A person who read the last column here about the state's budget and pension dilemma, and whose advice is to be trusted, asked this: "If you were emperor of California, what would you do?"
To feel as though one is emperor is, of course, presumptuous and runs against the principles of the republic. But it is a fitting structure for laying out a concept.
So, if emperor, I would focus on reversing this series of statistics:
In 1990, California had 1.978 million manufacturing jobs vs. 1.686 million in state and local government, about a 15 percent difference in favor of the private sector, according to the Employment Development Department.
In 2011, those EDD figures are dramatically reversed: the state has 2.125 million state and local government jobs and 1.250 million in manufacturing, or 40 percent more for the public sector.
Is there any mystery why the economy -- public and private -- is facing a crisis? Put simply, California has in the last two decades become a place where, in the words of Wall Street Journal columnist Stephen Moore, there are more takers than makers. (And before people run to their Blackberries to fire off an angry email, Mr. Moore's phrase is rhetorical and not meant to belittle hardworking public employees.)
"Fiddle," you say about the decline in manufacturing jobs. "Manufacturing has been offshored."
OK. But the statistics are nearly as bad for other important sectors of the economy.
For instance, of California's approximately 14 million nonfarm jobs, the largest sub-set in the massive service-producing category is trade -- including retail (can you say, sales tax for cities and the state) -- transportation and utilities at 2.648 million, about the size of all government including federal employees.
"But," you continue, "we are a services economy today."
OK, sure. The state's professional services employment, which includes finance and science professionals, stood at 2.145 million in February, about the same as state and local government employment. And it's a reasonable guess that a good portion of those are under government contracts.
Now, set aside those statistics for the moment and come back to the basic premise of takers vs. makers: It is possible to have a singular focus on returning California's wealth-creating manufacturing prowess so that the sector's employment exceeds that of government by, to be conservative, 20 percent? Is it possible to test every public policy decision against what it does to achieve that goal?
One has to believe anything is possible in a state that is home to some of the world's most creative innovators and entrepreneurs and a world-class lifestyle.
But reaching the goal would require a focus on reducing all the things that are taking this state to the brink whether you are a sandwich shopkeeper or high-tech manufacturer. They include: high taxes relative to other states, burdensome regulatory bureaucracies that run entrepreneurs and businesses down and the government's fascination with subsidizing projects in energy and social engineering. The focus must be on encouraging (at least getting out of the way of) innovation and creating jobs in the private sector.
It shouldn't require an emperor to do that.
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Brad Bollinger is associate publisher and editor in chief of the Business Journal. He can be reached at 707-521-5241 or bbollinger@busjrnl.com. You can find his blog and other commentary at NorthBayBusinessJournal.com.
