If you were given the perfect country, could you mess it up as bad as California? Begin with fertile, productive, well-irrigated soils capable of growing just about anything. Add vast agricultural tracts and miles upon miles of wine country with lush, bountiful vineyards. Include majestic mountain ranges containing rich deposits of gold, silver and other useful metals, and covered with thick, immense forests with every type of timber imaginable. Toss in critical navigable rivers to move these resources to market. Insert vast oil and natural gas deposits while you are at it, along with wind, water, geothermal and solar resources. Give it a long coastline with beautiful beaches, plentiful fresh water, ocean fisheries, many natural harbors, a well-connected transportation grid with first-class roads, rails and airports too. Don’t forget universities at the cutting edge of technology and an unparalleled educational system.

Bestow all the natural building blocks necessary for a well-balanced, diversified, leading economy that is virtually guaranteed to bring unparalleled prosperity to your people—a smorgasbord of natural blessings. Then on top of it all, throw in days spent skiing at sunrise on Lake Tahoe and swimming at sunset in San Francisco the same day. This is the Golden State.

Yet California is imploding. And it is dragging the rest of the country with it.

California is home to America’s leading manufacturing belt, the nation’s largest high-tech center (Silicon Valley), and one of its most productive agricultural areas (the Central Valley). As a stand-alone economy, it is bigger than Canada, Brazil, India and even Russia. It is also the most populous state, with one in eight Americans calling California home.

But just look at the next headline you see that says “California.” Whether it’s an article on finance, economics, government, crime, morals or some other subject, the glaring question is: What went wrong?

Agricultural Collapse

“California’s Central Valley is our nation’s agricultural engine, and unemployment here is devastating the economy and hurting the people of California,” Gov. Arnold Schwarzenegger said last Friday. “These are dire circumstances—no water means no work—and no work means people cannot feed their families. This drought is truly an emergency ….”

Schwarzenegger declared California’s Fresno County a disaster zone, and took the extreme step of asking President Barack Obama to declare the region a federal disaster zone as well, due to extreme drought. The declaration followed a string of executive orders issued to save an agriculture sector on the brink. On June 4, 2008, Schwarzenegger issued an executive order proclaiming a statewide drought. On June 12, 2008, he ratcheted it up to a state of emergency for 9 of 18 Central Valley counties. Then, this February, he proclaimed a state of emergency for the entire state.

California just isn’t getting enough rain. The state received only 53 percent of its normal rainfall in 2007 and 58 percent in 2008. So far this year, it has received only 77 percent of normal volumes. And the drought is an emergency for more than just the farmers. Before the Spanish arrived in 1769, there were 12 large natural lakes in California. Today, four have been completely de-watered for agriculture. Man-made reservoirs are running low, and sedimentation is reducing even their remaining lifespans. Los Angeles announced in February what was, in effect, water rationing for the first time in its 200-plus-year history.

Around 450,000 acres of normally prime agricultural land are lying fallow this year in California due to water shortages, according to state officials. Although the Central Valley contains less than 1 percent of the total farmland in the United States, it produces close to 8 percent of the nation’s agricultural output by value.

Fisheries Collapse

On April 21, Governor Schwarzenegger also renewed a state of emergency over California’s fishing industry. He noted that there has been a “commercial fishery failure due to a fishery resource disaster.” This is the second year in a row that both the commercial and recreational fisheries will be closed statewide. Last year’s declaration, which stemmed from the sudden collapse of the Chinook salmon in California’s Sacramento River, was the first such ban in 160 years.

California has a rich history of fishing. Back during the winter of 1883 to 1884, more than 700,000 salmon from the Monterey Bay Delta alone were caught and processed. But today, there are no commercial fish canneries in operation—a result of habitat destruction. There are other reasons California’s fisheries are suffering as well.

