California is a mess. Let me count three ways:

1. California has the highest unsheltered homeless population of any state in the country

“At last official count 151,278 individuals are homeless in California, according to the U.S. Department of Housing and Urban Development…. Experts say this method likely underestimates the unsheltered, and doesn’t capture the total number of people who fall into homelessness over the course of a year, which could be two or three times higher.” - California’s homelessness crisis — and possible solutions — explained by Matt Levin and Jackie Botts/CalMatters  December 31, 2019. Updated January 8, 2020.

2. California has the highest poverty rate in the nation, adjusted for cost of living.

“Under the official rate, 12.5% of California residents are considered to be living below the poverty line, roughly in line with the 12.3% national poverty rate. After adjusting for medical costs, taxes, and other expenses as well as government aid programs and subsidies, however, the percentage rises to 18.1% – the highest supplemental poverty measure rate of any state and the highest gap between the two measures.” — In states such as California and Maryland, poverty may be worse than you think Evan Comen/24/7 Wall Street-USA Today  November 12, 2019. Based on data from US Census Bureau and Bureau of Economic Analysis.

To make matters worse, there are almost as many “near-poor” California residents as there are poor residents. In other words, more than a third of Californians are living in or near poverty (Public Policy Institute of California July 2020).

3. California has an extremely unreliable tax base

“Individual wages and business income as a measure of the overall economy aren’t terribly volatile. But California’s income taxes are over five times more volatile than personal income because they also include investment gains, according to the Legislative Analyst’s Office. The state taxes capital gains, partnership income and dividends, interest and rent—areas where the highest-income taxpayers derive most of their money…According to the Legislative Analyst’s Office, half of the state’s personal income tax revenue comes from those making $500,000 or more”. — The open secret about California taxes by Judy Lin/CalMatters May 8, 2018

During economic slowdowns, much of that tax revenue disappears as the rich become much-less-rich as their taxable investment income plummets. The end result being California can no longer pay its bills. As in the Great Recession, when …

“… the state faced multiple years of multibillion-dollar deficits, including a shortfall of $39.5 billion in 2009, as fallout from the housing and economic crisis. The California Teachers Association estimates 30,000 teachers were laid off during the recession. When the state ran low on cash in 2009, it issued IOUs, mostly to taxpayers waiting for their tax refunds. The state cut benefits for the poor, such as dental coverage for those on Medi-Cal. And state workers, along with many local government  employees, were forced to take furloughs, hitting working-class families.” — The open secret about California taxes by Judy Lin/CalMatters May 8, 2018

California already has highest top income tax in the nation - at 13.3%. And now state legislators want to raise the top rate to 16%. If the goal is to get rich people to leave the state and erode the tax base even further, that’s a great idea. If the goal is to increase tax revenue and establish a stable tax base, it’s a rotten idea.

Is there any hope for California? Not without a change in political culture.

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Some ideas as to how to fix the mess that is California (with the federal government’s help):

Homelessness: Housing the Chronically Homeless - Affordably! Part I: Some Concrete Suggestions  and Housing the Chronically Homeless - Affordably! Part II: Breaking Down The Costs 

Poverty: How the US Government Can Reduce Poverty on a Tight Budget  

Volatile Tax Base: Market-Friendly, Minimal Debt, Broad Tax Base, and a Solid Safety Net: Welcome to Denmark!