Businesses vote with their feet, money
The Editorial Board, The Sun
Walt Disney Company is joining the long list of companies sending large numbers of jobs out of California.
Last Thursday, it was announced that 2,000 professionals working in fields such as digital technology and finance would be shifted to Florida.
If anyone is puzzled about why a company like Disney would do this, they haven’t been paying attention.
“Florida is known for its rich culture of hospitality and active lifestyle as well as a lower cost of living with no state income tax,” wrote Josh D’Amaro, chairman of Disney Parks, Experiences and Products in a letter to Disney employees. In other words, Florida has many of the advantages of California, but it’s a more affordable place to live and do business.
On a similar note, D’Amaro cited Florida’s “business-friendly climate” as a consideration. To that point, California’s reputation for being unfriendly to business is well-established.
CEOs surveyed by Chief Executive Magazine consistently rank California the worst state in the country to do business.
The U.S. Chamber Institute for Legal Reform has consistently found that businesses perceive California as having among the most difficult legal environments to conduct business in.
And of course California’s tax and regulatory environments are infamous.
Just this year, the nonpartisan Tax Foundation ranked California 49th on its 2021 State Business Tax Climate Index, better only than New Jersey. In 2019, researchers at the Mercatus Center noted that California’s Code of Regulations consisted of 395,129 restrictions. In practice, it doesn’t get much clearer than how California and Florida treated Disney with respect to theme parks. While Florida allowed Disney World to reopen in July 2020, California barely issued guidance to theme parks like Disneyland in March 2021.
There’s no doubt that California remains, for all the failings of its state government, a great state. But it unfortunately remains a state that makes it hard for many businesses to rationalize starting, staying or expanding here. Until state officials realize the counterproductive impacts of their economic policies, expect more businesses to consider investing elsewhere.