California is among the top ten high tax states in the union, coming in at either #6 or #8, depending who you ask. The steep marginal tax rates on its most productive workers has resulted in a negative outflow of highly skilled workers from California to other western states, even as the immigration of less skilled and undocumented workers strains the school systems and socials services. By the end of 2008, the on-going recession threw over 250,000 workers from the tax rolls to the welfare queue. Unemployment jumped in January to 9.3%. The trend line is negative.
The outflow of skilled labor, influx of non-skilled labor, increase of joblessness and overall reduction in taxable economic activity has resulted in a state budget shortfall of $40 billion. In the face of all this economic bad news, the state government proposes a $20 billion tax increase.
Herbert Hoover would be proud.