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发帖数: 29846 | 1 California Tax Revenue Plunges
Inquiring minds have noticed a huge plunge in California Tax Revenue for the
month of February compared to February 2011.
That is a 22.55% plunge in spite of the fact that this February was a leap
year adding a day to the calendar.
Madeline Schnapp, at TrimTabs Investment Research sent me a quick note
regarding that plunge a few days ago.
Madeline writes...
Hello Mish
I came across this little tidbit from the February report from the
Comptroller's office of the State of CA.
In Feb 2012 income tax receipts are down $328 million y-o-y, or 16.5%.
Ouch!
What about retail sales taxes? CA had a "temporary" sales tax hike of
one cent that expired last July. Adjust the data to reflect that change, it
looks like sales taxes in February are $400 million y-o-y +/-, a decline of
about 12.4%. Double ouch!
That doesn't sound like robust growth to me.
Something About the Economy Doesn't Add Up
In Piecing Together the Jobs-Picture Puzzle, Jon Hilsenrath at The Wall
Street Journal wonders "How can an economy that is growing so slowly produce
such big declines in unemployment?"
Something about the U.S. economy isn't adding up.
At 8.3%, the unemployment rate has fallen 0.7 percentage point from
a year earlier and is down 1.7 percentage points from a peak of 10% in
October 2009. Many other measures of the job market are improving. Companies
have expanded payrolls by more than 200,000 a month for the past three
months, according to Labor Department data. And the number of people filing
claims for government unemployment benefits has fallen.
Yet the economy is barely growing. Many economists in the past few
weeks have again reduced their estimates of growth. The economy by many
estimates is on track to grow at an annual rate of less than 2% in the first
three months of 2012. The economy expanded just 1.7% last year. And since
the final months of 2009, when unemployment peaked, the economy has expanded
at a pretty paltry 2.5% annual rate.
How can an economy that is growing so slowly produce such big
declines in unemployment?
Trimtabs thinks the problem lies in the heavily massaged BLS employment
data and the highly suspect BEA personal income data.
That said, withholding tax data is also messy and not a perfect measure
either, but no matter what I do with the data, I can't get to 200,000+ jobs
unless a huge percentage of the workforce is suddenly working for McDonalds
Best,
Madeline Schnapp
Director, Macroeconomic Research
TrimTabs Investment Research
Businesses Exit California in Droves
Madeline and I are not the only ones who noticed the plunge in California.
Chriss W. Street on Beitbart discusses the California Exodus behind the drop
. Street has the reason: Businesses fed up with high taxes have fled the
state.
California politicians seem delusional in their continued delusion that
high taxes have not savaged the State’s economy. Each month’s
disappointment is written off as due to some one-time event.
The more likely reason tax collections continue falling is that
businesses and successful people are leaving California for the better tax
rates available in more pro-business states.
Derisively referred to as “Taxifornia” by the independent Pacific
Research Institute, California wins the booby prize for the highest personal
income taxes in the nation and higher sales tax rates than all but four
other states. Though Californians benefit from Proposition 13 restrictions
on how much their property tax can increase in one year, the state still has
the worst state tax burden in the U.S.
Spectrum Locations Consultants recorded 254 California companies moved
some or all of their work and jobs out of state in 2011, 26% more than in
2010 and five times as many as in 2009. According SLC President, Joe Vranich
in surveys 2) More adversarial toward business 3) Uncontrollable public
spending 4) Unfriendly business climate 5) Provable savings elsewhere 6)
Most expensive business locations 7) Unfriendly legal environment for
business 8) Worst regulatory burden 9) Severe tax treatment 10)
Unprecedented energy costs.
Vranich considers California the worst state in the nation to locate a
business and Los Angeles is considered the worst city to start a business.
Leaving Los Angeles for another surrounding county can save businesses 20%
of costs. Leaving the state for Texas can save up to 40% of costs. This
probably explains why California lost 120,000 jobs last year and Texas
gained 130,000 jobs.
California Governor Jerry Brown’s answer to the State’s failing
economy and crumbling tax revenue is to place a $6 billion tax increase
initiative on the ballot to support K-12 public schools. He promises to only
“temporarily” raise personal income rates by 25% on any of the rich folk
who haven’t already left.
Taxed to Death
If Brown continues to suck up to the public unions responsible for the mess
California is in, expect still more businesses to leave, expect the
unemployment rate to rise, and expect a continued plunge in revenue.
Mike "Mish" Shedlock |
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