Tuesday, June 25, 2013

Of Sunny Beaches And Confiscatory Tax Rates

I've mentioned before how infuriating it is to live in California. For people with even a modicum of success, the state continues to drain you as if you were a maple tree in Vermont. Physicians in the state have it especially bad. We are socked with the highest marginal income tax rates in the nation thanks to an electorate who vote for tax increases out of envy instead of clear logic. The cost of doing business here is outlandish, with high office rents, expensive employee compensation, and onerous work rules. Yet the state is determined to drive down physician compensation by ten percent for its Medi-Cal program. This of course is the service that a million previously uninsured Californians will have to sign up for once ObamaCare kicks in full force in 2014.

While this calamity is happening to the medical community, what is the state doing about it? They are suddenly spending money like a new mega lottery winner, which in a way is what California's government bodies have discovered. Our elected representatives have realized that there is more money in the pot than what they've been used to for the last half decade. So now it's party time like it's 1999. Future busts be damned.

Thanks to the higher tax rates this year California has a small budget surplus. Because more of my income is being taken by the government, the governor and state legislature think they are the smartest kids in class when they can pass a budget that is not marked in red ink. Now they feel they deserve a raise. The state has just granted itself raises along with increased health care benefits. So really through no action of their own, the increased confiscation of my hard earned money has allowed our politicians to give themselves a little gift. In the meantime my reimbursements are being cut even while the same politicians are driving thousands of new patients into my practice. Talk about nice work if you can get it.

The Los Angeles Unified school district also can't wait to get its hands on the new money. They have just decided to give every single student in the school district an iPad. The cost is $678 per tablet. The district serves almost 700,000 students. The pilot cost for this program is $30 million but once all the students have one, along with various support and maintenance expenses, the final bill will be in the hundreds of millions of dollars.

Seriously? For that kind of money, the school district could easily higher more teachers to lessen classroom crowding. Heck they could even build a brand new school with that. That thought of thousands of students traipsing all around Los Angeles carrying expensive electronics is terrifying. New York City is suffering a crime spree thanks to thefts of the iPhone. What's going to happen when vulnerable students are targeted by thiefs as they carry their iPads to and from home? This could be the biggest opportunity of all time for eBay and Craigslist users.

That's not even considering the thousands of tablets that will have to be replaced due to carelessness. Have these school board members never seen what children can do to school property? And who is going to pay to keep these iPads upgraded. Buying desktop computers is easy since they don't need to be upgraded so often. iPads are updated every year. Who wants to own an iPad that is even three years old? Their depreciation are even worse than cars. Is the school going to keep buying new iPads as another model is introduced? Would it be fair for the some kids to get newer models while others are stuck with the older ones? And what ever happened to funding programs that really have shown benefits to children? You know, like music and the arts? Have we all bowed down to the deity of Apple Inc. and offered our children and cash as sacrifice?

Is it any wonder people don't trust government with their tax dollars? As soon as the money is collected, it is spent. The list of needs is endless. But the resources are finite, unless you can convince the proletariat to keep voting against their employers. California better keep showing those promotional commercials of sunny beaches if it hopes to convince people to move here and give up their money.


  1. As a former Californian, I'm sad to see my home state going down the toilet.

    As an anesthesiologist, I'm hoping to practice in another state more friendly to doctors. Any suggestions?

  2. It depends on what you want. But according to the last Medscape physician salary survey (link below), the upper Midwest offers the highest income of any region in the country. They also have lower cost of living, lower crime rates, and better schools. But if you must have great weather or proximity to the beach, well you better bend over and pay up to live on the coasts.