Is California a Great Place to Live for the Middle Class?

This NY Times magazine piece laments the decline in quality of life for California's middle class. Attending the flagship UC's best campuses costs a family roughly $25,000 a year per kid. While this is a great deal relative to an Ivy League education, it is a high price tag for a "Middle Class" household who makes $125,000 a year. There are more and more pieces pointing out that such households appear to be "rich" but in real terms (if they have a mortgage and 2 or 3 kids) they aren't.

Enrico Moretti's paper on Real Wage Inequality
should be required reading. Nominal high salaries do not buy you much in high tax, high home price areas. The amenities must be highly valued to keep people living here.

If the middle class are squeezed and can no longer live in California, this leads to some funky political economy. The state will consist of immigrants, native wealthy and international wealthy. What types of public goods and taxes will be equilibrium outcomes? In the case of UC tuition (now at $10 grand a year), that looks cheap to me. But, I'm used to ivy league prices and I have 1 child and I know that the UC provides roughly equal quality to our ivy league peers.

I would like to see President Yudoff counter the perception that there is plenty of waste in the UC budget. For all of the well paid administrators at his Oakland office, he should explain what each of them do and why they are earning their salaries. The UC campuses also need to learn the dark art of fundraising. We should hire people from Princeton's and dartmouth's fund raising offices to show us how the pros do it.

The NY Times author hints that California's best days are in the past. So, where in the U.S would she suggest we move to? St. Louis? Phoenix? Cleveland?

I am cautiously optimistic about the state but I do worry that there is too little thought about reinventing government and thinking through innovative ways of providing public goods. I look at the Los Angeles Public Schools District and its apparent inability to put together any good middle schools or high schools and wonder what in the heck is going on.

With a budget of $13 billion a year, they owe taxpayers such as my household some value.

http://en.wikipedia.org/wiki/Los_Angeles_Unified_School_District


UPDATE:

Here is a quote from my teacher Gary Becker; "Hundreds of economists have blogs, although many are not very good." Source .

Now , I'm slightly concerned that he is talking about this blog. As Malcolm X once said, the Chickens have come home to roost.

Gary, if you read this blog --- please keep in mind that I'm trying to supplement my UCLA salary with a comedy act and I use this blog to hone my material that I hope will soon be a HBO Comedy Show. This is all a joke. Nothing here is serious.