Lakers, Clippers, Warriors, Kings losing
MANILA, Philippines — The NBA champion Los Angeles Lakers and the Los Angeles Clippers, Golden State Warriors and Sacramento Kings are starting to lose. Those teams and players are starting to lose more of their live audience, economic stability and even personal income. The fifth largest economy in the world, their home state of California is in dire straits. Like any major enterprise in the state, the four NBA teams are being dragged into a crisis unlike anything they’ve seen before.
The past few months have seen an accelerated exodus from the state. Housing prices in California have been among the highest in the US, with San Francisco and New York leading the way nationwide. In 2019, more than half a million Californians moved to Texas. Since the pandemic, homeless people have taken over sidewalks along major thoroughfares throughout the city and even tourist hot spots like Venice Beach with tent cities. Drug use has become more brazen. One third of the state’s citizens avail of state health care support. People don’t feel safe in downtown areas. Crime is visibly on the rise. Wildfires have consumed thousands of acres, destroying valuable land and trees hundreds of years old.
Big businesses have also been moving out of the state, as well, partly due to excessive regulation and the pandemic. Elon Musk announced that he was moving his Tesla manufacturing facility to Texas, mainly because he wasn’t being allowed by the state government to reopen yet. According to reports, 54 percent of Bay Area storefronts have closed since the pandemic. Unemployment in Los Angeles is soaring to around the 20 percent mark. Other big businesses in the state have allowed at least half their workforce to work remotely, which often means outside the state, which now projects a deficit of over $500 billion. Other states have been reopening. Not California.
UFC commentator and podcaster Joe Rogan, political commentator Ben Shapiro and YouTube real estate adviser Graham Stephan are just the latest celebrities to ride the new mass departures. Musk already put his California mansion up for sale back in February. In 2015, actor Chris Hemsworth moved his family back to Australia after seven years in LA, citing the inconvenience of traffic and overcrowding. In prior years, Julia Roberts, Elijah Wood, Mark Ruffalo, Ryan Reynolds, Blake Lively, and other actors all thanked Hollywood for helping them earn enough so they wouldn’t have to live there, and left. Fox News has reported that moving companies which normally experience low income after summer are overwhelmed by the demand the past few weeks. Texas, Arizona and Nevada have absorbed most of the millions of “refugees.” Good news for the Houston Rockets, San Antonio Spurs, Dallas Mavericks and Phoenix Suns, the newly transferred Las Vegas Raiders (from LA) and other sports teams in those states.
If you’re a pro athlete who is already being taxed half – yes, half – your income in California, brace yourself. It’s going to get worse. Let’s break it down. First of all, California has the highest state income tax in the US at 13.3 percent. (Nevada and Texas have no income tax.) Federal and other taxes add another 37 percent for the higher tax brackets. So for a professional athlete, that comes out to over 50 percent in obligatory taxes. And California’s government still plans to raise state income tax to 16.8 percent. There is also a proposed “wealth tax,” through which any California resident with a net worth of over $30 million will be taxed an extra 0.4 percent, regardless of income. If you’re worth $100 million, the government will take half of that and an additional $400,000. Look out LeBron James, Steph Curry, David Beckham, and other high-profile athletes living in California. In effect, they’ll be working for the government. A third proposed state law even seeks to impose a retroactive tax on those who have left the state within the last year or two, even if they no longer earn anything in California or live there. Ridiculous.
So the Lakers, Clippers, Warriors and Kings are waist-deep in this disastrous situation, and the state government is only making things worse. With all these problems, the players and teams are examples of hardworking professionals who will earn less, and they will lose value simply by virtue of being in California. This would take a long time to fix even if they were trying to.