California-and the L.A. area especially-keeps losing corporate headquarters--WHY?

[Pedestrian]

Originally Posted by SLO

The schools including all of the above are so reliant on cash and student loans its created a crisis.

I do NOT think you are doing students any favors by encouraging them to borrow money to get a bad education in a field with few employment options. I have seen one proposal for a reverse tuition scale whereby the easier it is to get a job following a given course of study, the lower the tuition charged to pursue it. Engineering students (US citizens) might be charged little or nothing. Students in "political science" and "ethnic studies" might be charged a lot.

[ChargerCarl]

Originally Posted by Pedestrian

Proximity via the ever-problematic Highway 17. I don't know . . . .

After I become dictator I'm rezoning all of the Bay Area for higher density and tunneling a train through those damn mountains connecting SC/Monterrey/Watsonville and San Jose.

[SLO]

Originally Posted by Pedestrian

I do NOT think you are doing students any favors by encouraging them to borrow money to get a bad education in a field with few employment options. I have seen one proposal for a reverse tuition scale whereby the easier it is to get a job following a given course of study, the lower the tuition charged to pursue it. Engineering students (US citizens) might be charged little or nothing. Students in "political science" and "ethnic studies" might be charged a lot.

I totally agree. Interesting proposal. Wont fly, but interesting.
And the UC's are leaders in useless college degrees. My son in Biology/Premed had a room mate graduate in Asian American Studies at UCLA last June (he's Mexican), and has had no real job prospects. The school itself does a horrible job teaching real world conditions to these kids. UCLA is so difficult to get into and he is a good kid, good student who was making his family proud but cant make a good living like that. He now takes his massive student debt and is starting over getting another degree to be a Physicians Assistant.

[Pedestrian]

^^My niece did something like that. Got a bachelor's in I-don't-even-know-what from Clemson. After graduating, got trained as an EMT and worked at that for a while. She liked it so she went to nursing school and got a BN. Worked as a nurse (in the Johns Hopkins Surgical Recovery Room with Ben Carson as it happens) but eventually got some more training and is now happily working as a Nurse Practitioner. I told her at the beginning to get a degree in some field of science and offered to try to help her get into my Alma Mater's Med School but her Mom and guidance counselors thought they knew better (she's "just" a girl after all--but then more than half of all US doctors are women now I believe. Mine has been for years).

[DePaul Bunyan]

Originally Posted by Shawn

Saw this a few weeks ago and thought of this thread:

Scraping by on six figures? Tech workers feel poor in Silicon Valley's wealth bubble

Some nice quotes: "One Apple employee was recently living in a Santa Cruz garage, using a compost bucket as a toilet. Another tech worker, enrolled in a coding bootcamp, described how he lived with 12 other engineers in a two-bedroom apartment rented via Airbnb. “It was $1,100 for a fucking bunk bed and five people in the same room. One guy was living in a closet, paying $1,400 for a ‘private room’.”

"Although he said his salary means he can afford to live a decent life, he finds the cost of living, combined with the terrible commute, unpalatable. He’s had enough, and has accepted a 50% pay cut to relocate to San Diego. . . We will be unequivocally better off than we are now.” He said he won’t miss some of the more mundane day-to-day costs, like spending $8 on a bagel and coffee or $12 on freshly pressed juice."

I've looked at moving to Coastal California, and the salary premium doesn't offset the massive housing premium or the general cost of living. Even at my level of employment / pay grade, it's necessarily a drop in quality of life. I'll pass.

I've thought about this. I could make 50-70% more basically anywhere in CA, but the housing premium would more than wipe that out, and then there are the highers costs of everything in CA, and the taxes.

Originally Posted by Shawn

Saw this a few weeks ago and thought of this thread:

Scraping by on six figures? Tech workers feel poor in Silicon Valley's wealth bubble

Some nice quotes: "One Apple employee was recently living in a Santa Cruz garage, using a compost bucket as a toilet. Another tech worker, enrolled in a coding bootcamp, described how he lived with 12 other engineers in a two-bedroom apartment rented via Airbnb. “It was $1,100 for a fucking bunk bed and five people in the same room. One guy was living in a closet, paying $1,400 for a ‘private room’.”

