So, as someone that lived in New York for 6 years and California for 6 years, stories like this are incredibly depressing. The US is the world's largest economy and should be the shining example of amazing infrastructure, high-tech, green cities, and forward thinking policies. California is an especially egregious example in terms of infrastructure investment: If California was a country it would be the world's fifth…
If your Federal Reserve stopping adding nonsense imputed and hedonic values to the tune of about ~$7 trillion to your economy's GDP, you would find yourself in second place.
Which might make help explain away your confusion :)