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California Reopens… Again! 

urban city pedestrians wearing face masks

California Reopens... Again!

On Monday, California officials lifted the stay-at-home order, clearing the way for restaurants, wineries, movie theaters, and gyms to operate outdoors—and hotels and personal care service businesses to reopen with strict caps on occupancy.

I am so excited to finally see that restaurants will be able to open for outdoor dining beginning immediately. Yea! I’m thrilled to support my local restaurants again.

And now you can get a haircut and polish those nails in salons. I almost bought a do-it- yourself haircut kit, which probably would have made me look silly.

Hopefully, this takes us one step closer to normal life.

Question: Is California going to be able to recover its mojo?

With California Personal Income Tax rates above 13% and no break for capital gains, it is easy to see why folks are leaving.

Florida, Texas, and Nevada and working endlessly to attract California’s best companies to their states with real estate breaks and absolutely no state income tax.

  • Tesla, the darling of Fremont, is building their battery plant outside of Reno and a large car manufacturing plant in Texas. 
  • Hewlett-Packard, the company that started it all in Silicon Valley, is moving most of their operations and headquarters to Texas.
  • Miami is pressing hard to become “Little Silicon Valley” with all types of incentives for companies and their owners.
  • Oracle is on the move to Texas too.
  • Apple, Google, Amazon, and Facebook have all quietly expanded with facilities in Austin.


And let us talk about the unfunded pension liabilities by the state and counties. Forbes contributor Adam Andrzejewski reports:

Despite California’s $54 billion budget deficit, we have a $1 trillion unfunded pension liability not on the State’s books. There are 340,390 government employees bringing home six-figure salaries and pension checks. The auditors at OpentheBooks.com found truck drivers in San Francisco making $159,000 per year; lifeguards in LA County costing taxpayers $365,000; nurses at UCSF making up to $501,000; the UCLA athletic director earning $1.8 million; and 1,420 city employees out earning all 50 state governors ($202,000).

Opinion: What can California do?

With smarter policy choices that prioritize some critical supports, California can chart a quicker economic rebound.

  • Lower the State Income Tax by 50% to make it more competitive.
  • Lower the number of state employees by 10% to pay for this. Cities’ payrolls are bloated and need to be trimmed.
  • Freeze the County and State Pension Plans and replace them with 401(k) plans.
  • Work with cities to give temporary tax relief to manufacturers who wish to relocate here. Learn from New York’s lesson with Amazon HQ2.
  • Give tax breaks to restaurant owners and other small business owners.
  • Change the unlimited liability for health insurance carriers so they can lower their business rates.
  • Create public-private partnerships to clean roads, parks, and more. California’s state park system has accumulated over $1 billion in deferred maintenance over the last few decades, due to lack of funding. 
  • Solve the homeless problem. California has the third-largest homeless population in the United States and this has only gotten worse in the last few years. It’s time to accept the fact that the past policies haven’t worked.
  • Help the local police departments do their job and stop crime. No one is going to move or stay here if they do not feel safe!

Conclusion

While this crisis is unprecedented, taking bold action today is vital to help recover from the pandemic recession.


We all hope for our families that life will get completely back to normal ASAP. Our kids need to be in school, our restaurants should be open. Our small businesses must be supported and not assaulted. We need safe streets and neighborhoods, a clean BART, clean and safe parks and so much more. 


Come on California, you can do it!


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