Wake Up, California: Let’s Get This State Moving Again : What’s needed is a new game plan--and more leadership--as the state confronts unprecedented challenges

Is the California dream turning into a nightmare? To read all the recent published accounts and network television reports of California’s economic troubles, one might think the state is in some dire emergency. In truth the economy here remains a world powerhouse, with many underlying strengths and much unrealized potential.

Still, if only a fraction of these reports are close to the truth, California’s customary complacency is wholly misplaced. The state does face troubles: Its traditional recession-proof economy is sputtering; its quality of life is deteriorating and its infrastructure is crumbling. People and companies are leaving. The veneer of the Golden State is tarnished.

Less than five years ago, California and Los Angeles were hailed by some as models for the 21st Century. But today, the widespread perception is of trouble in paradise.

WANTED: TREND-SETTING POLITICAL DECISIONS

That perception is far from reality, but Californians feel as if they are in a crisis. If it’s not the drought, then it’s traffic, air quality, crime, housing costs--the list is long and troublesome. Their dilemma puts the state at a major crossroads: California must get a handle on its growth or become its victim.

If it does succeed, California, ever the trendsetter in entertainment, lifestyle and politics, could set the pace in a new approach to governance in the 1990s. After all, the state’s problems are similar to those confronting the rest of the nation: An eroding industrial/manufacturing base, changing demographics, a fraying infrastructure, a deteriorating education system, unaffordable housing and ballooning government deficits.

A California solution to these problems could spark the inspiration needed to kindle an American renaissance. But devising answers requires leadership, strategic policy-making, public/private partnerships and the political will to abandon the status quo. Much as corporate giants often must restructure to adapt to marketplace realities, California has to change to meet new economic and social needs.

Gone are the days when vast open spaces readily accommodated growth, however haphazard and ill-planned. California must manage its growth with aggressive state policies. The state’s phenomenal population growth in the 1980s--6 million--far outpaced the ability of state and local governments to meet demands in housing, education and transportation. The recession only exacerbated an economy already hard-hit by the downsizing of the aerospace and defense industries and restructuring in other industries. The state lost 80,000 manufacturing jobs in April.

ALSO WANTED: A NEW GAME PLAN FOR CALIFORNIA

Fortunately, economists say, the actual fundamentals for California’s economic growth are solid. The state economy is equal in size to the sixth-largest national economy. It should benefit from continued growth in Pacific Rim trade. The free trade agreement now being negotiated with Mexico could also hold huge benefits for California.

The state will continue to attract people over the next decade. A report called “The 1991 Development Report Card for the States” ranks California seventh in development capacity, yet 26th in economic performance. Continued confidence and economic development are critical to California’s competitiveness. The first steps in engendering renewed confidence must be taken by the state’s political, business and community leaders.

California needs a game plan for the 1990s. Gov. Pete Wilson upset the status quo early in his term by taking on controversial issues, such as worker’s compensation and pension fund reforms. He demonstrated unexpected political courage in advocating--and holding out for--tax hikes to help offset the state’s $14.3-billion budget deficit.

The state’s agenda for change should include:

Fostering Growth

Identifying California’s problems is a cinch. There’s easy consensus on that. Developing a strategic plan to tackle them is fractious, divisive and upsetting to the status quo. It takes political courage and vision.

California politicians have too often fallen short of expectations. So citizens have taken on the task of governing themselves through the messy initiative process, which may provide a remedy to one problem only to create other headaches.

The state needs an integrated, streamlined approach to managing growth. Wisely, Wilson created a Council on Growth Management in January to come up with answers.

* Keeping Competitive

California has evolved into a high-cost, high-tax state with a reputation for being unfriendly and unfair to business. Nearby states such as Utah and Arizona score big in maligning California to snatch away jobs. “ABC . . . Anywhere But California” is the buzz phrase.

The state has become an easy mark as others pick off choice contracts, projects and jobs. Many companies, particularly manufacturers, are relocating to escape California’s costly worker’s compensation system, cumbersome government red tape, high business taxes and uncertain water and air quality policies.

The governor recently established a Council on California Competitiveness to study government red tape, regulation and waste. That’s a start.

- Helping the Middle Class

California once epitomized the opportunity to make the giant leap into the middle class--the American dream. Today many state policies, taxes and infrastructure problems are putting the squeeze on the middle class, which feels it is paying more and more but getting far less in return.

A growing number of middle-class families are packing up and leaving in search of less stressful and less expensive lives. The challenge: To stop the flight of the middle class. Otherwise the gap between the rich and poor will widen and the state’s problems will worsen. One approach is to reduce the costs and headaches of everyday living. A mass transit system would help reduce gridlock and make commuting easier for homeowners pushed miles away from their jobs by astronomical housing costs.

- Empowering Communities

The leave-me-alone syndrome of California has fostered an apathetic constituency. Community involvement is crucial in finding solutions, especially to problems in the inner cities.

Can infrastructure needs of schools and housing be met in such a way as to produce local jobs and industries? Community investment would translate into a greater responsibility and participation so citizens have a real stake in state and local development. That would help to combat voter apathy and get people involved in holding their elected leaders accountable to the needs of the people rather than to vested political interests and contributors.

- Thinking Entrepreneurially

California, which since Gold Rush days has benefited greatly from entrepreneurial talent, needs to be more entrepreneurial in its solutions. It will take that kind of approach to manage and solve the state’s daunting problems.

Like other states, California has limited money to handle immense demands. That means stretching those limited dollars with innovation and creativity, eliminating crusty, costly layers of bureaucracy and duplication and abandoning outdated and inefficient ways.

Too much time, energy and money are devoted to reactive government, with questionable results. For example, why is it that California still lacks a coherent water policy after episodic sieges of drought?

- Upgrading Education

Improving the state’s public education system is crucial to California’s future--economically and politically. Poor students make poor workers. Employers increasingly are discovering that a disturbingly large number of people in the work force lack minimal skills needed for a job. Employers are spending more time and money to teach workers basic reading and math.

The cost of illiteracy is not just dollars and cents. Also at stake is political literacy--knowledge of our democratic processes, institutions, new ideas and implications of change.

The workplace of the 1990s and beyond will be increasingly automated and computerized both for blue- and white-collar workers. The new jobs will require new skills that the public education systems must provide to develop an educated work force needed to attract business and industries. California must drastically change its education system to meet the challenges.

Trends in America, it is often said, start in California and move eastward. A spark of leadership in California, one that meets these challenges head-on with the confidence that helped build this state into a world leader, could inspire the building of a new nation--an effort that might indeed help redefine 21st-Century America.

Next Monday: Regaining Competitiveness