Although some in California seem not to know it, one of the major effects of state government is to transfer tax dollars from the coast, where California generates most of its wealth and income, to the less affluent interior of the state. Splitting California to create a new South California would be the beginning of an unprosperous and unhappy marriage.Read More
Jeff Stone, a Riverside County supervisor, is basking a moment in the media sun by resurrecting that hoariest of notions, that California be split in two. He wants to free his constituents of their bonds to the high-taxing, big-spending, business-regulating, gay-marrying folks of the Bay Area, northern California, and Los Angeles and break off a new state of South California, comprising 13 inland counties from Mariposa and Mono on the north to Imperial and San Diego on the south. His proposal will quickly go the way of all such gimmicks. And for that the people of his proposed South California should be very glad. Because one of these days the rest of California might very well take them up on the offer of divorce.
Like other recent would-be state splitters, Stone seems unaware of the big fact of California’s political-economic geography. In California, water flows south and west from the mountains to the valley and coast, but money flows west to east, from the coast toward inland areas. The big money in California is earned and the big ideas are hatched within reach of the summertime Pacific fog. Hollywood, Silicon Valley, the premium vineyards, the most productive marijuana plantings, and seven of ten University of California campuses: All are within 40 miles of the surf. And a disproportionate share of the taxes paid by the robust economy on the coast ends up financing public services for people living in the less affluent interior.
The chart below shows how Stone’s proposed SouthCal would stack up on spending and taxes compared to California as a whole.
Out of Balance
State government educates, medicates, and incarcerates. Public education, health care, and criminal justice account for more than 80 percent of the state budget. The counties that Stone would turn into SouthCal receive at or above their proportional share of those key three functions. (And an even higher share of social welfare benefits.) But as the table shows, they fall far below their share in generating income or revenue. As it’s now constituted, state government is a machine that raises money on the coast and ships a lot of it inland to Stone and his fellow South Californians. His proposal would break that conveyor belt and leave SouthCal (which already has an unemployment rate higher than the state as a whole) much worse off.
But notice that Stone doesn’t propose to divorce the entire coast. Like former Assemblyman Bill Maze, who proposed a similar split a few years back, he wants to include Orange and San Diego counties in his new paradise. He didn’t ask their permission to include them in his breakaway state, and if you look at the third column of the table, which shows how SouthCal would fare without Orange and San Diego, you can see why. Even more than the current state, SouthCal would be dependent on its coastal higher earners to pay for services for people in the inland areas. It is hard to understand why Orange and San Diego residents would want to sign up for that duty.
In fact, they and the rest of the California that Stone wants to divorce may begin to see some merit in his offer to walk away from the rest of us. Shorn of SouthCal, the remainder of California would find itself without a budget deficit. There would be many more places for California children at UC and CSU campuses, where the sons and daughters of Fresno and Riverside would now be paying out-of-state tuition. And there would be a lot fewer elected Republicans screaming about high taxes but then complaining when the Legislature cuts spending for their redevelopment agencies, cities, and local schools. Right about now, a lot of Californians might see that as a very good outcome.