OPINION:
When it comes to cultivating entrepreneurs, Virginia has a few lessons to teach California. Last week, the Old Dominion retained the top five spot on CNBC’s “Top State for Business” list, which it has held since 2018, despite recent cuts to the federal workforce that have sunk the economy in the D.C. suburbs.
Gov. Glenn Youngkin has been bragging about the $121 billion in private-sector investment he has overseen. Big-name companies, including Amazon, the LEGO Group and Hilton, have been expanding their operations in the state.
With perfect weather, abundant natural resources and a surplus of highly educated technology workers, the Golden State should have no rival. Instead, it achieves a pathetic, middle-of-the-pack finish on CNBC’s ranking. That’s because the state Legislature’s Democratic supermajority created the worst possible environment for commerce, surpassed only by New York and New Jersey.
Recognizing this, Fortune 500 heavyweights such as Charles Schwab, Chevron, Hewlett-Packard and Tesla ditched the land of fruits and nuts for Texas. Although that’s a safe choice, it’s not necessarily the best for everyone. After a brief stay in the Lone Star State, Oracle settled in Tennessee.
Hilton fled California to set up shop in McLean in 2009. It’s now augmenting its headquarters and promising 350 new jobs by 2027. Mr. Youngkin offered $5 million in state funding incentives and tax breaks to encourage the move.
“Economic development is a team sport, and Virginia’s made giant strides in business-ready sites, workforce development, regulatory reduction, infrastructure investment and all-of-the-above power solutions,” he said in a statement.
Still, every state’s chief executive is eager to offer such bribes. What sets Virginia apart is its willingness to undergo a regulatory diet. Mr. Youngkin announced last week that 11 million words from Virginia’s official guidance documents would be eliminated after a quarter of the state’s red tape was removed.
Verbal austerity has tangible benefits. A slimmer building code means new home construction costs have dropped by $24,000. California, by contrast, imposes the most regulatory angst of any state, according to a Mercatus Center study that counted 395,608 individual restrictions in its 21-million-word administrative code.
California Gov. Gavin Newsom is more concerned about making his state a sanctuary for illegal aliens than a haven for the major firms that once called it home. For the past four years, Mr. Newsom has been shaking down his citizens so more than 1 million foreigners who have no right to live in this country can enjoy free health care and luxury accommodations despite their, in the state’s euphemism, “unsatisfactory immigration status.”
Now that he is running for the 2028 Democratic presidential nomination, Mr. Newsom is casually walking back his most extreme positions. The budget he signed last month freezes enrollments so newly arrived illegals won’t be eligible for as many medical freebies.
That might sound like progress, but it doesn’t change. President Trump has effectively cut off the supply of fresh illegal aliens by sealing the border. Outraged, the California governor sued Mr. Trump on behalf of the foreign invaders after the president dared to protect federal agents assaulted by Mr. Newsom’s protesters of “unsatisfactory immigration status.”
It is especially hard for a small enterprise to succeed in a state where rampant lawlessness prevails. That is why Mr. Newsom needs to alter his approach if he wants to win in 2028. He can start by learning a few lessons from Mr. Youngkin.
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