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The California Workers’ Compensation system is often the scapegoat for the current (and past) statewide dismal business climate. This perception fuels the battle cry for more comp reform. So, let us look at the report card for the first quarter of 2014. Is Workers Compensation costs the singular issue of concern to state citizens? As of April 1st, 2014, according to a story on Breitbart News, California is noteworthy because it has:

  • the third highest workers compensation costs,
  • the most progressive personal income tax schedule,
  • the highest state personal income and capital gains tax rate, and
  • the highest state-only sales tax rate,
  • the fourth highest state and local tax burden in the country,
  • the fourth highest unemployment rate in the nation,
  • the highest poverty rate in the nation,
  • the third highest educational employee pay in the nation with the fourth lowest student test scores in the nation (according to Laffer Associates analysis of U.S. Department of Education NAEP test scores),
  • the most restrictive regulatory burden,
  • the California’s teachers union has been the single largest contributor to political campaigns in California over the past decade ($212 million)–double that of the next largest contributor, also a state government employees union.
  • the seventh highest share of public employee unionization,
  • the highest paid public employees, and
  • the fourth worst highways in the country,
  • the greatest net outflow of state adjusted gross income.

There is a lot of work to improve the problems shown on this report card in order to improve the business climate and the State economy as a whole. Certainly there are more problems other than Workers’ Compensation.costs; This is a very painful report card to digest in 2014 as the rest of the country recovers from the great recession. A singular focus on Workers’ Compensation reform is not the answer.