California Government is the Reason for California’s Housing Shortage

The homebuilder Lennar has new affordable homes for sale in San Antonio, Texas with nine different floor plans to choose from at a variety of price points – starting in the $130,000s.

In California, permits and development fees often total more than $130,000 before ground is even broken. A report published by UC Berkeley found that development fees can compromise up to 18% of the cost of a new home. In many jurisdictions, developers pay as much as $157,000 in fees on each single family home constructed, ahead of actual construction.

“Ranging in size from 466 to 1,950 square feet of living space, the homes at Republic Meadows offer one to four bedrooms and one to two-and-a-half baths,” Builderonline.com reported about the Lennar homes in San Antonio.

Compare the San Antonio housing to Sacramento’s  Lennar homes: the “high $400,000s” in South Sacramento, the “mid $400,000s in Natomas, and the “low $400,000s” in Rancho Cordova. These neighborhoods are standard track housing, middle-working class areas, and these are just the starting prices before any upgrades.

In California, housing “solutions” were offered by Apple, which promised $2.5 billion in affordable housing; Facebook pledged $1 billion in affordable housing funds; and Sen. Scott Wiener (D-San Francisco) pushed his high-density housing bill, SB 50. Democrats have tried rent control, and mandating cities build a certain percentage of “affordable housing,” to no avail.

A flurry of eight related Assembly housing bills proposing to target development and impact fees claims to be a solution, but are word salads lacking any real solutions:

AB 1484: Provides a comprehensive reform of the nexus standards that cities and counties use to determine their fees.

AB 1924: Requires jurisdictions to assess fees on a per-square-foot basis, giving developers the option to build smaller, more affordable units without being penalized with multiple fees.

AB 3144: Provides state funding to reimburse local governments who waive impact fees on affordable projects.

AB 3145: Establishes a ceiling for development fees based on the median home price in a jurisdiction. Cities and counties that exceed this ceiling will be required to seek approval from the Department of Housing and Community Development, and justify the need to do so.

AB 3146: Requires cities and counties to report a wide variety of essential housing data to the Department of Housing and Community Development, including the number of new housing units that have been issued a completed entitlement, a building permit, or a certificate of occupancy.

AB 3147: Ensures that certain impact fees are payable under protest. This allows for a developer to pay a fee they consider to be unreasonably high so they can continue construction.

AB 3148: Reduces the impact fees paid on affordable housing units that are built using the state’s density bonus program.

AB 3149: Modernizes the way that local agencies notify interested parties prior to levying a new fee or service charge or prior to approving an increase in an existing fee or service charge.

The Berkeley study addresses this:

“Our conversations with experts and stakeholders made it clear that some approaches would not be productive. Simply capping impact fees statewide, for example, could cut off much-needed revenue, resulting in lowered levels of public services and potentially incentivizing cash-strapped localities to block new housing altogether.”

“Over the course of 2017 alone, the national single-family and multifamily construction price indexes increased by 5.6 percent and 6.3 percent, respectively, compared to an average annual increase of 2.7 percent between 1990 and 2000. In that year, New York, San Francisco, San Jose/Silicon Valley, and Oakland ranked among the most expensive construction markets.”

“The cost of building a 100-unit affordable project in California increased from $265,000 per unit in 2000 to almost $425,000 in 2016. The same trends that increase costs for market-rate housing (such as land pricing, construction costs, and regulation) impact affordable housing. In addition, affordable projects are often subject to increased local scrutiny, further inflating costs. A 2014 study found that local government design requirements for affordable housing added an average of seven percent in total costs, and that community opposition (measured by holding four or more community meetings) increased expenses by five percent.”

While Gov. Gavin Newsom punishes cities he claims are not complying with the state’s affordable housing mandates, the California Legislature and governors have allowed more and more state mandates on all construction, including affordable housing: rooftop solar mandates and requirements that all new homes be “net-zero,” green homebuilding standards, fire sprinkler mandates, CEQA requirements, environmental impact studies, and many, many more.

Newsom even sued the Orange County city of Huntington Beach for failing to provide enough additional “affordable housing,” while his own home county of Marin has enjoyed a moratorium on affordable housing building requirements and will do so until 2028.

While former Gov. Jerry Brown signed the 2017 budget bill allowing Marin County to remain exempted from affordable housing requirements, he also signed SB 1333 in 2018 to eliminate a “housing loophole” that allows charter cities to reduce sites zoned for affordable housing, even if the action is inconsistent with the cities’ adopted general plans, which is a violation of the California Constitution.

Republicans argued against the housing exemption in the trailer bill, and asked why Marin was allowed to ignore its own housing needs, and instead export its housing obligations to neighboring counties.

“But Democrats who posture as fierce advocates for more housing, even those carrying high-profile housing bills, such as Sens. Toni Atkins and Jim Beall, voted for it and Gov. Jerry Brown signed it,” Dan Walters reported. “For at least another decade, therefore, Marin’s residents can smugly assume that their bucolic lifestyles will not be marred by having more neighbors who don’t make as much money and, you know, just don’t fit in.”

Nearly every attempt to reform the California Environmental Quality Act has been met with a wall of resistance. Instead, lawmakers simply vote to exempt powerful and wealthy development projects from CEQA: Sacramento’s Golden1 Center for the Kings basketball team; San Francisco’s Warriors arena; and the Inglewood Chargers/Rams Hollywood Park stadium, to name just a few.

Meanwhile, infrastructure projects, affordable housing, and even transportation projects come under extreme “environmental” scrutiny.

This housing shortage in California was created by California government and politicians, through and through. These pretend “fixes” only add to the burden.

This article was originally published by the California Globe.