"Although he said his salary means he can afford to live a decent life, he finds the cost of living, combined with the terrible commute, unpalatable. He’s had enough, and has accepted a 50% pay cut to relocate to San Diego. . . We will be unequivocally better off than we are now.” He said he won’t miss some of the more mundane day-to-day costs, like spending $8 on a bagel and coffee or $12 on freshly pressed juice."

I've looked at moving to Coastal California, and the salary premium doesn't offset the massive housing premium or the general cost of living. Even at my level of employment / pay grade, it's necessarily a drop in quality of life. I'll pass.

Originally Posted by Pedestrian

I do NOT think you are doing students any favors by encouraging them to borrow money to get a bad education in a field with few employment options. I have seen one proposal for a reverse tuition scale whereby the easier it is to get a job following a given course of study, the lower the tuition charged to pursue it. Engineering students (US citizens) might be charged little or nothing. Students in "political science" and "ethnic studies" might be charged a lot.

Will never happen. College has become big business, and in states like California, the bureaucracy and administration that comes with such a system is too much of a golden goose for powerful public sector unions and the people in state government who rely on campaign contributions and patronage. It's a good idea, and coupled with tweaking bankruptcy laws to allow student debt to be discharged (thus removing the incentive for lenders to loan money for degrees that have poor returns) would go a long way to resolving the student debt crisis and getting college more affordable.

[the urban politician]

^ In my profession jobs are offering 50% more, I'm even seeing $200k signing bonuses in California. But it still won't make up for the higher cost of housing in the long run.

But one thing that helps: California has relatively lower property taxes than Chicagoland, which is a life long gut punch around here

[DePaul Bunyan]

Originally Posted by the urban politician

^ In my profession jobs are offering 50% more, I'm even seeing $200k signing bonuses in California. But it still won't make up for the higher cost of housing in the long run.

But one thing that helps: California has relatively lower property taxes than Chicagoland, which is a life long gut punch around here

True, but CA actually has a pretty obscene personal income tax rate and schedule, and the cost of home ownership is so high you're going end up with a property that's 3-4x as expensive as a comparable property in Chicago and effectively you'll pay more in property taxes even though the rate's lower. A property tax rate that's half of Chicago's doesn't have as much luster when the cost of the property is 4x as much.

I could go from $32 to over $50 per hour, which sounds decent, but I would be paying at least double for a shittier, smaller apartment and have a horrid commute. And forget home ownership. After taxes most or all of the difference in take-home would go to housing. And where I'm at in healthcare, the decent CA jobs are all union, which is fine if you're looking to stay one place for 30 years, but I want to be flexible. Plus I'm lucky enough to already have a pension plan through my employer, and they give me a 401k match. And California's finances aren't in a whole lot better shape than IL's, it's just that their economy is humming along nicely (for the time being) so it's kind of ignored.

[Pedestrian]

Originally Posted by DePaul Bunyan

California's finances aren't in a whole lot better shape than IL's

You'll have to support that because from where I sit it couldn't be more wrong. It's a delusion the un-knowledgeable who suffer from a certain desire for Californians to share their suffering have.

Let's see. California has a balanced budget and has had every year because its Constitution requires it (these are projections--at the end of at least 3 of the last 5 years, there was a budget SURPLUS). California has a "rainy day fund" set aside for unexpected budget problems with a current balance of around $8 billion (they ay have to spend a little of that on state-maintaied dams this year). California had, in 2016, about $116 billion of general fund supported debt (bonds) existing and approved and a gross state product of almost $2.5 trillion (with a T). That's a debt to GSP of 4.6% (by comparison, at the federal level the federal debt is now over 100% of the gross national product).

CA has an economy bigger than any country in the world except the U.S., China, Japan, Germany and the United Kingdom.

