California's taxes and greenie laws breaching the gates of even Silicon Valley

The Economist has a fine cover story on the decline of Silicon Valley, warning that its famed garage start-ups are fleeing to places such as Fort Lauderdale and Pittsburgh.  Its title leader, "Why startups are leaving Silicon Valley," sums the problem up as this:

Its combination of engineering expertise, thriving business networks, deep pools of capital, strong universities and a risk-taking culture have made the Valley impossible to clone, despite many attempts to do so.  There is no credible rival for its position as the world’s pre-eminent innovation hub.  But there are signs that the Valley’s influence is peaking (see Briefing).  If that were simply a symptom of much greater innovation elsewhere, it would be cause for cheer.  The truth is unhappier.

It's a pretty good article for giving the lay of the land over there if you aren't all that familiar with it (Facebook median salary is $240,000, Silicon Valley hosts three of the five most valuable companies in America, the valley has gone through multiple cycles of Schumpeterian creative destruction, etc.).  And, it warns, likely accurately, that Silicon Valley is losing its pre-eminence because it's losing its start-ups, the newly formed businesses that, in Silicon Valley, often become big businesses that change the way we live.  Try starting a computer company in a garage now in a place where an ordinary home costs more than a million.  It's not going to happen.

But the article leaves out the most obvious factor for chasing away start-ups: California's hideous one-party state and the high taxes, green laws, and general regulations that have made operating a fresh start-up business such a hell.  Those taxes and regulations, by the way, just happen to be the handiwork of the Democrats and politically correct socialists who run California.  By the wildest of coincidences, Silicon Valley's barons just happen to support those people, as well as their increasingly rabid socialist ideas. 

Now, from the business perspective of these leftist monopolies, which tolerate no ideological dissent in their own ranks, it's probably a good thing to chase out start-ups, the better to keep from being toppled by one of them, which, as the Economist piece notes, is a Silicon Valley specialty.  What better way to do that than to elect Democrats?

But with the Democrats' taxes and regulations driving out these start-ups, their own greatness is looking increasingly tenuous, not from the punk-kid start-ups they'd like off their lawns, but from the ugliness of economic stagnation, waste, and decline as the alternative.  It's as if the very left-wingery of Mark Zuckerberg, Laurene Jobs, Sergey Brin, and the rest of the monoculture, while making them comfortable and driving away their potential challengers, is also making their home scene a place of decline.

That decline isn't just in Democrats' higher taxes and greenie regulations.  It's also in their affinity for Obamacare, single-payer, and free health care for illegals.  As Mitch McConnell once explained to our Investor's Business Daily editorial board, states have two big expenses: health and education.  Raise one, and you end up cutting the other.  So as Democrats in California expand health care for illegals, guess what happens to education.

The Economist points to some troubling signs of these Democrat costs and effects – in the high costs of living, in the flight of capital outward, in the presence of bums and syringes...but I would add that it's also evident in the general public loathing and suspicion brewing against these monopolies, and in the increasing calls for antitrust legislation to allow more ideas – and competitors – in.

What it really shows is that repression of tech innovation ideas and repression of political ideas go hand in hand, as Megan McArdle noted in her essay earlier this year, "Silicon Valley Will Pay the Price for its Lefty Leanings."

The flight of start-ups ought to be a warning to them that they can take a chance of going downhill by being bested by competitors in atmospheres of free ideas and markets, or else they can go downhill the Rust Belt way, by electing Democrats and smothering their competition with socialism, hoping the crocodile eats them last.

Right now, it looks rather obvious that they've taken the second course.  Now there's a crocodile crawling out from their own swamp, and it's headed in their direction.

Image Credit: Samykolon via Wikimedia CommonsCC BY-SA 3.0.

The Economist has a fine cover story on the decline of Silicon Valley, warning that its famed garage start-ups are fleeing to places such as Fort Lauderdale and Pittsburgh.  Its title leader, "Why startups are leaving Silicon Valley," sums the problem up as this:

Its combination of engineering expertise, thriving business networks, deep pools of capital, strong universities and a risk-taking culture have made the Valley impossible to clone, despite many attempts to do so.  There is no credible rival for its position as the world’s pre-eminent innovation hub.  But there are signs that the Valley’s influence is peaking (see Briefing).  If that were simply a symptom of much greater innovation elsewhere, it would be cause for cheer.  The truth is unhappier.

It's a pretty good article for giving the lay of the land over there if you aren't all that familiar with it (Facebook median salary is $240,000, Silicon Valley hosts three of the five most valuable companies in America, the valley has gone through multiple cycles of Schumpeterian creative destruction, etc.).  And, it warns, likely accurately, that Silicon Valley is losing its pre-eminence because it's losing its start-ups, the newly formed businesses that, in Silicon Valley, often become big businesses that change the way we live.  Try starting a computer company in a garage now in a place where an ordinary home costs more than a million.  It's not going to happen.

But the article leaves out the most obvious factor for chasing away start-ups: California's hideous one-party state and the high taxes, green laws, and general regulations that have made operating a fresh start-up business such a hell.  Those taxes and regulations, by the way, just happen to be the handiwork of the Democrats and politically correct socialists who run California.  By the wildest of coincidences, Silicon Valley's barons just happen to support those people, as well as their increasingly rabid socialist ideas. 

Now, from the business perspective of these leftist monopolies, which tolerate no ideological dissent in their own ranks, it's probably a good thing to chase out start-ups, the better to keep from being toppled by one of them, which, as the Economist piece notes, is a Silicon Valley specialty.  What better way to do that than to elect Democrats?

But with the Democrats' taxes and regulations driving out these start-ups, their own greatness is looking increasingly tenuous, not from the punk-kid start-ups they'd like off their lawns, but from the ugliness of economic stagnation, waste, and decline as the alternative.  It's as if the very left-wingery of Mark Zuckerberg, Laurene Jobs, Sergey Brin, and the rest of the monoculture, while making them comfortable and driving away their potential challengers, is also making their home scene a place of decline.

That decline isn't just in Democrats' higher taxes and greenie regulations.  It's also in their affinity for Obamacare, single-payer, and free health care for illegals.  As Mitch McConnell once explained to our Investor's Business Daily editorial board, states have two big expenses: health and education.  Raise one, and you end up cutting the other.  So as Democrats in California expand health care for illegals, guess what happens to education.

The Economist points to some troubling signs of these Democrat costs and effects – in the high costs of living, in the flight of capital outward, in the presence of bums and syringes...but I would add that it's also evident in the general public loathing and suspicion brewing against these monopolies, and in the increasing calls for antitrust legislation to allow more ideas – and competitors – in.

What it really shows is that repression of tech innovation ideas and repression of political ideas go hand in hand, as Megan McArdle noted in her essay earlier this year, "Silicon Valley Will Pay the Price for its Lefty Leanings."

The flight of start-ups ought to be a warning to them that they can take a chance of going downhill by being bested by competitors in atmospheres of free ideas and markets, or else they can go downhill the Rust Belt way, by electing Democrats and smothering their competition with socialism, hoping the crocodile eats them last.

Right now, it looks rather obvious that they've taken the second course.  Now there's a crocodile crawling out from their own swamp, and it's headed in their direction.

Image Credit: Samykolon via Wikimedia CommonsCC BY-SA 3.0.