California’s K-12 spending exceeds $20,000 per pupil

“It’s not enough. We’re still 41st in the nation in per pupil funding. Something needs to change. We need to have an honest conversation about how we fund our schools at a state and local level,” –  California Governor Gavin Newsom, State of the State Address, February 12, 2020

It should come as no surprise that Governor Newsom would call for more education spending, but is he right to say that California is 41st in per pupil funding? It turns out the answer to that question is complicated.

The place to start would be the readily available data on California’s per pupil spending. The most recent compilation from Ed Week is for 2019, reporting the California average at $12,143 per pupil. This places California in 20th place among the states, which puts it in the front half of the pack.

To the uninitiated, $12,143 seems like a lot. In a classroom with 30 students, that would equate to well over $300,000. If you hired an absolutely first rate teacher at the very competitive rate of $150,000 per year in pay and benefits, for a ten month school year you would still have more than $15,000 per month for other expenses. Isn’t that enough to rent a classroom, buy books, and share costs for a few administrative staff?

Perhaps this explains why charter schools now attract 10 percent of California’s K-12 students. $10,000 per year per student – or $12,143 per year per student, as the case may be – is enough to build an effective educational business model.

This amount, around $12,000 per year per pupil, gets batted around a lot in the media. A Google search on the sum $12,143, paired with search terms “per pupil in California” yields first page citations in PatchTimes of San DiegoOrange County RegisterGoverning, and others including the prestigious Public Policy Institute of California. But even proponents of increasing spending per pupil acknowledge this number is low.

As Larry Sand documents in a recent California Policy Center article, “After a six-day teacher strike in January 2019, the district and union settled on a contract that many questioned. Now, a year later, LAUSD officials admit that they spend $18,788 per student. But in a mid-January interview with EdSource, school superintendent Austin Beutner indicated that the district gets just $16,402 from the state to educate each child.”

So what is the number? How much are California’s taxpayers spending per pupil? According to LAUSD itself, that district spends $18,788 per student.

The Ed Week compilation included the following clarification: “Captures factors such as teacher and staff salaries, classroom spending, and administration, but not construction or other capital [expenditures].”

What else may be not included in this number?

To get at this, state government experts were contacted at the California Dept. of Education, the California Dept. of Finance, and Ed Data, which is “a partnership of the California Department of Education, EdSource, and the Fiscal Crisis and Management Assistance Team/California School Information Services (FCMAT/CSIS).”

Speaking and corresponding with these experts raised as many questions as it answered. But here’s a basic formula that ought to lead to a calculation of per pupil education spending:

For the most recent available historical data, start with $72.4 billion in spending in 2017-18, an amount that is found on the Ed Data home page on their “Financial Data” tab:

This figure needs to be adjusted as follows:
– deduct pre-school, adult education, and community college spending,
– add the state’s annual CalSTRS contribution,
– add debt service on school bonds (or instead, add capital spending, but a lot of debt funds go into operating budgets (or “deferred maintenance” budgets) so not sure which to pick – it should be one or the other),
– deduct from student headcount all charter school attendees,
– deduct from total revenue all funds directed to charter schools,
– verify that $72.4 billion was the entire gross amount of incoming funds.

Only a few of these amounts are readily available. Official sources do not offer much. For example, it is known that roughly 10 percent of all K-12 students are enrolled in charter schools, but determining what amount of total taxpayer funding goes into charter schools is not generally known, despite the unrelenting attacks by teachers unions that claim diverting funds to charter schools is the cause of their financial challenges.

Another known variable is how much the state contributed to CalSTRS, $2.8 billion, which can be found on the CalSTRS website in their 2019-20 Annual Budget (page 47). Expect that amount to increase in the coming years as CalSTRS attempts to dig out of an unfunded liability now totaling $73.7 billion (page 24).

Turning from historical data, which is three years behind, Governor Newsom’s 2020-21 budget claims “K-12 Education Spending per Pupil” will be $17,964. This is based on “ongoing per-pupil expenditures of Prop. 98 funds of $12,600 in 2020-21,” as well as additional per-pupil expenditures of $5,364 from other sources.

Not explicit in the Governor’s Budget Report on K-12 Education, but impossible to refute if the inputs they’re providing on pages 68-69 are correct, is that California’s taxpayers will be spending a total of $119.8 billion on K-12 6.7 million K-12 students. And it is reasonable to assume that this does not include the CalSTRS contribution from the state. It is also reasonable to assume it doesn’t include capital spending.

The best compiled information on capital spending, at least via bond financings, can be found on Ballotpedia’s “School Bond Elections in California” page, which reports on local and state school bond elections. According to their data, over the decade from 2010 through 2019, $76.7 billion in local school bonds were approved by voters, along with the $9.0 billion Prop. 51, approved by voters statewide in 2016. And then there are the older bonds, still outstanding. According to Ballotpedia, “from 1996 to 2006, California voters approved about $109 billion in school construction bonds at the state and local level.”

This yields impressive totals, especially when taking into account interest expense. A bond earning 5 percent, paid down over 30 years, will require total payments, interest and principle, of nearly double that much.  Figure that California’s taxpayers are currently paying at least $15 billion per year to finance currently outstanding school bonds, with more on the way.

Pulling this all together offers an interesting counterpoint to the popular $12,143 per student meme that’s making the rounds. In reality, total spending, adding Prop. 98 funds and other funds from the governor’s budget, along with the state’s CalSTRS payment and payment on school bond debt, can be estimated to be around $137.6 billion, which equates to $20,642 per pupil.

One must wonder what charter schools could do if they had access to all that money. They don’t, and proving that would go a long way towards debunking the narrative that charter schools are the cause of financial problems for traditional public schools. It would also document a reality that is inconvenient for advocates of ever higher K-12 education spending: spending for traditional public schools, once charter school allocations and enrollments are deducted from the calculation, are even greater than $20,642 per pupil.

