Governor Gavin Newsom’s decision to embed sweeping housing reforms in his budget trailer bill isn’t just a policy move—it’s a political gauntlet, thrown down not at Republicans, but at his fellow Democrats. With California’s housing crisis continuing and the failure to make any inroads, Newsom has decided that the time for consensus-building has passed. He’s shifting from persuasion to power.
This isn’t the typical legislative fight. It’s an existential reckoning for California’s Democratic Party—one that pits its progressive identity against the entrenched interests and ideological contradictions that have made the state’s housing system functionally ungovernable.
At the center of that fight is a simple truth: Democrats, not Republicans, are the biggest political barrier to housing in California.
Newsom’s budget proposal would override local zoning, streamline CEQA review, and fast-track housing construction in cities that have spent decades stonewalling development. These are not new ideas. YIMBYs, planners, renters, and younger voters have been sounding this alarm for years: housing scarcity is not a bug of California’s system—it’s a feature, produced by exclusionary zoning, bureaucratic paralysis, and elite capture of local government.
What’s new is that Newsom is using the budget process to bypass the usual roadblocks—and daring his own party to stop him.
The pushback is already coming. Labor groups fear the loss of wage standards. Environmental advocates see a slippery slope on CEQA. Local officials are incensed at the erosion of their land-use authority. These are not right-wing voices—they are core constituencies of the California Democratic coalition. And therein lies the problem.
Democrats are talking out of both sides of their mouths: calling for affordable housing while opposing the very mechanisms needed to build it.
This contradiction is on full display in places like San Francisco and Los Angeles, where progressive electeds talk a big game about justice and equity but fight tooth and nail to preserve single-family zoning, delay permits, and block new construction. The rhetoric is inclusive, but the policy outcomes are exclusionary.
As Ezra Klein has pointed out, “Homelessness is a (f-ing) problem—and it is the worst problem for the people experiencing it, not for me.”
He’s right. And yet, when Klein pressed a progressive critic about how to reduce the obscene $650,000–$1 million per-unit costs of affordable housing in California, the answer wasn’t a plan—it was a pivot.
Klein’s frustration mirrors that of many pro-housing liberals who are watching the left implode under the weight of its own contradictions.
Conor Friedersdorf put it bluntly: “Nothing frustrates me more than NIMBYs and their leftist allies on housing. It’d be easy to lower the cost of the biggest expense most Americans confront. The left’s failure to understand the problem renders them not only unable to fix it but oppositional to those with solutions.”
That opposition comes dressed in the language of virtue—equity, environment, labor—but its effect is regressive. It protects homeowners at the expense of renters. It preserves aesthetics over access. It subsidizes scarcity while pretending to fight for abundance.
Meanwhile, the reality on the ground is dire. California now has nearly one-third of the nation’s homeless population. Home prices and rents have soared far beyond the reach of most working families. The state’s population is declining as people flee to states like Texas and Arizona, not because those states are better governed, but because they build.
And that’s the uncomfortable part for many Democrats.
When it comes to housing, the states that build fastest and cheapest are not the progressive strongholds—they’re red states. In Texas and Florida, homelessness has grown modestly despite minimal social spending. In California, despite spending $24 billion since 2019, homelessness rose 24 percent. Why? Because we’ve made building housing virtually impossible.
San Francisco tried to build a single public toilet for $1.7 million. Affordable housing projects regularly cost more than luxury condos. Regulations, mandates, and lawsuits stretch timelines into decades and costs into the stratosphere. And every attempt to streamline this mess is met with outrage from some corner of the Democratic coalition.
Even Ezra Klein and Derek Thompson—liberal journalists by any standard—have described California’s governance as a cautionary tale.
In Abundance, they write, “California has the worst homelessness problem in the country. It has the worst housing affordability problem in the country. It trails only Hawaii and Massachusetts in its cost of living. As a result, it is losing hundreds of thousands of people every year to Texas and Arizona.” That’s not a Republican ad. That’s a liberal diagnosis.
And yet, many Democrats can’t seem to accept that building more housing—at scale, and with urgency—is the only path forward. Instead, they pour money into subsidies, tax credits, and vouchers that can’t keep up with demand. As Klein and Thompson argue, this is like “building a ladder to try to reach an elevator that is racing ever upward.” Unless we tackle supply-side constraints—permitting, zoning, CEQA, local veto points—we are only subsidizing our own failure.
Newsom appears to understand this. His move to embed housing reform in the budget is an admission that the ordinary political process has failed. Too many good bills die in committee. Too many local governments flaunt the law. Too many compromises produce toothless half-measures.
Yes, there are risks to Newsom’s approach. Using budget trailer bills for major policy raises real concerns about transparency and democratic process. It circumvents public input and legislative negotiation. It may provoke legal challenges or backlash. But what’s the alternative? Another decade of stagnation, displacement, and dysfunction?
California needs to build—deeply affordable housing, workforce housing, and yes, market-rate housing. We need to build near transit, in affluent suburbs, and in cities where opportunity has been gated off by design. We need to build faster, cheaper, and with fewer arbitrary obstacles. That will require confronting not just Republican obstruction, but Democratic cowardice.
The question is whether the party can reconcile its competing impulses—pro-labor, pro-environment, pro-housing—or whether it will continue to treat every policy as a zero-sum game. If labor standards block housing, if CEQA protects parking lots, if neighborhood character trumps human need, then the party is not progressive—it’s performative.
