Steve Hilton frames California’s crisis as a $425 billion failure of delivery. The former Cameron advisor argues the state’s doubled budget yields the nation’s highest poverty and unemployment. His team identified a $1 billion climate fund where over 90% went to nonprofits for activism, not solar panels.
“California is wasting about $80 billion a year on waste, fraud, abuse, and just stupid political handout programs.”
- Steve Hilton, All-In
Hilton’s proposed fix is a zero state income tax for earners under $100,000 and a 7.5% flat tax above it, funded by rolling spending back to pre-pandemic 2019 levels. He blames the state’s $7 gas on importing 80% of its oil - mostly from Iraq - due to local drilling bans that export emissions.
Meanwhile, a voter-approved wealth tax accelerates capital flight. The initiative imposes a one-time 5% levy on the net worth of anyone who was a California billionaire on January 1st, 2024, targeting assets like stocks and art but exempting primary homes. Sergey Brin, Larry Page, Peter Thiel, and David Sacks shifted official residency before the retroactive deadline.
“Tax advisors are telling clients to move high-value paintings from Beverly Hills to a home in Aspen.”
- Laurel Rosenhall, The Daily
Governor Gavin Newsom opposes the tax, fearing a permanent collapse of the high-earner income tax base. He argues wealth taxes must be national to prevent interstate competition - a hedge for a 2028 run. The internal Democratic rift is stark: 70% of state Democrats support the measure, but teachers’ unions are silent, seeing its dedicated healthcare fund as a threat to school money.
This political gridlock manifests in stalled construction. Derek Thompson notes that despite governors adopting supply-side ‘abundance’ rhetoric, California housing starts remain flat. He calls it a “Russian nesting doll” of 50 years of restrictive rules, a 20-year story of industry collapse, and a 5-year shock of high rates and labor scarcity.
“If you can’t translate the vibes into concrete and steel, then ‘abundance’ just becomes a synonym for empty efficiency.”
- Derek Thompson, The Ezra Klein Show
The outcome gap defines the state. Voters want tax fairness and affordable housing, but a half-century of procedural veto points and a decimated building sector prevent results. Hilton bets a multiracial working-class coalition, including Trump’s 6.1 million California voters, will choose radical reform over a status quo that taxes everyone but builds nothing.
