Key Moments
CA Governor Candidate Steve Hilton on Why California is Destroying Itself & How a Republican Can Win
All-In PodcastKey Moments
California's cost of living is crippling residents, with extreme regulations and union power driving up housing costs threefold and making basic necessities unaffordable for over a third of citizens.
Key Insights
Over a third of Californians cannot afford to meet basic needs, according to a United Way report.
Building the same home in California costs two to three times more than in neighboring states.
California has the highest gas prices in the country due to a combination of taxes and regulations, with nearly 80% of its oil now imported, primarily from Iraq.
California spends over $27,000 per student per year on education, yet less than half of students meet basic standards in English and reading.
Tens of thousands of dangerous criminals have been released from state prisons due to closure programs, leading to overcrowded county jails and a 'catch and release' system.
Over 80% of homeless individuals in California struggle with drug/alcohol addiction or severe mental health issues, compounded by inefficient state spending and outdated regulations.
A Republican Brit's unlikely bid for California governor
Steve Hilton, a British immigrant and naturalized American citizen, is running for Governor of California. Drawing inspiration from his parents' experience as refugees from communism and Margaret Thatcher's economic policies, Hilton aims to address what he views as California's severe economic decline and overregulation. He positions himself as a pro-worker, pro-growth candidate, advocating for significant policy shifts to revitalize the state. His unique background as a non-Californian, outsider candidate sets the stage for his unconventional policy proposals.
Pro-worker tax plan: Zero tax under $100K, 7.5% flat rate above
Hilton's signature policy proposal is a radical tax reform: no state income tax for individuals or households earning under $100,000, and a flat 7.5% tax for all income above that threshold. This plan aims to provide immediate relief to struggling working families, noting that $100,000 is considered 'low income' in many parts of California. He argues this is fiscally possible by drastically cutting state spending, reducing the budget to pre-pandemic levels (approximately a 75% increase in spending over five years needs to be reversed). The proposal intends to attract investment, stimulate growth, and simplify the tax code, which he claims is overly complex and burdensome.
Rampant fraud and waste drain $80 billion annually
Hilton's campaign has identified significant fraud and waste within California's state budget, estimating it at around $80 billion per year, or roughly 20% of the total budget. Examples cited include the climate change mitigation fund, where out of $1 billion allocated for solar panels on low-income housing over 10 years, only $72 million was spent on the intended purpose, with the rest going to political nonprofits. Similarly, $350 million in cannabis tax revenue meant for substance abuse prevention was diverted to activism and voter registration. A $3.8 billion 'Project Home Key' initiative for homelessness also saw significant funds mismanaged. This pervasive inefficiency, Hilton argues, is a primary reason for the state's fiscal distress and the need to return to more prudent spending levels.
Housing crisis driven by unions, litigation, and climate dogma
The prohibitive cost of housing in California, Hilton states, is a symptom of three intertwined structural issues: the immense power of unions, extensive litigation, and an extreme 'climate dogma.' He explains that building costs are two to three times higher than in neighboring states. This is exacerbated by overly stringent building codes mandating expensive features like EV charging infrastructure and solar panels, and the California Environmental Quality Act (CEQA). CEQA allows for lawsuits that often block housing projects, frequently initiated by unions to force project labor agreements with inflated wages and union-only labor requirements. These factors, combined with high government fees ($30,000 per door in California versus under $1,000 in Texas), severely limit housing supply and drive up costs for residents.
Education spending is high, but results are abysmal
California spends over $27,000 per student annually, among the highest in the nation, yet achieves some of the worst educational outcomes. Only 47% of students meet basic English standards, and just 35% meet basic math standards. Hilton attributes this failure largely to the grip of teacher unions on the public school monopoly. He criticizes their focus on political agendas, exemplified by lengthy pandemic school closures and demands unrelated to education. He advocates for long-term structural reform through school choice and immediate practical measures like implementing phonics-based reading instruction and mandatory grade retention if students don't achieve reading proficiency by third grade. Furthermore, he proposes a grading system for schools and teachers to incentivize better performance and accountability.
Reversing prison closures and enforcing existing laws to combat crime
Hilton argues that California's crime problem stems from a failure to enforce existing laws and a misguided decarceration agenda. He highlights the reversal of Proposition 47, which had legalized theft up to $950, stressing that while it has been overturned, enforcement is weak. A major focus is reversing the closure of state prisons initiated by previous administrations, which has led to overcrowded county jails and a 'catch and release' system where offenders are often immediately freed. By increasing prison capacity, Hilton believes accountability can be restored, and rehabilitated individuals can be reintegrated more effectively, citing Virginia's lower recidivism rates as a model. He also points to the large percentage of incarcerated individuals with untreated mental health issues as a critical problem.
A three-pronged approach to ending homelessness
Addressing homelessness, Hilton contends, requires enforcing existing laws, mandating sobriety for treatment, and reforming mental healthcare. He notes that living in encampments is already illegal and that recent court rulings remove excuses for inaction. His plan includes removing encampments and immediately offering help. Over 80% of homeless individuals struggle with addiction or severe mental illness; therefore, his plan mandates drug and alcohol recovery programs and requires sobriety for state services. He also criticizes the 'IMD rule' in Medicaid, which restricts funding for mental health facilities over 16 beds, and proposes using state funds to build larger, more efficient mental health facilities, citing that many individuals in jails suffer from severe mental health issues.
