Colossal California?

Mark J. Perry, a professor of economics, wrote an article about America's GDP. Perry's composition addresses specifically, U.S. states' GDPs, which he presents as massive, considering they are compared to entire countries! 

Investopedia defines the gross domestic product (GDP) by describing it as "one of the primary indicators used to gauge the health (or size) of a country's economy." These numbers are calculated by measuring the revenue earned through goods and services in countries or (in this case) states. 

Mark Perry reveals that the state of California generates the highest GDP with $2,458,535 (in million USDs), beating France's $2,241,560 (also in million USDs). It is for this reason that I will be focusing on California for this blog.

How is it that California alone bests the entire country of France in regards to GDP? I've compiled a list of several factors that increase the GDP of California.

1. California is enormous.
CA has the highest population of all the states and is the 3rd largest by area. California's population is about 39 million, almost 2/3 that of France. 

2. California is the home of Silicon Valley.
Silicon Valley harbors business and technology. This includes major software companies such as Sony, Google, and Yahoo!


3.California has a major agricultural base.
Netstate's statistic show that "California grows over 200 different crops, some of which are grown nowhere else in the nation." This state is so clearly rooted in agriculture, even my neighbor sells rice to Japan! California also ranks second in the nation in livestock produce.


4.Hollywood, baby!
This one is obvious. This entertainment industry is worth billions.

5.Rebates.
The government giving California money can raise its GDP. Since the drought, rebates have been given out to those in CA willing to change their landscaping and household appliances to "save precious water today and invest in a more sustainable future" - Governor Edmund Brown. Geez. That sounds like a line from Rango or Holes.

6.Hard work.
The average American works 40 hours a week while the average Frenchman works 35 hours a week. 

As a Californian, I admit to feeling a pinch of pride learning about our economic status. However, I noticed a major GDP lowering factor not taken into account: debt.

Growth is what tends to display a bustling economy. GDP alone does not determine the growth of a state/nation. For example, China claimed to have a growth rate of 12%. It was later discovered that gigantic buildings were constructed, completely unoccupied. This only gave an illusion of economic growth.

As vacancy reveals a lack of growth, debt reveals a lower GDP. Debt can take the form of an unfunded liability. For example, an unpaid retirement would reduce the GDP. The San Francisco Chronicle reports that California has "$400 billion in unfunded liabilities and debt from public pensions, retiree health care, and bonds".

There is no doubt that California has an extensive economy. Although, considering its debt, is it still monstrous enough to be compared to the entire country of France? Your comments are welcome. What do you think?