The Democratic Party faces challenges that stretch beyond its struggles in the upcoming 2024 election and even Elon Musk’s criticism of government policies. The real issue is essentially the migration away from Democrat-led areas like New York, Illinois, and my own California. [CLIP: Since the pandemic started, California is seeing an exodus, a mass exodus.] In 2023 alone, California experienced a net loss of 268,000 residents, while New York lost 179,000. [CLIP: New York City is losing some folks, some residents. But it turns out that New York State is also seeing the population drop.] [CLIP: And in Illinois, the Illinois residents have been fleeing the state at an alarming rate. The state’s population has been in decline for the 10th year in a row.]
So, what’s driving people away? Survey after survey points to one main reason: the sky-high cost of living. Childcare expenses can be as burdensome as a mortgage, and buying a home feels like a distant dream. [CLIP: It’s very unrealistic to be able to put a down payment on a $2 million home with two kids surviving.] Many find themselves living far away from their workplaces, prompting relocations to more affordable regions. [CLIP: Every day someone is moving to the Florida area.] [CLIP: She got an apartment three times the size of the one she had in Manhattan. Plus, there’s a wraparound deck.] [CLIP: Yeah, I can definitely understand that. Four bedroom, three bath house I had in Texas.]
These are friends and families I know well; they’re the ones uprooting their lives not because they want to, but because it’s become too costly to stay in places they love. A party that prides itself on supporting working families cannot ignore the fact that those same families are being priced out of their communities. Losing residents ultimately means losing influence in the political landscape. If these trends persist, the 2030 census could shift the electoral college towards conservative states. This might mean that even if a Democratic candidate like Kamala Harris wins all the states she did in 2024, along with Michigan, Pennsylvania, and Wisconsin, it could still lead to a defeat in the presidential race.
There’s a policy failure looming over blue states. It’s become increasingly difficult and costly to build and live where Democrats are in power. This political dilemma is compounded by a left that defends government operations even when they’re flawed and a right that advocates against government’s role altogether. The necessary shift is towards a political party that genuinely makes government effective. That could be the Democrats if they acknowledge the part they’ve played in governmental shortcomings.
Let me illustrate with a story documented in my latest book. In 1982, then-Governor of California Jerry Brown initiated a study on the feasibility of a high-speed rail system. [CLIP: Make a choice. Change the chemistry of the country.] The proposal was well-received by both Brown and the voters. By 1996, the California High-Speed Rail Authority was established to chart out this ambitious project. High-speed rail is not a new venture; Japan started theirs in 1959. In 2008, Californians approved Proposition 1A to allocate $10 billion towards a rail line connecting Los Angeles to San Francisco, potentially trimming travel time down to under two hours and 40 minutes—initially estimated at $33.6 billion, with a completion target of 2020.
The optimism grew when President Obama, in 2009, endorsed the American Recovery and Reinvestment Act to further infrastructure projects, including high-speed rail. [CLIP: Imagine boarding a train in the center of a city. No racing to an airport and across a terminal. No delays. No sitting on the tarmac, no lost luggage, no taking off your shoes. Now, all of this is not some fanciful pie in the sky vision of the future. It is now. It is happening right now. It’s been happening for decades. The problem is, it’s been happening elsewhere. