Just the rise in quantity and purity of meth and fentanyl in 2018 is enough to explain a drop of 1% in GDP growth. Just extrapolate from the L teachers strike, a lot of that was thee drug problem. Statistics well bear me aut here, I know because Tyler Cowen had the stats on dementia and its cost. Then earlier we had hints of worker shortages associated with fentanyl.
If California is the staging point then we have a huge mess. There are two main effects if California the culprit. First, the rest of the USA won't go cycle with Cal for fear of an unending cycle. There will be no observable path out of a recession. Second, the trade effect, much worse than the Chicago hub effect. The trade adjustment is worldwide, from California and we get a double whammy on that.
The side effects horrid, sudden exit from Silicon Valley is one. Sudden collapse of capital gains tax from Silicon Valley. An Then the lack of trust, Gavin is not trusted by the DEA, so there are few Feds working with state on this. Then boomers get stuck in retirement in a Narco State, they will stampede. Narco California inverts many Y axes, it is a major requant. Cocaine California works, we can do that if we can get a cartel agreement.
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