Does it make sense to spend even more on our K-12 public school students, when there may be other reasons for the problems? What about restoring discipline in public schools, instead of applying racial quotas to how many students can be suspended or expelled? What about reforming union work rules such as were attempted in the Vergara case, rules governing tenure, layoff and dismissal criteria, so great teachers could be fairly compensated, good teachers could be retained, and poor teachers could be fired?

For that matter, why is there no discussion anymore about just issuing school vouchers, which would solve California’s public education challenges overnight?

Heck, what about solving the real fiscal challenge facing California’s public schools, by making teachers eligible for Social Security instead of pensions, and just rolling all of the CalSTRS assets into the Social Security fund?

Or what about outlawing the teachers unions, who have turned public education into their own private monopoly?

California’s voters should ask themselves: If you had to educate K-12 students, having them in your charge 180 days per year, how well could you do it if you were paid over $20,000 per year, per student?

*  *  *

Edward Ring is a co-founder of the California Policy Center and served as its first president. This article originally appeared in the California Globe.

Enjoy the Silence for Now – Mega Ballot Battles Are Just Around the Corner

That sound you hear is millions of California voters feeling relieved that the primary election is finally over in the Golden State. Many are rejoicing the fact that they won’t have to see any more campaign advertising the next time they turn on their TV or log on to their computers.

Unfortunately, the respite will be short-lived.

There are still millions of votes to be counted in the March primary, but well-heeled interest groups are gearing up for several, major ballot initiatives in the November election that will bring about tens, if not hundreds, of millions of dollars in television and digital advertising that will begin sooner than you think.

This is in addition to the tens of millions that will be spent on both sides of the aisle in the competitive races for the U.S. Congress and state legislature this fall.

Here’s a preview of the some of the expensive ballot fights that will soon be coming to a TV screen or computer near you:

The Battle Over Assembly Bill 5

Assembly Bill 5 continues to be controversial both in and out of the Legislature.  Last week, Assemblyman Kevin Kiley was unsuccessful in his procedural vote to bring his urgency legislation suspending the law up for an immediate vote.  Meanwhile, AB 5’s author, Assemblywoman Lorena Gonzalez Fletcher, released her long-awaited amendments tweaking the law’s restrictions on freelance journalists.

But that’s not where the real action is.  Proponents of the “Protect App-Based Drivers and Services” ballot measure announced that they have gathered more than 1 million signatures, likely more than enough to qualify their measure for the November ballot.  Fueled by $110 million in campaign donations from Uber, Lyft, DoorDash, Postmates and other proponents, the measure will change AB 5 to essentially “carve out” their companies from the law and put in place an alternate model that would protect their businesses and the ability of independent contractors to work for them.

You can be certain that proponents will spend more, if needed, to pass their measure – and labor unions and other opponents will surely spend significantly, as well.

Strengthening Digital Privacy in California

Less than 2 months after the compromise privacy measure he championed officially took effect, its chief proponent, Alastair Mactaggart, is back with another data privacy measure that he is aiming to qualify for the November ballot, which he dubs the “California Privacy Rights Act.”

Mactaggart famously qualified another measure two years ago and presented the Legislature with somewhat of a Hobson’s choice:  pass a modified version of a proposal they didn’t like or face near certain passage of a much-worse measure at the polls.  So, the Legislature cut a deal with Mactaggart on a compromise that resulted in his removing his original proposal from the ballot.

As PRI’s Bartlett Cleland recently wrote of the 2020 effort, “adding to the costs and confusion, Mactaggart is circulating a new ballot proposal, the California Privacy Rights and Enforcement Act, which could appear on the November 2020 ballot. This new proposal suffers from the same lack of thoughtful analysis and redraft.”

Between Mactaggart’s big checkbook and the spending from the businesses small and large that would be harmed by this latest proposal, you can expect mega spending in the battle over this initiative.

Split Roll and the Future of Proposition 13

A fight by proponents of higher spending in Sacramento to try and weaken the historic taxpayer protections in Proposition 13 has been brewing for some time now.  Activists have qualified a measure for the November ballot to create a so-called “split roll” property tax system in California.  As I wrote previously, liberal groups are taking their policy wish list to the ballot this year, believing that favorable turnout in the 2020 presidential campaign could push their priorities over the top.

If enacted, the proposal would gut Prop. 13’s protections for business property and lead to an estimated tax annual tax increase reaching between $8 billion and $12.5 billion, according to the nonpartisan Legislative Analyst’s office.  The measure was a key issue for liberal groups weighing whom to support in the Democratic presidential primary.  All the major Democratic contenders endorsed the measure.

With voters nearly equally divided on the measure according to a November 2019 PPIC poll,  will be an epic battle between business and labor groups that could even surpass the spending in the AB 5 ballot campaign.

Tim Anaya is the Pacific Research Institute’s senior director of communications and the Sacramento office.

The Premises of California’s Dysfunction

Anyone unfamiliar with what is really going on in California would have listened to Governor Newsom’s State of the State address on February 12 and gotten the impression that things have never been better. Newsom’s opening set the tone for the rest of his 4,400 word monologue:

“By every traditional measure, the state of our state is strong. We have a record-breaking surplus. We’ve added 3 million jobs since the depths of the recession. Wages are rising. We have more scientists, researchers, and engineers, more Nobel laureates, and the finest system of higher education anywhere in the world.”

Newsom, to his credit, immediately qualified his sunny opening with a disclaimer that might be the understatement of the century, saying “But along with that prosperity and progress, there are problems that have been deferred for too long and that threaten to put the California dream out of reach for too many. We face hard decisions that are coming due.”

