competition fostered by vouchers.  In fact, every empirical study conducted in states with voucher programs, such as Wisconsin, Ohio and Florida, has found that “voucher programs in those places improved public schools.”  The FEC study said that while there are a variety of reasons why vouchers might improve public school performance, “The most important is that competition from vouchers introduces healthy incentives for public schools to improve.”  Yet, California has erected barriers to widespread competition in education.

Over the last few years, voucher and other pro-school-choice legislation have died in the state Legislature.  Now, with Democrats controlling the Assembly, Senate and the governor’s office, liberal legislators have unleashed a flood of anti-choice bills.  For example, AB 401 by Assemblyman Tom Ammiano (D-San Francisco) caps the number of charter schools, deregulated public schools started by parents, teachers and community organizations.  Ammiano’s bill targets charters despite the reality that they are four times more likely than regular public schools to be among the top 5 percent of schools statewide in student achievement.  Current California regulations also block students from choosing online and virtual education alternatives.

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Jerry Brown hating on small businesses

Jerry Brown hates me.

Hates me.

We’ve never met.  It’s not like I ever caused him any personal harm or grief.  It’s not like I hit on Linda Ronstadt or anything.

But the guy just hates my guts.  I think he wants to destroy me.

I’m not paranoid.

I’m just a California business owner.

On some level, Jerry Brown must hate all of us.

I call it payroll envy.  It’s the feeling that people who have spent most if not all of their lives in government have about people who actually start a business, work really hard, hire people, and meet a payroll every two months.

People in government feel as though they’re missing out on that experience, which I consider one of the most important life experiences an individual can have.

It’s not just that we business owners get to create our own destiny, make all the money we can, and bring about wonderful lives for ourselves, those we love, our employees and their families, our communities, and the charitable organizations we support.

It’s the sense of building something.

It’s the sense of creating something that actually serves people and makes money at the same time.

This isn’t to say that government has never done anything for the people.  If it weren’t for our government, we wouldn’t have a military, although why we are busily defending borders thousands of miles from our nation instead of eighty miles from my home in Orange County is a mystery to me.

If it weren’t for government, we wouldn’t have freeways, although when you look at the state they’re in, you start to wonder whether government is the best guarantor of our nation’s infrastructure.

If it weren’t for state government, we wouldn’t have the UC system, perhaps the finest public education system ever created in the history of man.

What’s wrong with a little California-style hyperbole?  Anyway, it’s probably true.  The problem is that when government exceeds its responsibilities to protect us, help us get from point A to point B in our cars, and educate our kids effectively, it gets into trouble.

Pretty much every single time.

It rewards people who do not deserve to be rewarded, like teachers who are not dedicated to teaching, unions that are more interested in protecting pensions than serving the state, and all of the other shenanigans that we know all too well.  When government lacks sufficient resources to take care of its own citizens and yet opens its borders, its schools, its hospitals, and other expensive and vital resources to anyone old enough to break into the country, something’s wrong.

That’s why I think Jerry Brown must hate me.  All I’m doing is running a business, meeting a payroll, and wondering what obstacle government will throw up in my path next.

Governor Brown has lived in a state where Hollywood is located, so maybe he’s been influenced too much by what he sees on TV and at the movies.  The number one villain, year in year out, on the small screen and the big screen, isn’t terrorists, or foreign agents, or any other murderous bad guys.

It’s business people.

Hollywood loves, loves, loves to make movies and TV shows about larcenous business owners, thieving corporate executives, and greedy Wall Street types.

Of course there is excess and chicanery in the business world.  We live in the real world, and in the real world, sometimes people do bad things.

But business can’t be all bad.  The governor, and the legislators in Sacramento, like the cars they drive (or are driven in), the five-star hotels where they stay, the expensive restaurants where they dine, the movies they view, the basketball games they attend from luxury of their business-related donors all these goods and services are the products of businesses, and most all of this happens on our dime as taxpayers.

The point is that you can take all the potshots you want at business, but at the end of the day, Governor, you need us.  You need us to create things.  You need us to create jobs.  You need us to create tax revenue.

And we’re not stupid.  We can read balance sheets—both ours and yours.  Don’t tell us that the California budget is so complicated that only a few people can understand it and that we taxpayers are too dumb to figure it out.  We know when you are spending more than you’re taking in.  We know when you’re pandering to the unions, to illegals, and to other shortsighted special interest groups that are more interested in the question of “Where is mine?” than the question of “What’s right?”

Governor Brown, stop hating me just because I own a business and I make a payroll.

And if you’re going to tell me that you don’t hate me, that’s terrific.  But let your actions demonstrate that you’re not trying to choke business owners like me.

Without us, there won’t be any tax revenues for you to distribute to your friends and supporters.

