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April 2006, Volume 12, Number 2

San Joaquin Valley

Joel Kotkin and William Frey call the Central Valley the "third California" and assert that the share of Californians in "inland California" will rise from 30 percent in 2000 to almost 40 percent by 2050. The first California is the San Francisco Bay region, and the second California is Los Angeles and San Diego; about 70 percent of Californians live in the 20 coastal counties and 30 percent live in the 38 inland counties.

The growing economic base of the Central Valley is construction and retail sales, which may stagnate if interest rates rise. Kotkin and Frey emphasize that more highly educated professionals are moving to parts of Third California, which could set in motion other changes, but many newcomer immigrants to the Valley have little education.

California's manufacturing employment fell from 1.9 million in 1990 to 1.5 million in 2005, while US manufacturing employment fell from 18 million to 14 million in the same period. In 2005, manufacturing was about 10 percent of California and US employment.

California. California's $126 billion proposed budget for 2006-07 includes $40 billion for K-12 education (32 percent of spending), $35 billion for health and human services (28 percent), and $14 billion for higher education (11 percent). The state anticipates revenues of $116 billion, including $50 billion from personal income taxes and $33 billion in sales taxes.

The health and human services spending includes $14 billion for Medi-Cal, the state's share of the cost of a program covering 6.7 million state residents. California Governor Arnold Schwarzenegger proposed cutting Medi-Cal payments by five percent and did not propose cost of living increases for cash assistance recipients.

Schwarzenegger also proposed a 10-year, $222-billion plan for shoring up California's infrastructure, using $68 billion in state-floated bonds over the next decade as seed money for the ambitious infrastructure spending. Schwarzenegger says that the state can improve its infrastructure without raising taxes and still limit debt service to six percent of the state's GDP.

California has a state bird (valley quail), tree (redwood), flower (golden poppy), reptile (desert tortoise) and even dance (West Coast swing). There is an effort underway to make Zinfandel the state's wine. Cabernet grapes came from Bordeaux and Chardonnay and Pinot Noir arrived from Burgundy, and it appears that Zinfandel grapes may have come from the gardens of the Austrian imperial palace in Vienna, which in the 18th century had vines from every part of the empire, including Croatia. Zinfandel ranks second in red grape acreage, behind cabernet sauvignon.