VOTERS ENJOY 30 YEARS OF A GIFT TO THEMSELVES

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, DECEMBER 28, 2018 OR THEREAFTER

BY THOMAS D. ELIAS
     “VOTERS ENJOY 30 YEARS OF A GIFT TO THEMSELVES”

          As this winter’s gift-giving season proceeds, California voters might want to pause a moment and pat themselves on the back for a gift that has lasted 30 years: Proposition 103.

          If there ever was a ballot measure proving the effectiveness of direct democracy, making policy by letting the public vote on important policy choices, this is it.

          Voters who participated back in 1988 might also want to congratulate themselves on resisting the blandishments of a massive advertising campaign that sought to squash this initiative, whose backers were outspent by margins of more than 10-1. Fully $63 million was spent against Proposition 103 – that’s $134 million in today’s dollars, far more than the $110 million spent against this fall’s dialysis-meddling Proposition 8 – and it still won by a large margin.

          Most of the money came from the insurance industry, which until then had pretty much had its way with California regulators. Before that vote, governors appointed California’s insurance commissioner, with no firm rules governing what rate increases that official could allow for car and property insurance.

          Proposition 103 changed all this immediately. It made the insurance commissioner an elected state officer and imposed limits on premium increases. The Consumer Federation of America reported last month the measure has saved California motorists alone $154 billion over 30 years compared with what drivers in other states have paid – an average of about $5 billion yearly.

          The group found that auto liability insurance – the most basic part of an auto policy – now costs 5.7 percent less in California than it did 30 years ago, when the law took effect in early 1989. Prices for the same coverage meanwhile rose 58.5 percent around the rest of America.

          No one has calculated the accompanying savings on homeowner insurance and other property coverage, but it’s certain they have also been substantial. State Farm Insurance, for just one example, is now in court trying to avoid an order to reduce homeowners’ rates by $150 million a year.

          For those whom soon-to-be-ex-Gov. Jerry Brown likes to call “declinists,” that’s one thing keeping living expenses under control even while California sales and income taxes are somewhat higher than in most other states.

          “Can you name anything else that costs less now than it did 30 years ago?” asks Proposition 103 author Harvey Rosenfield, former president of the Foundation for Taxpayer and Consumer Rights, now known as Consumer Watchdog, one of the state’s leading consumer advocate groups.

          “When I wrote it, I never imagined it would save motorists as much as it has,” he said.

          Among other things Prop. 103 established: Auto insurance prices are based mostly on a driver’s safety record and miles driven, insurance companies now must open their books and justify all rate increases and they can no longer base rates on where customers live, a practice commonly known as “redlining,” which saw residents of the poorest areas forced to pay some of the highest prices.

          Of course, enforcement of these rules has not always been certain. Over the years, the insurance industry has filed more than 100 lawsuits against Prop. 103, besides trying to get the state Legislature to nullify most of its rules. Two initiatives to water it down have also been defeated.

          This fight may never end. Five current court and administrative proceedings are now challenging parts of Prop. 103, even while State Farm Insurance fights its big refund order.

          “This is proof that citizen initiatives can change the way consumers are treated and make the system fairer,” says Carmen Balber, Consumer Watchdog executive director.

          In this time when it’s become possible for state legislators to interfere in the initiative process and reach “settlements” with sponsors of measures that have qualified for the ballot, skeptics often question whether it’s wise to let the public – not politicians – decide important policy issues.

          But Prop. 103 stands as a shining example of what the initiative process at its purest can accomplish if voters can see through the flood of special interest advertising so common at election times and make decisions of their own about key issues affecting their lives and pocketbooks.

         

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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

FIRES MAY CHANGE MUCH OF CALIFORNIA, NOT JUST URBAN INTERFACES

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, DECEMBER 21, 2019, OR THEREAFTER


BY THOMAS D. ELIAS
     “FIRES MAY CHANGE MUCH OF CALIFORNIA, NOT JUST URBAN INTERFACES”

          It’s obvious the huge, fast-moving and devastating wildfires of the last two autumns changed the face of parts of California. Large swaths of onetime woodland and brush are now blackened; former luxury homes – and simpler ones, too – became mere rubble and concrete pads.

          Many courageous homeowners, some burned out once and others repeat victims, some famous and others just folks, are determined to risk their lives and property again in exchange for the joys of living amid nature’s beauty for at least another 10 or 15 years. It usually takes that long for plant life to regenerate enough to fuel another big conflagration.

          Rebuilding has already begun in some places. In neighborhoods turned to ash last year, the sounds of hammers, saws and building supply trucks are now common, with contractors in demand.

          And yet…with each passing fire season, cries grow louder to restrict the rebuilds. Questions arise about whether all insurance customers should see higher rates so that a privileged few can live the life they choose. Outcries against allowing routine rebuilding in the areas called “urban interfaces” grow louder each fire season. There’s also the question of utility rates: Should all consumers pay so that power lines can be strung in fire-prone areas where large numbers of homes will predictably burn?

          These are valid questions, but they beg another one: If rebuilding and expansion of new housing is banned in the fire-prone areas containing much remaining undeveloped land, where do we put new housing?

          There’s already a housing shortage, just now felt strongest by the thousands displaced in this fall’s fires that destroyed the Butte County city of Paradise and smaller towns around it, along with hundreds of homes in Malibu, Thousand Oaks, Oak Park and other areas northwest of Los Angeles. Some victims, especially those who were underinsured, can’t even find temporary shelter outside mass civically-run facilities.

          If California doesn’t allow rebuilding in place or expand development in the burned areas, how to grow housing in the state by about 3 million units over the next 10 years, as Gov.-elect Gavin Newsom advocated during his election campaign?

          Almost inevitably, the answer will include rezoning and dense new inbuilding in places considered built out for much of the last century.

          Just such a plan was pushed in the Legislature last year by Newsom’s fellow San Franciscan, Democratic state Sen. Scott Wiener. It didn’t last long, predictably shot down by city officials vowing to fight for local control and against Wiener’s plan for zoning nullification.

          Known as SB 827, that plan would have prevented localities from regulating housing construction within half a mile of frequently used transit stops, whether rail or bus. In wide areas, it would have mandated housing density seldom seen in California outside the downtowns of San Francisco, Los Angeles and San Diego, with minimum heights of 45 feet to 85 feet in many places, making eight-story high-rise buildings common in many low-rise parts of the state.

          This plan won backing from high-tech moguls including the CEOs of Twitter, Mozilla and others headquartered in the densest parts of San Francisco.

          The plan would change the character of California more than anything since the advent of the automobile, and it still might happen.

          For without intense inbuilding in areas that are already built up, many of the needed new units will appear on urban fringes where wildfires are sadly predictable.

          Yes, Wiener’s bill drew strong opposition from residents and governments as geographically diverse as Mill Valley and Santa Monica. But without rebuilding and new building in the fire areas, pressure for such a plan will keep rising as the housing crunch worsens, steadily at times, but also with sudden increases like what has followed the frightening, spectacular fall fires.

          All of which means the blazes that have already degraded the look of hundreds of thousands of acres might soon change the character of California itself, including areas never touched by any major fire.

         

         

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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

WILL LAWMAKERS GIFT UTILITIES ANOTHER FIRE BAILOUT?

CALIFORNIA FOCUS
FOR RELEASE: TUESDAY, DECEMBER 18, 2018, OR THEREAFTER

BY THOMAS D. ELIAS
   “WILL LAWMAKERS GIFT UTILITIES ANOTHER FIRE BAILOUT?”

          California’s big utilities breathed easily in the early fall this year, relieved by a new state law that seemed to guarantee they would never go bankrupt over liabilities from fires caused by their equipment.

          But that relief lasted only until the Camp, Hill and Woolsey fires flared up spectacularly, destroying the Butte County town of Paradise and some surrounding areas, while many hundreds of homes burned in the Thousand Oaks and Malibu areas of Ventura and Los Angeles counties.

          For last summer’s utility bailout bill known as SB 901 contained what amounted to a donut hole noticed by few before it passed. The law ended this year’s fiercest legislative battle on terms long sought by utilities like Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric.

          They forgot one thing: Their pet bill covered liabilities from most future fires and the big blazes of 2017, which raged through the Wine County, Lake County and Ventura County – but it left out 2018. Oops.

