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InsiderOnline Blog: April 2011

California Shrugged, Lawmakers Wonder Why

Seventy businesses have left California this year, and last week a group of lawmakers from the Golden State followed some of them to find out why they left. John Fund reports that the group, mostly Republicans, traveled to Austin to meet with ex-California businesses that have relocated to Texas. The group also included Calif. Lt. Gov. Gavin Newsom, who described himself and Gov. Jerry Brown as “pro-jobs Democrats” who “get it” on the need for business-friendly policies.

What the lawmakers heard, reports Fund, is that excessive regulations and high taxes make it too difficult to run a business in California. For example:

Andy Puzder, the CEO of Hardee’s Restaurants, was one of many witnesses to bemoan California’s hostile regulatory climate. He said it takes six months to two years to secure permits to build a new Carl’s Jr. restaurant in the Golden State, versus the six weeks it takes in Texas. California is also one of only three states that demands overtime pay after an eight-hour day, rather than after a 40-hour week. Such rules wreak havoc on flexible work schedules based on actual need. If there’s a line out the door at a Carl’s Jr. while employees are seen resting, it’s because they aren’t allowed to help: Break time is mandatory.

Fund’s article, “California Dreamin’—of Jobs in Texas,” (Wall Street Journal, April 22, 2011) also reports that more Democrats would have gone on the trip but were pressured to drop out by public employee unions.

Not entirely by coincidence, The Heritage Foundation’s 34th Annual Resource Bank also takes place in Texas—next Thursday and Friday in Dallas in fact. Among the offerings will be remarks from Texas Gov. Rick Perry, a keynote speech from pro-growth guru Arthur Laffer, and a panel on what other states can learn from Texas. You can still register.

Posted on 04/22/11 11:19 AM by Alex Adrianson

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