For Clients & Friends of The Gualco Group, Inc.
IN THIS ISSUE – “Building an economy that gives every American a chance to succeed”
Californians’ major concern in new Public Policy Institute of California poll
- Californians Focus on Inflation Control & Building Economic Opportunity
- Governor & Legislators Must Remember: “It’s the Economy, Stupid”
- State Agencies Are Late on 84% of Reports Required by the Legislature
- Key Credit Rater Finds Better State Fiscal Outlook
- Governor Welcomes Significant SoCal Support for Delta Tunnel
- Newsom Touts Sites Reservoir; Seeks Trump Support for $4.5-Billion Project
The Gualco Group’s Capitol News & Notes (CN&N) curates California policy, legislative and regulatory insights from dozens of media and official sources for the past week. Please feel free to forward this unique client service.
FOR THE WEEK ENDING DEC. 13, 2024
Californians Focus on Inflation Control & Building Economic Opportunity
Public Policy Institute of California
With the election in the rearview mirror, how are Californians thinking about the economic priorities of the next president?
Fifty-two percent of adult residents say that “getting costs and inflation under control” and 45 percent say that “building an economy that gives every American a chance to succeed” should be “very high” economic priorities for the next president.
Overwhelming majorities across partisan and income groups and regions of the state believe that the two economic goals should be “very high or high” priorities of the next president.
Over the next 12 months, 56 percent of adult residents expect bad times financially in California. Sixty-two percent expected bad times in our October survey. Today, solid majorities of Republicans (60%) and independents (65%) are pessimistic, compared to 47 percent of Democrats. And majorities across income groups and state regions expect bad times financially in the next 12 months.
Only one in three Californians think that the American Dream—the notion that if you work hard, you’ll get ahead—holds true.
About half or more across partisan and demographic groups and state regions think the American Dream once held true, while 15 percent think it never held true. Just 25 percent of 18-to-34-year-olds and 26 percent of renters think that the American Dream still holds true.
In addition, six in ten adults and majorities across partisan and income groups and state regions think the American Dream is harder to achieve in California than elsewhere in the US (12% easier, 26% same).
Moreover, 70 percent of Californians think that when children in California today grow up, they will be worse off financially than their parents (28% better off). Solid majorities across regions and partisan and demographic groups—including 63 percent of adults with children in their household—believe that when children in California today grow up, they will be financially worse off than their parents.
Rising prices and inflation have impacted many Californians. We asked Californians about their experiences with various financial difficulties in the past year.
Three in ten Californians (29%)—including half of lower-income adults—say they have reduced meals or cut back on food to save money; slightly fewer have had their hours cut at work (23%), had difficulty paying rent or their mortgage (22%), or been unable to pay a monthly bill (21%).
Californians also report that they or someone in their household have put off going to see a doctor or purchasing medication (20%), received CalFresh benefits (17%) or food from a food bank or pantry (17%), been laid off (16%), or received unemployment benefits (12%).
Notably, these findings are mostly similar to results a year ago.
We also asked Californians how often they worry about a variety of economic issues. About one in four Californians worry every day or almost every day about saving for retirement (28%), the cost of housing (26%), and the amount of debt they have (24%).
Slightly fewer worry every day or almost every day about paying bills (20%), the cost of health care (19%), and job loss in their household (15%).
Among parents, one-third worry daily or almost every day about being able to save enough for their children’s college education (32%) and one in ten worry about the cost of child care (12%). Overall, these findings are similar to last November.
Governor & Legislators Must Remember: “It’s the Economy, Stupid”
CalMatters commentary from Dan Walters
Pundits and academics who have parsed the data of Donald Trump’s presidential victory five weeks ago differ on the fine points but generally agree that it reflected voters’ widespread unhappiness with the status quo, particularly their personal finances and inflation.
Living costs jumped about 20% under the Biden administration. While its policies may not have been directly or fully responsible, it’s a time-honored political axiom that if voters have serious economic concerns, they will punish the party in power.
As James Carville, who ran Bill Clinton’s successful 1992 presidential campaign, famously said, “It’s the economy, stupid.” Clinton’s campaign portrayed then-President George H.W. Bush as oblivious to voters’ angst, just as Trump did against Vice President Kamala Harris.
California, of course, is a deeply blue state so Harris could count on capturing its 52 electoral votes. But its voters were, in the main, just as frustrated — if not more so — about the impact of inflation. The state’s presidential vote reflected it.
Harris garnered roughly 9.3 million votes in California, nearly 2 million votes and five percentage points fewer than Biden received in 2020, while Trump’s 6.1 million California votes were slightly higher than his 2020 showing.
A new attitudinal survey by the nonpartisan Public Policy Institute of California quantifies the unrest behind Harris’s mediocre showing in her home state.
“Over the next 12 months, 56 percent of adult residents expect bad times financially in California,” PPIC pollsters wrote of the survey, which was conducted just after the election.
“Today, solid majorities of Republicans (60%) and independents (65%) are pessimistic, compared to 47% of Democrats,” they added. “And majorities across income groups and state regions expect bad times financially in the next 12 months.”
Furthermore, the poll found, “Only one in three Californians think that the American Dream — the notion that if you work hard, you’ll get ahead — holds true. About half or more across partisan and demographic groups and state regions think the American Dream once held true, while 15 percent think it never held true. Just 25 percent of 18-to-34-year-olds and 26 percent of renters think that the American Dream still holds true.”
Finally, more than 60% of those surveyed — and at least majorities of all partisan, economic and geographic subgroups — believe that the American Dream is more difficult to achieve in California than anywhere else. That belief led to 26% of adults saying that a lack of well-paying jobs in California has made them consider moving, mostly to other states.
