Tom Steyer’s intentions are righteous, but his ideas don’t add up

On Wednesday, I had the opportunity to speak to gubernatorial candidate Tom Steyer about his campaign. 

Steyer is a billionaire environmentalist with a long history of political activity. In 2020, he sought the Democratic presidential nomination. He spent millions during President Trump’s first term on an ad campaign to have Trump impeached. As a citizen he has held fundraisers for Democratic candidates such as President Obama and Hilary Clinton and championed numerous environmental policies. 

Today, he’s among the top polling candidates to succeed Gov. Gavin Newsom, offering a progressive message to Californians. 

Steyer is running heavily on making corporations “pay their fair share” and as such, has publicly stated that he would like to hold a special election to modify Proposition 13, the landmark initiative which caps property tax increases. Steyer has proposed modifying Prop. 13 to allow the state to assess commercial property taxes based on market value. 

I asked him why he thought that these tax hikes wouldn’t increase prices and slow economic growth. 

Steyer clarified that the changes would distinguish between large and small businesses and that, “Charging people fairly for commercial real estate doesn’t seem like an unfair thing to do to me. […] And I don’t think a 1% property tax is something that’s dramatically different from what everybody else charges. So I don’t think it, in fact, is going to be a big drag on business. […] And I think this is an actual honest to God tax loophole. I don’t think it’s fair. And I think that it’s, you know, a completely just thing to do.” 

Unfortunately that is the extent of his answer. Typically, if you increase the cost of doing business, as such a modification would undoubtedly cause, prices increase and economic growth is slowed. While government revenues would increase, I assume most people would rather keep that money in their pockets than watch the government waste it on things like the high speed rail project.  

We moved on to some of the positions Steyer expressed during the gubernatorial debate earlier this month, particularly his stated support for rent control. In July of last year Steyer sent out a tweet criticizing rent control for its deleterious and counterproductive effects. I asked him if he had changed his mind: “Yes and no. […] So I look at rent control as a short-term solution to an immediate problem with the long-term solution being building a lot. I don’t view rent control as a long-term solution.”

So what’s wrong with this picture? Californians get immediate temporary relief until we get enough housing built, at which point rent controls can be removed. Well, if we take all of the evidence that history can provide about the ability of the government to build housing or motivate its construction, is there anything in those history pages that would suggest that they will be able to do that? 

Of course not, which means that those temporary rent controls will not be so temporary when those housing cost reductions never come. Of course, I would love to believe that there is a candidate in our gubernatorial race that is capable of delivering on their promise to build millions of homes but I would be an irresponsible epistemic agent if I ignored the fact that they’re never able to do so. 

Therefore, given all of our evidence, we can expect that they will not be temporary and that we’ll suffer those negative long term consequences that Steyer acknowledges.

When it becomes clear that not enough housing was built, that housing costs are higher than ever, and that affordability is still at the top of voters’ concerns, will anyone have the political will to reverse those rent controls? Almost certainly not, and we’ll have the same predictable worsened outcome that rent control always produces. 

We moved on to the topic of public sector unions. On his campaign website, Steyer states that he will work to eliminate corporate PAC money in politics to end the influence of special interests. When I asked about the influence of unions on state politics and whether he thought they shared problematic similarities with corporate influence, Steyer dodged the question. 

He spoke about how workers have been treated unfairly in America and spoke about how corporations have been silent on Trump’s attack on our democracy: “Rafa. And, you know, look, you may not agree with this, but we’ve seen at the federal level, that we have a government that, from my angle, is doing everything it can to dismantle democracy, that’s incredibly corrupt, that feels that they have impunity, that there’s no punishment for people. There are, you know, ICE agents who shoot Americans dead on the street. Just saying. And we haven’t heard a peep out of business.”

I agree that the Trump administration is corrupt and lawless and that corporations have chosen to preserve themselves over opposing Trump but what does that have to do with the outsized influence of public sector unions on California’s politics?

Is it that public employee unions have been vocal critics of the Trump administration while corporations have not so they should be allowed to unfairly manipulate our state’s politics for their benefit? I didn’t quite follow Steyer’s reasoning here but perhaps I wasn’t meant to. 

Steyer appears to have all of the good intentions in the world. He spends his money fighting against climate change and wants to help Californians. When he promises to lower housing costs and improve affordability, we should be aware that his underlying strategies will do the exact opposite despite his admirable intentions.

Rafael Perez is a columnist for the Southern California News Group. He is a doctoral candidate in philosophy at the University of Rochester. You can reach him at rafaelperezocregister@gmail.com.