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IN THIS ISSUE – “Historical, Unprecedented, Generational and Transformational”
GOVERNOR & LEGISLATURE TEST FISCAL FITNESS
- “A Brutal Day in the Legislature”: Hundreds of Spending Bills Meet Their Fates
- State Budget Negotiations Begin Over Billions & Billions
- Governor Proposes Record Spending on Environmental Measures; Casts Doubt on Bonds in 2022
- Legislative Analyst Cautions Against Permanent Spending Hikes for 400 New Programs
DROUGHT & BLACKOUTS
- Drought Actions Begin: “How Will Californians Cope?”
- Summer Power Outages Appear Likely, May Impact Newsom Recall
- Soaring “Rare Earth” Metal Costs Slow Renewable Energy
CALIFORNIAN & US SENATE
Capital News & Notes (CN&N) harvests California legislative and regulatory insights from dozens of media and official sources for the past week, tailored to your business and advocacy interests. Please feel free to forward.
READ ALL ABOUT IT!!
FOR THE WEEK ENDING MAY 21, 2021
ADVISORY TO READERS – Capitol News & Notes will not publish on May 28 due to the Memorial Day weekend.
“A Brutal Day in the Legislature”: Hundreds of Spending Bills Meet Their Fates
CalMatters
Thursday was a brutal day in the state Legislature.
Hundreds of spending bills met their demise or were watered down as lawmakers raced through an opaque process called the “suspense file,” a tool often used to euthanize proposals without having to cast a politically precarious vote or offer a public explanation.
Intensifying an already high-stakes procedure was top Democrats’ decision to limit each lawmaker to 12 bills this year, likely a boon for interest groups trying to kill proposals and a setback for those trying to push their ideas through.
Assemblymember Lorena Gonzalez, chair of the powerful Appropriations Committee, which decides the fate of bills: “Everybody but God himself has contacted me on a bill.”
Major bills that didn’t pass intact through Thursday’s bloodbath include:
- A proposal to decertify bad copswas watered down to limit when people can sue police officers and departments for civil rights violations.
- A proposal to require law enforcement agencies to process backlogged rape kitswas killed for the second year in a row.
- A proposal to streamline affordable housing funding— in response to a state auditor report that found California wasted $2.7 billion — died amid opposition from the state treasurer.
- A proposal to bring more transparency and accountabilityto nursing home ownership failed amid industry opposition.
- A proposal to require big companies to publicly report their greenhouse gas emissionswas killed in a big loss for environmentalists.
More:
State Budget Negotiations Begin Over Billions & Billions
Sacramento Bee & CalMatters
Gov. Gavin Newsom proposed pouring tens of billions of dollars into California’s struggling economy as part of a record-setting state budget proposal that will play out as he defends himself in a recall election.
The $267.8 billion plan would direct billions in spending toward stimulus checks for Californians, give millions of children a start on college savings accounts and provide grants of up to $25,000 apiece to businesses set back by COVID-19.
His plan, which proposes $196.8 billion in general fund spending, also includes massive efforts to modernize the state’s roads, bridges and broadband.
“This is our plan to get California not only back on its feet, but California roaring back, once again, to its rightful status as the most essential and dominant state, not only in the United States, but one of the most essential modern economies anywhere in the world,” Newsom said.
It’s a stark turnaround from a year ago when he and lawmakers slashed tens of billions of dollars in planned spending and cut public employees’ pay as they braced for a severe recession.
The coronavirus downturn didn’t happen to the extent Newsom anticipated. Instead, the state’s high-earners tended to do well during the coronavirus pandemic, while low-income people bore the brunt of the economic hardship.
Now, his plan is on built on a $75 billion surplus from tax revenue and another $27 billion in stimulus funds from the federal government. He credited the people of California for “this historic, unprecedented, generational and transformational budget.”
KICKS OFF BUDGET NEGOTIATIONS
Newsom and lawmakers have a month to negotiate details of the 2021-22 budget. Lawmakers must pass a budget by June 15 for Newsom to sign into law before the fiscal year begins July 1.
