Fixing California- Part nine: The prosperity economy

Edward Ring

Director, Water and Energy Policy

Edward Ring
July 21, 2021

Fixing California- Part nine: The prosperity economy

Editor’s note: This is the seventh article in a nine-part series on how to fix California. Read the first article in the series here, the second here, the third here, the fourth here, the fifth here, the sixth here, the seventh here, and the eighth here.

The policy topics considered in this series—energywatertransportationhousinglaw enforcement and the homelessforestry, and education—have all been hijacked by ideologues.

Because of this, and regardless of the relevance, climate change and racism are the two broad and urgent themes that dominate policy discussions and decisions on these issues. And in all cases, these alleged crises are used to distort policies and derail projects. They become the primary focus, limiting options, enabling impractical and expensive schemes, and always with a pessimistic outlook. This series has offered a different set of perspectives through which to view these topics: abundance, pragmatism, and optimism.

There are other big challenges that dominate the political dialogue in California and throughout America. It is a broad and diverse list. But the seven topics chosen, if properly addressed, fulfill a practical goal. They give back to Californians—all Californians—something that’s been missing for decades: a prosperity economy where anyone willing to work hard can afford to live a secure life.

The governing ideology in California today is corporate socialism hiding behind the moral imperatives of fighting climate change and combating racism. California today is run by an alliance of special interests—tech monopolies, public-sector unions, leftist billionaires, extreme environmentalists, and social justice warriors—who are crushing the middle class. Their motivations differ, and their intentions may not be so explicit, but their actions share the same goal. Environmentalists believe the middle-class lifestyle is ecologically unsustainable. Social justice warriors believe the middle class is racist and exclusionary. To the extent small businesses are wiped out and consumers are forced to buy green gadgets and pay more for everything, tech monopolies and billionaires accrue even more wealth and power. Public-sector unions share the ideology of the environmentalists and social justice warriors, and use collective bargaining to largely exempt themselves from the worst consequences afflicting the private sector middle class. But it’s all wrong.

Wanting to save the planet and end systemic racism may be legitimate moral concerns. But the policies being implemented in their name are not working. Rationing, redistribution, and retribution are the themes behind current policies. But rationing breeds corruption and squeezes resiliency out of the system. Socialist redistribution destroys incentives, and, not incidentally, socialism managed by mega-corporations is still socialism. It is an authoritarian, centralized system of governing that replaces the competitive, decentralized, and pluralistic economy that is essential to maintaining freedom and prosperity. Moreover, continuously accentuating the negative aspects of environmental health and race relations is one-sided, punitive, pessimistic, inaccurate, and psychologically unhealthy. We have come so far. We have done so much. Where is that recognition? Where is the optimism?

Practical solutions that lead to abundance need to be the ideology, if you want to call it that, to inform policy on issues affecting prosperity in California—and the United States, for that matter. With abundant desalinated water from the ocean, perpetually recycled wastewater, and storm runoff that’s saved for timely release from high dams, environmentalists have more ways to maintain downstream ecosystems and ordinary people can take showers again without worrying about getting fined.

Abundant water and energy provide resilience to climate change. Building more suburbs opens up opportunities for everyone to achieve homeownership. Enforcing vagrancy laws and laws against hard drugs and petty theft creates a deterrent, pushing individuals towards making healthy choices in their lives. Next-generation roads give everyone mobility. Practical education with immutable standards creates uniform incentives, so everyone knows that if they can meet the standards they will not be passed over.

The policy recommendations that appeared throughout this series are not written with any attempt to adhere to any conventional ideology. Libertarians and anti-tax activists may object to certain public works projects, particularly with respect to water and transportation. While the recommendations concerning California’s energy sector focus primarily on deregulation, and rely mostly on private investment, environmentalists may not accept the argument that California can set a better example to the world by pioneering the cleanest methods possible to use natural gas and nuclear power. Environmentalists will certainly struggle with the solution to forestry management—logging, grazing, and controlled burns—but properly done and privately funded, these enterprises would restore health to the forests and create thousands of jobs.

Public investment is an essential part of any solution to California’s punitive cost of living and hostile business environment. By investing in water and transportation infrastructure and deregulating energy production, enabling infrastructure costs less to the end-user. Homebuilders don’t have to build into home prices the fees to build the roads and utility conduits. Businesses don’t have to pay prices for gas and electricity that are more than double the rates in most other states, and many times the rates in other nations.

