The California Department of Finance announced in May that California’s population fell for the first time, dropping by more than 182,000 people in 2020.
Additional demographic information from the U.S. Census Bureau and the Internal Revenue Service found the population losses mainly were around lower and middle-class residents over the age of 30, though all age groups and pay ranges were affected.
The Pacific Research Institute (PRI), a public policy nonprofit, released a deep dive Sept. 21 into why thousands of Californians have been leaving the state at higher-than-ever rates.
It said nation-leading income tax rates, high utility bills, growing crime and homelessness, housing shortages because of restrictive zoning laws have created an environment that has people and businesses looking to leave.
“The exodus from California is real and too large to ignore,” said PRI’s Kerry Jackson and Wayne Winegarden, the study’s co-authors. “The state’s increasingly detrimental policy environment creates numerous obstacles that reduce people’s quality of life and inhibits their ability to prosper, which they can overcome by relocating. Reversing these trends requires a policy overhaul. The quicker we start, the sooner we can reinvigorate the California dream.”
PRI highlights several high-profile business leaders who recently announced their companies had departed from California, often citing high costs of doing business and opportunities for growth elsewhere. Local officials, including Gov. Gavin Newsom’s office, have disputed that, saying the loss of companies is overblown.
“Despite the protestations from politicians, the words and actions of business owners, large and small, demonstrate that California’s exodus problem is large and growing,” the report said.
PRI suggested reforms, many unpopular with Democrats who carry bulletproof majorities in the Legislature, it said would lessen the state’s people losses:
• Reforming zoning regulations and the California Environmental Quality Act (CEQA) to reduce the cost of housing;
• Reforming the state’s energy and global warming policies to make gas and electricity affordable and reduce the growing problem of energy poverty throughout the state;
• Lowering the cost of energy and regulations also will alleviate California’s expensive food and transportation costs;
• Implementing tax reform to improve the incentive to work and save in California, reduce the volatility of state revenues and lessen the adverse consequences that results from the state’s excessively volatile budget;
• Addressing short-term and long-term spending that are the root cause of the state’s uncompetitive tax burden;
• Reversing the recent justice reforms, such as Prop. 47, which are undermining the safety and security of residents;
• Leveraging private charities to help sustainably address the homelessness crisis, with a focus on addressing the root causes of the problem.
“Implementing these reforms is a long road, undoubtedly, but the quicker we start, the sooner we can reinvigorate the California dream,” the report said. “There is no time to waste.”…Original Source…