Democrats who control the Legislature have already signaled they agree to at least the spirit of Newsom’s economic stimulus proposal, which they’ve framed as a way to use money from the state’s richest residents to help low-income people who were hurt by the coronavirus-fueled economic downturn.
Senate President Pro Tem Toni Atkins, D-San Diego, called the strong economic projections “an opportunity to create transformative change” and build an inclusive post-pandemic economy.
“It’s promising to see Gov. Newsom aligned with us on many of the ways we can accomplish that goal,” Atkins said in a statement. “The Senate will come to the table ready to champion the needs of Californians.”
But Republicans are pushing back against Newsom’s plan. Assemblyman Vince Fong, a Bakersfield Republican and vice chair of the Assembly Budget Committee, said the $75 billion surplus “is the clearest indication that Californians are over-taxed” and called for that “tax burden” to be “permanently reduced immediately.”
“We do not have a revenue problem in our state,” Fong included in his statement. “We have an incompetent government that cannot fix the basics in our state. We need a new direction that actually achieves real results for all Californians.”
“The devil is in the details,” said Democratic Assemblymember Lorena Gonzalez of San Diego. “We will end up in a similar place on expenditures, and the difference will be in the implementation and how we achieve the goal.”
Assembly and Senate leaders have their own priorities.
Atkins, for example, proposed a new program to help first-time homebuyers. Newsom didn’t include that idea in his plan, but proposed expanding an existing homeownership assistance program. Assembly Speaker Anthony Rendon said he’ll try to increase spending on childcare and college financial aid, as well as health and social services.
Key lawmakers have been pushing to overhaul of the state’s financial aid system — something Newsom didn’t include. While Newsom included $7 billion to close the digital divide, lawmakers have their own ideas about how to expand broadband service.
Various interest groups will lobby lawmakers over the next month for their share of the bounty. Some public health officials were dismayed that they didn’t get more money to make sure they’re ready for the next emergency.
Even though Newsom proposed expanding health care and cash aid for low-income undocumented Californians, some advocates said his plan doesn’t go far enough because non-citizens have been excluded from federal stimulus checks and unemployment benefits.
From the other end of the political spectrum, business interests will pressure Newsom and lawmakers to spend more paying down debt in the unemployment insurance fund, which is “the biggest threat to all businesses in California and their ability to bring back workers to their jobs,” according to Rob Lapsley, president of the California Business Roundtable.
ROADS, HEALTH CARE, STIMULUS CHECKS AND MORE
Newsom over the past week toured the state announcing big-ticket budget items, earning applause from Democratic allies during his daily stops that, at times, seemed like a campaign tour.
Republicans have panned some of the proposals, accusing Newsom using the surplus to bolster his chances in an expected recall election this year by sending checks directly to Californians.
Newsom is proposing sending $600 checks for individuals making less than $75,000 and an additional $500 to families.
By law, the size of California’s budget is determined by tax revenue, not by Newsom, although political experts say he’ll likely benefit from the surplus money he’ll be able to spend.
State law will also likely require state government to send some money back to taxpayers anyway because revenues are so high, and Newsom’s administration says it plans to use the stimulus checks he’s proposing to satisfy that requirement.
Some Republicans argue that those checks don’t go far enough, and that Newsom should propose actual tax cuts, which he has not done. Former San Diego Mayor Kevin Faucloner, who is running to replace Newsom as governor, released an income tax cut proposal this week as a contrast to Newsom’s spending plans.
U.S. Senate Republican Leader Mitch McConnell has pointed to California’s budget surplus as evidence Congress should not have sent so much stimulus money to states.
Newsom’s budget proposal uses the state’s surplus and the federal stimulus money for $100 billion in economic stimulus programs, including $7.2 billion to help low-income tenants make rent and utility bills they missed during the pandemic and expanded aid for small businesses.
Newsom also wants to spend $12 billion to alleviate homelessness, one of the most stubborn problems in California. Most of that money would go to expand a program Newsom launched during the pandemic called Project Homekey that gives local governments money to purchase hotels and other buildings that they can convert into supportive housing to get people off the streets.
