What happened to the so-called 'California Dream?'

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Is the California dream dead?

Oracle is leaving the Bay Area for Texas. Hewlett Packard’s HPE is too. Larry Ellison is moving to Hawaii. Elon Musk is heading to the Lone Star State.

Is California hemorrhaging big businesses because of its economic climate and tax policy? Former Monterey Congressman, Secretary of Defense, White House Chief of Staff and CIA Director Leon Panetta thinks so.

He now leads the Panetta Institute for Public Policy.

He is also on Oracle’s Board of Directors and is worried about the future of the "California Dream."

Secretary of Defense Leon Panetta testifies before the House Committee on Armed Services on Capitol Hill on October 13, 2011 in Washington, DC.
Secretary of Defense Leon Panetta testifies before the House Committee on Armed Services on Capitol Hill on October 13, 2011 in Washington, DC. Photo credit Brendan Hoffman/Getty Images

"It’s a concern because frankly I’ve had the chance to live the California dream as the son of Italian immigrants who worked hard, provided a good education and gave me the opportunity to succeed," Panetta said, pointing to a recent Panetta Institute poll of college students concerned about a major change in their livelihoods because of the COVID-19 pandemic.

"The fact is that California has been hit hard by a number of crises across the board," Panetta told KCBS Radio’s "The State Of California."

The pandemic, U.S. recession, wildfires, climate change, power outages, congestion and the housing crunch top Panetta’s list.

"We’ve always taken for granted that California can come back and it has in the past," he said. "There are a lot of businesses and industries that are not so sure. The result is there are economists saying this recovery is going to be much more difficult than expected and it’s for that reason that CEOs, boards and businesses are looking at other options."

Musk announced earlier this month he had moved to Texas after much speculation, news met with surprising announcements that HPE and Oracle were leaving Silicon Valley and the state’s high taxes behind. Airbnb, the popular housing rental company that went public just this week, brushed aside speculation they’d do the same Tuesday with an emphatic series of tweets from its co-founder.

"We’re gonna have to grow because that’s the way we expand opportunity for everyone and for every region and for every income level," Panetta added. "That’s the way we ultimately restore the California dream."