Those with superficial knowledge of the situation may have concluded that CA was in budgetary trouble due to the fact that until a recent Constitutional change, CA required a legislative supermajority to pass a budget which, in turn, meant the Democratic legislative majority required some Republican votes (usually, just a couple). I several years within recent memory the wheeling and dealing to obtain those votes caused the legislature to miss the end of the old fiscal year to pass its budget. That, in turn, meant the state Treasurer had to stop spending money and n 2 cases I recall paid state employees and creditors woth IOUs for a week or two (the IOUs were promptly redeemed for cash when the budget--balanced as required--was passed).

So how does Illinois compare in specific terms? One direct comparison are the state general obligation bond ratings. California's is AA- from S&P and Fitch, Aa3 from Moody's. Illinois's is BBB from S&P and Fitch, Baa2 from Moody's (in each case, Illinois is the lowest of the 50 states).

This article from today's Wall Street Journal isn't promising for Illinois (CA schools are having no such problem):

Illinois Universities Feel the Brunt of State’s Fiscal Woes
By MELISSA KORN
March 18, 2017

With the budget stalemate in Illinois in its 21st month, public universities in the state are going beyond belt-tightening to deal with a funding drought that has no end in sight.

Campuses already have paused new construction and stopped hiring for vacant positions. Now, universities including Northeastern Illinois, Governors State and Southern Illinois are looking to fixes such as raising tuition, cutting academic programs or laying off student workers . . . .

https://www.wsj.com/articles/illinoi...oes-1489842000

So I guess if your company leaves CA and goes to Illinois you may want to leave the kids in their CA colleges.

[Pedestrian]

SF tech company offers employees $10K to move outside Bay Area
BY ADAM BRINKLOW MAR 20, 2017, 1:42PM PDT

Zapier, a San Francisco-based startup that automates different web apps to work together, now offers to pay its employees $10,000 to move out of the Bay Area.

CEO Wade Foster, who moved to San Francisco from Missouri five years ago, explained in a company blog:

Some of us fall in love with the area and are financially able to make this home. But for the rest of us, it can be a real challenge to turn the Bay Area into a life-long home rather than a short stop somewhere in our twenties and thirties. The housing crunch and high cost of living simply price out many families and, despite loving the area, the realities are many of us need to look elsewhere to create the life we want for our families.

So Zapier, which has a workforce of about 80 people, now offers a “de-location package” to Bay Area employees who want to move away.

Foster specifies that “The $10,000 will be a reimbursement for moving expenses you incur in the first three months” and that it’s contingent upon employees staying with the company for at least a year.

Inc Magazine points out that Zapier has no office and all of its employees work remotely . . . .

http://sf.curbed.com/2017/3/20/14986...-san-francisco

It makes one ponder how much they'd have to pay YOU to move out state. I guess it depends somewhat on where. Towns like Incline, NV practically exist as a refuge in no-income-tax Nevada for wealthy former Californians. From there it's a 10-minute drive back to CA (but several hours back to the Bay Area and the I-80 traffic can be awful but if you have your own helicopter it's qucker).

Home of typical suffering California ex-pat in Incline Village, NV

http://homesoftherich.net/2015/02/26...ne-village-nv/

[the urban politician]

Originally Posted by Pedestrian

You'll have to support that because from where I sit it couldn't be more wrong. It's a delusion the un-knowledgeable who suffer from a certain desire for Californians to share their suffering have.

Let's see. California has a balanced budget and has had every year because its Constitution requires it (these are projections--at the end of at least 3 of the last 5 years, there was a budget SURPLUS). California has a "rainy day fund" set aside for unexpected budget problems with a current balance of around $8 billion (they ay have to spend a little of that on state-maintaied dams this year). California had, in 2016, about $116 billion of general fund supported debt (bonds) existing and approved and a gross state product of almost $2.5 trillion (with a T). That's a debt to GSP of 4.6% (by comparison, at the federal level the federal debt is now over 100% of the gross national product).

CA has an economy bigger than any country in the world except the U.S., China, Japan, Germany and the United Kingdom.

