Kotkin: CA Experiencing “Oakies in Reverse”

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

When the Dust Bowl of the 1930s crushed the economy of the southwest thousands of migrants (many from Oklahoma) found their way to California. Now California’s business climate is propelling “Oakies in reverse,” says Joel Kotkin, internationally-recognized authority on global, economic, political and social trends and contributor to Fox and Hounds. Speaking last month to a California Manufacturers and Technology Conference, which asked the question, Can California Compete for Jobs in America’s Manufacturing Renaissance, Kotkin said, in a reversal of what occurred 80 years ago, people are leaving California in search of better economic opportunities.

Kotkin painted a picture of a state that is losing its economic power and influence.

Describing himself as a Pat Brown Democrat, Kotkin said California’s problems were a result of anti-growth attitudes (especially along the coast), regulations and taxes, and a sinking middle class.

The issue of the smaller middle class in California he compared unfavorably to the United States as a whole, and particularly to the state of Texas. The same was true in high tech/STEM jobs (jobs related to Science, Technology, Engineering, and Mathematics.) In fact, Kotkin predicted that under current circumstances Texas would surpass California as the top high tech state. Texas may not have the “nameplate” businesses in tech, he said, but they will have a majority of the jobs.

Kotkin blamed some of California’s problems on the “gentry” telling others how to live. He described them as smart growth advocates who live in gated communities. He said progressive policies tend to make the state’s class distinctions worse.

The state won’t be saved by “grand illusions,” which he cited as green jobs, high speed rail and social media IPOs.

Kotkin’s harsh analysis of California’s situation included the surprise observation that not only was the Midwest recovering while California seems to be stuck in mud, but that Michigan, the scene of hard times lately, “looks better than California.”

As solutions to turn the state around, Kotkin suggested tapping into the great immigrant population, which can aide in international business; lessen green legislation while improving infrastructure; and re-orienting education for more positive results.

He also suggested that California tap its great energy reserves, including natural gas.

He laid some responsibility for California’s condition at the foot of its business community, for not doing a good job in communicating its message and failing to make the case for a more business friendly state.

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