And it can turn some of its short-term problems, such as the pressures arising from ethnic and linguistic diversity (the state is now 37% Hispanic and 13% Asian) into long-term strengths in the global economy. But its political class will have to confront some hard realities and face up to the fact that Californians who pay no income tax (almost half the workforce) will have to start paying for services, and that services will have to be more carefully targeted.