There’s an important irony to recognize in the calls from both environmentalists and libertarians for the state to not make these investments. Why spend $50 billion on civil engineering projects to increase California’s annual supply of water to farms and cities by 5 million acre-feet or more? Why not just conserve, and save all that money? Notwithstanding the resiliency argument, which ought to be reason enough, the irony is that the money will still be spent. Instead of wealthier households paying slightly more in taxes, low-income households will have to cover the costs of new “water sipping” appliances that don’t work very well, higher water bills, higher electric bills, and more expensive homes to buy or rent. Subsidizing the capital costs for enabling infrastructure yields long-term reductions to the cost-of-living, and distributes those savings to everyone.

There’s also an important factor that is too often lost in the panic over climate and race relations, and the rush towards authoritarian solutions to these sudden emergencies: corporate special interests benefit when there is scarcity. Does anyone think the financial firms trading water futures want cheap water? Or that corporate agribusiness doesn’t plan to buy every family farm that can’t financially withstand consecutive years of drought? Does anyone think public utilities want to go back to delivering cheap energy, when their profits are pegged by law to a fixed percentage of revenue? Does anyone think the homeless-industrial complex doesn’t love the subsidies attendant to building “permanent supportive housing” on some of the most expensive real estate on the planet? “Inclusive zoning” requires that they locate their projects on land that in some actual cases would sell for over $10 million an acre. This is an outrageous scandal, but if you object, you’re a racist. If you’re wondering what “corporate socialism” means, this is it.

California’s public education curricula, along with California’s policies that prevent effective law enforcement, also reflect the corporate socialist mentality. “Restorative justice” is meant to atone for systemic racism and capitalist oppression. Students and criminals alike are victims of society. Better to tell them this lie than admit the reason California is unaffordable is that mega-corporations are rolling up the entire state and turning it into a company town. Don’t teach them practical skills, make them angry. Don’t punish crimes to create a deterrent to more crime, let them sow chaos. Exploit the unrest to nurture a generation of activists demanding racial justice and environmental justice by any means necessary. Then oblige them. Because no group is easier prey for grifters and demagogues than angry people.

The policies to reverse California’s regressive, authoritarian drift require a cultural shift. An awakening. And this awakening requires a movement not of indignation but of joy. The only way to convince millions of thoroughly indoctrinated, deliberately embittered and panicked Californians is through controlled passion. An unforgettable excerpt from Stephen Vincent Benet’s The Devil and Daniel Webster provides a cautionary example:

“It was him they’d come for, not only Jabez Stone. He read it in the glitter of their eyes and in the way the stranger hid his mouth with one hand. And if he fought them with their own weapons, he’d fall into their power; he knew that, though he couldn’t have told you how. It was his own anger and horror that burned in their eyes; and he’d have to wipe that out or the case was lost.”

How do you wipe out anger and horror? How do you erase the negativity that is the currency of the social justice warriors and the climate catastrophists? Facts matter. But to cast light into darkness and change hearts, facts are useless without also presenting a beautiful vision.

The other side can afford hysteria and hate, they can afford to divide their own ranks and eat their own, because it is all smoothed over with rivers of money. Our side can only win if we exude not just tough resolve, but love, compassion, humility, tolerance, and empathy.

This is the power of optimism, the belief that abundance is possible, the suggestion that ideology matters, but sometimes practical solutions matter more. Critics of California’s dysfunction accurately describe the problems and the culprits, often with justifiable rage. But there is an irresistible, contagious joy in imagining a future where homes are affordable again, where good jobs are plentiful, where the schools are succeeding and the streets are clean. There is joy in imagining what Californians can do if they have a reliable supply of cheap water and electricity and uncongested roads and freeways. There is joy in imagining the next great leaps in innovation that can come from California—innovation in politics as well as in technology.

Think big. Embrace solutions, but also imagine them realized. Visualize California in just a few decades, heading toward the 22nd century. Imagine a state where abundant energy and water and new, smart roads have enabled megastructures in the urban core and spacious suburbs spreading like penumbra along the interstate corridors. Picture passenger drones and subterranean tunnels crossing the great cities. Spaceplanes carrying passengers from San Francisco to Singapore in 30 minutes.

Consider California, a nation within a state, with mountains and deserts separating it from the rest of America, vast and golden, nestled on the Pacific Rim. Consider California in 2050, with the people fulfilling every bit of their potential and realizing their aspirations, because back in the 2020s and 2030s, Californians had the foresight to invest in massive but practical projects and transformative but sensible policies. This is the prosperity economy. This is the opportunity to advocate today. This is the choice. Anything is possible.

This article originally appeared on the website American Greatness.

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Edward Ring is a contributing editor for the California Policy Center.

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