Golden State Rebound

As aficionados of conservative punditry probably understand, there is no recent staple of right-wing journalism hardier than the Dysfunctional California meme. The Golden State, were are told, illustrates the Grecian Formula of Ruin that progressives are determined to impose on the entire country: greedy union bosses conspiring with growth-hating environmentalists and deadbeat minorities to despoil pristine suburbs, destroy agribusiness, drive out private capital, and sink the state into bankruptcy, counting on their socialist allies in Washington to bail them out by looting the hard-earned dollars of virtuous red-state producers. Joel Kottkin has been writing this same story for decades now; it’s also Victor Davis Hanson’s Great White Whale.

Imagine the cognitive dissonance created on the Right by this lede from Matthew Garrahan in yesterday’s Financial Times:

After a decade marred by ballooning budget deficits, rising unemployment and swingeing cuts in public services, California’s economy may have finally turned a corner.

The state was hit hard by the financial crisis, with the rate of mortgage foreclosures and unemployment much higher than the national average. Regular budget deficits forced the state to slash public services and two years ago it even had to offer IOUs to its creditors in lieu of cash.

But jobs growth in the Golden State, an economy larger than those of India or Russia, has outpaced the national trend in the US in recent months. California’s Legislative Analyst’s Office is projecting a $1bn budget surplus by the 2014-2015 fiscal year, as $6bn of new tax revenue is due to flood into state coffers after voters passed a staggered tax increase on individuals and families earning more than $250,000 and $500,000 a year.

Now this could turn out to be an excessively optimistic assessment, for several reasons, among them the pent-up desire for more than moderate spending increases on education (where austerity measures have bitten deeply over the last few years in particular) and corrections.

But the very idea that California is headed anywhere other than straight to Hell is a problem not just for Grecian Formula enthusiasts like Kottkin and Hanson, but for all conservatives whose use of the Golden State as a cautionary tale in national fiscal and economic debates is in danger. You mean tax increases on the wealthy might actually help, not hurt? Horrors!

So I expect that we’ll see an enormous amount of pushback against the California Rebound story, replete with predictions that the job-creators of the state will immediately pick up and move to Texas, where policymakers understand that economic growth is inherently incompatible with unions, environmental protection, and the coddling of low-wage workers, who ought to be damn grateful for everything they get. And no hippies, either!

Ed Kilgore

Ed Kilgore, a Monthly contributing editor, is a columnist for the Daily Intelligencer, New York magazine’s politics blog, and the managing editor for the Democratic Strategist.