Roughly half the people that voted in this past U.S. election voted against Donald Trump. As you know now President Trump won the Electoral College, but lost the popular vote. This outcome has not sat well with some and many well known actors had already threatened to move to Canada if Mr. Trump won the election.
Many of these folks live in California and most have not as of yet moved to our neighbor to the north. The fact that people are having to move has raised a different possibility. One that involves the Golden State no longer being part of the Union. The petition for succession is being called Calexit (taking a similar name as the successful Brexit). There are seemingly impossible odds for California to leave the United States, but what if it worked?
If CalExit passed at the ballot box (it would need 55 percent to pass) it would then take an amendment to the U.S. Constitution to allow for the state to break away. While this isn’t likely to happen (and we don’t see too many gun control loving anti-war California’s wanting to fight for their independence) there is a slight chance.
If the state became its own nation then based the current GDP of $2.4 trillion dollars it would be the sixth largest economy in the world. It would only be behind the United States, China, Japan, Germany and the UK. Of course this is if GDP stays up and a large chunk of that is from technology and agricultural.
The tech industry would likely stay in California (with some companies leaving for lower tax areas), but the farming industry could look to bolt. As regulations and the recent drought have left many farmers struggling quite a few have already given up on farming. California produces one third of the worlds produce, but if this left the state with farmers looking to do their farming elsewhere that could be a major hit to the new country’s economy. To add to this the overwhelming majority of folks that own a farm are conservative and would no longer have good representation in a California Nation. Because of this they are likely to sell the farm and move. What would happen next would depend on who bought these farms and what happened to the land.
While California is known as a very liberal state some may find it interesting that there are a lot of conservative areas. The large population centers of the Bay Area and the LA area keep the more conservative parts of the state from having a voice. Because of this at a state level (and potentially a country level) these people are not well represented and many would look to leave California if it was no longer part of the USA. Of course the opposite is true and many liberals from the remaining states would leave for California.
If passed it could be the ultimate social experiment of if conservative or liberal ideas work better. And after all that setup this is where we get to the auto industry.
Without California in the Union, Republicans would likely dominate elections (especially the presidential election) over most of the U.S. Likewise the Nation of California would likely be dominated by Democrats. This would mean that California’s already strict laws regarding the environment and climate change would probably become even more strict. The Governor is currently talking about raising the already high gas tax by 42% and a 141% increase on vehicle registration fees. With an entire nation to finance, taxes would go through the roof.
With gas being taxed higher and higher more and more people in the state would look to electric cars to help elevate the financial burden. Cars from Tesla, especially the forthcoming Model 3, would almost be impossible to build fast enough to support the demand. Outside of the very wealthy or people with a classic car for weekends only, the V8 would get the death penalty with a much higher gas guzzler tax than already exists. The SUV in general would also become impractical due to the fact that most get less than great gas mileage.
If less gas powered vehicles are on the road, then the new Nation would collect less use taxes from fuel. This will accelerate the move to a per mile tax that is already being toyed with.
Emission testing standards could also become much more strict which could prevent automakers from importing some models. Outside of San Francisco, public transportation in California is terrible. The state is just not made for it. This would begin to change should the state break away and as driving continues to become more expensive.
On the contrast with Republicans more than likely in control of the remaining states, the United States would overall be more lax on automotive companies. It would continue to be somewhat state dependent, but what the Trump administration has already done to encourage oil pipelines and changes in the EPA that will reduce climate change related federal regulations is encouraging for those that love big engines. V8 powered vehicles and SUVs will remain popular choices in much of the USA.
Overall the automotive landscape in the 49 state left in the United States would remain largely the same as it is today. Automakers will fill market needs and if regulations and low gas prices allow for it, bigger engines will be very much in style.
In California hybrids and all electric vehicles will become even more popular than they already are. More regulation will force U.S. automakers to keep emissions lower for any imports to California (as well as many other countries).
Do you agree with these assumptions of what would happen if California left the Union? Scroll down to comments and let us know your thoughts.
Picture Source: TUBS