          Few noticed the omission until the state’s most destructive fire ever broke out near Paradise in Butte County. It was quickly linked to possible power line problems. Then came huge flames in Southern California, where an electric line connection was also alleged.

          But it appears the utilities will soon get more relief. “We think it’s clear anything that would cause the bankruptcy of a major utility would have a negative effect on the ratepayers,” said Democrat Chris Holden of Pasadena, chairman of the state Assembly’s Utilities and Energy Committee. Translation: Some utilities are too big to fail.

Holden, who received more than $51,000 – well over one-fourth of his 2018 campaign funds – from the big utilities now at risk and other power-producing companies, promised in an interview to carry a bill in the new Legislative session filling the SB 901 donut hole.

          If it could have passed this month, current Gov. Jerry Brown, whose sister Kathleen sits on the board of San Diego Gas & Electric’s parent company, would surely have signed it. But Holden delayed his bill until January, and it’s not so certain what Gov.-elect Gavin Newsom might do. Holden and Newsom have talked.

          Here’s the rub in the potential fire bailouts for the utilities: If any company can show it is in danger of bankruptcy due to fire damage it caused – negligent or not – its customers would pick up much of the resulting tab.

          Like SB 901, Holden’s new bill would force the companies to pay all damages not covered by their insurance until the state Public Utilities Commission determines they are close to going broke. At that point, Holden said, the PUC would have the companies issue 20-year bonds for the rest, to be paid back via increased rates. So all utility customers, including any who consciously chose not to live or build businesses in fire-prone areas, most likely will foot most of fire expenses.

          No one knows just how broke a company must be for the PUC, which historically favors utilities over their customers, to declare it in danger.

          In the Camp Fire alone, potential PG&E liabilities could exceed $15 billion, Holden said. He did not explain why a utility bankruptcy would necessarily harm consumers, when PG&E’s Chapter 11 filing during the energy crunch almost 20 years ago caused no service interruptions.

          Nor did he say why, in case of bankruptcy, utility assets like dams and power lines couldn’t be sold to the highest bidders and keep operating, while city- and county-run Community Choice Aggregation utilities move in and provide other services. CCAs are already spreading rapidly around the state, with Republican San Diego Mayor Kevin Faulconer the latest local official to advocate one for his city.

          In short, if customers don’t quickly fight the new bailout, they will likely find themselves paying for most damage from the latest fires and all other major ones going forward. Then the sky would be the limit on millions of electric bills.

        

           

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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

KIDNEY PATIENTS BREATHE EASIER, BUT WARINESS ADVISED

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, DECEMBER 14, 2018 OR THEREAFTER


BY THOMAS D. ELIAS

     “KIDNEY PATIENTS BREATHE EASIER, BUT WARINESS ADVISED”

          For quite awhile this year, it seemed like open season on kidney dialysis patients, the more than 66,000 Californians who depend for life after kidney failure on getting their blood cleansed during sessions of three or more hours three times a week.

          The most serious threat came from Proposition 8, which lost at the polls by a 62–38 percent margin, but not before it became the year’s most expensive issue-oriented campaign in America, more than $120 million being spent on both sides.

          There was also a threat this year from the Legislature, whose strong Democratic majorities are so much under the sway of labor unions which provide much of their campaign funding that they easily passed a measure  threatening to throw dialysis patients off their health insurance plans if they accept third-party aid in paying their premiums.

          Bear in mind, many dialysis patients are so exhausted and weakened by the constant blood exchanges they undergo that they cannot work, living on fixed disability payments and other forms of welfare. For many, premium assistance is the key to staying alive.

          Fortunately for them, outgoing Gov. Jerry Brown vetoed this ill-advised measure sponsored by Democratic state Sen. Connie Leyva, whose Inland Empire district spans many miles between Pomona and San Bernardino.

          “This bill goes too far as it would permit health plans and insurers to refuse premium assistance payments and to choose which patients they will cover,” Brown’s veto message said.

          Spreading the alarm as the measure sped through committee after committee was the American Kidney Fund (AKF), largely funded by big dialysis companies which stood to lose under the measure. The AKF uses donations to give premium help for 74,000 dialysis patients in all 50 states, including almost 4,000 Californians.

         Noting that the bill was largely backed by health insurance companies, a statement from the AKF called the Leyva bill “a thinly veiled attempt by insurers to prevent kidney patients from being able to choose their own insurance plan if they accept charitable premium assistance.”

