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All That Glitters Isn’t Gold for Many in CA’s 4th-Largest World Economy

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Photo of the Golden Gate Bridge symbolizing California's greatness
California's economic boom isn't paying off for many of the state's residents, a respected finance professor says. (Shutterstock)
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A Bloomberg analysis that predicted California would soon pass Germany as the world’s fourth-biggest economy is attracting widespread attention.

But all that glitters is not gold, says Dr. Sanjay Varshney, a highly respected finance professor at Sacramento State and the founder of a wealth management firm.

Varshney told CBS News Sacramento that while economic growth is good news, it is misleading to glorify California’s gains without pointing out its clear problems.

“Look at everything that we have to pay for, and you’re gonna find the answer that California is increasingly becoming less and less affordable for the ordinary people, and we are creating this huge gap between the ‘haves’ and the ‘have nots,'” Varshney said.

Tech Billionaires Mask the Realities of State’s Economy

The professor also says that while Silicon Valley’s high-tech industries flourish other components of the economy sputter.

“Those are the multimillionaires and billionaires in the Bay Area who skew the numbers. The rest of us in California, we are all struggling to make ends meet,” said Varshney.

According to the California Poverty Measure, 28.7% of the state’s residents are poor or near poor. That’s down from 34.0% in 2019.

In addition, CalMatters reported earlier this month that the number of homeless people in California increased by at least 22,500 over the past three years to a nation-leading 173,800.

Newsom Promotes Glowing Bloomberg Analysis

California Gov. Gavin Newsom, who faces challenger state Sen. Brian Dahle in the Nov. 8 election, quickly touted the Bloomberg prediction on social media Monday.

Economists calculated the state’s gross domestic product at $3.357 trillion last year. Although California’s new GDP won’t be known until 2023, estimates suggest it may have already caught Germany. Soaring energy costs related to the Ukraine war are ravaging the German economy.

Bill McEwen is news director and columnist for GV Wire. He joined GV Wire in August 2017 after 37 years at The Fresno Bee. With The Bee, he served as Opinion Editor, City Hall reporter, Metro columnist, sports columnist and sports editor through the years. His work has been frequently honored by the California Newspapers Publishers Association, including authoring first-place editorials in 2015 and 2016. Bill and his wife, Karen, are proud parents of two adult sons, and they have two grandsons. You can contact Bill at 559-492-4031 or at Send an Email

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