Governor Gavin Newsom proposed spending $322 billion in total state funds during 2025. In 2024, the budgeted expenditure was approximately $223 billion, while revenues were $210 billion. Not exactly balanced. Newsom claims that he can spend an additional $100 billion because of increased revenue resulting from a stronger economy, and the stock market resulting in increased cash receipts (tax revenue). If you believe that, you probably think Joe Biden was a great President and voted for Kamala Harris.
This does not, of course, include the cost of the massive wildfires in Southern California. AccuWeather estimates more than $250 billion in damages, or more than the entire revenue of California during 2024. The economic loss to California is estimated at $50 billion. This is likely to be low. Biden is promising to provide tens of billion in aid. He has six more days to do this.
Insurance losses are estimated to be as much as $50 billion. Since many of these homes were insured by the California Fair Plan, the maximum a homeowner can recover is $3 million. This is the combined amount available for both the home and the contents. If it costs $2.5 million to rebuild your home, you only get $500 for contents. Since the average cost of a home in some areas is $4.5 million this is a real problem.
While wildfires like this in Southern California, due to Santa Ana winds are predictable there is little evidence California or Los Angeles was adequately prepared. Some fire trucks literally ran out of water. The fires quickly got out of control and they are still not fully contained.
Whether it is fair or not, the Governor of California and the Mayor of Los Angeles are the focus of increasing outrage. The pathetic efforts by Gavin Newsom to deflect blame is the polar opposite of leadership. Neither of these people are likely to survive the political storm which is also intensifying. Publicly putting your faith in Joe Biden to save the day is beyond wishful thinking it is downright delusional.
The impact of these wildfires will be felt internationally. They will impact the reinsurance market worldwide. Every state, including states with outrageously high homeowners’ insurance costs now, will see rates skyrocket even more. The result will be at least some people defaulting on their mortgages, which will drop property values.
The good news is that Joe Biden is going, going, gone and there is a new leader in charge. One that is capable of acknowledging the truth and taking action to fix things. Anyone who lives in California or who has lived in California knows what caused this. A refusable by state government to deal with the obvious. Instead of working to clean up forests from dead trees and debris, logging was considered evil. As a result, there are no logging roads for fire trucks to use and no logging roads with even the potential to provide fire breaks. The shortage of fire fighters in LA is so severe that convicts are now being used to make up some of the deficit.
California actually has plenty of water, but if you keep building houses and you refuse to build reservoirs, it doesn’t matter because the water just runs out to the ocean.
Donald Trump inherited a full out mess from Joe Biden. The country is going to pay a severe price for four years of incompetence. But this country is bigger and stronger than anywhere else on the planet and our ability to handle the worst storms is far greater than anyone can even imagine. Perhaps it is time to reflect on Abraham Lincoln’s declaration of Thanksgiving on October 3, 1863. This was a bleak time for many with the incredible destruction and loss of human life resulting from the civil war. Yet Lincoln took time to thank God. Here is a link to the entire text:
Abraham Lincoln’s Proclamation of Thanksgiving | American Battlefield Trust
The year that is drawing towards its close, has been filled with the blessings of fruitful fields and healthful skies. To these bounties, which are so constantly enjoyed that we are prone to forget the source from which they come, others have been added, which are of so extraordinary a nature, that they cannot fail to penetrate and soften even the heart which is habitually insensible to the ever watchful providence of Almighty God…No human counsel hath devised nor hath any mortal hand worked out these great things. They are the gracious gifts of the Most High God, who, while dealing with us in anger for our sins, hath nevertheless remembered mercy.
At a time when we are facing human catastrophe as a direct result of leadership that not only forgets God, but naïve leaders who they are God, He has reminded us who is and who is not in charge. Ultimately, just as they failed in preventing this incredible damage, they will fail in overcoming the incomparable power of God. It is time to look forward, not backward and give thanks.
TDM