As inflation continues to squeeze wallets, California politicians are trying to respond

By Dan Walters

Thirty-two years ago, when then-Arkansas Governor Bill Clinton attempted to overthrow President HW Bush, Clinton’s strategist James Carville summed up the campaign in four immortal words: “It’s the economy, stupid.”

Clinton succeeded in portraying Bush as someone who was out of touch with the fears of voters who had to use their income to cover their living expenses and debts.

If anything, the economic unease is even greater this election year, especially given the high inflation of recent years. And politicians from the White House down are paying attention to one potentially decisive factor.

This explains, for example, why Vice President Kamala Harris promises to ban food price gouging if she wins the election.

“It is an attempt to directly address an obvious weakness of Harris,” says an analysis by the Related Press“Under the Biden-Harris administration, food prices have risen 21%, part of a surge in inflation that has raised overall costs by about 19% and soured sentiment toward the economy among many Americans even as unemployment has fallen to historic lows.”

The residents of Harris' home state are certainly not immune.

“Food prices have risen by 27% compared to April 2019, and petrol prices by 29%,” The Public Policy Institute of California found in a May report. “While spending on these goods and services makes up a large portion of most household budgets, lower-income households spend nearly all of their resources (83%) on food, housing, transportation (including gasoline), and health care.”

The California Center for Employment and Economics reports that Californians currently pay the highest prices in the country for electricity and gasoline for residential, commercial and industrial use.

The California Public Utilities Commission’s Consumer Protection Officer reports that over the past decade Electricity prices have risen by 110% for customers of Pacific Gas and Electric and only slightly less for ratepayers of other investor-owned utilities.

Housing costs in California are notoriously among the highest in the country. The median home price of $793,600 is the highest of any state and almost exactly double the national median, according to a current Bankrate reportThe average rent for a two-bedroom apartment is $1,903 per month, according to a Survey by the Ministry of Consumer Protectiona consumer research website.

California is essentially a one-party state, and Democrat leaders don't have to worry about losing office because of inflation. But they do have to at least feign sympathy for their constituents who can barely afford basic living expenses.

Governor Gavin Newsom, who is Building its national political imageapparently plans to apply for approval of a relief plan for the electricity supply in the last days of the current legislative period.

The Sacramento Bee reports that Newsom wants to allocate around a billion dollars to reduce electricity bills, but does not want to tap into the deficit-ridden state budget. Instead, he would divert money currently spent on some ancillary programs and link it to a measure aimed at Accelerating environmentally friendly energy projects, This legislation, for example on offshore wind energy, is being prepared for passage before the session is adjourned on August 31.

As Newsom's plan makes the rounds in the Capitol, it is facing fierce criticism from supporters of the programs being cut, such as air conditioning for schools, improving electricity in poor communities and installing solar panels in public housing projects.

A coalition of renewable energy, environmental and other groups sent a letter this week to Newsom and legislative leaders opposing any diversions.

“Cutting them would only result in a negligible reduction in energy costs in the short term, while jeopardising the long-term climate and affordability benefits they provide,” the coalition said.

In the final days of the session, a heated confrontation develops between competing concerns.

This article was originally published by CalMatters.

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