Ain’t that the truth. And Gavin Newsom, the political party he represents, and the ideology they’ve embraced, cannot possibly solve these “problems that have been deferred for too long.” First, because Newsom and his gang created the problems, and second, because the ideology they adhere to is based on premises that are both economically unsustainable and destined to eventually deliver not solutions, but tyranny.

Here are the three core premises of California’s dysfunction:

The Climate Emergency

Every policy in California must be ran through the filter of its “climate change” impact. At some point over the past 10-20 years the required “environmental impact” reports morphed into “climate change” impact reports. It is impossible to overstate the degree to which this has stunted economic opportunities and raised the cost of living in California, and there is no end in sight.

“Climate change” impact is the pretext for countless laws and regulations, along with endless litigation, and its reach expands every year. There is no aspect of life in California, almost no category of activity, that can escape monitoring. If what you do moves electrons or involves combustion, convection, emission, discharge, motion, extraction, construction, anything – than there is justification for “carbon accounting,” and into the breech ride the carbon accountants, the consulting experts, the bureaucrats, the attorneys, the regulators and the legislators. “Climate change” is the pretext for an entire parasitic industry, and there is no theoretical limit to the scope of its authority.

The problem with this premise, beyond the fact it justifies an ongoing and inexorable creep towards micromanaged tyranny, is that it can’t be challenged. To suggest there might be other political priorities, unintended consequences, or even to just ask for a cost/benefit analysis, is to be branded a “denier,” as if someone who doesn’t think the world is about to end via “climate change,” or just thinks the proposed solutions are ludicrous in addition to being tyrannical, is the moral equivalent of a holocaust denier.

The “climate emergency” is an explicitly fascist political ideology, according to at least two conventional definitions of fascism. It requires an economic model where corporate oligopolies act in junior partnership to an authoritarian government. At the same time, it justifies itself according to a moral framework that does not tolerate dissent and relies on fomenting panic and fear to secure popular support. There is nothing that escapes the authoritarian reach of “climate change” policies.

The entire premise, that “climate change” is an emergency and that no sacrifice is too great in order to stop it, is based on exaggerations and lies, spread by people motivated by power and profit. It is not enough to oppose the myriad policies justified by the “climate emergency.” This fundamental premise, that it is an emergency eclipsing all other political priorities, must be utterly broken.

Eliminating Privilege and Oppression

This mantra, repeated across the U.S. by the American Left, is especially entrenched in California. And the laws attendant to it, like those attendant to the “climate emergency,” continue to multiply with no end in sight.

Whether it’s women, transgenders, gays and lesbians, “people of color,” or any other identifiable group where some statistical disparity in their aggregate achievements can be identified, new laws are being passed to join well established laws, all designed to enforce equal outcomes.

All of this relies on a premise that has supposedly passed almost beyond debate, that “cisgender heteronormative white males” have engaged in systemic racism since the dawn of time against everyone who is not a “cisgender heteronormative white male,” and this explains every statistical disparity between their achievement and that of everyone else.

There is so much wrong and evil about this premise it is hard to pick where to begin. First of all, it probably makes sense to remind the purveyors of this nonsense that life on earth has never been fair, but when it comes to “inclusion and equity,” no culture on earth comes anywhere close to America.

Perhaps more people should say to anyone tempted to declare themselves a victim of systemic oppression, “too bad, and grow up, because the cure you are proposing is far worse than the disease.” Perhaps anyone who thinks they’ve got it so bad in the United States, much less California, is invited to return to their nations of origin, and see if they find themselves feeling more welcome, with more access to opportunity.

The problems facing California’s residents who are not “cisgender heteronormative white males” are made far more challenging by a Leftist establishment telling them their prospects are diminished by “systemic oppression” as by any actual oppression.

Join the military and get free college tuition when you’re discharged. Learn the plumbing trade and make $175,000 per year because there’s a shortage of plumbers. Quit pretending a degree in “ethnic (or whatever) studies” is marketable in the real world, and instead train to become a nurse and make $175,000 per year because there’s a shortage of nurses. Whoever you are: you’re not a victim, despite what you’re hearing from some blowhard who’s made a career of saying so.

Claiming “privilege and oppression” are “systemic” and that laws are necessary to stop it will literally destroy America. It will fracture our culture and further paralyze our economy. It is a lie based on biased, self serving facts and studies, and just as in the case with the “climate emergency,” it is used to justify a parasitic industry. It cannot be stopped by fighting the myriad and derivative battles over budgets and legislation. The root premise must be relentlessly rejected, and everyone, regardless of their possible “protected status,” must be recruited to join in this attack.

Capitalism is Evil, Long Live Capitalism

Into this broad category can be found most of the remaining flawed but fundamental premises of California’s ruling elite. In no particular order, here are the delusions and lies that derive from this impossible, contradictory, blatantly hypocritical premise:

It is possible to make it impossible for the free market to build anything affordable in California, thanks to crippling regulations and punitive fees, yet it is possible to spend even more per unit, using taxpayer money, to build government funded “affordable housing.”

It is possible to award pension benefits to state and local government employees that average literally three times (if not more) what private sector workers may receive from Social Security, and then, while attacking capitalist profiteers at every turn, and demanding more regulations and taxes to control them and make them pay their “fair share,” simultaneously claim that pension benefits are sustained by returns on smartly invested asset portfolios, returns that are only possible via profits.

It is necessary to curb the excesses of capitalism through expansive legislation and regulations, because capitalism is inherently oppressive to “marginalized communities” and “working families,” yet the ultimate victims of these laws and regulations are always the small family owned businesses and emerging innovative potential competitors to large companies, because they lack the financial resiliency to comply. Meanwhile, the large monopolistic corporations consolidate their positions in the market.