Among the other big proposals in Newsom’s budget plan:
▪ $11 billion to modernize California’s roads, bridges and public transportation, as well as to continue construction on high speed rail and build infrastructure for the 2028 Olympics in Los Angeles
▪ $7 billion to expand broadband access to underserved communities
▪ $3.2 billion to increase zero-emission vehicle use, as well as $1.3 billion to prepare the state for extreme heat and rising sea levels caused by climate change
https://www.sacbee.com/news/politics-government/capitol-alert/article251408278.html#storylink=cpy
Governor’s May Revise Budget “summary”:
http://www.ebudget.ca.gov/budget/2021-22MR/#/BudgetSummary
Governor Proposes Record Spending on Environmental Measures; Casts Doubt on Bonds in 2022
Politico
Gov. Gavin Newsom as part of his May Revised Budget proposed record state spending on environmental programs and suggested that California might not need to use voter-approved bonds next year because of its massive budget surplus.
Newsom proposed nearly $10 billion in spending on climate adaptation, water infrastructure and clean transportation — the state’s largest budget ever devoted to environmental programs, state officials said.
When asked whether the proposals replace the need for bonds, Newsom said he thought “they substantially do across the spectrum.” Lawmakers have been working on a roughly $7 billion bond for water, wildfire and extreme heat-related projects and a $10 billion bond to fund broadband high-speed internet upgrades.
“I think what was inspired, envisioned around the Recovery Act was to get moving and not look at 30-year payback periods but look at opportunities to make investments in the short run, to get people back on their feet, to get our economy moving all across this country,” he said. “In California, we’re picking up on that spirit.”
On the back of a $75.7 billion budget surplus, Newsom earlier this week unveiled the biggest piece of his environmental budget: $5.1 billion over four years for water projects, with the biggest portion — $1.3 billion — going to drinking water and wastewater infrastructure and smaller amounts for groundwater management and cleanup, water recycling, wildlife habitat, irrigation efficiency, flood-risk reduction and water supply forecasting.
On Friday, he added a new $1.3 billion “climate resilience package,” including $784 million in 2021-22 spending. The money would go to urban parks, weatherization programs for low-income residents, wetlands restoration and other projects to address heat-related health risks, sea-level rise, drought and flooding, as well as cleanup of abandoned oil wells and research into generating hydrogen from biomass.
Newsom also boosted his proposal for clean transportation to $1.8 billion in 2021-22 spending, up from $965 million in January. He included $160 million for low-emission trucks and equipment at ports and $134 million in funding for the state’s popular Clean Vehicle Rebate Program that he had previously proposed zeroing out. He also abandoned his January idea to fund EV charging stations by securitizing future vehicle registration and smog fees, instead proposing to use $500 million from the General Fund. Total spending on zero-emissions vehicles would be $3.2 billion over three years under his plan.
Along with an anticipated $4.2 billion request to spend the last of the $10 billion bond that voters approved in 2008 for high-speed rail, Newsom proposed spending $1 billion from the general fund for Los Angeles transportation projects ahead of the 2028 Olympics. That ask came from Southern California lawmakers who have opposed spending all of the remaining high-speed rail money in the Central Valley. He also included another $1 billion for transit and rail projects statewide that improve connections between state and regional or local service.
Newsom also proposed nearly $340 million for state parks and outdoor education and a total of $130 million to improve recycling infrastructure, including funding for food waste recovery, composting, and grants and loans to recycling companies.
And weeks after announcing a 2024 ban on hydraulic fracturing and a study of how to phase out oil extraction by 2045, he proposed spending $750 million in federal stimulus funding on a “community economic resilience fund” to help the petroleum industry and others transition to a carbon-neutral economy.
Legislative Analyst Cautions Against Permanent Spending Hikes for 400 New Programs
Legislative Analyst’s Office
Gov. Gavin Newsom, who spent the past week touting the state’s staggering $76 billion surplus, had some of the wind taken out of his sails Monday when the nonpartisan group that advises the state Legislature estimated the actual size of the surplus to be $38 billion.
