Even Gavin Newsom, who the LA Times (with embarassing inaccuracy) calls "a poster boy for California liberalism" is buying, at least a little bit, the argument that California is losing jobs to Texas (and presumably other states) because of a "bad business climate."
But a new study demonstrates, with excruciating accuracy, that the Texas argument is nothing more than bullpucky. California loses 25,000 jobs a year to other states, and gains 16,000 jobs a year from other states, and when you look at the 15 million jobs in the state, that's just decimal dust.
Government – perhaps contrary to popular belief — cut 51,000 jobs last year. The construction industry, particularly hart-hit in California because of the housing bust, lost 26,000 jobs.
Remove those two sectors from the picture and California’s job growth was a respectable 1.5 percent in 2010. That’s a rate that compares favorably to the nation as a whole, which on the same measure grew by 1.3 percent. Professional services, health care, tourism and trade all posted job gains in California, as did the entertainment industry and Internet-related businesses.
In other words, public-sector layoffs (caused by low tax receipts) caused more economic pain than private-sector jobs moving to Texas for lower taxes -- by far. More:
But even if a state’s tax code can lead to economic growth, other factors, including the state’s weather and its mix of industries, appear to be more influential than government policies, according to the PPIC study. So while California might do even better if it simplified its corporate tax code or restructured its welfare programs, the study found, those issues do not appear to be the reason for the recent doldrums.
That's right -- cutting taxes won't create jobs in California.But cutting taxes so deeply that schools and police departments have to lay off employees will, indeed, cause job losses.