Dan Walters

Dan Walters

Dan Walters: Cailfornia officially has a two-tier economy

Published: Sunday, Nov. 18, 2012 - 12:00 am | Page 3A
Last Modified: Tuesday, Feb. 26, 2013 - 8:16 pm

About a quarter-century ago, I wrote a book about California's social, economic, demographic and political evolution and quoted a couple of academics as predicting "the possible emerging of a two-tier economy."

Today, we can eliminate the "possible" qualifier because it's a proven fact.

A Census Bureau poverty report and another from the Center on Budget and Policy Priorities, released simultaneously last week, should remove any lingering doubt about California's stratification.

The Census Bureau is experimenting with a new way of gauging poverty, one that uses more measures of income and outgo and the cost of living. And by that new standard, California has – by a wide margin – the highest level of poverty of any state, with nearly a quarter of its 38 million residents in that category.

Meanwhile, the CBPP calculated, state by state, gaps in various family income brackets and found that California has the third largest "income inequality" between those in the highest and lowest levels, and the second largest between those in the highest and middle quintiles.

So, to put it in the vernacular, California's rich are richer and its poor are poorer, in relative terms, than almost anywhere else in the nation. And that stratification also has, as those two academics predicted a quarter-century ago, an ethnic element. They saw a mostly white and Asian overclass, a mostly black and Latino underclass and a smaller middle class.

What happened?

The decline of a once-vigorous industrial economy wiped out countless well-paying, middle-class jobs. The emergence of a post-industrial economy rooted in trade, services and technology marginalized those without the specific talents and training the new economy demanded.

Public policy did not adjust to that new economic reality, nor to the rapid ethnic diversification of the state's population.

In particular, public education failed to adjust – in part because school finance and governance shifted from local hands to state politicians and bureaucrats and became politically polarized. The very wide disparities in educational outcomes, from test scores to dropout rates, between white and Asian students on one end and black and Latino kids on the other attest to that failure.

This socio-economic evolution paralleled, in time, another evolution, from a fairly conservative, red state to a somewhat liberal, blue state. Whether it's cause and effect is debatable, but it is, at least, noteworthy.

The state's dominant Democrats profess to oppose socio-economic stratification and champion egalitarianism and mobility and say they want to spend more in that direction, but with recently approved tax increases, the state already has one of the nation's highest state and local tax burdens.

Welcome to reality.

© Copyright The Sacramento Bee. All rights reserved.

Read more articles by Dan Walters



Dan Walters, political columnist

Dan Walters

Dan Walters has been a journalist for more than a half-century, spending all but a few of those years working for California newspapers. At one point in his career, at age 22, he was the nation's youngest daily newspaper editor.

He joined The Sacramento Union's Capitol bureau in 1975, just as Jerry Brown began his first governorship, and later became the Union's Capitol bureau chief. In 1981, Walters began writing the state's only daily newspaper column devoted to California political, economic and social events and, in 1984, he and the column moved to The Sacramento Bee. He has written more than 7,500 columns about California and its politics and his column now appears in dozens of California newspapers.

Email: dwalters@sacbee.com
Phone: 916-321-1195
Twitter: @WaltersBee

Sacramento Bee Job listing powered by Careerbuilder.com
Quick Job Search
Sacramento Bee Jobs »
Buy
Used Cars
Dealer and private-party ads
Make:

Model:

Price Range:
to
Search within:
miles of ZIP

Advanced Search | 1982 & Older

TODAY'S CIRCULARS