The sizable discrepancy derives from different definitions of “surplus”: Newsom included constitutionally required spending on schools, reserves and debt payments in his total — presumably because a larger number would generate more buzz — while the Legislative Analyst’s Office did not.
The office also poked holes in Newsom’s sprawling list of proposals, noting that it might be wiser to use the surplus to comprehensively address a few key issues, rather than spreading the money across 400 new programs.
Other key recommendations from the legislative analyst:
- “In contrast to the governor” proposing to borrow money and tap into reserves, lawmakers should “restore budget resilience” by saving money to help cushion the state against projected future deficits.
- Lawmakers should take more time to consider Newsom’s proposals, rather than spending almost all of the state surplus and federal stimulus at once with limited oversight.
Drought Actions Begin: “How Will Californians Cope?”
CalMatters
Generals know that you always fight the last war. So California — already in the clutches of another drought emergency — is looking over its shoulder at what happened last time, anticipating the worst and evaluating the strategies that worked and those that failed.
So is California in a better position to weather this drought? Some things are worse, some better: Groundwater is still being pumped with no statewide limits, siphoning up drinking water that rural communities rely on. In northern counties, residents are reliving the last disaster as water restrictions kick in again, but in the south, enough water is stored to avoid them for now.
The good news is that in urban areas, most Californians haven’t lapsed back into their old water-wasting patterns. But, while some farmers have adopted water-saving technology, others are drilling deeper wells to suck out more water to plant new orchards.
The upshot is California isn’t ready — again.
“We are in worse shape than we were before the last drought, and we are going to be in even worse shape after this one,” said Jay Lund, co-director of the Center for Watershed Sciences at University of California at Davis.
The most acute problem, experts say, is the lack of controls on groundwater pumping.
And an overarching question lingers: How will Californians cope as the world continues to warm and the dry spells become ever more common and more severe?
Three-fourths of California is already experiencing extreme drought, a designation that only hints at the trickle down of impacts on people, the environment and the economy. Nature’s orderly seasons are upended: As the winter so-called “wet season” ended, Gov. Gavin Newsom declared a drought emergency in 41 counties.
This year’s drought is steadily approaching the peak severity of the last one, climate experts say. It’s a dangerous benchmark: 2012 through 2015 was the state’s driest consecutive four-year stretch since record-keeping began in 1896.
Drought is characterized by deficit — of rainfall, snow, runoff into rivers, storage in reservoirs and more. And all of these factors are in dire shape this year. Some are even worse than they were during the last drought.
Much of the state has received less than half of average rain and snowfall since October, with some areas seeing as little as a quarter. For most of Northern California, the past two years have been the second driest on record.
The Sierra Nevada snowpack, which provides about a third of California’s water, dwindled to 5% of average this month, equaling April 2015’s record-low percentage. That signals trouble for California’s reservoirs — even before the long, dry summer begins.
Already, the water stored in major reservoirs is far below normal as some rivers’ runoff has dipped below the last drought’s levels. Lake Oroville, which stores water delivered as far away as San Diego, has dropped to just under half of its historic average for this time of year.
“We’ve had dry springs before, but that is just astonishing,” said Daniel Swain, a climate scientist at the University of California, Los Angeles and The Nature Conservancy. “And we’re still a few months out from seeing the worst of things.”
Megan Brown, a sixth-generation cattle rancher in Oroville, worries that climate change might finally make her the last of her family to run cattle in California. Dry pastures can force ranchers to sell livestock or buy expensive feed.
Usually, she said, the hills on her ranch are as green as Ireland in the spring. But by the end of April, dry golden grass had already started to claim the slopes. The blackberry-lined creek on Brown’s ranch is so parched that her dogs kick up clouds of dust as they nose through the rocks.
“It’s turning,” she said, looking up at her browning hills dotted with so many fewer cows than usual. “I don’t like it. It’s scary.”
Prolonged dry periods, some more than a hundred years in the state, can be traced to the Middle Ages, via tree rings from stumps preserved in lakes. But while droughts are part of California’s natural cycles, climate change is exacerbating them, increasing drought frequency and making them more extreme, climate experts say.
