Last night, I saw San Francisco Mayor Gavin Newsom - one of the most liberal prominent public officials in America - speak proudly about how California has some of the most progressive policies in the country, and how that makes California an enviable state.

Really? Let’s look at what those great progressive policies have done to the state. One can often read a liberal wish list and find much to like. Who could object to funding for promising stem cell research? Or what about a high speed rail - America’s first - between Los Angeles and San Francisco?

The problem is not some progressive policies are bad, but that there is not such thing as a free lunch. Every special-interest group wants something for nothing: increased wages and benefits for state employees, more funding for the arts, more money for education that is wasted by the teachers union, ect.... The state budget though cannot continue to grow without eventually leading productivity-crushing taxes and leaving state finances in turmoil. That is where California finds itself today.

First, California boosts one of the highest tax rates in the nation. And its tax structure is slanted toward income taxes with income receipts accounting for 49.1% of all state revenues. And the tax structure is so “progressive” that is puts an incredibly dispoportionate burden on the rich. The top 1% in California pay 48% of all income taxes! So, in other words, the top 1% in the state pay 25% of all state revenues. And, yet, many of California’s liberal elders will tell you start to your face that the “rich don’t pay their fair share.”

Due to the state’s intrusive regulation - especially environmental regulation - based on the progressive ideal to dictate every facet to businesses, along with the state’s powerful unions and high business taxes; California has one of the highest unemployment rates in the nation at 10.1%. The national unemployment rate is a little over 7%. Is this a mark of progressive policies to drive people out of work in the name of, say, environmental purity?

The taxes are so high in the state and starting a business also carries equally high taxes and regulation to compile with that since the year 2000 100,000 Californians have been moving out every year. No other state has since such a migration out in either absolute terms or in percentage of state population. And as The Economist recently noted, “more would follow if they could sell their homes.” The state will lose a congressional district come 2010. Apparently not all adore the state’s progressive policies in the same manner as a man who’s mayor of a radical city of leftists. And for the record, “progressive” San Francisco has a realty market this forces out the middle class. The market is so expensive that only the rich can afford decent housing, the rest of the people live in slums with no space for the middle class that has deserted the city in the past several years. This “progressive” city has one of the worst income inequality rates in the nation. That’s because so-called progressive policies are supported by affluent liberals who get to maintain their status of wealth while dragging the middle class with higher taxes and more barres to entrepreneurial endeavors.

[The hippies have already taken over San Francisco, will they take over the rest of California? They must be stop. Only you can prevent the Hippieization of California.]

But even with just high taxes, because spending is so out of control [instead of saving money during good years, lawmakers prefer to increase spending even more!] and due to the fact that the rich make most of their money through the market and in the current climate their sources of income have declined, the state budget is facing the worst financial crisis in the nation. No exaggeration!!!

California has a $42 billion budget hole! Its finances are in such disarray that Standard & Poor’s has downgraded California’s bond holding to the worst in the nation. A great fall for a once mighty state And how do they lawmakers deal with it? Raise more taxes. Instead of cutting state spending, liberal Democrats who control both state houses plan a tax increase on everyone. Sales and income taxes will rise along with car registration taxes [which will double] and gas [already second highest in the nation] will be taxed 12 cents more. And this is not the end of it. Voters in California have to approve a state ballot that will allow the government to seek $5 billions from the state lottery. If this and other initiates fall, then taxes will have to rise further.

California should be a warning to all freedom loving Americans who want the U.S. economy to remain the world’s best about the crippling dangers of the “progressive” policies that Gavin Newsom and his ilk want to spread. Let them be proud in their self-created misery. Most Americans prefer capitalism.

[Besides the aforementioned The Economist, see also this Economist article.]