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Friday, July 22, 2011

Are Californians a bunch of rich tightwads?

People often talk about CA as a rich state when they are referring to GSP (Gross State Product).  Looking at just the total GSP when CA has the biggest population is rather odd.  On that basis I suppose India is a rich country ($1,729T) and Switzerland ($523T) is a poor country.
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29

GSPs are available at Wikipedia
http://en.wikipedia.org/wiki/List_of_U.S._states_by_GDP_%28nominal%29
which shows California’s at 12th “per capita”.  If, after adjusting for COL, being 9th in personal income adjusts to 34th, then being 12th in GSP probably adjusts to about 40th in GSP per capita.  (see previous post). You spend it on services “per capita” and collect it in taxes “per capita”.  Mostly it is collected on income and on property.  CA at 34th “per capita” personal income (adjusted for cost of living) is not really rich.  Richer than some, poorer than most.  The reason it spends proportionately less on K-12 is because it spends proportionately more on colleges, particularly the UCs.  It spends proportionately more on education than most states in unadjusted expenditures.  The group that took the biggest hit in this years state budget was social services.  This huge hit to social services helped minimize the cuts to education.

I see a state with higher than the national average unemployment at a time when the national average unemployment (including those who stopped looking or are working only a few hours a week and so don’t count in the official figures) is around 18%, college graduates working at $8/hour, (if they can find that) and a lot of laid off people wondering when their unemployment checks will run out.  Even the Army and Navy are “laying off” thousands of enlisted and officers because the lousy economy isn’t inducing many to leave voluntarily.  There should be a little sympathy for people who feel stretched and are taxing themselves more than most to pay for education, such as teachers salaries.

Suppose CA did raise taxes enough to give everyone below poverty level an extra $20K per year, thereby cutting nominal poverty by a lot – would this automatically turn their kids into good students?  Or would they be the same kids only with better shoes?  Maybe correlation is not causation as others have so wisely noted.  Maybe the reason they are poor is that they and their parents don’t have the life skills to figure out how to get out of poverty.  In which case high intensity burn-out-the-teachers but turn (at least some) kids around charter schools might help if the local districts would quit fighting them?  Or maybe a lousy economy doesn’t provide much opportunity for anyone these days?

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