Tag Archives: Meg Whitman

More Evidence of Real World Tiebout Competition

The past year, California experienced its lowest population growth rate in over a decade. Furthermore, the state’s positive growth was maintained by foreign, rather than domestic migration. The San Francisco Chronicle reports:

Since [2005], more than half a million more people have left California than have moved to the state. They mainly have moved to neighboring Western states, said Mary Heim, chief of the demographic research unit at the Department of Finance. In past years, more of those people moved to Nevada, but last year saw an increase in people moving to Oregon and Washington, she said. Texas also attracts a large number of Californians.

The article quotes state policy analysts who suggest that the Golden State’s regulatory climate is driving jobs and residents to other states. Contrarily, a Newsweek article from earlier this year explained that California’s CO2 regulations, the strictest in the country, could help the state’s businesses:

California has led the way in demonstrating how market-savvy regulation, instead of stifling growth, can jump-start innovation. For instance, the state has revolutionized the way utilities are regulated: instead of making profits by building more power plants, the California Public Utilities Commission links utility profits to efficiency gains—and leaves it up to the utilities to decide how to do it most cost-effectively.

However, potential Republican gubernatorial nominee Meg Whitman sees the situation differently. She said of Governor Schwarzenegger’s energy regulation:

I applaud the goals of AB 32 and our Governor for forcefully advocating for a clean environment.  However, three years ago when the bill was signed, the unemployment rate was 4.9 percent with 883,000 Californians unemployed.  Today, we have 12.2 percent unemployment, with 2.2 million Californians out of work.  Simply, jobs must come first.

Whitman’s views are in line with the ALEC-Laffer analysis of the states’ business environments, which suggests that Americans are moving from states with higher regulatory burdens to those with more economic freedom.