It is economically sustainable to curb development of land, energy, water and roads, in order to protect the environment, because the resulting scarcity creates an explosion in asset values. This in turn enables a financialization of California’s economy as people borrow on the artificially inflated collateral of their home equity. The increased consumer activity, debt fueled, bolsters corporate profits and investment portfolio returns. The bubble never pops.

The Consequences of Lies

Nearly everything California’s ruling elite does wrong derives from these three premises. The first two are never challenged, and the third is a paradox, barely understood but best summarized by this: Democrats, not Republicans, are the party supported by the financial sector and the super wealthy, and they are systematically exterminating the middle class, and making things harder, not easier, for low income communities.

One of the policies central to California’s oppressive dysfunction is so-called “densification” or urban containment. Rarely discussed holistically, it is foundational to what ails California, and it is a consequence of all three premises.

The policy of densification means that new cities and towns cannot be built outside of existing urban areas. New housing subdivisions cannot extend beyond the existing urban periphery. This is justified based on protecting the environment, as if 95 percent of California’s more than 160,000 square miles of land weren’t still rural. It is justified based on stopping “climate change,” as if vehicles weren’t becoming cleaner and greener every year, and as if jobs wouldn’t follow residents into new cities.

Densification is also justified based on combating “racism,” because if jobs follow residents to new communities outside the existing urban core, then somehow this means no jobs will remain for people still living there – who may be disproportionately represented by members of “disadvantaged communities.”

The economic premise behind densification, besides the rabid and cynical certainty that artificial scarcity causes asset bubbles which reward speculative investors and predatory home equity loan sharks, is that suburbs require roads which require “subsidies.” When making this argument, California’s ruling elites find useful and very idiotic support from libertarian dogmatists, who have made a lifestyle of living with paradoxical, self contradictory beliefs. “Let’s not subsidize the car,” is what these libertarians will smugly assert, hoping for a pat on the back from the progressives with whom they’ve found common ground. No, of course not. Let’s just subsidize light rail, trolleys, buses, and every other imaginable conveyance instead.

The wicked first cousin of Densification is “Inclusive Zoning,” is a policy that as well relies on all three of California’s dysfunctional premises. This policy, which like most leftist inspired policies, sounds so virtuous – “inclusive” – that only a heartless monster would oppose it.

Inclusive zoning takes the form of long-standing mandates to include subsidized “affordable housing” in virtually every housing development, and new mandates requiring cities and counties to approve “accessory dwelling units” inside any residential backyard bigger than a postage stamp. It is based on the fatally flawed premise that “disadvantaged communities” will suddenly be uplifted if they are able to live in subsidized units of housing in affluent neighborhoods.

Inclusive zoning is by its very nature consistent with the environmentally motivated policy of densification, since these mandated “affordable” units are smaller then the housing that surrounds them, consuming backyard lawns instead of “open space.” They are, as noted, also consistent with combating “oppression,” since lower income individuals will occupy these units.

California is Waging War on Working Californians

The most pernicious way in which inclusionary zoning follows from California’s dysfunctional premises, however, is in the economic realm.

What inclusionary zoning mandates allow is an invasion of predatory real estate speculators to pour into every tranquil, shady neighborhood in California, where they will encounter homes that are worth more demolished than left standing. They will raze, randomly, homes throughout these to-date intact neighborhoods, and then, relying tax incentives to fund the construction, they will replace these homes with fourplexes that will house low income residents living on taxpayer supported rent subsidies.

Densification and inclusionary zoning epitomize how California’s ruling elite is waging war against its own citizens – and that ruling class very explicitly includes Gavin Newsom.

These policies reflect a contempt for the middle class bordering on hatred. No fair minded person objects to people who look different or have different lifestyles living in their neighborhoods. What they object to is having their neighborhoods destroyed through densification, then filled up with new residents whose residences and rent payments are largely paid through higher taxes.

If you object to this because you worked hard to live in a nice neighborhood, too bad. It wasn’t hard work that got you there, it was “privilege.” And if you object because you don’t like seeing homes randomly demolished and replaced with apartments, too bad, you must be a “denier.” And if you think the economics are unsustainable – after all, at what percentage of tax subsidized construction of “affordable housing” and subsidized monthly rent do government budgets implode – too bad, because all the smart libertarians joined with all the smart progressives to do this to you.

As for the tony enclaves of California’s wealthiest? They litigate and lobby for exemptions to the rules they make the rest of us live by, and laugh all the way to the bank.

This article originally appeared on the website American Greatness.

California Democrats Embrace a Socialist? It’s Not the First Time

If nothing else, Sen. Bernie Sanders’ robust showing in the California Democratic primary proves this: In the state that gave the nation Richard Nixon, Ronald Reagan and the anti-tax revolt, a decisive chunk of the Democratic electorate is no longer allergic to the word “socialism.”

It’s a political milestone in California history. But it’s not a new one.

In Depression-era 1934 Upton Sinclair, the muckraking author of The Jungle, ran seeking the Democratic nomination for governor and won it decisively, racking up more than 50% of the vote. 

Like Sanders, Sinclair was a long-time self-described socialist — though without the “Democratic” suffix that the Vermont senator favors today. 

And like Sanders, Sinclair led a grassroots political movement that existed outside the formal Democratic Party structure, seeking to usher young radicals into the party and radical policies into the mainstream. He, too, drew skepticism and disdain from the “establishment” of his time. Even President Franklin Roosevelt refused to endorse him.

Sinclair went onto lose the general election for governor in a three-way race, after a concerted opposition campaign from the right that equated his policies with Communism. But historians say his campaign offered a strong, leftward shove to both California Democratic politics and the national policy agenda of FDR’s New Deal. Stanley Mosk, who cast his first vote for Sinclair and would go on to become associate justice of the California Supreme Court, recalled Sinclair’s campaign as “the acorn from which evolved the tree of whatever liberalism we have in California.”