          The fund claimed the bill’s aim was to let insurance companies rid themselves of “sicker and more costly patients.” And make no mistake, dialysis is costly, often running more than $6,000 per month and sometimes more than $50,000.

          That high cost was also the ostensible motivating factor behind Proposition 8, primarily sponsored by the Service Employees International Union, which would dearly like to recruit thousands of technicians and nurses working in California’s 550 dialysis clinics.

          The measure claimed it would hold costs down by forbidding clinics from charging insurance companies for the work of physician medical directors vital to maintaining quality care. It also would not have allowed clinics to charge for the work of facility administrators, security personnel and professional services like accounting, payroll and legal expenses, all normally considered ordinary costs of doing business.

          Cut those costs, the sponsors argued, and everyone’s health insurance premiums would drop. But the two largest owners of dialysis clinics in California, the German-based Fresenius Medical Care and Denver-based DaVita Corp. responded by saying the cuts would force them to close many clinics.

          No one knows how many they would really have shuttered, but if they closed any significant number, the long rides many dialysis patients now endure several times a week before and after treatment would grow even longer and tax their depleted strength much more.

          Fresenius and DaVita put their money where their mouths were by becoming the prime funders of the seemingly ubiquitous campaign against Proposition 8.

          Had either of these proposals become state law, the lives of thousands of patients figured to become even more difficult.

          So there was relief in the clinics when both measures ultimately failed. But there is no guarantee either won’t be back, especially with a new governor taking office Jan. 3 and nobody quite sure how he might deal with similar measures if the Legislature puts them on his desk.

          This means dialysis patients who are fit enough to track these developments – and many are not – cannot afford to relax completely even though the two immediate threats were not realized. They must remain wary and ready to respond again if and when similar dangers arise.

         

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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

CALIFORNIA GOP DOESN’T HAVE TO BE IRRELEVANT

CALIFORNIA FOCUS
FOR RELEASE: TUESDAY, DECEMBER 11, 2018 OR THEREAFTER


BY THOMAS D. ELIAS

     “CALIFORNIA GOP DOESN’T HAVE TO BE IRRELEVANT”

          From across California, the obituaries for the California Republican Party have come thick and fast ever since the November election. After all, the GOP’s onetime national stronghold in Orange County now lacks even a single Republican in Congress.

          All statewide officeholders also are Democrats, from the governor right through the nominally nonpartisan state school superintendent. Democrats hold majorities of more than two-thirds in both houses of the Legislature, allowing them to pass any tax increase they like.

          So the eulogies now being read over the seemingly dead body of the onetime Grand Old Party amount to piling on after Republicans’ worst defeat ever in California.

          One veteran conservative commentator suggests the GOP should stop calling itself Republican and adopt some other label because the present one was poisonous for so many candidates. The party’s former leader in the state Assembly, Kristin Olson, opined in print that her party “is dead.”

          But it doesn’t have to be that way. And a major Democratic operative has now outlined just how Republicans can recover in this state. A potential GOP recovery, though, would probably require its candidates to divorce themselves as much as possible from President Trump and his brand of government by insult, belittlement, braggadocio, whim and tweet.

          If Republicans in California do as the Democrats did after their 2016 losses, they have a shot at making a significant comeback. But so far, the GOP is so enmeshed in feeling sorry for itself that there is little sign it will make the kind of effort Democrats did starting at the end of 2016 and carrying right through this fall’s election.

          The first thing Democrats did then was select the Republican congressional seats they had a chance of winning. In the end, they took virtually all of those.

          Their chief criterion was simple: Target districts where Hillary Clinton beat Trump, but which elected Republicans to Congress. Those included all the Orange County areas they flipped this fall, and three in the Central Valley. They also made a strong, successful effort to ensure they didn’t lose any of the 39 congressional seats they already held in California.

          Republicans have plenty of potential targets for 2020, if they take even a cursory look. They might go after districts where GOP candidates led in Election Night counts, but lost when late mail and provisional ballots were counted.

