Bear Essentials April 10th: The Bill is Coming Due
April 10, 2026
For years, California has been spending money like the tab belongs to some future version of itself that we neither know nor care much about. State spending has outpaced inflation by roughly two-to-one over the past seven years. About 1.8 million residents have left. And Sacramento is staring at a $35 billion structural deficit — on the optimistic end of the forecast. This week, NCC board members Chris Thornberg and Peter Weber argued in CalMatters that the state needs a fundamental rethink in how it handles money.
Below the fold, there’s more grim news: LA’s $300 million flagship homeless program is sending roughly 40% of participants back to the street. California electricity rates are up nearly 9% in a single year. And crops are rotting in fields because there are not enough workers to pick them. Different failures, same pattern: delayed decisions, half-decisions, and expensive delusions. The bill, as they say, has arrived.
THE BOOMS AND THE BUSTS
In a new CalMatters commentary, NCC board members Peter Weber and Chris Thornberg lay out the arithmetic Sacramento keeps treating like a hostile rumor. Over the past seven years, California’s general fund spending has risen roughly 66%. Inflation explains only about a third of that. The number of state employees per resident is up 19%, even as net population has fallen by 450,000 people. Meanwhile, 57,000 high-net-worth residents left between 2018 and 2022, taking an estimated $1.1 trillion in personal wealth with them. The Legislative Analyst’s Office now projects structural deficits of $18 billion in fiscal 2026–27 and as much as $35 billion beyond that. Weber and Thornberg’s prescription is not exotic: stop treating revenue spikes like permanent income, build stronger reserves, and demand better returns from the money California already takes in. As gubernatorial candidates split between raising taxes and squeezing more from existing revenue, their piece frames the real choice with refreshing bluntness. California has the highest unemployment rate in the country, the lowest housing affordability in the continental U.S., and has spent $23 billion on homelessness while the houseless population rose 40%. Whatever Sacramento is doing with all that money, “working” would be an ambitious description.
🤫 Everything you should know
⚡ - POWER SURGE — California’s year-over-year residential electricity rates jumped 8.9% in April, reaching 33.75 cents per kilowatt-hour — the second-highest in the United States, behind only Hawaii. Nationally, rates rose 5.4% to about 18 cents per kWh. In other words, Californians are paying nearly double the national average just to keep the lights on. (At this rate, the fridge will soon be a luxury appliance.) The reasons are all familiar: grid modernization, hardening infrastructure against extreme weather, the price tag attached to the renewable transition, and rising demand from data centers. None of that is going away. In a state where one in three residents says cost of living is the top concern, this is one more monthly reminder that California still charges a premium for the privilege of remaining in California. — Electric Choice
🏠 - CUTTING TO BUILD — San Francisco has already slashed its affordable housing requirements once to try to jumpstart development. It didn't work. Now the city is considering cutting them even further — a tacit admission that the economics of building in California have become so punishing that even reduced mandates are enough to kill a project. It's the same paradox playing out across the state: cities can require affordable units or they can get units built, but increasingly, they can't do both. Every concession to market reality is a concession that the policy framework isn't working as designed. At some point, the question stops being "how low can we go on affordability requirements" and starts being "why is it so expensive to build anything here in the first place." — SF Chronicle
🏡 - THE HOA ALWAYS WINS — Adam Hardesty, a condo owner in Carlsbad, spent a year and an undisclosed amount of money fighting his homeowners association for the right to turn his garage into an accessory dwelling unit — exactly the kind of backyard-style housing California has spent years encouraging. A state housing planner told him the law was on his side. He started construction. Then the HOA sued. Last week, a San Diego County judge ruled for the association on technical grounds, finding that the state’s ADU law does not apply to condo developments. The judge himself sounded less than thrilled, admitting he wished he had “a stronger feeling one way or the other.” The case exposes a large hole in California’s housing strategy: the state has spent a decade bulldozing local barriers to new housing, while HOAs — which govern more than a third of California homes — often sit outside that enforcement regime. Hardesty says he would like to appeal, but cannot afford to. Which is one way to keep the housing shortage very much on schedule. — CalMatters
🏕️ - GOOD NEWS, BAD NEWS — First, the good news: Governor Newsom announced $145.4 million in homeless housing funding through HHAP for eight California regions, following the first statewide decline in unsheltered homelessness in 15 years — about a 9% drop in regions reporting 2025 numbers. That is real progress, and it should be acknowledged. Now the bad news: in Los Angeles, a new analysis found that roughly 40% of the 5,800 people moved indoors through Mayor Karen Bass’s $300 million “Inside Safe” program have ended up back on the street, and the failure rate is increasing. In many cases, people object to strict rules, including a blanket ban on guests, violate them, and are expelled. So California is simultaneously showing that it can reduce unsheltered homelessness and that moving people indoors without enough support can become an expensive revolving door. Both things are true. The question is whether Sacramento and City Hall are capable of learning from either. — Governor's Newsroom, LA Times
🌾 FIELD OF (BROKEN) DREAMS — Last summer, the Trump administration declared there would be “no amnesty” for undocumented farmworkers and pledged to make the agricultural labor force “100% American.” This week, the Wall Street Journal editorial board supplied the number that blows that fantasy apart: U.S. workers submitted applications for just 182 of the 415,000 farm jobs advertised in the last fiscal year. That is 0.04%. Meanwhile, crops are rotting in California fields because there are not enough workers to harvest them. The math here is not subtle. California’s $50 billion agricultural economy runs on immigrant labor. Remove that labor without a workable replacement and you do not get orderly reform — you get an economic wrecking ball aimed squarely at one of the state’s most important industries and the communities built around it.
— Wall Street Journal, San Jose Spotlight
⌚ - WORTH YOUR TIME: THE COMPUTER HISTORY MUSEUM
The Computer History Museum in Mountain View is Silicon Valley gazing lovingly at its own source code. The museum offers a brisk, smart, genuinely entertaining walk through the machines and ideas that built modern life. Equal parts geek pilgrimage and cultural archaeology, it is far more fun than the phrase “computer museum” suggests.
🌲 ♥️ 🌲 - HOPE IN PARADISE
Image: hopeplazaparadise.com
More than seven years after the Camp Fire tore through the forest hamlet of Paradise, residents and survivors will now have a central place to remember, grieve and find solace in their connection to one another. Hope Plaza, scheduled to be dedicated on Saturday, April 11, from 1:00 p.m. – 3:00 p.m., feels less like a monument than a promise kept. The space honors the 85 people lost in the Camp Fire, the first responders who ran toward it, and even the pets and wildlife the fire took. It invites reflection without forcing sentiment, and is sure to become an emotional cornerstone of the still rebuilding town. Action News Now
🏃♂️ 💨 ✋ FAST FIVE
- 🌬️ Inside CA’s audacious bid to build the world's deepest floating wind farm.
LA Times - 🫡 NY Times opinion writer German Lopez gives San Francisco a pat on the back.
NY Times - 🎣 Federal Bureau of Reclamation lends salmon a helping hand (more water).
SacBee - 🛢️ Why the blocked Strait of Hormuz hits California disproportionately hard.
Wall Street Journal - 🔋 The California Lake Billed as the ‘Saudi Arabia of Lithium’.
NY Times
