Site search

Subscribe by Email

More Information


California: The Place Where Dreams Never Get Started

Elon Musk, a California resident, heir to Steve Jobs’ reputation as the smartest, boldest guy in Silicon Valley, and the driving force behind Tesla Motors, SolarCity and SpaceX, has announced plans to build the biggest manufacturing plant ever. He wants to spend up to $50 Billion and employ 6,500 workers to build batteries to power a more affordable version of the Tesla S, to be called Gen III. The ripple effects benefitting the economy in the lucky community where this plant is built will be enormous.

So, where do you suppose he wants to build this plant? He’s looking at Arizona and Nevada, where the legislatures are working overtime to get out of his way, New Mexico and Texas, where Governor Perry is personally negotiating for a deal.

But not California. We’re not even on his list. Here are some reasons why.

In 2013, Chief Executive Magazine ranked California the worst state to do business – for the 9th year in a row.

In January 2014, The Economist magazine reported that California suffered 254 “disinvestment events” in 2011. That means 254 California companies of 100 workers or more either moved out of state or expanded elsewhere rather than invest any more in our future.

And these numbers don’t count companies and entrepreneurs which, like Musk, took a look and decided to take a pass.

The magazine quoted one observer in Sacramento as saying that our state government’s attitude toward business in general, and manufacturing especially, is – and you can certainly include Cal/OSHA here – the phrase “FY” (we’re old enough not to want to spell it out for you) repeated nine times. iPhones, for example, are proudly “designed by Apple in California,” but they are made in China. Design is clean, employs bright, well-paid engineers and plays to the myth of Californian exceptionalism. Manufacturing, by comparison, is messy, has higher worker injury rates but pays working wages.

Considering the regulatory burdens we place on businesses – and in Musk’s case, the roadblocks traditional energy companies throw in the way of alternative energy start-ups – and you have a society which repels industry and is paying the price. Is it any wonder that our middle class is shrinking faster than the other states?


Write a comment