          Those include three Orange County districts that went Democratic this year after decades of Republican representation. The GOP also could examine districts like those of Democrats Ami Bera and Jerry McNerney, perpetual targets for them in the northern San Joaquin Valley where the incumbent Democrats rarely pull more than 53 percent of the vote, even in big Democratic years like 2018.

          There is definite potential for Republican recovery. But only if the GOP adopts some of the tactics outlined in a post-election memo sent to reporters by Drew Godinich, regional press secretary for the Democratic Congressional Campaign Committee.

          The DCCC, Godinich reported, started by making sure it had solid candidates. It then spent big money on primary campaigns to get those candidates into the fall runoff. Democrats also put local organizers into target districts just two weeks after Trump’s inauguration, while he was embroiled in feckless and false arguments over whether his inauguration crowd matched Barack Obama’s.

          The DCCC then invested $30 million to register and turn out new voters from diverse ethnicities, women and younger voters known as millennials. It hired 11 full-time organizers to expand Latino and African-American voting, one reason those groups came out in larger numbers than almost any prior mid-term election.

          And it made sure each target voter heard from Democrats more than 100 times in the 60 days prior to Nov. 6.

          Still, it’s likely none of those things would have won for the Democrats if not for the negative presence of Trump, who loomed over the entire election.

          So far, Republicans aren’t following up on any of this and show no signs of learning from the Democrats, while Trump appears unready to go away.

          All of which means recovery is possible for the GOP. But only if it cleans up its act, and very soon.

         

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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

 

BROWN’S MIXED LEGACY OF BIG FIXES, SOME CORRUPTION

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, DECEMBER 7, 2018, OR THEREAFTER


BY THOMAS D. ELIAS
   “BROWN’S MIXED LEGACY OF BIG FIXES, SOME CORRUPTION”

          About a month from today, a new governor will sit in the state Capitol’s “horseshoe” suite and face some problems that not even the hyper-active and often contemptuous soon-to-be-ex-Gov. Jerry Brown could solve.

          Those problems will obscure neither Brown’s achievements nor his failures.

 When Brown took office in early 2011 for the first term of his second go-‘round as California’s chief, the state faced a huge budget deficit of $27 billion, which he turned into both a positive and a large rainy-day fund via a combination of parsimony and the political courage needed to run a major tax-increase ballot initiative, one that now forms part of state government’s financial base.

He also inherited from predecessor Arnold Schwarzenegger an over-budget High Speed Rail project that faced numerous legal challenges over items as basic as acquiring the land for laying tracks. The so-called “bullet train” has not exactly proceeded with bullet-like speed and today is even more over-budget and behind schedule than when Brown took over, while still facing most of the same legal problems.

Mark that one as a problem not solved, which Gov.-elect Gavin Newsom will inherit.

          Brown helped appoint former Arizona Gov. Janet Napolitano, also a former Homeland Security Secretary, president of the University of California and did little while she and her aides accumulated a $175 million slush fund at the same time students were assessed roughly the same amount in tuition increases.

          He’s been a leader in the global movement against climate change and last fall even dared the world to revive the “Gov. Moonbeam” tag once applied to him by the late Chicago columnist Mike Royko, promising California will “launch our own damn satellite” to track global warming. Royko coined the nickname in the late 1970s, when Brown previously advocated a state satellite.

          Brown sees the putative new space project as one part of California’s resistance to climate change reluctance from President Trump, who ordered federal agencies like NASA and the National Oceanographic and Atmospheric Agency not to track worldwide temperature changes. Newsom said in October he likes the satellite idea.

          If there’s a large negative in how Brown is remembered, it likely will come over the corruption his appointees spawned at the state Public Utilities and Energy commissions.

          The PUC consistently favors utilities over their customers and never penalized any commissioners who helped orchestrate a settlement between the Southern California Edison Co. and its customers on the costs of closing the San Onofre Nuclear Generating Stations. That deal was illegally reached in a secret meeting involving former PUC President Michael Peevey. Peevey has supposedly been under investigation for his role, but that alleged probe is now more than four years old, with no result. Meanwhile, Atty. Gen. Xavier Becerra, a Brown appointee just elected in his own right, won’t say where it stands.

          Similar collusion by Peevey and other PUC members with Pacific Gas & Electric Co. has also gone unpunished, while costing consumers billions of dollars.