In his 1952 novel, East of Eden, John Steinbeck depicted the yin and yang of California’s water cycle in the Salinas Valley where he grew up, how the bounty of the wet years drove out memories of the dry, until, predictably, the water wheel came back around. “And it never failed that during the dry years the people forgot about the rich years, and during the wet years they lost all memory of the dry years. It was always that way.”
But droughts and water shortages are more of a persistent way of life now in California than a mere cycle. The rare has become the routine.
The last drought posed a palpable, day-to-day crisis. The signs were clearly visible: withered crops and gardens, bathtub rings around shrinking reservoirs, dried-out salmon streams. People drove filthy cars and thought twice about flushing their toilets. Ski runs reverted to gravel and mountain resorts shut down months early.
All Californians were ordered to conserve, and state officials in 2015 mandated a 25% statewide cut in the water used by urban residents. Homeowners used smartphone apps to turn in neighbors for over-sprinkling their lawns, and cities hired water cops to enforce the rules. Hotels notified guests of reduced laundry service. In restaurants, glasses of water that used to automatically appear were served only after patrons requested them.
Thousands of rural wells, particularly in the Central Valley, ran dry, forcing the state to truck in emergency drinking water to hard-hit Latino communities. In 2014, with years of the drought to go, recent groundwater levels in some parts of the San Joaquin valley had already sunk 100 feet — the equivalent of a 10-story building — below historic norms.
Agriculture took a $3.8 billion hit from 2014 through 2016. More than a half-million acres of farmland was taken out of production for lack of irrigation water, and an estimated 21,000 jobs were lost in 2015 alone.
The astonishing aridity also killed more than 100 million trees and weakened millions more, setting off a catastrophic cascade: The carpet of dead trees added fuel to California’s wildfire epidemic. Fire season stretched year-round and into normally damp parts of the state.
Summer Power Outages Appear Likely, May Impact Newsom Recall
Politico
A deepening drought and potential for heat waves threaten to unleash a new political nightmare for Gov. Newsom: widespread power outages. The state’s grid operator is already warning of the possibility of rolling blackouts in August and September, not long before voters will decide his fate in a Republican-driven recall election.
State officials — with last summer’s outages still fresh in their minds — know well that a second straight year of blackouts could be damaging to Newsom, especially so close to the election. A hot summer with low hydropower supplies could send them scrambling for more electricity to stave off the worst-case scenario.
“Even if we end up a few megawatts short,” said Severin Borenstein, a UC Berkeley economist and a Newsom appointee to the state’s grid operator, “I have a feeling that any rolling blackouts will be considered a major political hit.”
Newsom, a Democrat, is riding high this month with California’s lowest-in-the-nation coronavirus infection rates and a breathtaking $76 billion budget surplus that has allowed him to dole out cash to millions of potential voters. But he risks stoking voters’ ire if he loses control of the grid again.
A mid-August heat wave last year forced power cuts to more than 800,000 customers over two nights. The state was caught so off-guard that officials at energy agencies resorted to calling individual companies, asking them to reduce their electricity demand and send excess energy to the grid.
Last year’s blackouts were relatively minor in scale, dwarfed by electricity shutoffs intended to avoid sparking wildfires that have become a regular feature of California summers as well as the two-week outage in Texas this past February. But the episode evoked memories of the state’s 2000-01 energy crisis that took down a governor — and now, with a recall election looming, the comparisons are even clearer.
“Folks have very limited patience when they simply can’t turn a switch and flip on the lights,” said Steven Maviglio, who served as press secretary to Gov. Gray Davis before he was recalled in 2003. “I think he’s more vulnerable than even Gray Davis was because first of all, we had a taste of it. He said he was going to fix it, and if it happens again, he may have to pay the price for it.”
State agencies have already taken steps to avoid blackouts this summer by keeping natural gas plants online, increasing energy storage and boosting conservation. But they acknowledge there’s still a risk, especially if temperatures spike in August and September like they did last year.
