Blackouts and Fires: California’s Summer Attractions

In the soft warmth of spring the swallows famously return to Capistrano, but in recent years they are followed by what seems inevitable summer power outages and fires. This is not as pleasant an experience for Californians as the return of our favored feathered companions.

Every summer, usually around this time of year, we get our inevitable heat waves. In the past, we used to endure them without fearing our lights — and computers — would be shut down, and our houses left in ruins. Read more

Podcast Episode 7: Why Environmental Alarmism Hurts Us All With Mike Shellenberger

On the 7th Feudal Future episode, Mike Shellenberger joins hosts Marshall Toplansky & Joel Kotkin to talk about how environmentalism and housing policies are mismanaged and why environmental alarmism hurts us all.

Green Policies Won’t Keep California Truckin’

No state advertises its green credentials more than California. That these policies often hurt the economy, driving up housing costs and narrowing opportunities for working-class people while not even doing much for the environment, has not discouraged the state’s environmental overlords.

Consider the state’s insistence on electrifying transportation. Even as California reduces its reliable sources of power, notably nuclear and natural gas, it is mandating a statewide shift to all-electric medium- and heavy-duty trucks starting in 2024, with the goal of reaching 100 percent of all new sales, wherever feasible, by 2045. On top of other electrification mandates for light-duty cars and buildings, the new truck rule will further increase the state’s demand for electricity and raise rates, already among the nation’s highest. Since 2011, electricity prices have increased five times as fast as the national average. In 2017 alone, they increased at three times the national rate.

These policies have been devastating to poorer Californians, particularly in the less-temperate interior, where “energy poverty” has grown rapidly. Alternative energy sources like recycled natural gas and nuclear could lessen the pain, but the climate purists who dominate California policymaking find only wind and solar acceptable. Even some climate-change advocates caution that overreliance on intermittent, weather-dependent energy will push costs so high and lead to such massive land and environmental impacts that the public will turn against such policies. Time will tell.

Tragedy at the Port

The impact of forced electrification on working people, who have been rightfully praised for their critical and even heroic efforts during the pandemic can be glimpsed at California’s three major ports—Los Angeles, Long Beach, and Oakland. International trade, including exports and imports, supports nearly 5 million California jobs, nearly one in four of the state total. Yet the new electrical truck mandate will threaten the competitive advantage of these ports, and the jobs of the tens of thousands of blue-collar Californians who work at them.

Compared with very low-emission natural gas vehicles, large electric trucks are far more expensive, not yet readily available, and less capable of carrying loads for great distances, notes Weston Le Bar, CEO of the Harbor Trucking Association trade group. An electric truck, he notes, can cost four times that of a “near-zero” natural gas truck. The electric trucks can go at best 80 miles without stopping; a less expensive gas one can cover 500, greatly increasing efficiency.

Challenges including a lack of electric-charging stations, notes Jack Khudikyan, principal owner of Compton-based MDB Transportation, also make such vehicles impractical for longer hauls. He estimates the cost of running an electric truck is as much as seven times as high per mile than a near-zero vehicle.

The electric-truck mandate—California’s latest in a series of green strictures—will work to the benefit of rival ports such as Houston, which make no such demands on haulers. Over the past five years, California’s ports have lost a substantial portion of their North American container-market share, dropping from 35.5% to 30.2%, as shippers take advantage of the greater capacity of the upgraded Panama Canal to reach more user-friendly ports on the Gulf Coast. Current volume numbers are down 30% from 2018 levels.

Such losses could prove troubling in the future. Past experience shows that once supply chains are rerouted—as they have been during escalating tensions with China and the ongoing pandemic—they are notoriously hard to reverse. East Coast ports lost out to California on Pacific trade in the past, for example. And California greens shouldn’t delude themselves that the exodus to other ports will make any net difference in greenhouse-gas emissions—it will merely shift demand to new locations.

The biggest losers in California’s green port policy are minority entrepreneurs and blue-collar workers. Most of the roughly 18,000 drivers working at the Ports of Long Beach and Los Angeles are Latino, while the 4,500 in Oakland include large contingents of Indian-Americans. Some 1,800 small and sole proprietors, who dominate the trade, have little wherewithal to absorb the huge costs associated with electric trucks, forcing them out of business, in favor of larger rivals.

“Regulation like this drives consolidation,” Le Bar suggests. “One of our biggest fears is that the entrepreneurial character of the business is being destroyed…The regulators don’t care about the working class.”

Read the rest of this piece at Real Clear Energy.

Joel Kotkin is the author of the just-released book The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute — formerly the Center for Opportunity Urbanism. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin

Photo credit: Dennis Schroeder/NREL via Flickr under CC 2.0 License.

California’s Woke Hypocrisy

No state wears its multicultural veneer more ostentatiously than California. The Golden State’s leaders believe that they lead a progressive paradise, ushering in what theorists Laura Tyson and Lenny Mendonca call “a new progressive era.” Others see California as deserving of nationhood; it reflects, as a New York Times columnist put it, “the shared values of our increasingly tolerant and pluralistic society.”

In response to the brutal killing of George Floyd in Minneapolis, Los Angeles mayor Eric Garcetti announced plans to defund the police—a move applauded by Senator Kamala Harris, a prospective Democratic vice presidential candidate, despite the city’s steep rise in homicides. San Francisco mayor London Breed wants to do the same in her increasingly crime-ridden, disordered city. This follows state attorney general Xavier Becerra’s numerous immigration-related lawsuits against the Trump administration, even as his state has become a sanctuary for illegal immigrants—complete with driver’s licenses for some 1 million and free health care.