But as the Cold War set in, the “s”-word became an epithet and an electoral nonstarter in mainstream California politics. There were exceptions — such as the 1970 election of Berkeley Rep. Ronald Dellums, the first Democratic Socialist sent to Congress in the post-WWII era— but they proved the rule.

Then Sanders turned in a surprise showing in his 2016 bid for president, winning 46% of the California primary vote to Hillary Clinton’s 53%

Tonight the Associated Press declared him the winner of California’s 2020 primary — although any candidates who clear a 15% threshold either statewide or within congressional districts will receive a portion of delegates. It’s those delegates who will actually choose the party nominee at the Democratic National Convention in July. The state party has said it doesn’t expect to apportion all the delegates until April.

Super Tuesday exit polling by NBC News found that 53% of California Democratic primary voters viewed socialism favorably, while 33% viewed it unfavorably. Democratic voters in Texas also approved of socialism by a similar 20 point margin.

So does a Sanders victory suggest that the socialist label might be ready for a comeback here in California? Maybe. Note that San Francisco recently elected Chesa Boudin, the son of the leftist militants, as its district attorney. …

Click here to read the full article from CalMatters.org

A Tale of Two California Elections

It’s the best of California elections. It’s the worst of California elections. 

It’s never been easier to vote in California. It’s never been harder to figure out how to vote.

 These March elections represent the culmination of years of herculean efforts by state and local officials to boost the state’s historically low voter turnouts, by making voting more convenient. So now you can register on line. You also can register at any time, including on election day. If you vote in person, you no longer have to find one particular precinct; this year, in 15 counties, you can go to any of hundreds of vote centers, that are open for several days before the election.  

If you don’t feel like going out, it’s easy to vote by mail. In many counties, you don’t have to request a mail ballot—they automatically send you one. And you no longer have to mail your ballot in ahead of time. Just send it in by election day. 

If you’re Californian, be proud. While the rest of the world doubts democracy, California has become a bastion of greater participation. More Californians—beyond 20 million—are registered to vote than ever before.

Is this a great democratic state or what?

Unfortunately, the answer is: Or what.

Because this election is a failure to match our expansion of voting with informational infrastructure to help people choose. 

Today, California voters are more misinformed than ever. Newspapers are in decline. Most election races and ballot measures don’t get covered at all. Voters too often rely on nonsense from social media. The state’s Official Voter Information Guide doesn’t cover all the races on the ballot, and has significant omissions (like the fact that this March’s state school bond would lift local school debt limits and raise the risk of insolvency).

Our informational infrastructure is so weak that most Californians don’t even know all the ways that voting has been improved. In the 15 counties with voting centers, a poll showed that more than 60 percent of voters don’t know about the changes. 

Why? Our state government and media have failed to explain, accurately and memorably, how our elections have changed. And the state and media don’t bother to get very basic things right—like the very name of the elections themselves. 

Ten years ago California eliminated primary elections for state offices. To replace primaries, voters approved what’s called a “top two” system, where the first-round election is actually a general election, when candidates from all parties appear on the ballot and voters have the most choice. The second round is a run-off for the top two finishers in the general election. 

Still, the state and elite media persist in calling the first round, inaccurately, a primary. This is a clear mistake, with real consequences, since California voters—especially the younger and diverse voters who are registered independents—are less likely to turn out for primary elections than general elections. But the state won’t fix the problem, and the media won’t correct the error. 

In the March 3 elections, the mislabeling adds another dimension of confusion to an already long and confusing ballot. Because political parties still hold primaries in California for president, the presidential contest actually is a primary. But all the other races on your ballot—everything from state assembly and senate to city council—will be general elections. 

So March 3 will be, quite literally, a tale of two elections.

Unfortunately, Dickens isn’t writing this story. Our election tale is now being told by national media who don’t understand California, and by politicians like

Bernie Sanders and Donald Trump, who make false attacks on California’s election system. That may be why polls show 20 percent of likely California voters saying they are not confident that their ballot will be counted.

Those doubters are distressingly wrong. California is so committed to counting every ballot that the count will go on for weeks after election day. For the crime of being careful in counting, California will be savaged by the media and political elites demanding to know, “What is taking so long?” 

There is little we can do to counter such lies. But we can construct new processes of deliberation and information—like a better ballot guide, or citizens’ juries to study ballot questions—to serve our growing population of voters.

Until we do, everyone may vote in California elections, but no one will know what they’re doing.

Joe Mathews writes the Connecting California column for Zócalo Public Square.

Fake Taxpayer Group Misleads Voters on Prop. 13 Bond Measure

We’ve seen this before. Fearful that taxpayers might reject a proposed tax increase or bond, the proponents of the measure will trot out some endorsement of a fake organization with a pro-taxpayer sounding name. It is a highly deceptive tactic meant to confuse voters.

Before this campaign season began, had anyone heard of the California Republican Taxpayers Association? We doubt it. But that is the name of the group appearing on millions of “slate mailers” and which is now running radio ads throughout the state supporting the costly $15 billion school bond measure ironically labeled as Proposition 13. Employing both the “taxpayer”and “Republican” label the group clearly hopes to appeal to more conservative voters. 

The best we can tell is that CRTA was started by a political consultant working for the infamous anti-taxpayer Republican, Abel Maldonado. Not only was Maldonado notorious for voting against taxpayers when he was in the legislature, he successfully traded his state Senate vote, which was needed to pass a massive tax increase, in exchange for putting Proposition 14, the open primary law, on the ballot. 