River water volumes are plummeting due to irrigation and other industrial use. As less water reaches the oceans, the river deltas get inundated with saline sea water, destroying ecosystems. Fish populations struggle to make it to open ocean water. Lower water volumes also provide less nutrients and feed for fish populations. Toxic chemical discharges take their toll too.

“It breaks my heart to report this,” said author and fisheries sustainability expert Alex Rose. “I believe we are at the tipping point. The Pacific salmon fishery may very well go the way of the Grand Banks cod.”

“[I]n a generation we’ve gone from unbelievable abundance to a crisis,” he said.

Environmental Regulation and Strangulation

A crisis of another sort is strangling Californian industries. California has some of the most progressive environmental laws in the world. It needs environmental laws, because vast swaths of the state are a polluted mess.

However, misdirected and poorly timed environmentalism is also inhibiting job growth and sending jobs out of state—as well as out of country.

The New York Times reports that Californian businesses are being slammed by new requirements to curb carbon dioxide emissions at a time when they are already struggling to survive in a very tough economy. In 2006, the state passed laws to curb carbon dioxide emissions from all economic sectors, including transportation, manufacturing and real-estate development. The result: People are paying more to travel and make purchases, manufacturers are moving out of state or to places like China (taking jobs with them), and just look at the real-estate industry.

CalPortland’s formerly profitable Mount Slover limestone cement facility is a powerful example. The state of California says the company must reduce carbon dioxide emissions by 12 percent per ton of cement. The company estimates that to retrofit its operations will cost in excess of $220 million—for just one plant. But there is not nearly enough limestone in its quarry to justify such an expense. The result is that the plant, which has produced cement for over 100 years, will probably be shut down. People will be laid off, and the state will take a tax revenue hit. Future shipments of cement will probably be imported from Mexico.

Every manufacturer across the state will be subject to what is essentially a massive carbon tax. So multiply CalPortland’s problems by the thousands.

On June 18, the New York Times gave another example of environmental activism gone awry. Apparently, unions are exploiting environmental laws to blackmail companies into signing labor agreements and becoming unionized. The latest developments in this regard are taking place in the solar energy field.

To reduce California’s dependence on polluting-but-inexpensive fossil fuels, which it has in abundance, state legislators decided they would promote solar power plant construction. However, an unpredicted turn of events has resulted. Laws designed to protect the environment are being used to hold up projects designed to help the environment. How so? California’s giant worker unions want a foot in the door.

If a company proposes to build a plant, but does not agree to be unionized, unions inundate the company with demands to study the effect of their proposed project on all kinds of endangered creatures, from the short-nosed kangaroo rat to the Delhi Sands flower-loving fly. The studies add hundreds of thousands of dollars and years of delay to a development plan—if the plans pass at all, since the unions are sure to produce their own scientists at public hearings.

Not only are Californians forced to pay the higher cost of solar energy, but they are forced to pay the higher cost of union labor when the plants are constructed and operated. The unions get their plants and union jobs, or else Californians get no jobs at all.

All this environmental regulation and strangulation couldn’t come at a much worse time for California.

Economic Collapse

It is economic judgment day in California. In spite of its natural resources, the state’s economy and budget are in a complete shambles.

On April 17, Governor Schwarzenegger declared a state of emergency over unemployment. He said that the “current and continuing economic downturn and resulting unemployment” represented “conditions of extreme peril to the safety of persons and property” in California. At that time, state unemployment was 11.2 percent—which was then the highest for the state since statistics began to be collected, and far above the then national average of 8.5 percent. Three months later, the situation has worsened, and unemployment stands at a new record high: 11.5 percent. And the real unemployment rate, after including those people who are stuck working part-time and those who have given up looking for work, is closer to 20 percent. The unemployment rate may be even greater in counties such as Los Angeles, due to losses in what the Los Angeles Business Journal calls “informal employment”—involving cash for hire, off-company books, and uncounted illegal workers.

