The good news is that California still lost less businesses than Massachusetts, the “You Didn’t Build That State” and the Soviet Union. The bad news is that it’s hard to fund a giant welfare state when all the businesses have moved to Texas. And even Canada.
Every now and then, one state governor or another will head to California to pitch businesses on leaving the Golden State. Canada’s immigration chief has been trying his luck, too
You know things are bad when Canada is poaching your businesses by promising a friendlier free enterprise environment.
There were 1.3 million businesses in California at the end of 2012, 5.2 percent fewer than in the previous year (that’s about 73,000 fewer).
But don’t worry. Most of those businesses aren’t leaving the environs of California for somewhere better.
“It’s more likely the disappearance of a number of businesses than it is businesses leaving California,” says Kevin Klowden, an economist at the Milken Institute’s California Center.
Whew. So California businesses aren’t leaving. They’re just mysteriously vanishing into thin air. Must be that recovery we keep hearing so much about.
In other words, it’s not exactly clear why California’s businesses are disappearing. Florida, another state hard hit by the bursting of the real estate bubble, and the state with the second most businesses, added new businesses at the nation’s seventh-fastest rate.
It’s a mystery all right. One state has low taxes and a Republican governor. One state has high taxes and a Democrat. One state is adding businesses and in the other state, businesses are mysteriously vanishing.
Can any junior detectives solve this mystery before all of California’s businesses disappear?