Those with superficial knowledge of the situation may have concluded that CA was in budgetary trouble due to the fact that until a recent Constitutional change, CA required a legislative supermajority to pass a budget which, in turn, meant the Democratic legislative majority required some Republican votes (usually, just a couple). I several years within recent memory the wheeling and dealing to obtain those votes caused the legislature to miss the end of the old fiscal year to pass its budget. That, in turn, meant the state Treasurer had to stop spending money and n 2 cases I recall paid state employees and creditors woth IOUs for a week or two (the IOUs were promptly redeemed for cash when the budget--balanced as required--was passed).

So how does Illinois compare in specific terms? One direct comparison are the state general obligation bond ratings. California's is AA- from S&P and Fitch, Aa3 from Moody's. Illinois's is BBB from S&P and Fitch, Baa2 from Moody's (in each case, Illinois is the lowest of the 50 states).

This article from today's Wall Street Journal isn't promising for Illinois (CA schools are having no such problem):


https://www.wsj.com/articles/illinoi...oes-1489842000

So I guess if your company leaves CA and goes to Illinois you may want to leave the kids in their CA colleges.

What's happening in Illinois is nothing short of dysfunction of epic levels brought about by a severely corrupt Government headed by a despotic House Speaker (Mike Madigan) who cares about nothing more than to stay in power.

Horrible, fucked up state of affairs. Horror. Makes it extremely hard to justify voting for Democrats ever again

[DePaul Bunyan]

Originally Posted by Pedestrian

You'll have to support that because from where I sit it couldn't be more wrong. It's a delusion the un-knowledgeable who suffer from a certain desire for Californians to share their suffering have.

http://www.latimes.com/projects/la-me-pension-unfunded/

According to the state controller’s office, the unfunded liability of California’s 130 state and local government pension plans stood at $241.3 billion as of 2014, the most recent year for which figures are available.

In addition to pensions, an analysis of state and local government financial reports representing 90% of public workers uncovered $125 billion in unfunded retiree healthcare costs.

This brings the public retirement debt to at least $366 billion.

http://www.sacbee.com/news/politics-...#storylink=cpy

For many years, the California Public Employees’ Retirement System and other state and local pension systems have assumed earnings, technically called the “discount rate,” in the 7.5 percent to 8 percent range, and they seemed to be generally on target.

With that assumption, California’s unfunded pension liabilities – the gap between what the funds expect to have and what retirees will be owed – are roughly $450 billion.

That’s a big number, but investment earnings have stumbled in the last couple of years. CalPERS gained 2.4 percent in 2014-15 and a minuscule 0.6 percent in 2015-16. That generally was the experience of other California and national systems as well.

Were pension fund overseers to drop their discount rates to the 4 percent range, roughly the rate private corporate systems use, California’s unfunded liabilities would probably surpass $1 trillion.

A couple of years ago, the Governmental Accounting Standards Board began pressuring governments to report their pension debts more fully – and perhaps more realistically.

http://us.pensiontracker.org/stateSu...&search=Search

California is where Illinois was 30-years ago. The numbers are jarring but people are ignoring them because they're a ways away from actually having to do anything about them and "muh 6th largest economy" chest-thumping, which makes California's financial affairs immune from math or something.

[DePaul Bunyan]

Originally Posted by the urban politician

What's happening in Illinois is nothing short of dysfunction of epic levels brought about by a severely corrupt Government headed by a despotic House Speaker (Mike Madigan) who cares about nothing more than to stay in power.

Horrible, fucked up state of affairs. Horror. Makes it extremely hard to justify voting for Democrats ever again

I'm a pretty liberal guy (Sanders supporter), and what (effectively) one-party rule has done to IL over the last 15 or so years has made me very weary of blindly punching "D" on the ballot and extremely cynical towards the Democratic party, at least here in Illinois. People like to (rightfully) pick on Kansas and point to it as a failed conservative experiment, but Illinois has to be the liberal corollary. It's shocking, and then these parasites in state government who have driven the truck into the ditch bitch at Rauner because he broke the tow hitch trying to get us out of the mud. Rauner is not some Tea Party asshole, he's actually signed some very progressive criminal justice and school discipline reform (stuff that you would be hard-pressed to find other GOP governors supporting), and he banned state funding of "gay conversion" ministries. He is driving a hard bargain with the public sector unions and refusing to repeat Madigan's "spend now pay later" style of governance that has gotten us into this mess over the last 30 years.

