Judging from the headlines, California is on the cusp of collapse. The state of California certainly has a sizable budget gap, just like they do every year. There are also a number of people leaving the state to escape the taxes and companies that are fleeing regulation. The news coverage leaves little doubt that California faces a grim future. Yet, the state somehow continues to function and keep millions of its residents. The budget problem is the latest crisis. However, budget shortfalls are a problem that other states face every year and hundreds of cities and countries across the nation also face. The current problems are most likely worsened by the impact of the deep recession. Unemployment in the state has decreased the amount of income taxes collected at the same time the governmen...

We are not taking sides in the political debates that surround the California state budget, but we do believe that everyone can learn something about spending, and budgeting, from watching the action in Sacramento. The obvious lesson to draw from California and almost every other government is that chronic overspending leads to big problems. Gimmicks help many of them, including California, technically balance their budget or at least show a lower deficit than private sector companies with similar spending patterns would. What went wrong for California’s budget? Governments have largely reached this point where they suffer from chronic budget deficits because they failed to set priorities in many cases. In California, some are appalled that the state spends more on prisons every year...

Nationally, the average price of a gallon of gas reached $3.76 recently according to AAA. In California, the average was $4.35, almost 60 cents a gallon more. California usually has the highest gas prices in the continental United States. Residents of the Golden State usually pay about 25 cents more than the national average, but are paying much more in 2012. The biggest reasons are taxes and environmental regulations. At the pump, Californians pay about 66 cents in state and federal taxes for a gallon of gas. The American Petroleum Institute says that the national average is about 48 cents a gallon. That difference alone accounts for a large part of the higher cost. A factor unique to California’s gas price is one of a kind environmental regulation. In the mid-1990s, state law required ...

Recently, the University of San Diego hosted its annual round table of local economists to discuss the year ahead. In general, the experts seem to believe that there will be slow but steady economic growth in our area, largely mirroring what economists expect to see at the national level. The best news may be from Point Loma Nazarene University economist Lynn Reaser who said that she believes San Diego would probably lead both the nation and the state of California in the recovery. She believes this because of our region’s concentration in innovative fields like high-tech and biotech. Unfortunately, she thinks that the county probably will not recover all of the jobs it lost during the recession until 2015. What economists are saying about the housing market in San Diego Recovery in the ...

Home prices are directly related to economic growth, and the state of California has suffered a large drop in many other economic indicators, including employment, as home prices fell. But determining which came first is almost a “chicken or the egg” type of question. Given the close relationship between real estate and the economy, there is some good news on both fronts according to recent reports. Economic growth is in the forecast Wells Fargo offers detailed economic research in addition to banking services. They recently noted that employment in California has finally turned higher. Data from July shows that the number of jobs available rose by 1.2% from last year. Even better news came with the fact that the high paying information services sector is leading that job growth. Econo...