When most people think of California, they think of Silicon Valley, Hollywood, and Beverly Hills. Yet, California is actually tied with Louisiana for the nation’s highest poverty rate. Clearly, the “California model” is failing to address the needs of all the Golden State’s residents.
My most recent book, The Inclusive Economy: How to Bring Wealth to America’s Poor, examined the causes and solutions for poverty on a national scale, pointing to government policies from criminal justice to education to over regulation that trap people in poverty. Now, I’m going to look specifically at California’s failure to help its poorest citizens.
The Cato Institute is launching a Project on Poverty and Inequality in California. I will be directing this two-year project that will look at ways in which California government policies have burdened those most in need, and will suggest specific reforms designed to help poor Californians become part of the economic mainstream. An analysis of what works and what doesn’t in California will provide important information to California policy makers, as well as valuable insights for other states as they work to address similar problems.
The Project on Poverty and Inequality in California will investigate the impact that the state’s policies have had in five critical areas:
- Criminal Justice: Over-criminalization, sentencing disparities, treatment of ex-offenders, and pervasive bias against People of Color are problems for all levels of society, but have a disproportionate impact on the poor. Despite recent progress, California has lagged behind many other states in reforming its policing and criminal justice system.
- Education: While California has some of the highest per-student spending in the nation, student performance continues to lag behind other states. Despite this, the state rigidly restricts charter schools and blocks other forms of school choice.
- Housing: The poor spend a disproportionate share of their income on housing. California has some of the nation’s most costly and restrictive zoning and land use laws, which further drive up the cost of housing.
- Welfare reform: Asset tests for welfare programs encourage consumption and discourage savings. California eligibility requirements for a variety of welfare programs need to be examined in light of the incentives they create.
- Regressive regulation: Regulatory barriers to getting a job or starting a business can block people from fully participating in the economy. Occupational licensing, zoning, environmental regulation, and high minimum wage requirements can inhibit small business development and growth and leave those wanting to work locked out of the labor force.
As part of this project, I will be undertaking extensive visits to California to meet with stakeholders, including state-level elected officials, interest groups, and individuals who are affected by current policy. My first trip will be to Sacramento for a community roundtable discussion on June 26. If you would like to attend, you can register here: https://register.cato.org/stakeholder-roundtable-sacramento-2019.
I am very excited at this opportunity to continue providing positive solutions to one of the most important problems of our time.