          At the Energy Commission, highly questionable multi-million-dollar “hydrogen highway” grants favoring automakers and big producers of industrial fuel were first pulled back by commissioners after this column exposed the cronyism behind them. Most were re-instituted to the same recipients after the commission changed its rules a short time later. Brown did and said nothing about this scandal, then reappointed the commission chairman who oversaw it.

          Brown also went along with almost all demands of public employee unions and signed every bill reaching his desk that eliminated delays under the California Environmental Quality Act and promoted large building projects like the Golden State Warriors’ under-construction new arena in San Francisco. Similar bills boosted the Los Angeles Rams/Chargers coming new stadium in Inglewood, the Los Angeles Clippers’ nascent arena also in Inglewood and the Sacramento Kings’ already completed new home.

          And he did nothing to prevent the “motor voter” debacle at the Department of Motor Vehicles, which has mis-registered thousands of voters.

          So how will Brown be remembered? Most likely as a governor who solved some problems he inherited and worked hard against climate change. But his legacy will also include doing little about corruption and virtually ignoring the state’s biggest financial problem: Its massive public pension deficit.

         

         

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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It" is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

NEWSOM: INCOME EQUALITY STATE’S BIGGEST PROBLEM

CALIFORNIA FOCUS
FOR RELEASE:  TUESDAY, DECEMBER 4, 2018, OR THEREAFTER


BY THOMAS D. ELIAS

    “NEWSOM: INCOME EQUALITY STATE’S BIGGEST PROBLEM”

          More than a year before he won election as California’s next governor, Gov.-elect Gavin Newsom did not hesitate for a moment when asked what’s California’s biggest problem. “Income inequality,” he said in an interview then. He repeated that evaluation in subsequent sit-downs during the campaign.

          “Take Los Angeles,” he said. “It’s America’s richest city, with Bel Air, Brentwood, Beverly Hills. But it’s also America’s poorest city, with South Central and more. The remarkable thing is they are only a few miles apart.”

          Then he added that “You can’t live a good life in an unjust society.” And went on to quote the ancient Greek statesman and orator Pericles, who said, “The issue of wealth and income distribution is the oldest and most fatal of all issues in a republic.”

          Newsom left no doubt about his deep conviction on this, despite his longstanding friendships with plutocrats like Gordon Getty. He offered some immediate ideas on how to ease situations where families with annual incomes barely topping $20,000 per year live not far from others whose incomes are more than 100 times that.

          During his campaign, Newsom pledged to hire a statewide director to coordinate services he hopes will treat each homeless person from a “whole person care” perspective. He promised to push for more affordable housing aiming to take homeless off the streets, but – mindful of controversies in places like Los Angeles, Orange County and San Francisco – will leave it up to local authorities to decide where that housing should go.

          Newsom isn’t the first to note the inequality problem. California’s tax-collecting Franchise Tax Board has reported that in 2016, the top 1 percent in overall wealth received 23 percent of all income in the state, while the bottom 90 percent received 49.6 percent. White families on average earned more than 1.5 times what Latino and black families got. Even more startling are net-worth figures reported by the U.S. Census, which found white families in California had a net worth (assets minus debt and other liabilities) of $171,000, more than eight times the $20,700 belonging to the average Latino family and nearly 10 times the $17,600 of African-American families. Those numbers include home equity, value of vehicles, furniture and almost every other type of material goods.

          There will be no immediate help from the federal government, either, on evening things out: President Trump’s tax “reform” bill of last year will benefit whites far more than Latinos or blacks, and the richer you already are, the more you stand to benefit.

          So what can a new California governor do about this inequality, which grew more imbalanced than ever during Jerry Brown’s latest two terms as governor?

          The California Budget Project (CBP) suggests starting with an estate tax (sometimes called a “death tax”), saying that “serves as a curb on dynastic wealth.” In short, if you’ve built a valuable business, you’d better pass it on to your kids before you die, if estate taxes rise precipitously, as they might with two-thirds Democratic majorities in both houses of the Legislature. But the Legislature and governor couldn’t act alone on this: It would need to be okayed by voters because the 1982 Proposition 6 repealed state inheritance taxes. It can only be reversed via another popular vote.

