Land of Inequality
From the March 10, 2014, issue of NR

(Getty Images/Mark Miller)



From the end of World War II until the 1990s, California possessed a magnetism unique among the 50 states. It was — according to a mythology that was probably overwrought even in those halcyon days — an American Eden, a place where ambition and unfettered imagination combined to make even the most exotic dreams seem feasible.

One of the reasons that image was so enduring was that the state consistently delivered on the outsized expectations. It came to be the center of American entertainment, with “Hollywood” becoming a metonym for the entire industry. It fostered the digital revolution that would eventually flower in Silicon Valley. It constructed one of the nation’s most extensive freeway systems, built a sophisticated infrastructure for delivering water, and developed one of the most impressive networks of universities in the country.

That California was synonymous with opportunity. It was a beacon to the middle class, a place where it was believed that you could author the future on your own terms.

The California that once beckoned residents from every corner of the nation has been demagnetized over the past quarter century. As an important 2012 Manhattan Institute study by Tom Gray and Robert Scardamalia noted, California led the nation in domestic out-migration in the 20-year period from 1990 to 2010, seeing an exodus of nearly 3.4 million residents that eliminated approximately 80 percent of the gains the state had made in domestic migration in the three decades prior. When those numbers are considered as a percentage of overall population, the Golden State stands alongside the nation’s biggest exporters of citizens: public-sector basket cases like New York, Michigan, Illinois, and New Jersey. In 2010, for the first time in the state’s history, California failed to gain any new seats in congressional redistricting.

Around the time this trend became widely acknowledged, a notion began to take hold that California’s regime of high taxes, oppressive regulation, and rampant litigation was scaring away the business class that brought firms and jobs to the state. There is plenty of truth to this criticism. For nearly a decade straight, CEO magazine has ranked California as the worst state in the nation in which to do business. From 1994 to 2008, California lost 124,000 more jobs to other places than it gained. And a Bloomberg analysis of Bureau of Labor Statistics data found that the Golden State saw its number of businesses drop by 5.2 percent in 2012 (a figure that includes both closures and relocations), easily outpacing every other state in the nation.

While the plight of the business sector is all too real, it tends to obscure the story of the migration numbers. An analysis conducted last year by the Hoover Institution’s Carson Bruno revealed that the group making up the largest share of the California diaspora is the middle class. These are not titans of industry looking to maximize profits in Texas or Florida; these are everyday citizens who’ve found themselves priced out of what was once called the California dream.

What accounts for the disproportionate impact on the middle class? In political terms, the explanation is rather simple: California is a state that owes its regnant liberalism to a political alliance between the super-rich and the super-poor.

While it’s fashionable to decry the state’s yawning wealth gap — the liberal Center on Budget and Policy Priorities ranked the Golden State as having had the third-worst income inequality in the nation from 2008 to 2010 — a What’s the Matter with Kansas?–style analysis, blaming the lower class for not voting in their own economic interests, can’t pass the laugh test in California.

In Los Angeles County — the state’s most populous — Democrats command majorities in tony precincts like Beverly Hills and Malibu as readily as in downtrodden areas like Inglewood and Compton. Barely one-fifth of L.A. County voters are registered Republicans. The situation is much the same in northern California. In Silicon Valley’s affluent Santa Clara County — the region’s largest — registered Democrats outnumber registered Republicans more than two to one. Yet Democrats also dominate in poor farming communities like Salinas and hotbeds of urban crime like Oakland.

It’s not that Republicans are entirely dead in California. Many of the state’s inland counties have the political disposition of red states, and Orange County stands defiantly as perhaps the last redoubt of conservatism on the Pacific. Their numbers, however, pale in comparison with those of the dominant coastal majority. While California may be famed for the cultural antagonisms between north and south, the political battle is largely east vs. west — those who bronze on the beaches against those who toil under the hot inland sun.