How to NOT Solve California’s Housing Crisis

There are obvious reasons the median home price in California is $544,900, whereas in the United States it is only $220,100. In California, demand exceeds supply. And supply is constrained because of unwarranted environmental laws such as SB 375 that have made it nearly impossible to build housing outside the “urban service boundary.” These laws have made the value of land inside existing urban areas artificially expensive. Very expensive. Other overreaching environmentalist laws such as CEQA have made it nearly impossible to build housing anywhere.

Then there are the government fees attendant to construction, along with the ubiquitous and lengthy permitting delays caused by myriad, indifferent bureaucracies with overlapping and often conflicting requirements. There is a separate fee and a separate permit seemingly for everything: planning, building, impact, schools, parks, transportation, capital improvement, housing, etc. Government fees per home in California often are well over $100,000; in the City of Fremont in 2017, they totaled nearly $160,000 on the $850,000 median value of a single family home.

This is a shakedown. It has caused a politically engineered housing shortage in California that enriches billionaire property developers that have the financial strength to withstand decades of delays and millions in fees, because they reap the extreme profits when they sell these homes at inflated prices. Also enriched are the public servants whose pay and pensions depend on all taxes – definitely […] Read More

Beware of Fool’s Gold: Democratic California’s Cautionary Tale

It’s become fashionable among certain conservatives, libertarians, and assorted free-market types to claim that Republicans are no better than Democrats. Both parties, according to the disenchanted, have lost their way. Both parties are controlled by establishment cronies, who support big government of one sort or another.

But conservatives who are disillusioned with Republicans need to remember just how much is at stake if Democrats take over. To indulge in understatement, California offers a cautionary tale.

In the name of saving the planet, and helping the poor, Democrats win votes in California. Assisting these Democrats is the most powerful coalition of leftist oligarchs in the history of the world. But the planet is not better off and California’s poor get poorer. How can this be?

Absolute Power Corrupts Absolutely Since at least 2006—the year Governor Arnold Schwarzenegger, a moderate Republican, totally capitulated to the Democratic establishment—Democrats have exercised absolute power in California. Their ongoing agenda, much of which has already been implemented, offers insight into just how different Democrats are from Republicans—even those watered down Republicans who struggle to earn votes from true conservatives.

California’s Democrats, in pursuit of environmentalist perfection, have legislated artificial scarcity of everything necessary to civilized life: land, housing, electricity, gasoline, water, transportation, and quality education—you name it. California has the most expensive homes, the highest utility prices, the worst roads, and failing schools. Behind the high-minded environmentalist rhetoric stand oligarchs who profit from scarcity; established corporations, public utilities, large landowners, and “green” entrepreneurs.

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California’s Socialist Oligarchy, Part One: Making the State Unaffordable

Touted as the “fifth-largest economy on Earth,” and recently heralded as delivering the “greatest increase in average income,” these statistics obscure an alarming reality. California has become a feudal state, where the benefits of prosperity are unequally distributed, rewarding corrupt plutocrats and punishing ordinary working families. Joel Kotkin, a fellow in urban studies at Chapman University in Orange, California, characterized California’s current political economy as “Oligarchical Socialism.” This is a perfect description of a system that destroys the middle class at the same time it protects the ultra rich.

California’s leftist oligarchy benefits financially from precisely the depredations they accuse conservatives of committing. They have enacted policies that are designed to make California unaffordable to all but the wealthiest residents, and hostile to emerging small businesses, at the same time as their preexisting wealth and politically connected corporations reap enhanced returns and profits.

Plenty of Land, Impossible to Build

Nowhere are the consequences of California’s oligarchical socialism more evident than in the cost of housing. State legislation has made it nearly impossible for developers to construct new housing outside the so-called “urban growth boundary.” Instead, development is redirected into the footprint of existing urban areas.

While there is a natural tendency as population increases to see higher density redevelopment in urban cores, by restricting outward expansion of urban areas, the value of the limited remaining eligible […] Read More