California’s unemployment rate has been 11 percent or higher for nearly two-and-a-half years, by far the worst extended jobless crisis since before World War II. This prompts Jerry Brown, Darrell Steinberg and John Perez to pretend to care about helping the private sector. But the truth is that in California, it’s business — or, more precisely, anti-business — as usual. This was made plain by two articles over the holiday weekend, one about the state’s eagerness to micro-regulate businesses and one about how trial lawyers legally extort money out of companies by using laws ostensibly written to protect consumers but actually written to allow trial lawyers to act like remoras.
The first story was in the San Francisco Chronicle:
California agencies are mobilizing to crack down on businesses paying cash under the table, saying the “underground economy” costs the state $7 billion a year in lost tax revenue and hurts companies that abide by the law. … [The state] is launching a Labor Enforcement Task Force to combat the underground economy, along with the Employment Development Department, Contractors State License Board, Board of Equalization and Bureau of Automotive Repair. The new task force will also work with the Department of Insurance, state attorney general and local district attorneys.
Now I’m not saying that this isn’t a legit issue for the state to worry about. But compare the resources the state is using to deal with this problem and the scant resources it’s using to help businesses. Or compare the Brown administration’s aggressive attitude about this problem to its indifference to a problem laid out in the L.A. Times on Monday:
The state’s tough consumer-protection laws and consumer-friendly courts have created what the American Tort Reform Foundation recently termed a “judicial hellhole” that delays legitimate suits from being heard and chases away jobs and investment. ….
… claims of deception that could have been avoided with some consumer due diligence — for example, reading the label — have survived court scrutiny, saddling overworked judges with what some legal analysts call fights over peanuts. …
A version of consumer lawsuits — those alleging minor violations of the Americans with Disabilities Act’s requirements for handicapped access — was the subject of proposed legislation this year aimed at curbing abuse of that law.
The practice of forcing pretrial settlements from small business owners for coat hooks or paper towel dispensers that are a fraction of an inch off the law’s exacting standards has become so widespread that it is essentially a cottage industry in California. The bill would have made it easier for courts to stop such “vexatious litigants.” But trial lawyers opposed it, and it failed.
These sorts of stories are common. Yet many in the media say, “Well, what do you expect? Of course businesses will complain to try to get an advantage.”
But that doesn’t explain why in national surveys of CEOs, California always ranks last in business-friendliness. The idea that California is deeply hostile to the private sector isn’t just something that’s fabricated by the state’s private sector to gain a break or too. It’s how the Golden State looks to folks in the other 49 states, and perceptions matter. Especially when they’re accurate.
The only job-creation efforts that Jerry Brown, Darrell Steinberg and John Perez care about are “green” ones — nearly all of which require costly government subsidies or exist only because of onerous government mandates. Great, just great.
Let’s face it: Much of California is like a dying Rust Belt state, just with much better weather.