Whenever folks complain about California’s oppressive taxes, fees, cost of living, over-regulation, lousy roads, high utility costs and legal climate, progressives usually come back with this: “But California has the world’s fifth largest economy” — delivered with a smug “gotcha” look.
And it IS true — CA DOES have the fifth largest economy in the world. But that figure by itself tells us little about the prosperity of the PEOPLE in our Golden State. For instance, Red China has a much bigger economy (GDP) than California. Does anyone think that on average the Chinese are more prosperous than Californians? Well, anyone who’s not a Bernie Sanders acolyte?
Let’s look at the vaunted California prosperity compared to the other states — the only comparison that matters. Our CA median household income (half make more, half make less) is the 8th best in the nation. Seven states have a higher median household income. So CA ranks high, but not the best.
See chart #1 below.
But then we have to consider that income’s purchasing power. We have to factor in the states’ cost of living (COL). Here’s the shocking result: When states’ median household income is adjusted for the CA COL, California ranks worse than all but 10 states. That’s right — households in 39 states are on average more prosperous than Californians.
I ran this comparison a couple years ago, and CA was the 37th worst. Now we are #40. California’s stately decline continues.
See chart #2 below.
But that’s not all. Remember that CA holds 12.1% of the entire nation’s population. Our high COL significantly raises the national COL average. Take CA out of the national average — comparing CA with just the other 49 states — and the disparity is even worse.
https://www.census.gov/quickfacts
Compared to the national average, the CA COL is “only” 39.1% higher. But compared with the other 49 states, the CA COL is 47.0% higher, which would move us even lower towards the bottom of the prosperous states. Only Oregon and Hawaii would still be lower than our Golden State.
This abysmal level of Golden State prosperity is the bottom line reason why middle class Californians are increasingly leaving this lovely place for other states. In 2018, 156,000 MORE Californians left for other states than came to CA FROM other states (net domestic migration). I emphasize that the 156,000 is a NET domestic migration figure. I’m sure that the 2019 figure will be higher.
Our state’s low level of prosperity is further confirmed by California’s real (“supplemental”) 2017 poverty rate. This rate is the new census bureau standard adjusted for the COL. CA is still easily the worst in the nation at 19.0%. We are 43.9% higher than the average for the other 49 states. Texas is 14.7%. Our CA poverty rate is 34.6% higher than Texas.
https://www2.census.gov/programs-surveys/demo/tables/p60/265/table5.xls
NOTE: Two charts below compare the states median household income. Of the two, the second chart is the important one — ranking states by COL-adjusted household income.
| State Median Household
Income Adjusted for State COL Chart #1 |
||||
| Rank by
Household Income |
||||
| State | Median
Household Income |
COL Index | Median Household
Income Adjusted for COL |
Median
Household Income Rank |
| Maryland | $80,776 | 130.2% | $62,040 | 1 |
| New Jersey | $80,088 | 125.4% | $63,866 | 2 |
| Hawaii | $77,765 | 192.1% | $40,482 | 3 |
| Massachusetts | $77,385 | 134.2% | $57,664 | 4 |
| Connecticut | $74,168 | 128.9% | $57,539 | 5 |
| New Hampshire | $73,381 | 108.4% | $67,695 | 6 |
| Alaska | $73,181 | 129.7% | $56,423 | 7 |
| California | $71,805 | 139.1% | $51,621 | 8 |
| Virginia | $71,535 | 101.3% | $70,617 | 9 |
| Washington | $70,979 | 110.2% | $64,409 | 10 |
| Colorado | $69,117 | 105.9% | $65,266 | 11 |
| Minnesota | $68,388 | 101.9% | $67,113 | 12 |
| Utah | $68,358 | 98.5% | $69,399 | 13 |
| New York | $64,894 | 135.3% | $47,963 | 14 |
| Rhode Island | $63,870 | 120.9% | $52,829 | 15 |
| Illinois | $62,992 | 95.0% | $66,307 | 16 |
| Delaware | $62,852 | 107.1% | $58,685 | 17 |
| North Dakota | $61,843 | 98.5% | $62,785 | 18 |
| Wyoming | $60,434 | 95.7% | $63,149 | 19 |
| Oregon | $60,212 | 133.1% | $45,238 | 20 |
