Another Backroom Deal: California’s $20 Billion Climate Boondoggle

Governor and Legislative Leaders extend cap-and-trade to 2045 with 1B a year for 20 years to high-speed rail after closed-door talks, while California is in the throws of an in affordability crisis.

Welcome to the Friday freebie, as we call this. Typically our afternoon content is behind the pay-wall for our hundreds of paid subscribers. But free-subscribers would not know what they are missing if we didn’t get them behind the curtain on occasion! If you like this kind of content and you haven’t done so, please consider an upgrade. The reasons why are all here. But the main two - it’s a great VALUE, and you SUPPORT my independent, bold and relentless work! With your support I am beholding to no one.

---

Back Room Deal

California’s leaders just shook hands in a back-room deal to approve one of the largest climate-policy spending sprees in state history: a $20 billion extension of the state’s imprudent “cap-and-trade” program, with billions earmarked for the perpetually delayed and massively over-budget high-speed rail project. The deal, cut behind closed doors, cements California’s role as the nation’s leading laboratory for environmental extremism—at the direct expense of its citizens.

Cap and Trade: An Expensive Illusion

Cap-and-trade is sold as a market-based solution to climate change, but in practice it has become little more than a hidden tax on Californians. Energy producers and businesses must buy emission allowances, and those costs are inevitably passed on—whether in higher electricity bills, increased fuel costs, or more expensive goods on the shelves. The billions generated don’t reduce emissions in any meaningful way; they fund a grab-bag of political projects.

The reality is simple: California’s regulations barely dent global emissions. Every ton of carbon “saved” here is overwhelmed many times over by the smoke pouring out of our wildfire-ravaged forests. If even a fraction of the cap-and-trade billions were spent on fire prevention, we would save lives, protect property, and cut emissions more effectively. Instead, politicians funnel the money into pet projects like high-speed rail, which remains years behind schedule, wildly over budget, and irrelevant to most Californians’ daily lives.

No Adult in the Room

This latest cap-and-trade extension illustrates the dangers of one-party rule. With Democrats holding supermajorities in both houses, there is no sober adult in the room. The negotiations happened in backrooms, with ordinary Californians shut out of the process. There was no debate about whether the program is working, no accountability for its failures, and no acknowledgment of the crushing financial burden it places on families.

As I wrote earlier this year in the California Globe, Sacramento is pursuing a “carbon crusade” that reflects reckless ideological zeal rather than prudent governance. When politicians are more interested sloshing taxpayer money to friends and supporters, and appeasing environmental extremists than protecting working families, policy goes off the rails—literally and figuratively.

Republican Assemblyman Greg Wallis had this to say at about the deal, “When billion-dollar policies are jammed through at the last minute with no public process, Californians lose.”

The Affordability Crisis Gets Worse

Californians already face the highest gas prices, electricity bills, and housing costs in the nation. Layering on billions more in climate fees only deepens this affordability crisis. Every dollar extracted through cap-and-trade ultimately comes from consumers. Businesses simply pass the costs along, shrinking household budgets and driving more families out of the state.

At the same time, taking money out of the pockets of families literally makes things worse — the housing crisis, increased homelessness, failing schools, deteriorating infrastructure, wildfire emergencies and our insurance challenges. All of these are exacerbated due to the affordability problems we have, that are all make worse with these costly regulations and fees. Rather than tackling those urgent needs, ethical lawmakers chase abstract global carbon targets while unethical ones hungrily bring in tax dollars to redistribute to their pet projects and allies.

A Global Problem California Can’t Solve Alone

Even if you accept the most aggressive climate alarmist projections, and you believe that human-produced carbon emissions are slow-roasting Mother Earth, nothing California does in isolation will move the needle on global temperatures. China emits more carbon in a week or two than California could cut in a decade. Yet Sacramento insists on burdening its own people with higher costs and diminished opportunities, all while the supposed global benefits remain nonexistent.

If lawmakers were serious, they would redirect resources into practical measures like wildfire prevention, water storage, and energy reliability. Those are steps that would both protect Californians and make measurable contributions to environmental stewardship. Instead, we get the illusion of progress paired with real-world economic pain.

“We cannot sacrifice economic stability and affordability for false climate promises that will only raise costs for those who can least afford it,” says GOP State Senator Tony Strickland. He’s spot on.

So, Does It Matter?

Yes. Given the 100% probability that the Democratic supermajorities will pass this train wreck of a deal, what happens next is in Governor Gavin Newsom’s hands. The bill is headed to his desk, and unless he shocks everyone, he will sign it. Newsom has staked his legacy on the fantasy of high-speed rail and built his national profile on climate alarmism. Expect him to tout this bill as a “historic” win, while Californians pay the price in higher costs and fewer choices.

But it doesn’t have to be this way. The best outcome for Californians would be for Newsom to veto this scheme and allow cap-and-trade to expire. That would free families and businesses from a costly regulatory burden that does little for the environment and everything for Sacramento’s appetite for spending. Leadership means telling environmental activists “no” when their demands collide with economic reality. Sadly, that kind of prudence is in short supply at the Capitol.

---

Again, if you like this kind of content, 40% of our content is for our premium subscribers. Upgrade today. It’s only $7 a month or $70 for a full year (that’s like five and a half bucks a month). You get great content at a great price, and you support my efforts here!

Please share this column!

Have a great weekend!

Jon