          The CBP also suggests eliminating or cutting tax deductions that primarily benefit well-off homeowners, including deductions for mortgage interest and property taxes. Do that, of course, and the value of much California real estate would immediately fall, which would tend to even out the wealth held by whites, Latinos and blacks.

          But that would surely spur a massive political backlash, so don’t bet on it happening soon.

          Another way to boost low-wealth families is to expand child care and renters’ tax credits, which help the poor while not harming others. This one is the most likely of the CBP recommendations to become reality.

          But one thing is for sure: Newsom will evaluate many proposed new laws that land on his desk from the perspective of what they’ll do to help alleviate income inequality and boost low-income families. Which will be a very different perspective than any recent governor has brought to the office.

                  

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     Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, go to www.californiafocus.net

FEINSTEIN’S RACE REVEALS A MAJOR TOP TWO PROBLEM

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, NOVEMBER 20, 2018 OR THEREAFTER


BY THOMAS D. ELIAS
    “FEINSTEIN’S RACE REVEALS A MAJOR TOP TWO PROBLEM”

          Ever since the 2010 passage of Proposition 14, Libertarians and members of other small but sometimes significant California political parties have griped about the lack of choices presented to voters in the state’s biennial November general elections.

          Advocates of the “Top Two” primary election system set up by that eight-year-old initiative respond that it actually does provide runoff election choices, even if they’re often between different wings of the same political party.

          Voters had just such a choice this fall in the contest between longtime incumbent Democratic U.S. Sen. Dianne Feinstein and former state Senate President Kevin de Leon. Feinstein represented moderate Democrats, de Leon the party’s more extreme leftist Young Turks.

          This race ended up tossing a monkey wrench into Top Two, the first time the system has not worked as planned.

          Top Two, known to some as the “jungle primary,” puts the two leading vote-getters in California primaries into the finals, regardless of political party. The major parties despise this system because it cuts their organizational influence, as it did last spring when the state’s Democratic Party apparatus leaned to de Leon, but 70 percent of Democratic primary voters went instead for Feinstein.

          Top Two supporters enjoyed the fact that their rules reduced party influence. They don’t mind that dozens of district elections for Congress and the Legislature have been one-party affairs since 2010, some involving two Democrats and others matching two Republicans, depending on which major party was dominant in any particular district.

          They have rejoiced in the fact that voters of the minority party, whose smaller numbers previously gave them little or no voice in district elections and a few statewide races, could moderate the way their representatives behaved once in office in Sacramento and Washington, D.C.

          But then came the U.S. Supreme Court confirmation hearings for now-Justice Brett Kavanaugh, where Feinstein played a key role in getting #MeToo movement-style complaints about Kavanaugh’s alleged sexual misbehavior as a young man before the Senate Judiciary Committee, where she is the ranking Democrat.

          Feinstein’s role infuriated many Republicans, who saw the claims about Kavanaugh as trumped-up falsehoods.

          Rather than going for the more moderate Feinstein, who beat de Leon by a margin of more than 3-1 in the primary, Republicans by a margin of about 2-1 voted for de Leon. This was a real head-scratcher, as de Leon during the campaign often blasted Feinstein for her friendliness with some Republicans. De Leon is also the prime author of California’s “sanctuary state” law and his stances on everything from health care to climate change run diametrically counter to standard GOP positions.

          Still, many Republicans came to detest Feinstein last fall, and decided to vote for anyone over her. De Leon became their only possible fallback, allowing him to improve greatly on his primary performance, only losing by an eventual margin of about 9 percent.

          Their sentiments were expressed by the editor of one small Central Valley newspaper, who wrote in his pre-election endorsements column, where he also blasted Democrats for their “often stupid ideas”: “Vote for Kevin de Leon. Incumbent Dianne Feinstein embarrassed herself and California by carrying the water on the phony and vicious campaign against…Kavanaugh. Her days in the Senate should be brought to a close.”

          That did not happen, but GOP voters became strange bedfellows for the Democratic left and gave Feinstein some anxious moments.

          Had de Leon won, he would have voted consistently for six years against almost everything favored by the Republican voters who so avidly helped him out.

          That’s not how former GOP Gov. Arnold Schwarzenegger and his fellow Republican sidekick, ex-Lt. Gov. Abel Maldonado, planned it when they helped create Top Two. Under their predicted scenario, the ultra-conservative voters who backed de Leon this fall were supposed to vote for the more moderate Feinstein.