The consultant’s firm, Capitol Consulting & Public Relations, advertises on its website to potential clients that it can “manage your entire campaign from paid media: direct mail, radio and broadcast advertising.”

There’s certainly nothing illegal about that, but misrepresenting the source of the information can cross the line into legal problems. The CRTA reportedly heard from the Republican party after it used an elephant logo on these mailers to make it appear that the group was an official Republican organization. It’s not. Today its logo is a bear.

To be clear, a professional political consultant is a paid adviser to well-funded campaigns, not by any stretch of the imagination an advocate for the interests of taxpayers. Moreover, CRTA has no lobbyists, no attorneys representing taxpayers in legal fights, does no education efforts andits “location” is a UPS mailbox. It only materializes during election season. This purported group appears to be merely a “for sale” shill existing for the sole purpose of persuading, or deceiving, voters. (As for who “bought” CRTA, one need only consider that among the largest contributors to the Prop 13 bond campaign are the California Teachers Association, trade unions looking for construction business and the California Democratic Party. There’s nothing much “taxpayer” or “Republican” reflected in the money behind this bond measure).

It is now apparent that, because legitimate taxpayer groups such as the Howard Jarvis Taxpayers Association have opposed the massive Proposition 13 school bond, the special interests backing the costly proposal are attempting to counter our narrative. Unfortunately, their deceptive tactics may be working. 

We received an email from a longtime member of HJTA who, after hearing our radio ad opposing this year’s Prop. 13, told us he had already mistakenly voted in favor of the costly bond measure. “I feel like a fool,” he wrote. No, he wasn’t a fool. He got scammed. Apparently, this is the only way the progressive tax and spend lobby can win.

Perhaps we at Howard Jarvis Taxpayers Association take this too personally. We have worked for 41 years to establish an impeccable record of defending the interests of taxpayers and advocating for fiscal responsibility. We have two permanent offices in Sacramento and Los Angeles, three full-time lawyers who represent the interests of taxpayers in literally hundreds of tax cases against government, and a full-time lobbyist advancing the interests of taxpayers and defending the real Prop. 13 (1978) in the California Legislature.

It’s no secret that there is a lot of deception in politics. On Tuesday, voters who truly care about limiting increases in property taxes should listen to legitimate voices on behalf of taxpayers and vote NO on the Proposition 13 $15 billion bond measure. 

Jon Coupal is president of the Howard Jarvis Taxpayers Association.

This article was originally published by HJTA.org

Gov. Newsom’s Empty Words on Homelessness

California governor Gavin Newsom devoted almost his entire State of the State address to homelessness, though observers who follow the issue recognized no new analysis or important proposals. Some critics charge that Newsom lacks strategic vision. Ten to 15 years ago, homelessness policymakers had vision to spare: they were ramping up their “campaign to end homelessness,” and Newsom, then mayor of San Francisco, participated energetically in that nationwide push. It wasn’t successful, but the “end homelessness” rhetoric has endured. In his speech this week, Newsom asserted—as if we’re still in 2004—“I don’t think homelessness can be solved; I know homelessness can be solved.” Bold applause lines and “make no small plans” promises long ago ceased to be inspiring—or even credible—for most people.

The speech’s best ideas had to do with mental health. Newsom called for more use of conservatorships and outpatient civil commitment, both of which have the potential to stabilize thousands of seriously mentally ill Californians. Californians have heard hopeful proposals about mental health many times before, however; time will tell. Newsom praised a recent initiative in San Francisco that modestly expands conservatorship for the mentally ill, though local progressives opposed it.

Newsom said nothing about inpatient psychiatric care. Amid the flood of homelessness-policy reports coming out from public task forces and commissions, inpatient psychiatric care receives virtually no attention. It’s an area where the Trump administration, with its recent push to eliminate the so-called IMD Exclusion—which bans Medicaid funding for mentally ill adults in specialized psychiatric institutions—is doing more for the homeless than California’s leadership.

California particularly needs state leadership on homelessness due to the uniquely regional character of the crisis. Local policies on homelessness in California don’t stay confined within local borders. Regardless of what role personal choices did or didn’t play in their circumstances, the homeless clearly do exercise some preference about which communities are best to be homeless in. Progressive localities offering generous municipal services for the homeless often resent how they wind up providing those services for people from other communities, whose governments don’t invest as much in supportive housing, shelter, or outreach.

Newsom declined to offer state leadership on the issue of greatest regional importance: law enforcement. With the Ninth Circuit’s 2018 ruling in Martin v. Boise, which effectively prevents municipalities from outright bans on street camping, cities possess fewer options on disorder-related questions, such as how to deal with mass homeless encampments. Say you’re the mayor of a modest-size city in the Central Valley, and you want to do something about a downtown tent encampment. As soon as you start raising the issue, you get a letter from a Los Angeles-based lawyer threatening to sue if you don’t adhere to the ACLU’s dictates on encampment policy. Most local officials in that scenario will back down from trying their case in court. Thus, the practical effect of Martin is policymaking by legal advocates. This satisfies no one, but to what extent can cities push back? Can a mayor of, say, Sacramento expect broad-based support if he decides to make public disorder his Number One priority?

Oftentimes, the simplest explanation is the best. California politicians don’t want to commit themselves on public disorder because fence-sitting is the safer alternative. Polls in California show strong support for the goal of reducing public disorder but more ambiguous support as to the means. How much firmness the public would tolerate isn’t clear. One recent survey of 1,000 likely voters found that about three-fourths supported coupling encampment restrictions with a “right to shelter” policy. That’s not too far from the official position of the Ninth Circuit and legal advocates. Limiting street camping on the condition that cities be equipped to offer indoor shelter to every individual who may request it is unduly burdensome, even for well-off communities. But localities can expect little help or guidance from Governor Newsom on this thorny issue.

