Reversing Rent-Seeker Dominance In California

UNCAPTURING CALIFORNIA - In fiscal year 2024-25, state and local governments in California spent $240 billion on public employees and $161 billion on healthcare enterprises. The government in California is big business, and the public employee unions, healthcare corporations and healthcare employee unions that captured those billions are among the biggest businesses in California.

Controlling the governments that provide that money is the top priority of those enterprises. They exercise their control by capturing elected officials and winning ballot measures and court battles. The currencies they use are cash, endorsements and beards they wear to generate public support for more spending that always lines their pockets but rarely provides value for residents or taxpayers (eg, their advocacy for more spending on healthcare always translates into more revenues for them and higher healthcare costs for everyone but less often better health).

For decades they have succeeded even though they represent a small fraction of Californians. That’s because they have been unopposed. While the vast majority of Californians are working to generate trillions of dollars of new wealth every year, rent-seekers work to distribute that wealth to themselves.

Reversing that dynamic is the political challenge of the 21st century in California. Failure to do so will result in even higher taxes, worse public services, and more civil disorder. Success requires elections of un-captured elected officials, defeat and passage of ballot measures, repeal and passage of statutes and regulations, and victories in courts. Infinitely.

Returning California to a state of good governance is an infinite war requiring infinite vigilance. If you are not already enlisted in that war, you should be.

(David Crane is a Lecturer in Public Policy at Stanford University and President of Govern For California.)