The American Interest
Analysis by Walter Russell Mead & Staff
California Underperforms. New York Times Spins.

The New York Times has an article out today about California’s gradual recovery. Though it admits that the state is not out of the woods yet, and that the recovery is geographically limited to the coastal cities, the tone of the article is generally upbeat and optimistic. A taste:

After nearly five years of brutal economic decline, government retrenchment and a widespread loss of confidence in its future, California is showing the first signs of a rebound. There is evidence of job growth, economic stability, a resurgent housing market and rising spirits in a state that was among the worst hit by the recession.

[...]

A reason for the change, in addition to a series of deep budget cuts in recent years, was voter approval of Proposition 30, promoted by Gov. Jerry Brown to raise taxes temporarily to avoid up to $6 billion in education cuts.

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In one sign of a new spirit, some Californians are again promoting the idea of their state’s setting the cultural and policy pace for the rest of the country, a meme that, if ever true, appeared at least questionable as California endured cuts that diminished its once-great higher education system. Rick Jacobs, the head of the Courage Campaign, a liberal advocacy group, argued that Californians, by voting to raise their taxes, set a model Washington should follow in negotiations over how to avert the so-called fiscal cliff.

The article is not completely unbalanced. Some criticism of California’s policies are presented alongside the liberal boosterism. But the piece is arguing with a straw man. The problem with California has never been that bad policies put the state in a permanent recession. Rather, bad policies have meant that the state and its residents suffer more than average when recessions come, and that they benefit less than they should when the good times return. Some of the world’s most dynamic people and industries are found in California, but poor governance means that the state as a whole keeps losing ground when compared with the country as a whole. That is California’s real problem, and the Times would serve its readers better by analyzing the forces holding California back from achieving its magnificent potential instead of hailing a modest and cyclical economic recovery as some kind of proof that the state’s model ‘works’.

That is pretty much what we see today, and far from supporting the “California on the mend” narrative the article promotes, the full details of Adam Nagourney’s article actually support a gloomy prognosis for what ought to be one of the most prosperous economies on earth.

Published on November 28, 2012 9:56 am