Despite these progressive intentions, Hispanics and African-Americans—some 45 percent of California’s total population—fare worse in the state than almost anywhere nationwide. Based on cost-of-living estimates from the U.S. Census Bureau, 28 percent of California’s African-Americans live in poverty, compared with 22 percent nationally. Fully one-third of Latinos, now the state’s largest ethnic group, live in poverty, compared with 21 percent outside the state. “For Latinos,” notes longtime political consultant Mike Madrid, “the California Dream is becoming an unattainable fantasy.”

Since 1990, Los Angeles’s black share of the population has dropped in half. In San Francisco, blacks constitute barely 5 percent of the population, down from 13 percent four decades ago. As a recent University of California at Berkeley poll indicates, 58 percent of African-Americans express interest in leaving the state—more than any ethnic group—while 45 percent of Asians and Latinos are also considering moving out. These residents may appreciate California’s celebration of diversity, but they find the state increasingly inhospitable to their needs and those of their families.

More than 30 years ago, the Population Reference Bureau predicted that California was creating a two-tier economy, with a more affluent white and Asian population and a largely poor Latino and African-American class. Rather than find ways to increase opportunity for blue-collar workers, the state imposed strict business regulations that drove an exodus of the industries—notably, manufacturing and middle-management service jobs—that historically provided gateways to the middle class for minorities. As a recent Chapman University study reveals, California is the worst state in the U.S. when it comes to creating middle-class jobs; it tops the nation in creating below-average and low-paying jobs.

Following Floyd’s death, even environmental groups like the Sierra Club issued bold proclamations against racism, but they still push policies that, in the name of fighting climate change, only lead to higher energy and housing costs, which hurt the aspirational poor. Many businesses, including small firms, must convert from cheap natural gas to expensive, green-generated electricity, a policy adamantly opposed by the state’s African-American, Latino, and Asian-Pacific chambers of commerce.

Meantime, California’s strict Covid-19 lockdown policies, imposed by a well-compensated (and still-employed) public sector, have imperiled small firms. “There’s a sense that there was major discrimination against local small businesses,” said Armen Ross, who runs the 200-member Crenshaw Chamber of Commerce in South Los Angeles. “They allowed Target and Costco to stay open while they were closed. Many mom-and-pops may never come back.” Many restaurants—roughly 60 percent are minority-owned—may never recover, notes the California Restaurant Association.

Read the rest of this piece at City Journal.

Joel Kotkin is the author of the just-released book The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute — formerly the Center for Opportunity Urbanism. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin

Photo credit Charlie Nguyen via Flickr under CC 2.0 License.

Podcast Episode 6: Beyond Feudalism: Addressing California’s Inequality Crisis (Live Event)

On July 14, Joel & Marshall held a Virtual Town Hall, discussing California’s inequality crisis and how changes in state policy could restore the middle class.

Is the California Dream Finished?

For all the persistent rhetoric from California’s leaders about this state being on the cutting edge of social and racial justice, the reality on the ground is far grimmer.

Our new report on the state of California’s middle class shows a lurch toward a society in which power and money are increasingly concentrated and where upward mobility is constrained, amid shocking levels of poverty. Most of this data doesn’t even account for the recent effect of the coronavirus outbreak, which has pushed the state’s unemployment rate to 15.5%, higher than the nationwide rate of 14.7%. Read more

Virtual Town Hall: California Feudalism – Addressing California’s Inequality Crisis

Join us for a presentation on Kotkin and Toplanksky’s research brief titled California Feudalism: A Strategy to Restore California’s Middle Class, discussing inequality in California and how a change in state policy could restore our state’s dream. Kotkin and Toplansky will be joined by distinguished panelists for commentary and Q & A.  The event will be moderated by Lisa Sparks Dean of the School of Communication at Chapman University. Read more

Neo-Feudalism in California

From the beginning, California promised much. While yet barely a name on the map, it entered American awareness as a symbol of renewal. It was a final frontier: of geography and of expectation.
—Kevin Starr, Americans and the California Dream: 1850–1915

In the eyes of both those who live here and those who come to observe, California has long stood out as the beacon for a better future. Progressive writers Peter Leyden and Ruy Teixeira suggested last year that our state is in the vanguard of every positive trend, from racial diversity and environmentalism to policing gender roles. “Cali­fornia,” they said in a post on Medium, “is the future of American politics.”

Read more

From tragedy to opportunity: We could live better when today’s mayhem ends

For most people in this locked-down, riot-scarred world, the future beckons unpleasantly. There is a growing sense that, economically, the 2020s may look more like the 1930s than some halcyon post-industrial future. “Dark days ahead,” suggests The Week. “This is what the end of the end of history looks like.”

Yet, beyond the depressing statistics, the deserted malls, the looted or abandoned Main Streets, lies the potential to use the pandemic to create the impetus for better, more sustainable and family-centric communities. This is not just some return — imagined from the security of the high punditry — to a “plainer,” more noble past but actual, meaningful improvements in our daily lives, made largely possible by technology. Read more

Coronavirus: Why California’s Small Businesses May Not Survive

Whatever the medical benefits achieved from the prolonged coronavirus lockdown, California’s small business community will be suffering severe symptoms, likely for decades to come. The state’s small entrepreneurs, particularly in poorer areas, face major readjustments and perhaps obliteration, a situation further complicated for some by damage stemming from the protests over the killing of George Floyd.

These small firms were already in parlous shape before COVID-19. Despite the immense wealth generated in Silicon Valley and among real estate speculators and the entertainment elite, most of the state’s growth in recent years was in low-end service businesses. As a result, 80% of all jobs created in the state over the past decade paid less than the state median income and half of those well under $40,000, according to Marshall Toplansky, a researcher at Chapman University. Read more