With an economy like California’s, it is no surprise that some experts are coming forward saying the desperate state may hold back the rest of the Country from a recession recovery. A new article by the Sacramento Bee claims that not only does California account for 12% of the countries gross domestic product, but it also has more retail activity then any other state.
Check out the following snippet form the article, or you can find the full post at SacBee.com.
California faces a $24 billion budget shortfall, an eye-popping amount that dwarfs many states' entire annual spending plans.
Beyond California's borders, why should anyone care that the home of Google and the Walt Disney Co. might stop paying its bills this week?
Virtually all states are suffering in the recession, some worse than California. But none has the economic horsepower of the world's eighth-largest economy, home to one in eight Americans.
California accounts for 12 percent of the nation's gross domestic product and the largest share of retail sales of any state. It also sends far more in tax revenue to the federal government than it receives - giving a dollar for every 80 cents it gets back - which means Californians are keeping social programs afloat across the country.
While the deficit only affects the state, California's deepening economic malaise could make it harder for the entire nation's economy to recover.
When the state stumbles, its sheer size - 38.3 million people - creates fallout for businesses from Texas to Michigan.