The California Dream Is Far From Over : Economy: The state must not betray its long tradition of progressiveness and compassion to cope with a short-term crisis.

California, like Rolls-Royce, is recession-proof, we were once told. Now that the recession has taken its toll on both the Golden State and the British luxury-car maker, we are hearing that California’s future is behind us, that the state is in decline. Don’t believe it. Rolls-Royce may not recover, but California surely will. California remains a great state with a bright future. Here are several reasons for its long-term prosperity:

--The appealing climate.

--A work force that is highly educated, skilled, creative and strongly motivated.

--The state’s favorable industrial mix. California boasts one-third of the 100 fastest-growing companies in the country, according to Fortune magazine. The introduction of new industrial products, such as reformulated gasoline, will benefit the state.

--California’s struggling immigrants, who may initially be a burden on local governments (they pay more in taxes to the federal government than they get from it), will be tomorrow’s educated, highly trained middle class. They will become productive, tax-paying citizens like the immigrants who came before them. They and the millions of other new Californians will provide a large consumer market that will stimulate economic activity.

--California is far and away the most urbanized state in the country; 92.6% of Californians live in urban areas. Urban populations are much easier to educate than scattered rural populations.

--California is a young state that needs relatively little new infrastructure. In older states, like New York and Pennsylvania, virtually every water main and bridge needs to be repaired and nearly every dam requires upgrading. The cost of maintaining California’s infrastructure is relatively low.

--The recession will produce significant increases in productivity. The revival will be quite robust because the recession has been long and deep, producing much pent-up demand. After the recession, labor will be more productive. We will be more competitive. The private sector will be lean and the public sector will also be more productive and responsive. Rents will be substantially lower, especially for office space, because of oversupply and the large number of bankruptcies created during the downturn.

The recession is producing a profound restructuring of California. After this recession is over, California’s businesses, its banking and construction industries, will bear little resemblance to what they were in the mid-1980s. They will be much more efficient and much more responsive to the needs of their clientele. California will recapture its comparative advantage.

What made this state great is best exemplified by the great governors of the postwar period, Earl Warren and Pat Brown, who provided a humane, progressive, forward-looking vision of California: that anybody who tried hard enough could succeed. That vision attracted a lot of talented and productive people who made California what it is today.

The worst thing we could do now is to change that vision, that tradition of progressiveness and compassion, so that good people either leave or don’t come. California must not betray its long tradition.

We must avoid making long-term, irreversible decisions based on the short-term economic crisis. We must not lose sight of the importance of educating our future work force. The budget crisis has prompted the University of California to consider tuition for the first time in its history. (As opposed to fees, which pay for student activities and services, tuition supports the entire academic enterprise.) Tuition would make UC more a private than a public institution and result in reduced university access for the poor and minorities, even if scholarships are increased.

California’s vision should be of an Earl Warren-Pat Brown state, not a Jesse Helms state. Let’s stay the course of a great state, and not set one group against the others. Economic hard times have imposed on California very hard choices. Let’s have the courage to make the right ones. If we do, California will continue to thrive.