And unlike your friend in Washington, you can’t just print more money to solve your problem.

Governor Brown, you don’t have to love me.  All I ask is that you leave me alone.

(New York Times bestselling author Michael Levin runs BusinessGhost.com, which provides books for business owners to distinguish themselves in their crowded marketplaces.)

Restoring California Competitiveness

California was a place originally known for its opportunities, beauty, wilderness, open roads, Gold Rush mentality, freedom, and innovation. Eureka, the state’s motto, means “I have found it!”  But this place of dreams is now the land of wishful thinking: a consummate nanny-state of over-regulation, command and control.  From the profoundly and absurdly huge ideas (saving the planet from climate change while China and India march to a different tune) to the silly (mandating fitted sheets in hotel rooms).  And we’re so over-regulated, that I guarantee, right now, you are breaking some California law this very minute.  (Did you install your CO2 monitor required in every home July 1? No? $200 fine is on its way.)

Where unemployment at over 12% is one of the highest in the nation–two million people out of work–the state’s bond ratings flirt with junk status, and private investors are wary of a constantly changing and uncertain regulatory environment.  Where governors from other states proactively seek and invite the relocation of our best businesses.  And what’s to stop business from leaving? California has ranked 49th or 50th on numerous national lists as the worse place to do business for the last several years.  According to Dun & Bradstreet, 2,565 businesses with three or more employees have relocated to other states since January 2007 and 109,000 jobs left with those employers.

How can we restore California’s competitiveness?

With less.

Less government, less regulation, less mandate, less taxes.  We need to “let my people go!” as Moses would say.

One of the most difficult challenges posed by legislators to the weary regulated community is to name which offending regulations to change.  There are so many—each individually and independently approved with such good intentions—but piled one on top of the other, have produced a morass of laws and prohibitions that stifle investment, strike fear into the hearts of small business start-ups, and ultimately kill jobs before they’re even offered.

How many folks lost the opportunity for employment because—instead of hiring–thousands of hotels must now buy replacement fitted sheets for flat sheets?  Yes, that’s the law now proposed.

Let my people go.  Let my people work.  Simply, until businesses can predict with relative certainty what regulations they will be subjected to, (and litigated) and what their tax burden will be, at all government levels, they will not invest or grow or hire.  If business isn’t investing, growing or hiring, the state isn’t receiving tax revenues.  If business isn’t investing, growing or hiring, public employee pensions like CalPERS aren’t earning fair returns on their portfolio, entirely invested in stocks, bonds, mutual funds, real estate:  in BUSINESS!  The more elected leaders forget these time-honored facts, propose more taxes to fund government, or favor the flavor of the day in eco-thought without regard to economic benefit, the more this state will sink into a black hole of red ink.

To return California to economic competitiveness, every regulator at every level must do one thing now:  any proposed regulation must be subjected to an independent economic impact analysis.  What laws will it affect?  What jobs will it create/destroy/impact?  What other departments or agencies have competing or conflicting regulations?  What is the true cost/benefit analysis?  How does this relate to competing/complicit federal regulations?  You get the picture.

The independent economic impact analysis must be paid for by the agency or lawmaker proposing the law.  Don’t have funding to do this?  Don’t propose the regulation.  The economic impact analysis must be done by an outside, independent company—not by the lawmaker or agency in-house.  This analysis must be on the same level of sophistication as a CEQA environmental impact report for a proposed real estate development project, including formal public review, peer review and comment processes.

Southern California Association of Governments (SCAG)—the metropolitan planning organization for two-thirds of the state’s population—recognized this year that planning for future growth meant nothing without a strong economy.  Earlier this year, under the work of seven economists, developed its first ever Southern California Economic Recovery and Job Creation Strategy (www.scag.ca.gov) concentrating specific recommendations to expand the region’s economic base and increase the flow of funds driving the regional economy.  Fundamental to the strategy is the maxim that “stronger economic growth will help every community.”

To their members’ credit, SCAG approved this strategy unanimously.  190 cities and counties–with the strong support of the business community–threw down the gauntlet with job-creating action strategies that include:

(1) Oppose new legislation that negatively impacts jobs in the private sector;

 

(2) Support legislation that allows agencies…the flexibility to finance early delivery of project and at the same time create jobs;

 

(3) Eliminate or reduce regulations that inhibit expedited project delivery; and

 

(4) Require new state regulations be accompanied by an independent economic impact analysis…Any legislation considered to significantly impact jobs would be opposed;

 

This is outstanding work that recognizes California’s return to competitiveness begins with jobs that result from less government.  The State has both the need and wherewithal to develop a comparable strategy to create jobs, stimulate the economy, reduce regulations, and ultimately increase California’s competitiveness. Let my people go.

 

(Lucy Dunn is President and CEO, Orange County Business Council)