Path to Victory: A 'Change vs. More of the Same' Election
Hilton believes a Republican can win California by framing the election as a choice between fundamental change and continued decline. Despite the state's Democratic registration advantage, he notes that Republican votes have historically hovered around 40%, and current 'wrong track' sentiment favors change. His strategy involves mobilizing Republican voters, potentially boosted by a voter ID ballot initiative, and appealing to a multi-racial working-class coalition by emphasizing his tax plan – no state income tax up to $100,000, a flat 7.5% tax above, and no tax on tips. He aims to offer simple, common-sense solutions like affordable housing, lower gas and electric bills, and a focus on core problems, believing this message will resonate with voters tired of the current dysfunction. He acknowledges the difficulty but stresses the importance of offering an alternative to the status quo.
Mentioned in This Episode
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California Governor Candidate Steve Hilton's Platform Snapshot
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Steve Hilton proposes a tax plan with no state income tax for individuals earning under $100,000 and a flat tax of 7.5% for those earning over $100,000. This aims to provide relief to working families and stimulate economic growth.
Topics
Mentioned in this video
Republican candidate for Governor of California, discussing his background, policy proposals, and campaign strategy.
Former Prime Minister of the UK, known to Hilton from his time working for the Conservative Party.
Former Prime Minister of the UK, whose policies and stance against communism inspired Hilton.
Sent Hilton a report about the UK's current economic situation, highlighting parallels with California.
A Democratic opponent in the California gubernatorial race who has expressed agreement with aspects of Hilton's tax plan.
Running for State Controller with Steve Hilton; partnered on fraud reports for Cal Do.
Former Governor of California, who faced similar challenges with the legislature and had to moderate his policies.
A potential Democratic opponent in the California gubernatorial race.
A potential Democratic opponent in the California gubernatorial race.
Former Governor of California whose prison closure program is seen as a driver of current crime issues.
Provided advice on homelessness policy for Golden Together; a recovered addict based in San Francisco.
Former Republican Governor of California who served two terms.
Referred to in comparison to the tax plan proposed by Katie Porter, suggesting a shift towards more centrist policies.
Steve Hilton attended Oxford University.
Hilton worked for the Conservative Party in the UK and helped run David Cameron's campaign for leadership.
Hilton worked with economists from the Hoover Institution to develop his tax plan.
Hilton taught at Stanford University's public policy department and D school.
A policy organization founded by Steve Hilton to develop solutions for California's issues, including homelessness.
Responsible for creating the IMD waiver that allows states to obtain Medicaid reimbursement for mental health care.
California's environmental agency, which Hilton criticizes for miscounting carbon emissions from oil imports.
Published a report indicating over a third of Californians cannot afford basic needs.
Involved in the ruling Grants Pass v. Oregon, which overturned the Boise ruling regarding homeless encampments.
Mentioned in the context of federal legislation regarding tips.
Hilton served as a senior adviser to the Prime Minister at 10 Downing Street.
Cited as a state with successful rehabilitation programs and lower recidivism rates compared to California.
Mentioned as a competitor state to California, potentially benefiting from California's business exodus.
Mentioned as a competitor state to California, potentially benefiting from California's business exodus.
Mentioned as a state with higher taxes, contributing to business exodus from California.
Mentioned as having the highest poverty rate in the country, tied with California.
Mentioned as having high electric bills, second only to California.
Mentioned as a location where oil drilling is expanding to supply California's refineries, a consequence of Democratic climate policy.
A major city in California where residents experience high property crime and drug-related issues among the homeless population.
A mountain in Southern California, visible on clear days when air quality improves.
The Los Angeles basin, where air quality has significantly improved due to advances in car technology.
A major city in California where residents experience high property crime and drug-related issues among the homeless population.
A state with significantly lower per-student spending on education than California but much better results, serving as a model for reform.
Prop 64 legalized cannabis in California, with taxes intended for substance abuse prevention, but funds were allegedly misallocated.
A program aimed at housing homeless individuals by acquiring and converting properties; Hilton's team found significant cost overruns and misallocation of funds.
Environmental regulations in California that Hilton argues contribute to high construction costs and housing shortages, often leveraged by unions to block projects.
A California ballot proposition that decriminalized certain offenses; part of it was overturned by Prop 36 but not fully enforced.
A California proposition that overturned parts of Prop 47, aimed at addressing theft, but its enforcement is facing resistance.
A Ninth Circuit court ruling that prevented cities from removing homeless encampments without sufficient shelter availability; has since been overturned by Grants Pass v. Oregon.
A 2024 Supreme Court case that overturned the Boise ruling, allowing for the removal of homeless encampments.
A bill passed by the Democrat legislature that would have allocated funds for sober housing but was vetoed.
Institutions for Mental Disease rule that restricts Medicaid reimbursement for mental health care in facilities larger than 16 beds.
California legislation passed in 2006 that is cited as the starting point for climate policies leading to increased oil imports and high gas prices.
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