If the Economic Downturn Continues Through 1991, I Would . . . : . . . make our children, our small-business community and our goods competitive worldwide.
Whether California experiences a recession depends on macroeconomic factors that are national and international in scope. But California can very much affect its own economic destiny and must do so.
California is projected to become the fourth-largest economy in the world before the end of this decade. We can achieve that goal if California meets critical tests:
-- California schools must educate our children to compete and win in an increasingly competitive and technologically demanding global marketplace.
Our kids must prepare to compete with those not just in other states but also with foreign workers. But far too many do not even finish high school. And too many who do cannot read, write or speak English well enough to communicate effectively. Too many do not have a sufficient grasp of basic math and science to satisfy even the minimum demands of today’s job market.
Through a program to integrate delivery of social and child-development services with public education, we must ensure that children enter the classroom healthy enough to concentrate and motivated enough to stay. We must reward extraordinary teaching achievement with merit pay.
-- We must not sacrifice the competitiveness of California small business--the great job generator of the 1980s--by over-regulating and over-taxing it.
In the decade of the ‘80s, California’s population grew by 23%. It is imperative that California implement plans to ensure the kind of continued economic development that means expanding payrolls, not swelling welfare rolls.
A significant part of farsighted management of our growth requires making timely investment in needed physical infrastructure. The voters gave us in June the resources for the kind of rail and road transportation network we must have to avoid congestion and move goods and people. We must exercise similar foresight in providing greatly increased off-stream water storage capacity that will allow us to save water we are now wasting, without sacrificing water quality.
Happily, once the ‘79-’82 recession was over, in just five years California jobs increased by a percentage comparable to our population growth for the decade. Large companies played some role in this. But small businesses were the ones that put Californians to work--many in their first jobs. The growth in companies employing nine or fewer employees was 39%; the increase in those employing three or fewer was 54%.
The good news is that small business continues to hold the promise of creating more and more jobs. The bad news is that this small-business base is very vulnerable to wrong decisions by state government. Over-regulation and over-taxation can mean costs that wipe out the profits and close the doors of these promising small enterprises.
For example, if California decided to extend health-care coverage to those who do not have it, should we dump the entire cost on employers, as some in the Legislature have urged? Of course not.
Escalating state taxes have driven jobs out of New York and Massachusetts to neighboring states where costs of doing business--including taxes--are much lower. Massachusetts’ high taxes have provided a job bonanza for New Hampshire. Nevada and Arizona could be our New Hampshire. Our cost of living, especially the shortage of affordable housing, aggravates the situation.
I will create an office of small business within the governor’s office that will have as its explicit mission trouble-shooting both executive and legislative proposals for taxation and regulation to safeguard the continued job-producing capability of small business. Nor can well-intended but poorly conceived initiatives escape the same critical scrutiny.
--California must aggressively market its goods and services, at home and abroad.
One acre in every three under cultivation in California is for export. California agriculture and high-tech exports have not been accorded fair market access or fair treatment from our foreign trading partners. If trading partners fail to accord fair access and treatment to our exports, we must respond.
I will use California’s political and economic clout to apply pressure on both U.S. and foreign trade officials to ensure that California receives equity. We are positioned to be the premier player in the next decade in an explosion of Pacific Rim trade. I will relish the role, as I did as mayor of San Diego, of California’s chief salesman and trade advocate.
No other state can boast California’s tourism attractions or capabilities. Tourism offers enormous gains in employment and is the prime employer of young and entry-level workers. The state should engage in a vigorous collaboration with local convention/visitor bureaus and the industry to aggressively market California. In the same fashion, the governor and state government should be an advocate for California’s high-technology, biomedical research and instrumentation, telecommunications and motion picture and television production industries.
The California I envision for 2000 is a competitive and prosperous one, with a diverse and thriving economy producing good jobs and high job satisfaction, and profits to support sound public services and generous private philanthropy.
AN OP-ED DEBATE
Recently The Times invited gubernatorial candidates Dianne Feinstein and Pete Wilson to participate in a number of issue discussions on this page. Today’s question is: If the economic downturn continues through 1991, what are the three specific things a new governor could do about it? Subsequent topics, to appear in the coming weeks, will be the budget, drugs, the environment and education.