Anyway I can't wait to leave this state for greener, warmer, less corrupt, better-maintained, and cheaper pastures.

[the urban politician]

Originally Posted by DePaul Bunyan

http://www.latimes.com/projects/la-me-pension-unfunded/



http://www.sacbee.com/news/politics-...#storylink=cpy



http://us.pensiontracker.org/stateSu...&search=Search

California is where Illinois was 30-years ago. The numbers are jarring but people are ignoring them because they're a ways away from actually having to do anything about them and "muh 6th largest economy" chest-thumping, which makes California's financial affairs immune from math or something.

The question is whether California made the same dumb ass Constitutional amendment that Illinois did to prevent any reduction in pension benefits. Is California as blindingly beholden to unions at the expense of all other taxpayers, like Illinois is? Does California have flexibility in the system? Can the entire State be beholden to a single despot who never retires, the way Illinois is with Mike Madigan? That is the true question to ask

[Pedestrian]

Originally Posted by DePaul Bunyan

California is where Illinois was 30-years ago. The numbers are jarring but people are ignoring them because they're a ways away from actually having to do anything about them and "muh 6th largest economy" chest-thumping, which makes California's financial affairs immune from math or something.

California's unfunded pension and other liabilities seem daunting but they are not atypical. What you are really saying is that many states are 30 years behind Illinois. You might be right but from everything I've read Illinois has some unusually dysfunctional politics. California's politics works pretty well, maybe too well in that it allows the state government to efficiently pass new and creative ways to spend money and raise the revenue to pay for it. And its initiative and referendum laws and traditions give citizens a way to thwart the worst efforts of its politicians (example: They hate the property tax limiting Prop. 13 and have been trying to do away with it for decades but it is still there because the voters want it).

Nevertheless, none of this would seem to be a reason for business to leave the state at this time. If you turn out to be correct, they can wait 30 more years and leave IF your prediction comes true.

[Pedestrian]

Originally Posted by the urban politician

The question is whether California made the same dumb ass Constitutional amendment that Illinois did to prevent any reduction in pension benefits. Is California as blindingly beholden to unions at the expense of all other taxpayers, like Illinois is? Does California have flexibility in the system? Can the entire State be beholden to a single despot who never retires, the way Illinois is with Mike Madigan? That is the true question to ask

The issue of union influence may be one way in which the states are similar. Certain public employee unions--nurses, prison guards--are very powerful in California. One recent governor, Gray Davis, was impeached and removed from office largely because of his coziness with unions. But Davis WAS removed and the initiative process does give California voters the power to defeat unions when the situation requires it.

[sopas ej]

Originally Posted by Pedestrian

One recent governor, Gray Davis, was impeached and removed from office largely because of his coziness with unions. But Davis WAS removed and the initiative process does give California voters the power to defeat unions when the situation requires it.

Gray Davis was not impeached; he was removed from office through a recall election. Enough signatures were gathered (largely from a campaign funded by Republican Darrel Issa---I can't stand the guy) to create a special election for the recall. I voted no. This was the dumb election that gave us Arnold Schwarzenegger as governor.

I thought Gray Davis was recalled largely because he was blamed for the California power crisis of the early '00s, which was actually created by the previous governor, Pete Wilson, a Republican (and asshole), who deregulated the power companies and created the crisis. Ironically, it was Gray Davis who re-regulated the power companies and put an end to the power crisis, but he got blamed anyway and was recalled from office... probably for other reasons as well.

[Pedestrian]

Originally Posted by sopas ej

Gray Davis was not impeached; he was removed from office through a recall election.

