May 3, 2025 Breaking News, Latest News, and Videos

Newsom: Income Equality State’s Biggest Problem

More than a year before he won election as California’s next governor, Gov.-elect Gavin Newsom did not hesitate for a moment when asked what’s California’s biggest problem. “Income inquality,” he said in an interview then. He repeated that evaluation in subsequent sit-downs during the campaign.

“Take Los Angeles,” he said. “It’s America’s richest city, with Bel Air, Brentwood, Beverly Hills. But it’s also America’s poorest city, with South Central and more. The remarkable thing is they are only a few miles apart.”

Then he added that “You can’t live a good life in an unjust society.” And went on to quote the ancient Greek statesman and orator Pericles, who said, “The issue of wealth and income distribution is the oldest and most fatal of all issues in a republic.”

Newsom left no doubt about his deep conviction on this, despite his longstanding friendships with plutocrats like Gordon Getty. He offered some immediate ideas on how to ease situations where families with annual incomes barely topping $20,000 per year live not far from others whose incomes are more than 100 times that.

During his campaign, Newsom pledged to hire a statewide director to coordinate services he hopes will treat each homeless person from a “whole person care” perspective. He promised to push for more affordable housing aiming to take homeless off the streets, but – mindful of controversies in places like Los Angeles, Orange County and San Francisco – will leave it up to local authorities to decide where that housing should go.

Newsom isn’t the first to note the inequality problem. California’s tax-collecting Franchise Tax Board has reported that in 2016, the top 1 percent in overall wealth received 23 percent of all income in the state, while the bottom 90 percent received 49.6 percent. White families on average earned more than 1.5 times what Latino and black families got. Even more startling are net-worth figures reported by the U.S. Census, which found white families in California had a net worth (assets minus debt and other liabilities) of $171,000, more than eight times the $20,700 belonging to the average Latino family and nearly 10 times the $17,600 of African-American families. Those numbers include home equity, value of vehicles, furniture and almost every other type of material goods.

There will be no immediate help from the federal government, either, on evening things out: President Trump’s tax “reform” bill of last year will benefit whites far more than Latinos or blacks, and the richer you already are, the more you stand to benefit.

So what can a new California governor do about this inequality, which grew more imbalanced than ever during Jerry Brown’s latest two terms as governor?

The California Budget Project (CBP) suggests starting with an estate tax (sometimes called a “death tax”), saying that “serves as a curb on dynastic wealth.” In short, if you’ve built a valuable business, you’d better pass it on to your kids before you die, if estate taxes rise precipitously, as they might with two-thirds Democratic majorities in both houses of the Legislature. But the Legislature and governor couldn’t act alone on this: It would need to be okayed by voters because the 1982 Proposition 6 repealed state inheritance taxes. It can only be reversed via another popular vote.

The CBP also suggests eliminating or cutting tax deductions that primarily benefit well-off homeowners, including deductions for mortgage interest and property taxes. Do that, of course, and the value of much California real estate would immediately fall, which would tend to even out the wealth held by whites, Latinos and blacks.

But that would surely spur a massive political backlash, so don’t bet on it happening soon.

Another way to boost low-wealth families is to expand child care and renters’ tax credits, which help the poor while not harming others. This one is the most likely of the CBP recommendations to become reality.

But one thing is for sure: Newsom will evaluate many proposed new laws that land on his desk from the perspective of what they’ll do to help alleviate income inequality and boost low-income families. Which will be a very different perspective than any recent governor has brought to the office.

Email Thomas Elias at tdelias@aol.com. His book, “The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It,” is now available in a soft cover fourth edition. For more Elias columns, go to www.californiafocus.net

in Opinion
<>Related Posts

SM.a.r.t. Column: Owner Occupancy Protects Against Corporate Over-Development

May 2, 2025

May 2, 2025

This week SMa.r.t. will have as guest columnist Mark Borenstein. Mark is a long-time Santa Monica resident, a retired attorney,...

Opinion: Declaration of Economic State of Emergency in Malibu & Pacific Palisades: A Direct Result of the Devastating Impact of the Palisades Fire

April 27, 2025

April 27, 2025

Malibu and Pacific Palisades Request Emergency Financial Measures By Ramis Sadrieh, Chairperson, Malibu Pacific Palisades Chamber of Commerce    On behalf...

SM.a.r.t Column: The World’s Happiest Cities

April 27, 2025

April 27, 2025

Almost every year, we see new cities, regions, and countries that make the list(s) of our planet’s happiest and healthiest...

SM.a.r.t Column: A City for Everyone

April 20, 2025

April 20, 2025

Santa Monica dazzles with its ocean views, sunshine, and laid-back charm. But beyond the postcard image lies a more complicated...

SM.a.r.t Column: Part II: Rebuilding Resilient Communities: Policy and Planning After the Fires

April 13, 2025

April 13, 2025

The January 2025 wildfires that devastated Pacific Palisades and Altadena left an indelible mark on Los Angeles County. Beyond the...

SM.a.r.t Column: Innovative Materials for Fire-Resistant Rebuilding After the LA Fires

April 6, 2025

April 6, 2025

In the aftermath of the devastating 2025 Los Angeles wildfires, homeowners face the daunting task of rebuilding their lives and...

Opinion: Supervisor Lindsey P. Horvath Community Column Regarding a More Accountable Homeless Services System

April 3, 2025

April 3, 2025

By Lindsay Horvath, Los Angeles Board of Supervisors This week marks a significant milestone in our fight to end homelessness...

SM.a.r.t Column: Bring Back The Music 2.0

March 23, 2025

March 23, 2025

This is an update of the article appearing in the SM Mirror on Feb 1, 2025 On January 28th, 2025,...

Letter to the Editor: Close the Fairview Library??

March 17, 2025

March 17, 2025

By the Santa Monica Public Library Board, Judith Meister, Chair, Dana Newman, Vice Chair Antonio Spears, Boardmember Daniel Cody, Board Member...

SM.a.r.t Column: Fire Safety in Los Angeles: Reimagining an Age of Megafires

March 16, 2025

March 16, 2025

Los Angeles stands at a critical juncture in its relationship with fire. It is true that climate change intensified vegetations...

Santa Monica Civic Auditorium: The Cultural Icon Santa Monica Needs

March 9, 2025

March 9, 2025

Santa Monica is a city of innovation, creativity, and world-class attractions, yet it lacks a central cultural destination that reflects...

SM.a.r.t Column: The Perils of Passing the Buck: How Self-Certification Threatens Public Safety in Building Design and Construction

March 2, 2025

March 2, 2025

In the bustling city of Santa Monica, California, a quiet revolution is underway in the world of building design and...

SM.a.r.t Column: Bring Back The Music

February 16, 2025

February 16, 2025

On January 28th, 2025, the City Council did a wise thing and agreed to continue the process, for 30 days,...

SM.a.r.t Column: The Water Crisis Behind LA’s Fire Disaster: A Legacy of Outdated Infrastructure

February 9, 2025

February 9, 2025

A firefighter filling a trash can with pool water during the devastating 2025 Los Angeles fires tells a story more...

SM.a.r.t Column: California’s Fire Safety Evolution: Meeting Modern Wildfire Challenges

February 2, 2025

February 2, 2025

The devastating fires that struck Los Angeles in January 2025 echo a pattern of increasingly destructive wildfires reshaping California’s approach...