by Kiran Subramanian ’21
Published Oct. 4th, 2020
In the 1930s, many Okies migrated to California in an attempt to escape the Great Depression. Fast forward to today and that dream has turned into a nightmare for many Californians. According to ABC News, nearly 700,000 people left the state of California in 2020, compared to the 500,000 people entering the state. This may lead one to ask: why are people leaving the Golden State?
Strict regulations are one of the major reasons why people are leaving the state. According to the National Review, California has 395,000 regulatory restrictions on businesses, the most out of any state in the nation. In an interview at the 2019 Fast Company Innovation Festival, rapper and activist Kanye West talked about the excessive government regulation regarding his dome shaped homeless shelters, stating, “One of the domes was 10 feet too high… They came and said, ‘You got to take it down.’”
The tighter regulations that put Californian businesses in a stranglehold have only gotten worse since the Coronavirus pandemic. Elon Musk has stated that he is considering moving Tesla headquarters out of California unless the health officials in California let him reopen Tesla plants in the state.
Another economic reason why Californians are leaving the state is because of the high cost of living. California has the highest income tax rate in the nation (13.3%), according to Turbotax. As the USA Today states, “If you want to achieve that $75K standard of living, you’d need a salary of around $95,000 in California.”
Rich people aren’t the only ones leaving the Golden State, however. Lower and middle class Californians are also relocating. One major reason for this is the expensive cost of property in the state. According to a 2019 CNBC article, the average home price in San Francisco is approximately $1.2 million. Overall, the Mercury News reports that the average home price in California sits at around $600,000. Because of this high property cost, many Californians who make less than $100,000 are bidding the state goodbye.
Similar problems have been happening in New Jersey. According to Business Insider, New Jersey has lost around 69,000 citizens between 2016 and 2017. In that same article, many criticize New Jersey’s high property taxes and high cost of living. In terms of income tax rate, the top tax rate is 10.57%, according to smartasset, making it one of the highest taxed states in the nation.
Thankfully, it looks like politicians in both California and New Jersey are getting the message. When signing a $1.75 billion bill that would help combat the housing crisis in California, Governor Gavin Newsom is reported to have said, “‘We’re living in the wealthiest as well as the poorest state in America… Cost of living. It is the issue that defines more issues than any other issue in this state.’” Similarly, in New Jersey, State Representative Greg McGuckin has been quoted saying, “‘Our middle-class residents are leaving in unprecedented numbers to locations where property taxes and real estate is more affordable… As we face the uncertainty of the pandemic and the economic fallout on the horizon, it’s clear that many people feel New Jersey is not a desirable place to live, raise a family or own a small business.’”
While those in charge are responsible for the outcome of their state, it is up to those who live under them to vote for who will fix the state’s problems.