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Friday, January 2, 2015

A Tale of Two States

Mario Cuomo, who passed away yesterday, famously spoke of America as a "tale of two cities," one rich, one struggling. California is increasingly a tale of two states.  The Los Angeles Times reports that high living costs have caused hundreds of thousands of low- and middle-income workers to move out.
The state overall has been losing people to other parts of the country since the 1990s. A snapshot of more recent U.S. Census migration numbers shows that nearly three-quarters of those who have left California for other states since 2007 earn less than $50,000 a year.
Experts point to the state's increasingly unaffordable real estate markets as a major driver of the trends. More than half of the nation's 50 most expensive residential real estate markets are in California, according to Coldwell Banker's Home Listing Report, including nine of the top 10.
Those moving to California tend to have higher incomes. About 35% of working-age people moving in make more than $50,000 annually, compared with 27% of those moving out.

The disparity gets progressively pronounced at the lower end of the income scale.
For those making $40,000 to $49,999, for instance, the net loss of population is 15,403 residents since 2007. The loss is 22,754 residents in the $30,000 to $39,999 range, then more than doubles to 46,318 residents in the $20,000 to $29,999 range.
"Housing prices are a primary factor, because that's usually the first thing you deal with when you're moving," said Dowell Myers, a professor of demography and urban planning at USC.
Census surveys back that up. According to data from the Census' Current Population Survey, those moving out of the state over the last 15 years listed housing as one of the most common factors, behind only family and job concerns.
According to the Census data from 2007 to 2013, one of the largest groups of workers leaving California was those who had more than a high school diploma but less than a bachelor's degree.

"For the people who can afford to go there, get the jobs and do well, the cost of living is not as much a problem," [demographer William] Frey said. "It's just difficult to live there in the middle."
One out-migrant, Adrian Moore, writes:
Part of the problem is that the state government has run amok. It's high spending has meant ever-increasing taxes and stringent regulations that lead to higher prices on everything from food to gasoline. And I am tired of how state government is negatively impacting my life and my family. 
Then there are the taxes. California has the fourth-highest state and local tax burden in nation according to the Tax Foundation. Yet, my fellow citizens blithely approved 23 of 30 local government tax increases across the state in the June 4 elections. At the same time, they approved 42 of 55 proposed ballot initiatives to raise local government or school debt even though California has the highest total state and local government debt in the nation according to State Budget Solutions. -