Gavin Newsom's crony capitalism racket

Now that California's Gov. Gavin Newsom has a recall petition apparently reaching the threshold for ballot qualification, there's some renewed press interest in what he's about and what he really does.

Unlike, say, New York Gov. Andrew Cuomo, whose style seems to be bullying, machine politics, and use of snarling political muscle, Newsom's racket for maintaining power seems to be crony capitalism, or, perhaps more accurately, crony socialism.  This isn't surprising in a state with the highest inequality ratios in the nation — big billionaires in a couple of urban enclaves and a lot of impoverished and marginalized people pretty much everywhere else.

Reason magazine points out that Newsom has found a way to positively thrive on it and, with COVID restrictions, positively supercharge himself for it.  It goes like this:

In 2020, California Gov. Gavin Newsom's office reported that individuals or organizations made $226 million in private donations to organizations at Newsom's request. These "behested payments" were a record-setting haul eclipsing all prior donations on record by nearly $100 million. While most donations supported COVID-19 relief efforts, a closer look suggests Newsom's fundraising was supercharged not just by the pandemic, but also by the broad emergency powers the Democratic governor has assumed because of it.

Behested payments are a unique feature of California politics. State law defines a behested payment as a donation to a government program or charity made "at the request, suggestion, or solicitation of, or made in cooperation, consultation, coordination or concert" with a public official. While payments of $5,000 or more are disclosed to the public, they remain an overlooked portion of politicians' finances, even though contributions often come from businesses with interests in the state government.

So Newsom meets with corporate goliaths, tells them to "donate" money to his pet favorite causes, somewhat like what the Clinton Foundation used to do.  After that, he notes who donated and dishes out to them huge no-bid contracts.  They don't have to compete.  They don't have to give consumers or taxpayers any value or accountability.  And these moves are very non-transparent, as Reason noted.

Google (through a subsidiary), Blue Shield, Kaiser Permanente, and others all have donated huge amounts (probably tax-deductible) to Newsom's pet causes such as housing the homeless (which apparently doesn't do any good) and then, in turn, got monster no-bid contracts.  One hand washes the other.  Mutual back-scratching.  Newsom got his start with billionaire Gordon Getty and is cognizant of what billionaires can do; they're pretty much his native stomping grounds.  It all adds up.

What it isn't is a free market in best prices for goods and services.  It's crony socialism, where the rich grow richer based on their political donations and smaller players get shut out.  Apparently, this has been going on a long time, but Newsom has accelerated it.  California's cost of living is among the nation's highest.  All of these things add up to a culture of rigging and corruption, with inflationary prices and consumer-silencing.  Newsom has supercharged it with COVID measures (everyone must get a vaccine, see? delivered by Blue Shield, in the vaccine it chooses for you, too bad if you want something else or someone else to give it), making himself even more powerful. 

In this scenarios, the consumer, the taxpayer, and the voter become zeroes.  Newsom has amped up this political game to his advantage.  That's allowed him to be none too concerned about the Legislature, which normally directs government funding, and outside the framework of checks and balances.  It explains why he couldn't care less about business shutdowns in the time of COVID and could even be doing it at the behest of the behemoths who contribute to his pet causes and benefit from the shutdown of their tiny rivals.  The door has been opened for that, for sure.

This might just be why the recall referendum was the next logical blowback.  The Legislature is irrelevant, not a check, to a governor so powerful.  And since the elections are rigged for Democrats, even the Legislature, if it mattered, is no solution.  All that is left is the beleaguered people, which is what this recall referendum is fueled from.  The recall measure is a sign of some powerful popular forces, repressed otherwise, building up like lava.  It may just have arisen out of this increasingly obvious crony socialist corporate state practice, which is fundamentally anti-democratic.

Image: Gage Skidmore via FlickrCC BY-SA 2.0