Closed for business? The anti-business mythology of the Golden State (Fresno: middle-class, city hall)

[.highnlite]

The existence of market forces in no way implies that government policy doesn't radically distor

Ok, sounds great, now tell me why housing costs more in San Luis Obispo County than in Modoc County, by the way, have you ever heard of Modoc County?

[.highnlite]

Tax Freedom Day happens in Texas on April 5th, in California April 14th, 9 days later,

In 14 states it occurs earlier than in Texas,

9 days out of 365, lets see, 10% of 365 is 36.5 I reckon, half of that, or 5% would be 18.25 days, and half of that would be darned close to 9 days and roughly 2%, Heck, what do you know, looks like User and I are right after all, I take back everything negative I ever said about him, he is a fine fellow. Course I can't do math for beans, so I could be wrong......

and then one has to consider what Texas provides to its citizens, interesting that Texas whom some feel has a great economy spends more on Welfare than on any other program

[user_id]

Originally Posted by randian

According to the Tax Foundation, in 2008, California's per-capita state and local tax burden was $5,028 on $47,706 of income, or 10.5%. Texas' per-capita state and local tax burden was $3,580 on $42,796 of income, or 8.4%. That's a cool 20% lower tax burden.

Yep and.....Californians pay around 2% more of their income in taxes than Texans. Just as the other poster suggested.

Originally Posted by randian

Texas' gross receipts tax is indeed awful, however, that's why Texas dropped from 6th to 13th on the Tax Foundation's State Business Tax Climate Index. Texas also dropped from 6th to 15th on their Unemployment Tax sub-Index.

What is awful about it? A state is not going to be able to maintain a large population and provide good business infrastructure without a decent degree of taxation. Texas already under-funds many programs and the effects can be seen in its economy. Its not a coincidence that California, with one of the best higher education systems in the country, is also a state that attracts the most venture capital. Texas is a great place to relocate low-mid skill manufacturing to, but its not a good place to relocate your R&D division. And this is exactly what you see, technology, science, etc companies with their headquarters and/or R&D centers in CA, MA, NY, etc and with their customer service, manufacturing, etc in states like Texas. Innovation and research is very tied to universities, this is something Texas missed when it decided to poorly fund its university system. High tech companies will come to the bay area regardless of the taxes because they want to be next to Stanford and Berkeley.

Anyhow, California isn't "closed for business", rather the types of businesses that can operate cost effectively in California has shifted over the last few decades.

[randian]

Originally Posted by .highnlite

Ok, sounds great, now tell me why housing costs more in San Luis Obispo County than in Modoc County, by the way, have you ever heard of Modoc County?

The market. Now tell me why a house in the middle of nowhere (aka Modoc County) is so much more expensive than one in the middle of nowhere in most any other state? Yup, the government couldn't have had anything to do with it.

[.highnlite]

Now tell me why a house in the middle of nowhere (aka Modoc County) is so much more expensive than one in the middle of nowhere in most any other state

?

Is it? Not to my knowledge, so, please, tell us why, facts now.

[randian]

Originally Posted by user_id

Yep and.....Californians pay around 2% more of their income in taxes than Texans. Just as the other poster suggested.

"2% of income" doesn't tell you much. "20% less" says a lot.

Originally Posted by user_id

What is awful about it? A state is not going to be able to maintain a large population and provide good business infrastructure without a decent degree of taxation.

What's awful is it's grossly distortive, horribly riddled with complex rules, absolutely kills low-profit-margin businesses, and you pay it even when you lose money. What's more awful is (surprise!) the promised level of property tax relief this tax was supposed to pay for never appeared.

The tax wasn't necessary anyway, Texas had a balanced budget without it.

Originally Posted by user_id

High tech companies will come to the bay area regardless of the taxes because they want to be next to Stanford and Berkeley.

You're ignoring network effects. Students can move, you know. Where's the comparable tech industry around MIT or Caltech? They aren't exactly chump schools. It's not about Stanford, it's about the network. If the network was in Boise, who would care about Stanford?

[user_id]

Originally Posted by randian

"2% of income" doesn't tell you much. "20% less" says a lot.

They tell you the same thing.

Originally Posted by randian

What's awful is it's grossly distortive, horribly riddled with complex rules, absolutely kills low-profit-margin businesses, and you pay it even when you lose money.

Any tax is going to have winners and losers. A gross-profit tax doesn't distort the economy anymore than a corporate tax. The tax rates vary from industry to industry and these variation largely deals with the differences in profitability, etc.

Originally Posted by randian

You're ignoring network effects. Students can move, you know. Where's the comparable tech industry around MIT or Caltech? They aren't exactly chump schools. It's not about Stanford, it's about the network.

No I'm not, its precisely due to network effects that areas with a cluster of great schools attract innovative companies. Caltech has a student body of around 2,000, where as Stanford as 15,000 and Berkeley around 20,000. Not even remotely comparable.

In terms of MIT, there is comparable industry in the MIT/Harvard cluster. But both schools have different strengths than Berkeley/Standard as a result the industry in the areas are different.

The fact that students can move doesn't mean anything, its not so much the students businesses are after but rather the research activity at the universities. The research is tied to the faculty and once you're a tenured faculty member at a top university you tend not to move. The only way a company is going to get a piece of the action is by opening a R&D center in the area. Take for example, Pittsburgh. Why are Google, Apple, etc creating R&D centers in the city? Its certainly not low taxes and a strong economy, instead its CMU.

Anyhow, Texas has no education clusters. Its best is UT Austin and just as you'd expect a small tech sector has formed around it. You're not going to get 21st century businesses in a state with 19th century ideologies.

[.highnlite]

Guess we don't learn about the cost of housing in Modoc County, I could just cry.

Now, I must say, when I built my house in the mtns of North Cal, it definitely cost more than on the flats, I built it with 2x6 instead of 2x6, so I could get R36 insulation in it, and, insulated the subfloor and over head with R40, and used low E triple pane windows.

I did that because the extra cost paid for itself with lower energy use.

[Oerdin]

Originally Posted by ZhugeLiang

Even if you meant sales tax, you're still off. And there's no income tax.

He's talking about the total median tax rate for both state and local taxes. It's almost exactly 2% difference between California and Texas. In other words, not enough to really matter.

[randian]

Originally Posted by Oerdin

He's talking about the total median tax rate for both state and local taxes. It's almost exactly 2% difference between California and Texas. In other words, not enough to really matter.

Perhaps your money doesn't matter to you. A 20% lower tax burden very much matters to me