If you are a public sector worker, belonging to a public sector union and looking forward to retiring in your early 50s with nearly full pay and benefits, you probably don't care how high your state needs to raise its income taxes to pay for your ride.
But if you are a small businessperson trying to make ends meet, and being progressively crushed beneath a growing burden of taxes, regulations, and legislated liabilities, you are probably starting to look around at other locations that may offer you a better chance of surviving, if not prospering.
It's not just the cost of living. It's the cost of doing business. If the cost of doing business is too high, then business will make tracks on the way to somewhere else. That is what California is experiencing now. And if California loses any more of its businesses, who will pay for those ultra-deluxe pensions?