| Nebraska | $59,970 | 92.3% | $64,973 | 21 |
| Wisconsin | $59,305 | 96.3% | $61,584 | 22 |
| Texas | $59,206 | 91.5% | $64,706 | 23 |
| Pennsylvania | $59,195 | 98.8% | $59,914 | 24 |
| Iowa | $58,570 | 92.0% | $63,663 | 25 |
| Nevada | $58,003 | 109.2% | $53,116 | 26 |
| Vermont | $57,513 | 116.9% | $49,198 | 27 |
| Arizona | $56,581 | 101.0% | $56,021 | 28 |
| South Dakota | $56,521 | 98.5% | $57,382 | 29 |
| Kansas | $56,422 | 89.6% | $62,971 | 30 |
| Maine | $56,277 | 117.3% | $47,977 | 31 |
| Georgia | $56,183 | 90.6% | $62,012 | 32 |
| Michigan | $54,909 | 89.5% | $61,351 | 33 |
| Indiana | $54,181 | 90.5% | $59,869 | 34 |
| Ohio | $54,021 | 92.2% | $58,591 | 35 |
| Missouri | $53,578 | 88.3% | $60,677 | 36 |
| Montana | $53,386 | 105.0% | $50,844 | 37 |
| North Carolina | $52,752 | 94.4% | $55,881 | 38 |
| Florida | $52,594 | 99.1% | $53,072 | 39 |
| Idaho | $52,225 | 93.8% | $55,677 | 40 |
| Tennessee | $51,340 | 88.9% | $57,750 | 41 |
| South Carolina | $50,570 | 95.9% | $52,732 | 42 |
| Oklahoma | $50,051 | 87.2% | $57,398 | 43 |
| Kentucky | $48,375 | 91.7% | $52,754 | 44 |
| Alabama | $48,123 | 89.2% | $53,950 | 45 |
| New Mexico | $46,744 | 91.4% | $51,142 | 46 |
| Louisiana | $46,145 | 93.6% | $49,300 | 47 |
| Arkansas | $45,869 | 87.7% | $52,302 | 48 |
| Mississippi | $43,529 | 86.7% | $50,206 | 49 |
| West Virginia | $43,469 | 92.1% | $47,198 | 50 |
| US Average | $60,336 | 100% |
Chart #2
Rank by COL-ADJUSTED Household Income
| State | Median
Household Income |
COL Index | Median Household
Income Adjusted for COL |
COL
Adjusted Rank |
| Virginia | $71,535 | 101.3% | $70,617 | 1 |
| Utah | $68,358 | 98.5% | $69,399 | 2 |
| New Hampshire | $73,381 | 108.4% | $67,695 | 3 |
| Minnesota | $68,388 | 101.9% | $67,113 | 4 |
| Illinois | $62,992 | 95.0% | $66,307 | 5 |
| Colorado | $69,117 | 105.9% | $65,266 | 6 |
| Nebraska | $59,970 | 92.3% | $64,973 | 7 |
| Texas | $59,206 | 91.5% | $64,706 | 8 |
| Washington | $70,979 | 110.2% | $64,409 | 9 |
| New Jersey | $80,088 | 125.4% | $63,866 | 10 |
| Iowa | $58,570 | 92.0% | $63,663 | 11 |
| Wyoming | $60,434 | 95.7% | $63,149 | 12 |
| Kansas | $56,422 | 89.6% | $62,971 | 13 |
| North Dakota | $61,843 | 98.5% | $62,785 | 14 |
| Maryland | $80,776 | 130.2% | $62,040 | 15 |
| Georgia | $56,183 | 90.6% | $62,012 | 16 |
| Wisconsin | $59,305 | 96.3% | $61,584 | 17 |
| Michigan | $54,909 | 89.5% | $61,351 | 18 |
| Missouri | $53,578 | 88.3% | $60,677 | 19 |
| Pennsylvania | $59,195 | 98.8% | $59,914 | 20 |
| Indiana | $54,181 | 90.5% | $59,869 | 21 |
| Delaware | $62,852 | 107.1% | $58,685 | 22 |
| Ohio | $54,021 | 92.2% | $58,591 | 23 |
| Tennessee | $51,340 | 88.9% | $57,750 | 24 |
| Massachusetts | $77,385 | 134.2% | $57,664 | 25 |
| Connecticut | $74,168 | 128.9% | $57,539 | 26 |
| Oklahoma | $50,051 | 87.2% | $57,398 | 27 |
| South Dakota | $56,521 | 98.5% | $57,382 | 28 |
| Alaska | $73,181 | 129.7% | $56,423 | 29 |
| Arizona | $56,581 | 101.0% | $56,021 | 30 |
| North Carolina | $52,752 | 94.4% | $55,881 | 31 |
| Idaho | $52,225 | 93.8% | $55,677 | 32 |
| Alabama | $48,123 | 89.2% | $53,950 | 33 |
| Nevada | $58,003 | 109.2% | $53,116 | 34 |
| Florida | $52,594 | 99.1% | $53,072 | 35 |
| Rhode Island | $63,870 | 120.9% | $52,829 | 36 |
| Kentucky | $48,375 | 91.7% | $52,754 | 37 |
| South Carolina | $50,570 | 95.9% | $52,732 | 38 |
| Arkansas | $45,869 | 87.7% | $52,302 | 39 |
| California | $71,805 | 139.1% | $51,621 | 40 |
| New Mexico | $46,744 | 91.4% | $51,142 | 41 |
| Montana | $53,386 | 105.0% | $50,844 | 42 |
| Mississippi | $43,529 | 86.7% | $50,206 | 43 |
| Louisiana | $46,145 | 93.6% | $49,300 | 44 |
| Vermont | $57,513 | 116.9% | $49,198 | 45 |
| Maine | $56,277 | 117.3% | $47,977 | 46 |
| New York | $64,894 | 135.3% | $47,963 | 47 |
| West Virginia | $43,469 | 92.1% | $47,198 | 48 |
| Oregon | $60,212 | 133.1% | $45,238 | 49 |
| Hawaii | $77,765 | 192.1% | $40,482 | 50 |
“Median household income” is provided by the Henry J. Kaiser Foundation, drawing from U.S. Census data for 2017:
COL figures are from the link below. The CA COL is 39.1% higher than the national average (an average that includes CA) in 2nd quarter 2019. The CA COL is 66.1% higher than the TX COL.