ARTICLE EXCERPT:California accounts for 12 percent of the nation's gross domestic product and the largest share of retail sales of any state. It also sends far more in tax revenue to the federal government than it receives — giving a dollar for every 80 cents it gets back — which means Californians are keeping social programs afloat across the country. While the deficit only affects the state, California's deepening economic malaise could make it harder for the entire nation's economy to recover.
When the state stumbles, its sheer size — 38.3 million people — creates fallout for businesses from Texas to Michigan.
"California is the key catalyst for U.S. retail sales, and if California falls further you will see the U.S. economy suffer significantly," said retail consultant Burt P. Flickinger, managing director of Strategic Resource Group. He warned of more bankruptcies of national retail chains and brand suppliers.
ARTICLE LINK: Newsmax.com - California's Collapse Could Drag Down U.S. Economy