          If they were being rational, they would have done that. But they were governed by emotion, as many voters often are. So GOP-dominated counties like Shasta, Butte, Madera and Merced went big for de Leon.

          If more monkey wrenches like this ever get tossed into Top Two, there’s a chance the same voters who opted into it will someday opt out.

         

    -30-
     Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, go to www.californiafocus.net

FIRE INSURANCE CRISIS ALMOST UPON US

CALIFORNIA FOCUS
FOR RELEASE:  TUESDAY, NOVEMBER 27, 2018, OR THEREAFTER

BY THOMAS D. ELIAS

“FIRE INSURANCE CRISIS ALMOST UPON US”

          Californians already know about the wildfire crisis that’s been afflicting this state for the last few years, highlighted by a rash of huge blazes and the evacuations of at least 250,000 persons. It’s caused by a combination of climate change, forestry practices and the seemingly endless human drive to build more and more houses in increasingly remote and fire-prone areas.

          But many may not realize that a fire insurance crisis is also almost upon us.

          Sure, state legislators led by incoming state Insurance Commissioner Ricardo Lara worked much of the year to protect victims of the huge 2017 fires that hit the Wine Country, Ventura County and parts of San Diego County.

Homeowners burned out in this year’s firestorms in Shasta, Butte, Ventura, Los Angeles and rural parts of Mendocino, Lake, Orange and Riverside counties, could also benefit from what they’ve done – essentially expanding from one year to two the time when insurance companies cannot cancel fire coverage in burned-out areas or their nearby peripheries. The clock starts running on that time when the governor declares a state of emergency in a fire area.

          But…there’s nothing to prevent insurance companies from lowering their risks by canceling policies on homes and other buildings in fire-prone areas that have not yet burned.

          There’s little doubt insurance companies want to minimize their risks. They were the leading lobbyists against a legislative bill letting big utility companies off the hook for damages caused by fires their equipment starts. That could have upped liabilities by hundreds of millions of dollars for insurers, who would then raise premiums everywhere, not just in wildfire-prone areas. A fall-back bill that eventually passed could end up causing those very things.

          Insurance lobbyists also fought a bill requiring living expense insurance to include all reasonable costs of fire victims seeking to maintain their pre-conflagration living standards.

          These were among the biggest battles of the last legislative year, and they are not yet settled, with a special commission now attempting to hash out solutions designed to keep the utilities out of bankruptcy without dunning the average homeowner large new sums.

          With utilities already facing liabilities in the multiple billions of dollars, it may be hard to find such a formula, especially in a state increasingly fed up with large corporations fobbing the costs of their mistakes and negligence onto their customers.

          Which means that what outgoing Gov. Jerry Brown said last year about wildfires and climate change – “All hell is breaking loose” – applies now to more than the actual fires. Things always get more contentious as monetary stakes rise.

          But the threat to fire insurance isn’t completely new. Outgoing state Insurance Commissioner Dave Jones saw it coming a year ago. “The companies must renew policies for a time on homes in fire disaster areas,” he said then. “But they don’t have to renew policies in non-disaster areas when they expire and they don’t have to renew homes in disaster areas beyond the time limits.”

          So crisis is here. But it won’t be like what happened after the 1994 Northridge earthquake, when property insurance companies refused to renew most policies and stopped writing new home and business property coverage anywhere in California. That impasse – it amounted to blackmail – ended in 1996 with creation of the California Earthquake Authority and elimination of an old rule forcing companies that write property insurance also to offer quake insurance. The state-run CEA now writes the vast majority of earthquake policies.

          That’s because there is a safety net of sorts for homeowners whose coverage is not renewed. It’s called the Fair Plan, roughly equivalent to the CEA in that it must insure anyone who applies. But Fair Plan rates are much higher than other fire policies, although by law prices cannot be excessive, whatever that means.

          Before last year’s blazes, the number of Fair Plan policies was rising by about 1,000 per year. The figure was up in 2017 and likely will climb substantially over the next two years. So the fire insurance crisis will be less about scarce insurance than it is about money.

          That won’t make it any less painful for those who are forced to foot much higher bills than ever before.

         

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     Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, go to www.californiafocus.net