Inequality Divides the Golden State and Threatens Its Future
California's beauty has always hidden its poverty, but it hasn't made it go away. The last time I drove through the rich farmland of the Salinas Valley, I saw two homeless men pitching a makeshift tent made of plastic sheeting. This scene, straight out of John Steinbeck's East of Eden, appeared just a mile or so from the museum that celebrates his work. The land is fertile but its bounty is unequally divided, and it is inequality that is a defining feature of the state.
This week, the progressive news and commentary site Capital & Main rolled out the first of what will be a month-long series of stories about inequality and its remedies. Well worth a read.
So far in the series, Manuel Pastor and Dan Braun have looked across the California chasm at a state that has 111 billionaires, 41,000 millionaires, and the highest poverty rates in the country. Unemployment is at 3.5 percent in San Francisco, where resentment grows between the working poor, who are being priced out of their neighborhoods, and the tech-fueled salaried, who are moving in. In largely agricultural Imperial County, which runs north from the Mexican border, unemployment is 21 percent.
To add narrative to the numbers, reporter Maria Bustillos is on a road trip. Her stories are accompanied by some stunning images from photographer Elizabeth Fladung.
Meanwhile, Anthony York at the Grizzly Bear Project is opening his own discussion about whether policies that allow clusters of innovation and growth to occur in California also necessarily lead to inequality.
Concern about inequality is not voiced only by the left. Sacramento Bee columnist Dan Walters, no raving liberal, led a recent post reporting, "Income inequality sharply increased in California as the state emerged from the Great Recession, with the top 1 percent of Californians capturing 135 percent of income growth between 2009 and 2012."
The tax conundrum--and the difficulty of using state taxes to redistribute income--is that the top 1 percent already pay over half of the state's income taxes. And as York notes in his post, "dependence on high income taxes carries with it a series of risks. The booms and busts of the state budget over the last 25 years directly correlate to the rise and fall of the stock market, and the fortunes of high-income earners."
Currently, redistributive politics is playing between the Democrats in the legislature, who would expand social services, and Gov. Jerry Brown, who sees an unbalanced budget as the greater danger to the state. Brown holds the winning hand and the veto pen.
But pressures on California to reform its taxing structure are not going away, and it's encouraging to see that inequality is beginning to capture journalistic attention.
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UPDATE: for additional background material see this from The American Prospect on how to achieve full employment.