Dan Walters: Lawmakers get a dose of realism

April 16, 2013 

The California Legislature rarely, if ever, concerns itself with long-range, big picture social and economic trends and their relationship to decision making.

Likewise, legislators rarely, if ever, expose themselves to input about those trends that doesn't match their ideological predilections.

On Monday, however, members of the state Senate heard a cogent synopsis of California's demographic and economic present and likely future they should take to heart.

Simply put, California Lutheran University economist Bill Watkins told the Senate, California's population growth has slowed to a crawl, the population is likely to begin dropping in the next couple of decades because of outmigration and a dropping birthrate, and it's mostly losing middle-class families "because of a lack of opportunity."

"We're losing the economic heart of our state," Watkins told the Senate in one of a series of lectures arranged by its leaders.

The result, Watkins continued, could be a state of mostly rich and poor residents in which "there is no middle class." He also warned that while the Bay Area-centered high-technology industry is today one of the state's few economic bright spots, rapidly changing technology could undermine the region's dominance because the latter "can be done almost anyplace."

And what would Watkins do to revive a lethargic economy and brighten the state's social ambience? "You need to create an opportunity economy," he told the Senate, adding that we should encourage more immigration from other countries because immigrants are motivated and tend to found job-creating businesses at a faster rate than native-born Californians, and that the Legislature should make such business formation and expansion easier by reducing regulatory red tape.

Watkins seemed to be saying, California's policy-makers need to look beyond the politics of the moment and think of the long-term consequences of what they do and what they don't do.

We Californians have come to expect two major socioeconomic factors to continue -- high levels of population growth and an economy in which every recession is followed by a vigorous recovery.

But with a population growth rate today that's a third of what it was in the 1980s and at least a strong possibility of population decline, one of those assumptions is out of date. And the other assumption about a vigorous recovery also is not happening as the state remains tied for the highest unemployment rate in the nation.

It is, as Watkins implies, time to adjust our policy making in response to harsh reality, not wishful thinking.

THE SACRAMENTO BEE

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