00:00:00
What is going on? Why are rents so high? Why are homes so expensive for the 40 million residents of California? This
00:00:09
particular issue, I think, almost captures better than anything else the underlying structural reasons why
00:00:15
everything is so difficult in California and so expensive cuz you got these three
00:00:19
structural forces that I think underpin the problem and show why a Democrat can't fix it. And the three things are
00:00:26
union power, litigation, and climate dogma. The first part of the story is that we're just not building enough
00:00:34
homes for the number of jobs that we're creating and the size of our population.
00:00:37
It's a classic supply and demand situation. SQA, the California Environmental Quality Act itself is a
00:00:43
nightmare in terms of this the amount of regulation you have to comply with. The
00:00:46
private right of action means anyone can sue. 70% of SQA lawsuits are used to block housing. Most of those lawsuits
00:00:54
are filed by unions. They're used as leverage to negotiate what they call project labor agreements where you have
00:01:00
an agreement for the site and usually they have one or two of these components. Both of which sound great.
00:01:04
Skilled and trained workforce which means union only. So it's a closed shop and prevailing wage. Again sounds very
00:01:11
good but it's two or three times market rate wages. So both of those things inflate the