And the unemployment rate is probably about to get dramatically worse, especially since the state budget is in such a big hole. Moody’s ratings agency has joined Standard & Poor’s investors service and Fitch Ratings in warning the state that if it does not resolve its enormous budget woes, the agency will be forced to lower the state’s credit rating several notches. The state’s credit rating largely determines the cost of borrowing money from the market. In California’s case, it already has the worst rating of any state in the country and is having extreme difficulty finding any lenders at a price it can afford. Though California currently has an A-rating, it must be remembered that this has been given to it by companies that formerly rated subprime mortgages as triple-A.

The federal government can’t be relied on for a bailout either. After bailing out an insurance company, a credit card company, Fannie Mae and Freddie Mac, underwater homeowners, the Wall Street big banks, General Motors and Chrysler, President Obama rejected Schwarzenegger’s plea for aid and advised California to “make some very difficult choices.”

If state politicians cannot find a way to pass a budget by July 1, Controller John Chiang said the state would begin missing billions in payments to service providers and vendors. Either way, there will be massive cuts to cover a $24 billion deficit—which means thousands more teachers, police, firemen and garbage collectors will lose their jobs. The Anderson Forecast projects that Schwarzenegger’s budget cuts will eventually result in 64,000 job cuts from state government plus countless private-sector and local government jobs.

California’s massive deficit will also eventually mean higher taxes—despite the fact that it is already one of the highest taxed states in the nation.

The slowing economy is reflected in the now eerily quiet great ports of Los Angeles, Long Beach and San Francisco. Clobbered by the weak global economy, exports from California fell 25.5 percent in April from a year earlier. Massive tankers sit idle. Air traffic is down too. Exports from San Francisco International Airport plummeted 34 percent, according to the Sacramento Bee.

Green shoots are nowhere to be found, according to Money and Markets’ Martin Weiss. He says California is home to the highest concentration of 90-days-past-due mortgages in the country. And the number of foreclosures is continuing to skyrocket. So the housing and real-estate industries that provided the jobs during the boom years are probably not coming back anytime soon.

And then there’s education. With the new budget cuts to eventually take effect, class sizes will inevitably increase. Consequently, Democrats claim that students shouldn’t be held to as high a standard and therefore should not be required to take high school exit exams. Universities are sure to have funding slashed as well.

“California’s day of reckoning is here,” said Schwarzenegger. “Our wallet is empty. Our bank is closed. Our credit is dried up.”

Where Is the Hope?

The Trumpet has repeatedly written about the many “curses” California has experienced in recent decades—the fires, the drought, the riots, the earthquakes and so on. Of course, many scoff at the idea that an ever living, supremely powerful God is actually intervening in the affairs of mankind.

Abraham Lincoln didn’t. “I believe,” Lincoln said, “that it is meet and right to recognize and confess the presence of the Almighty Father equally in our triumphs and in those sorrows which we may justly fear are a punishment inflicted upon us for our presumptuous sins to the needful end of our reformation” (emphasis mine). Just as God rewards us for obedience to His laws, He lovingly punishes His children for disobedience so that we might be reformed, Lincoln said.

It is this God who has set before all of mankind two ways of life: the way of blessings and the way of curses, as it says in Deuteronomy 28. God will not force us to choose one way over the other. But we all must make a choice. And there are consequences for our choices, whether good or bad. If we choose the way that results in curses, no amount of wishful thinking will magically transform a curse into a blessing.

In the case of California, it is now experiencing the curses. But there is hope, and it is found in the reason the Golden State had such a lavish array of fantastic physical blessings in the first place. If you believe your Bible, those blessings were a direct result of a promise God made 4,000 years ago to the great patriarch Abraham (for more on this, read The United States and Britain in Prophecy).

But the shocking facts of the present make it undeniably obvious that those blessings have long since been removed. If you want an example of a state that should have been virtually impossible to ruin but nevertheless was, just look at California. But then again, a closer look at America as a whole makes California’s sad state not so shocking after all.