Sorry--you are absolutely right. Bad memory. But this makes my point even more so. California's empowerment of voters through various processes including recall and also the ones I mentioned, initiative and referendum, give voters an escape hatch from the illinois-like situation.

I thought Gray Davis was recalled largely because he was blamed for the California power crisis of the early '00s

There were a number of reasons--each voter had his/her reasosn for voting to recall him no doubt--but this one was powerful for many (including me):

2002-07-31 04:00:00 PDT Sacramento -- A generous salary and benefit package Gov. Gray Davis inked with the state's politically powerful prison guard union eventually will cost California taxpayers $518 million each year, according to a state audit released Tuesday.
The audit is the first independent assessment of the cost of the deal Davis approved one month before receiving a $251,000 campaign contribution from the California Correctional Peace Officers Association.
Davis, who vigorously denied any connection between the lucrative contract and the lucrative contribution, disputed the audit's cost estimate, saying it neglected to include offsetting savings . . . .

http://www.sfgate.com/news/article/S...al-2788877.php

Another factor for many voters was vehicle license fees. California charges a tax based on the presumed value of a vehicle deduced from its make/model/year as part of the cost of renewing its registration. Davis first lowered this tax when the state had a big budget surplus, then raised it after the dot-com bust cut state revenue. This angered many car owners.

I don't think many voters understood the power situation well enough to know who to blame. I read the financial press daily and I'm not sure even I got much of its nuances (and the politicians who made the laws clearly didn't).

[Pedestrian]

And then there are the corporate headquarters arriving and/or springing up.

There are 195 new names on Forbes' 2017 list of the world's billionaires, and the youngest newcomers are two brothers working in San Francisco. Ireland natives John and Patrick Collison, aged 26 and 28 respectively, are the co-founders of online payments firm Stripe, which has its headquarters in SoMa . . . .

http://www.sfgate.com/news/article/W...photo-12102170

Why didn't they do what they did in Ireland which is having it's own tech boom or sorts? I don't know but I'm betting they can give you good reasons and those reasons would probably be why I'm not worried about California.

[Pedestrian]

Why Bay Area tech workers are packing their bags for Seattle
Mar 21, 2017, 1:46pm PDT
Ashley Stewart and SVBJ staff
San Francisco Business Times

Technology workers are increasingly leaving the Bay Area for Seattle. A new study from Zillow and LinkedIn makes it easy to see why: Seattle tech workers have the most money left over after paying for housing.

A tech workers on average in Seattle keep nearly 55 percent of his or her paycheck, or $5,500, after paying rent. Bay Area tech workers generally make more but have only 35 percent, or nearly $4,000, left over after paying rent.

Seattle ranks No. 1 in a new study of disposable income among technology workers . . . .

http://www.bizjournals.com/sanfranci...676&j=77710531

[Pedestrian]

Some go, some come:

Exclusive: Amazon seeks 200,000 square feet of office space in San Francisco
Mar 27, 2017, 1:51pm PDT Updated Mar 27, 2017, 3:37pm PDT
Roland Li
Reporter, San Francisco Business Times

Amazon.com Inc. is looking for 200,000 square feet of office space in San Francisco, according to four sources familiar with talks.

The Seattle-based e-commerce retailer (NASDAQ: AMZN) is the latest tech giant to be shopping for San Francisco office space.

Google Inc., a unit of Alphabet Inc. (NASDAQ: GOOG) recently leased 166,460 square feet at Two Rincon Center. Amazon competed with Google for that space, according to a source. Facebook Inc. (NASDAQ: FB) is also considering an eventual expansion in San Francisco, according to sources.

San Francisco's office market is primarily filled by homegrown tech firms like Salesforce.com Inc. (NYSE: CRM), Twitter Inc. (NYSE: TWTR) and Uber Technologies Inc. But major tech firms with suburban corporate campuses are increasingly drawn to San Francisco, where many of their employees live . . . .

http://www.bizjournals.com/sanfranci...254&j=77769271

Note: This is office space they are seeking, not warehouse space. I'm not sure what they'll be doing there but it will likely be tech jobs, not low-paid folks packing boxes.