The grid operator released a report Wednesday predicting a 12 percent chance of rolling blackouts if the state’s three largest utilities don’t receive enough imported electricity from neighboring states and publicly-owned utilities — a likely scenario, as other western states often experience similar summer conditions.
A spokesperson for Newsom’s office acknowledged that grid reliability had become more challenging, but said Californians have been learning to shift their energy use during extreme weather events and the state has upped its supply.
“While this summer will have plenty of uncertainty, grid managers are preparing now for the worst, and the state has maximized supply and created new programs to reduce demand to avoid service disruptions,” said Erin Mellon, the spokesperson.
State officials have made it clear that avoiding blackouts is a priority for Newsom.
“He understands that we are working very hard to make sure that we keep the lights on,” Marybel Batjer, the president of the California Public Utilities Commission, told reporters this month. “He knows and we know that we’re doing all we can for the people of California.”
Newsom, she added, made “each of us” aware of “how critically important it is.”
The state has added enough new capacity since last summer to power up to 3.2 million homes. It has approved more than 60 new projects that will be online by August, such as natural gas, and has pushed out public service announcements urging conservation and increased incentives for companies to cut their use during grid emergencies.
But the state also faces new obstacles. Hydropower supplies that help balance out dips in solar generation are lower because of drought, and electricity demand could be higher than it was last year, as businesses ramp up activity after a year of lockdown.
“We’re running to stay in place, and it’s maybe even worse than that because we don’t have some of the resources we had last year in terms of available hydro,” said Michael Wara, director of Stanford University’s Climate and Energy Policy Program.
Some see pitfalls in the state’s response. A former state regulator warns that ordering utilities to buy more capacity ahead of this summer, as the state has done, will raise electric bills.
“We’re going to have extraordinary rates,” said Loretta Lynch, who served as Public Utilities Commission president during the 2000-01 energy crisis. “That too is a serious political liability to any governor.”
California’s electric system also faces longer term challenges, including a counterintuitive problem: a glut of daytime solar energy. When the sun sets, natural gas power plants or other fast-responding resources are needed to quickly supply power. Over the objections of environmentalists, state officials last year extended the lives of four aging plants to maintain grid reliability.
More blackouts would further undermine the state’s renewable energy push.
“It would be a political problem for Newsom, it would be a political problem for renewable policies, it would be a political problem for the general rollout of green technologies,” Borenstein said.
Last year, as they raced to avoid additional outages, Newsom’s office asked ports to switch docked ships from onshore electricity to engine power to free up supplies, circumventing state air pollution rules.
Port officials say they’re ready to help again. “If the administration reaches out again, we want to be prepared for the ask,” said David Libatique, a deputy executive director at the Port of Los Angeles.
But short of similar last-minute scrambling, “we’ve got what we’ve got for 2021,” said V. John White, executive director of the Center for Energy Efficiency and Renewable Technologies, a Sacramento think tank. “There isn’t a lot of time left to do much more.”
Soaring “Rare Earth” Metal Costs Slow Renewable Energy
SPGlobal
Soaring raw-material costs are putting a damper on the renewable energy industry, which rocketed into 2021 on the back of record growth forecasts and new commitments from governments and businesses to limit climate change.
Rebounding economic activity and government stimulus spending have lifted prices for steel, copper and other metals used in wind turbines and solar panels. Manufacturers, in turn, are raising equipment prices, which is threatening construction schedules and investment returns for project backers. A jump in shipping costs and port congestion following the blockage of the Suez Canal in April and a February storm in Texas have created further headwinds.
“Unfortunately, at the same time as we are seeing record demand for solar, our industry is contending with increases in steel and shipping costs that are unprecedented both in their magnitude and rate of change,” James Fusaro, CEO of Array Technologies Inc., which makes tracking systems for solar plants, said on an earnings call May 11.
The cost of raw materials is emerging as a key concern as the world tries to transition away from fossil fuels. Energy systems that run on wind, solar and battery resources are much more mineral-intensive than those fueled by hydrocarbon resources, the International Energy Agency said in a recent report. An onshore wind farm, for example, requires nine times more minerals than a natural gas plant, the agency said.