Adults with children, renters and young adults are most likely to consider moving.
These attitudes reflect the reality of life in California. Everything is extraordinarily expensive here — housing especially — and the state has seen a strong outflow of population in recent years to states with lower costs for housing, utilities and other necessities of life. If it continues, California will lose congressional seats after the 2030 census and therefore its electoral votes.
Gov. Gavin Newsom and his fellow Democrats who control the Legislature have sensed voters’ sour attitudes and have pledged to work on lowering living costs, but they don’t have many ways to do so.
The 20% inflation is already baked into the economy and the state lacks the powers of a federal government over interest rates and money supply that would be needed to have noticeable impact.
Newsom’s two terms as governor will expire two years but there are at least a half-dozen Democrats who appear interested in succeeding him. If the negativism of the new poll persists, the 2026 election will be another opportunity for California voters to send a message.
State Agencies Are Late on 84% of Reports Required by the Legislature
CalMatters
California lawmakers pass nearly 1,000 new laws each year. How do they know whether they are working?
Many new laws include a requirement for progress reports to the Legislature, but state agencies and commissions assigned to prepare those reports often fail to submit them on time, or at all, according to the Legislature’s website.
Of the 867 reports due between Jan. 1 and Dec. 9 of this year, 84% have not been filed to the Office of Legislative Counsel, according to a CalMatters analysis. Of the 16% that were submitted — 138 reports — 68 were filed late. Another 344 reports are due by Dec. 31.
Some agencies told CalMatters the reports were completed, but they were not properly filed with the Office of Legislative Counsel, as state law requires. It’s not clear how many of the missing reports were improperly filed.
MORE:
Key Credit Rater Finds Better State Fiscal Outlook
Politico
California received good budget news this week as Moody’s revised its outlook on state finances from “negative” to “stable.”
The bond credit rating business downgraded its view of California finances in May of 2023 as the state faced a deficit. It left its assessment unchanged for most of this year as the state grappled with one of its largest ever shortfalls.
“The state’s fiscal challenges have eased in light of both the implementation of spending adjustments and favorable revenue performance supported by a strong economy,” Moody’s said of its improved outlook. “State reserves have come down from an unprecedented height, but will likely remain at a satisfactory level as the state moves through fiscal 2025 and into fiscal 2026.”
The nonpartisan Legislative Analyst’s Office has projected California faces a $2 billion deficit this year and much larger shortfalls in years to come. But Moody’s analysts said they expect the state will manage those gaps “to maintain a satisfactory financial profile.”
Governor Welcomes Significant SoCal Support for Delta Tunnel
Politico’s Climate Change & Sacramento Bee
The Metropolitan Water District of Southern California overwhelmingly voted today to put up $141 million towards the next round of planning on the Delta Conveyance Project, Newsom’s proposal to route more water to Southern California through a single 45-mile-long tunnel under the crumbling Sacramento-San Joaquin River Delta.
Newsom saw the vote as key to his goal of getting the project permitted before he leaves office because Met’s contribution covers roughly half the planning costs through 2027.
Environmental groups and Northern California Democrats oppose the project because it could harm the Delta’s ecosystem. Mark Gold, a Natural Resources Defense Council director representing the city of Santa Monica on Met’s board, was the sole no vote among its 38 members.
Newsom heralded the awarding of $141 million for the $20 billion Delta Conveyance tunnel project as a “major milestone” in a statement.
At a Colusa press conference, he admitted he was not hopeful the project would break ground before he left office in 2027, but that he was “committed” to removing “as many barriers as I can.
“This project, if it’s not completed, we will pay a huge price,” Newsom told reporters.
Newsom Touts Sites Reservoir; Seeks Trump Support for $4.5-Billion Project
Sacramento Bee
Gov. Gavin Newsom touted his administration’s plans to build the first reservoir in decades in Northern California as the solution to maintaining the state’s water supply as extreme weather becomes a more regular occurrence.
Newsom spoke this week at Davis Ranches in Colusa, near the site of the planned Sites Reservoir in Maxwell. The governor argued the planned water storage project is critical to maintaining supply as drought becomes more common.
He fast-tracked the $4.5 billion project via legislation passed last year that expedites legal challenges filed under the Environmental Quality Act (CEQA).
“We now want to expand that streamlining…to ground water replenishment as well,” Newsom said. “It’s about above groundwater, and we’re going to get Sites done, and we’re going to continue to advocate for federal resources.
“Donald Trump, this is your kind of project,” he said. A Trump spokesperson did not immediately respond to a request for comment.
Newsom called the Sites Reservoir’s construction a “critical” part of the state’s climate adaptation strategy, citing the Malibu Franklin wildfire, which began Monday and had engulfed 1,300 acres as of Tuesday morning.
The Sites Reservoir would divert water from the Sacramento River by flooding almost 14,000 acres of ranchland in Glenn and Colusa counties via a system of dams, pipelines and a bridge.
Environmental groups say it would threaten fish populations and the Sacramento-San Joaquin River Delta’s ecosystem. The courts sided with the state after a host of environmental groups filed legal challenges last summer.
On Tuesday, the Golden State Salmon Association became the latest to criticize the state’s “destructive and failed water policies.” “We are in the second consecutive year of a salmon fishing season shutdown because our rivers lack the cold water flows fish need to survive,” executive director Scott Artis said in a statement.
The state must still obtain myriad federal and state permits before it can break ground on the reservoir, prompting Newsom to call for the White House’s support.
https://www.sacbee.com/news/politics-government/capitol-alert/article296899754.html#storylink=cpy