All is well in California, according to Gov. Gavin Newsom. The milk flows cool and creamy, and the honey has never been so sweet. But beneath the bluster lies bitter experience and, if nothing changes, a sour future.
The Golden State, says the presidential aspirant in a recent co-bylined op-ed published by Project Syndicate, offers policy predictability, a welcome home for global capital, and a green agenda like no other.
Newsom is correct in that policy is predictable in California. But that’s no virtue when policy is expected to always move in a single direction — toward weightier regulation, more punitive taxes, and a general tendency toward increasing government intervention in private matters. This has produced a state with stagnant employment, hostility toward business and enterprise, rising energy prices, unaffordable housing, and a cost of living that has sent residents fleeing to states where they have more freedom to pursue their happiness.
Newsom is also right when he points out that the state has one of the largest economies in the world. It’s either fourth or fifth, depending on who is doing the counting. But the Newsom economy has struggled.
In 2021, California’s share of the domestic economy was a record 14.5%. By the second quarter of 2025, though, it had slipped to 13.8%, and today is being propped up by the valuations of a few artificial intelligence companies and legacy tech firms such as Apple, Alphabet (Google), and Meta (Facebook) that haven’t fled (yet) as so many other companies have.
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