Newsom’s gambit is not just a policy play—it’s a political challenge to the soul of his party. Can Democrats govern through complexity? Can they hold their values while confronting trade-offs? Can they say yes to something other than another process?
If the answer is no, then they shouldn’t be surprised when voters stop believing in California as a model—or in the Democratic Party as an engine for solutions. The housing crisis is not just a crisis of supply. It’s a crisis of political will. And Democrats must finally decide: are they the party of housing or the party of the homeowners blocking it?
From article: “He’s shifting from persuasion to power.”
Interestingly-enough, columnist Dan Walters (who himself has been highly supportive of more housing) notes similarities between Newsom and Trump, regarding this “style” of governance. (And not just as it relates to housing.)
https://calmatters.org/commentary/2025/05/newsom-trump-weakness-political-hardball/
But I disagree with the premise of David’s article, since almost all of the Democratic representatives (at the state level) are the same type of YIMBYs that Newsom is (representatives such as Scott Wiener, Cecilia Aguiar-Curry, etc.). If not for those type of representatives proposing and approving legislation in the state assembly and senate, Newsom himself wouldn’t have anything to sign-off on.
The system itself prevents candidates with different goals and views from advancing in politics. That’s true for both Democrats and Republicans (and again – is not just limited to housing issues).
This is the reason that the choices presented to voters are often either “bad”, or “super-bad”. The system itself has already weeded out anyone else before reaching voters.
The “actual” fight is between the state vs. communities (and “some” of the local representatives) – regardless of political persuasion on “either side” of that equation.
Ron O
There’s some truth in your point that this is contest between state level and community level policy makers. However, it is certain communities that are pushing back–those with wealthier residents who are trying to keep other out. The role of the state is to account for the interests of everyone who lives here and often those interests are contrary to those of a few. It’s why we have environmental and labor laws. The state is finally stepping up to take on its appointed role.
There isn’t a housing shortage, nor is the population of any state or locale entirely “fixed”. A significant number of people who have relocated to Davis and the Sacramento area came from someplace “more expensive”.
https://news.ku.edu/news/article/study-finds-us-does-not-have-housing-shortage-but-shortage-of-affordable-housing
Cities in California already have an effective tool to ensure that existing renters aren’t priced out, if they’re inclined to use it. Of course, that tool is opposed by the usual suspects (the ones who prefer never-ending unsustainable growth in a state and country where the “replacements” are no longer being created fast-enough in regard to those dying-off – which they’re also not “happy” about).
These happen to be the same interests which create actual “affordable” housing shortages in the first place (e.g., the technology industry, realtor groups, etc.).
You somehow claim to do so while simultaneously claiming that more development is “for” those who ALREADY LIVE in a given area (and not those who would actually move TO the area).
First of all, there’s no shortage of housing. In the US, vacant homes exceed the homeless population. In San Francisco the number of vacant homes is five times the homeless population. Rent control is a taboo topic. Also Section 8 provides a rental subsidy, but is chronically underfunded. All the B.S. about changing CEQA or the scam we call zoning (typical proposals change it to a worse scam) is unnecessary. Your previous editorial about confronting entrenched interests is more on point.
One more thing worth noting: I have a contractor pal who complained that the low-income housing he worked on was trashed by the poor people. Any low-income housing has to account for that, and budget maintenance or supervision accordingly. Best would be mixed-income housing where the people who are concerned about material things (i.e. rich people) keep an eye on those more spiritually oriented (poor people).
I can testify that there is value in poor people. If nothing else, they’re not so concerned with being a dog in the dog-eat-dog economy. They’re generous (which is also one reason they’re poor). Complaining about their lack of attention to maintenance is a pretext to abandon them, but as the growing homeless population demonstrates, they aren’t going away because you wish they were more like the rich people.
AE say, “In San Francisco the number of vacant homes is five times the homeless population.”
So is your solution to make those with vacant housing, house the so-called ‘homeless’ population? How would that work, exactly?
AE say, “Best would be mixed-income housing where the people who are concerned about material things (i.e. rich people) keep an eye on those more spiritually oriented (poor people).”
Wow. Just wow.
AE say: “I can testify that there is value in poor people.”
How very kind of you :-|
AE say: “If nothing else, they’re not so concerned with being a dog in the dog-eat-dog economy.”
Woof?
AE say: “They’re generous (which is also one reason they’re poor).”
So your theory is that people are ‘poor’ because they give their stuff away. Interesting theory. Maybe you could get a professorship at UC Davis. Nevermind, you probably already do :-|
AE say: “Complaining about their lack of attention to maintenance is a pretext to abandon them, but as the growing homeless population demonstrates, they aren’t going away because you wish they were more like the rich people.”
There is a town near where I grew up where there were primarily people from two groups of people. Both had little money, which is why they lived in that town. Most everyone could point to who lived in which houses — not 100% but pretty close — by which houses were well-kept and tidy, and which where trashed and had yards full of trash. It wasn’t about money whether houses were well kempt, it was about culture. I wish it wasn’t that way, but it was.
In today’s visible so-called homeless population, the trashing of encampments and the trashing of hotels and other facilities is largely drug based. I base this on observing the many encampments come and go 50-200 feet from my home over the last 20 years, and in talking to a many-decade friend in town who is often homeless, who told me that when he was on meth and when others are on meth, they collect and pile up collected items because when you’re on meth, every trash pile is a potential pot of gold.