While activity remained strong in the U.S. renewable energy market during the first quarter, executives and analysts are warning of potential disruptions as prices for iron ore and copper hit record highs. Analysts at Roth Capital Partners LLC on May 16 said 15% of utility-scale solar projects could be delayed this year.
Solar project developers are trying to put off procurement in hopes that equipment and freight prices will be lower in 2022, Edurne Zoco, executive director of clean technology and renewables at IHS Markit, said in an email. However, she said a “significant part” of the project pipeline has contracts that require construction to be completed this year.
“In the U.S., in particular, the projects that people have bid are under significant pressure really from all dimensions,” Mark Widmar, CEO of solar panel manufacturer First Solar Inc., said on an earnings call April 29. “There’s going to be a number of these projects that are just not going to happen.”
In addition to surging metals prices, solar companies are also facing shortages of semiconductor chips and higher costs for polysilicon, a key ingredient in most solar panels, while the wind industry is paying more for resins that are used in rotor blades.
The California Tech Billionaire Who Wants to Change the US Senate
Politico
Ohio Republican J.D. Vance didn’t go it alone when he trekked to Donald Trump’s Mar-a-Lago resort for a meeting with the former president earlier this spring — the soon-to-be Senate candidate was accompanied by his mentor and political benefactor Peter Thiel.
Thiel, a tech billionaire and longtime Trump backer, had arranged the sit-down, which came five years after Vance declared that he had “no love” for Trump. Vance, who was looking to get some face time with Trump, took a good-natured ribbing from the former president during the hour-long meeting, but that’s all: Trump has so far refrained from publicly weighing in against Vance, a luxury the ex-president has not afforded other past Republican critics.
Thiel’s private power-brokering illustrated his growing influence in Republican politics, but his clout has become even clearer in the weeks since. Thiel has given a pair of $10 million donations to separate super PACs that are backing Vance and Arizona Republican Blake Masters, another protégé poised to launch a Senate campaign. The contributions are the most ever to outside groups supporting single Senate candidates, according to the Center for Responsive Politics, a nonpartisan organization that tracks political giving.
The largesse has transformed Thiel, an early Facebook investor and PayPal co-founder, into an outsize figure in the fight for control of the 50-50 Senate, providing fuel to two longtime associates who embrace his populist-conservative views. Top Republicans have expressed astonishment at the size of the donations and say they’ve turned Vance and Masters — who’ve never before run for elected office and will have to overcome primary rivals with far longer political resumes — into formidable contenders in the blink of an eye.
“A lot of people didn’t know if they should take Blake [Masters] seriously as a candidate before the money came in, and when the money was announced Blake became a serious prospective candidate,” said Kirk Adams, a former Arizona state House speaker. “Before folks didn’t really have any metric to judge his prospective candidacy, but now they do. Ten million dollars is a pretty damn good metric.”
Thiel declined an interview request. His donations are by far his largest in two decades of giving to Republican candidates — a partial reflection, friends say, of his intensifying interest in politics.
The tech investor’s profile in donor circles grew during the 2016 election, when he contributed around $1.5 million to pro-Trump outfits and spoke at the Republican National Convention. The 53-year-old, German-born Thiel would become an influential figure in Trump’s orbit. He served on Trump’s transition team and saw several of his aides become senior figures in the administration. He maintains a close relationship with Trump’s son-in-law and senior adviser Jared Kushner; the two both have homes in the Miami area.
Thiel’s support for 2022 candidates is expected to go beyond Vance and Masters, those familiar with his plans say. The list includes Florida Gov. Ron DeSantis, a rising star in Republican politics up for reelection next year, with whom Thiel has met privately.
Thiel is also looking at donating to an assortment of House candidates, including Army veteran Joe Kent, who is waging a challenge to GOP Rep. Jaime Herrera Beutler, a Trump impeachment backer, in Washington state’s all-party primary next year. Earlier this year, Thiel contributed to Brian Harrison, a former Trump administration official who ran unsuccessfully in a Texas congressional special election.
https://www.politico.com/news/2021/05/17/peter-thiel-senate-megadonor-488799