Given the current level of concern about homelessness in California, it would be strange had Newsom not devoted his State of the State to the topic. San Francisco’s and Los Angeles’s crises in the streets are internationally notorious, much like the South Bronx in the late 1970s, though at that point New York’s murder rate had yet to peak. Sometimes, policy challenges have to get worse before they get better. Californians’ confidence in a solution to homelessness is very low. Could the worst be yet to come?

Stephen Eide is a senior fellow at the Manhattan Institute and contributing editor of City Journal.

This article was originally published by City Journal Online.

Just Say No To California’s Drug-Making Plan

California wants to get into the drug making business.

Gov. Gavin Newsom just announced his intention to have the state contract with generic drug manufacturers to make drugs to sell to state residents, presumably at lower cost than they’re available on the market today.

But the plan won’t deliver much in the way of savings. In fact, it could cost taxpayers a significant amount of money. There are far more effective ways to make prescription drugs more affordable — say, by injecting transparency into the notoriously opaque drug supply chain.

Generic drugs are already quite affordable. Ninety-five percent of prescriptions for generic drugs cost $25 or less. Generics are also the bulk of the American drug market, accounting for 9 in 10 prescriptions filled.

In other words, there’s not much room for generic drug prices to decline further. If Newsom’s new drugmaker is going to undercut existing generic prices, it will have to sell its wares at loss-inducing prices. These losses will be compounded by the additional costs the state will incur monitoring its new drug retailing entity.

The taxpayers of California will be forced to cover these losses. Since the vast majority of generics are affordable right now, it makes little sense to foist additional costs onto California’s taxpayers, who are already among the most heavily taxed residents of any state in the country.

So the governor’s plan won’t make drugs more affordable. Changing the way medicines are sold in this country will.

Take insulin. The list price for Humalog U100, an oft-prescribed insulin product, rose 52% from 2014 to 2017. Price increases like this one feed the narrative that “out-of-control” capitalism is forcing diabetics to choose between food and their medicines — and that the government needs to forcibly control drug prices to ensure people have access to them.

There are some problems with this narrative. While list prices for insulin have been growing, the average price per patient that insulin manufacturers have been receiving has been declining — by approximately 8%.

In other words, patients are paying more even as manufacturers are taking in less money. This seemingly contradictory outcome is enabled by something called the “gross-to-net bubble.”

The gross price is a list price set by manufacturers before they begin negotiating with insurers. The net price is the ultimate cost that insurers pay after all the negotiations with all the various parts of the drug supply chain. The gross-to-net bubble refers to the widening gap between these two prices.

An inflating gross-to-net bubble means higher profits for all those middlemen in the supply chain. But that’s bad for patients, whose co-pays and co-insurance are typically tied to the more expensive gross prices even though their insurers’ costs are tied to the lower net prices.

Patients without insurance often face the highest costs of all, as they derive no benefit from the lower net prices.

Markets only work when prices are meaningful and transparent. What’s happening in the drug market is just the opposite. Transforming the industry supply chain to a transparent net-price model will deflate the gross-to-net bubble — and effectively lower the costs patients must pay for their medicines.

There are additional inefficiencies in our drug supply chain that merit fixing. Consider the case of insulin again. Generic versions of the hormone exist. But they’re often excluded from many formularies — the list of drugs approved for coverage by a patient’s insurer. Removing such barriers to lower-cost medicines — particularly the lower-cost biosimilars that compete against the most expensive biologic products — can meaningfully reduce costs for patients and overall health care expenditures.

Like all Americans, Californians are desperate for more affordable prescription drugs. But a state-run generic retailer won’t deliver that outcome. The state would be better served if the governor tabled this idea and instead pursued reforms that eliminated the perverse incentives that currently plague the drug market.

Wayne Winegarden, Ph.D., is the director of the Center for Medical Economics and Innovation at the Pacific Research Institute. To read his research on drug pricing reform, visit www.medecon.org

This article was originally published by the Pacific Research Institute.

The Prop 13 School Bond Doesn’t Provide the Right Kind of Money for Schools

Backers of Prop 13–the school bond on the March 3 ballot, not the 1978 ballot initiative—say they want to support students.

But their bond may leave California’s students worse off—by gobbling up political attention and money that would be better spent on education, rather than buildings.

This Prop 13 is complicated, and I like some of its provisions on equity, and on higher education. But at its heart, it’s the wrong measure at the wrong time. Specifically, it’s a bond for school facilities, which is not a big need for our schools at this time.

To put it more directly, Prop 13 gives us more money for new buildings—and more debt on state and local budgets—at a time when California schools have less students. 

This bond also comes on top of five state school bonds that have been passed over the last generation. As a result of prior bonds, our schools are in relatively good shape. Indeed, we may have too many schools and school buildings—declining enrollment and budgets busted by retirement costs are forcing school closures all over the state.

What schools are lacking is education. Instead of putting billions into debt service for school buildings, the state should be spending millions to extend the school day and the school year, giving students more instruction.

California school also needs more support for its growing population of special ed students. And it needs to provide more instruction, more technology, and more teachers for foreign language and STEM. Today’s students have to do better, and they have more expensive needs. Indeed, with fewer students and young people, California needs to make sure its students are doing much better in school. Instead, we’ve turned our school accountability system into gobbledygook.

So why the emphasis on building schools? Because it’s easy compared to raising educational levels, and it allows politicians to point to structures to show that they’ve done something. The school bond also makes the politically powerful construction lobbies and unions happy. Those lobbies don’t much care that school districts will be piling on more debt on top of balanced sheets loaded with obligations for retirement benefits.

Our students needs many billions more in support. But they don’t need more buildings.

Joe Mathews: Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

This article was originally published by Fox and Hounds Daily.