Doug Casey on California Breaking Apart

Via Casey Research

Justin’s note: California could soon become three states.

It sounds crazy, but a petition for this initiative, known as “Cal 3,” has already received more than 450,000 signatures. It’s now going to appear on the November ballot of California’s general election.

If Cal 3 goes through, it would have major ramifications, and not just for California. So, I called Doug Casey to get his thoughts…

Justin: What do you make of Cal 3? Would you like to see California break apart into three states?

Doug: It’s a good idea, in principle. If you’re going to have political entities, those entities ought to share a culture, language, religious beliefs, and traditions. In other words, political entities should more closely resemble what Greek city-states once were.

California is bigger than most of the countries in the world. If it were its own country, it would be the fifth largest economy on the planet. That, in itself, wouldn’t be a problem if its government in Sacramento wasn’t so involved in business, finance, and regulations of every type. It’s become a domestic empire. A war of all against all, where different economic groups want differing taxes, subsidies, and regulations to benefit themselves. Factions have become very antagonistic to one another. The state has become unmanageable.

My take is that the world—including the US—would be much happier and more prosperous if politics played a much smaller part than is now the case. The world would be better off with 7 billion or so independent political entities, not 235 like we have today. The geographical area known as California would be better off if its 40 million residents weren’t governed, but were self-governing. Of course that’s not going to happen anytime soon. But it’s an excellent goal to move towards.

The closer we get to every person being independent and having complete control of his own life, the better off we’ll be. That being said, three smaller Californias—each of whose residents have a lot in common—would be better than one big dysfunctional agglomeration.

Justin: So, you like the idea of California breaking up into three pieces. But what do you think about the current proposal? Is breaking California into Northern California, Southern California, and New California the right approach?

Doug: It’s unclear to me why the lines of the proposed new states are drawn where they are.

Source: California Legislative Analyst’s Office

The culture in far northern California—the pot and timber growing region—is very different from that of Silicon Valley. The yuppie/hippie culture of San Francisco is very different from the interior’s agricultural culture. And that’s very different from Los Angeles. There might be a dozen different cultural/economic regions in the state—each of them with more population than whole states like Wyoming or Montana.

For that matter, probably a third of California’s residents are Hispanic. How many of them believe in the Reconquista, and would like their own state? Probably a fair number, if a sign saying “Support the Reconquista” (in Spanish, of course) on the wall of a little Mexican restaurant I sometimes visit in Aspen is any indicator. I can assure you that young Latino males aren’t going to want to pay 20% in Social Security taxes in a few years to fund the retirement of old white women in Massachusetts—or anywhere else. They’ll be for a restructuring.

It’s unclear how you’d divide the state up. Economic lines? Cultural lines? Racial lines? Maybe you do it along political lines, splitting up the red counties and blue counties.

But that’s not what they’re proposing. So, it doesn’t seem like they’ve put a great deal of logic into this. The three proposed divisions are an improvement, but not optimal.

A lot of red and blue counties will still be mixed together. So, they’re still going to have the same political problems they have now. The people who live in these red and blue counties appear to want very different things from the government.

Justin: What are the chances of this even happening?

Doug: Slim. Apart from infighting within California, the powers that be in Washington won’t approve it because California would wind up with six senate seats, not just two. Plus, people fear and dislike real change—certainly the people that benefit from the status quo.

So, I like the idea in principle. But the chances of it happening are slim and none. And Slim’s out of town.

Justin: Ok. But let’s pretend for a second that it could happen. What sort of political ramifications could come out of this? Would the scales tilt in favor of the Democrats?

Doug: Well, yes. But I’m not so sure it makes that much difference—as shocking as that thought may be. Democrats and Republicans aren’t all that different. Even though they now seem to hate each other on a visceral level, they’re similar in that both parties are spineless, unprincipled, and very opportunistic.

Just because either the Reds or the Blues feel something today doesn’t mean that they won’t feel something different tomorrow, and reverse polarity. In other words, neither party has any sort of philosophical grounding. The differences are largely gut feelings and emotion.

For instance, the things the Dems say are uniformly stupid and despicable. Why, then, do they have so much apparently sincere support? It’s partly because they’re clearly the more honest party. They say that they believe in socialism, identity politics, feminism, “safe spaces,” collectivism, and all the rest of it. And they enact policies along those lines. It’s perverse, but you’ve got to respect their intellectual honesty. At least in some ways, they say what they mean, and mean what they say.

The Republicans, on the other hand, say they believe in things like free markets, freedom, and individualism, but they don’t. They’re happy to pass all kinds of regulations, subsidies and taxes that benefit their constituents—things that contradict their rhetoric. So, they’re naturally viewed as hypocrites.

It used to be the Reps were the warfare party and the Dems were the welfare party, but that’s no longer a valid distinction. They both believe in warfare and welfare. That said, I suppose you could divide California into red and blue areas. But that would only be based on the current emotional tenor, and emotions can change quickly. For all I know, one or both of those parties will cease to exist 10 years from now, just as the Federalists, the Whigs, and other major political parties have come and gone.

As it stands, Cal 3, or about any other redivision, would give the Democrats more Senate seats. But it won’t make much of a difference in the grand scheme of things. The country as a whole is declining economically, politically, and sociologically. It’s been heading in the wrong direction for many years, and it’s hard to reverse ingrained trends.

Maybe it’s both better and more likely that California secedes from the US…

Justin: So, you say that the chances of Cal 3 happening are slim because politicians have an interest in preserving the status quo. But then how will we ever get to anything close to resembling 7 billion independent political states?

Doug: First off, we shouldn’t think politically. Politics is basically about coercion, not voluntary cooperation. It’s about who gets control of the State, to wield its power. Democracy isn’t like a few friends politely deciding what to have for dinner; in practice it devolves into mob rule. I’d like to depoliticize the world. Since humans are social creatures, we’ll always move in groups. The strongest groups are bound by common values and interests. But with today’s technology, those groups have little relation to political borders. Instead of “nation states,” I think the world is evolving towards “phyles.”

If the state did nothing but provide a police force to protect you from criminals inside its bailiwick, a military to protect you from aggressors outside its borders, and a court system to allow you to adjudicate disputes without resorting to force—I could live with that. That’s reasonable enough.

The problem is that these three functions are too important to be left to the kind of people that inevitably gravitate towards government. Government workers and politicians are the kind of people that like to control other people’s lives. They’re natural busybodies. So even those three functions, which are the only legitimate reasons for the state, should be left to the private sector.

The world would be better off if nobody thought in political terms, if we thought strictly in economic terms. Society would be vastly more peaceful, prosperous, and happy if people thought mainly about what goods and services they can provide to other people in the market. Not how the people in government should reorder society.

Politics isn’t the solution. It’s the problem. And dividing California into three states isn’t going to solve the basic problem.

Justin: Thanks for taking the time to speak with me today, Doug.

Doug: My pleasure