California Is the World’s Fifth-Biggest Economy. Let’s Not Brag.

Underneath the state's self-congratulation for being really, really rich is the reality that much of California's wealth comes from exploitation and unsustainable practices.

As we’ve noted before, a strain of American conservatism hates California so much that they can’t stop themselves from telling outrageous lies about what a hellish dystopia this state has become. In terms of the median SF Weekly reader’s political affiliation, you might not hear about it, because most of it stays contained on the dumber half of the internet. But one of the more recent outbreaks of nonsense led to a ridiculous rumor that California law would shortly ban the Bible. Leaving aside the point that the ACLU would (rightfully) go into attack mode if any U.S. jurisdiction, let alone the biggest state, sought to ban a religious text, we also have the recent essay by a Town Hall columnist all but calling for an attack on San Francisco, a “hotbed of treason” — whatever that means — whose peninsular location and opposition to packing heat make us essentially defenseless.

“Treason” is one of those words that gets a lot of people excited. But whether you think California is bursting with scurrilous left-wing radicals or packed to the gills with Establishment-friendly moderates, the Golden State is certainly a hotbed of capitalism. California’s economy is now $2.747 trillion in size, eclipsing the GDP of the United Kingdom ($2.625 trillion) when measured in U.S. dollars, making it once again the fifth-largest economy in the world.

That’s a status California held once before, only to fall as low as 10th place at the bottom of the Great Recession. And Britain, it should be noted, has many more inhabitants than California does (65 million versus 39 million). The fourth-biggest economy is Germany, at $3.685 trillion — outpacing us by some $940 billion but with still more people (82 million overall). And German economic growth is so anemic that at current growth rates, California will be bigger in 2030. 

Underlying such hypotheticals are some unmistakably good indications that California is heading in the right direction. Consider this: From 2016-17, California’s economy grew by 3.4 percent, or $127 billion, a titanic figure that isn’t much smaller than the total economy of neighboring Nevada ($146 billion in 2016). The state’s economy is roughly equivalent to the combined economies of Texas, Oregon, Nevada, Idaho, Montana, Utah, Arizona, New Mexico, and the Dakotas, even though those states have 13 million more inhabitants.

We’re not just bigger, we’re also pulling away. California’s share of the overall American economy has increased, as did the state’s share of total job growth. In essence, Silicon Valley, Hollywood, and Central Valley agriculture are three huge reasons why the longest postwar economic expansion has continued and even strengthened.

Feeling a little proud of your state? Well, all of this is nothing to brag about. It’s really not.

On the one hand, this is important. California is a high-tax, high-services state with strong labor protections and a high proportion of undocumented immigrants in the workforce, essentially the opposite of supply-side paradises like Kansas. Many economic conservatives like to tut-tut at so-called nanny-state intrusions into the free market, but California’s resilience demonstrates that this is a viable model. We’re decoupling economic growth from carbon, we’re beginning to pay low-wage earners more fairly, and we’re making enormous strides in transit.

The urge, then, is to respond to the anti-California trolls with a snottiness of our own, because we can back up our success with hard numbers — while the dogma that you can generate endless prosperity through tax cuts that will quickly pay for themselves has proven once again to be a total fabrication. 

We must resist that temptation. The New York Times got it partly right, noting the dark underbelly of prosperity: a merger of morning and evening rush hours into one day-long traffic snarl, and of course, the ghastly unaffordability of nearly the entire urbanized part of the state. We claim to respect human dignity while tolerating a system in which tens of thousands of people sleep in tents at night. The mayor of the capital of American liberalism, installed in a coup by progressive supervisors, called for the breakup of encampments in the Mission only days ago.

But it’s even more fundamental than our grotesque hypocrisy. In the aggregate, we’re fucking rich as shit, and sneering at poorer states is a horrible thing to do. (Take that, Arkansas!) Are we really going to applaud ourselves for being linchpins of the #resistance just because a lot of rich people live here? Did we all not shudder in unison when then-candidate Trump bragged, “I’m really, really rich”? Can the average Californian really even take credit for these economic numbers? Sure, California grows nine-tenths of every almond Americans eat, but how much of that is built on the exploitation of low-income workers, almost all of them Latino? How much of the wealth those nut trees generate might be better characterized as theft from future generations, the people who will have to contend with brackish aquifers subsiding as those underground reservoirs slowly pull in salt water from the Pacific to replenish what we greedily took? 

Every human who opens the package of their brand-new iPhone reads the words “Designed by Apple in California.” But Apple has long been an obscene tax scofflaw, offshoring its unfathomable wealth until a ticking time-bomb of a GOP tax plan — quite the opposite of the prudent economic stewardship that characterizes the Jerry Brown era — made it feasible for that tech luxury-goods giant to repatriate its billions. (Those billions went largely to stock buybacks, further enriching the haves.) And those enormous cash infusions into the scooter and e-bike startups? How very nice for the money-hemorrhaging Uber to snap up a new potential revenue stream, but the people who collect and recharge your ride are barely scraping by. Conservatives might hate California for stupid reasons, but California has achieved Texas’ dream of enriching rich people and keeping workers down even better than Texas can.

The state is a juggernaut of wealth, but the occasional good sense of our state government is only one reason for it. Yes, it is undeniably a positive that California’s politically involved billionaires vote more like Tom Steyer than like Charles Koch or Sheldon Adelson, and a massive state that got walloped hard in 2008-09 needs years to right itself. In many ways — housing being the most notable outlier — we’re going in the right direction, particularly with respect to renewable energy. But under the self-congratulation for our prosperity is the fact that only people in a position of extreme privilege can really clap for capitalism. 

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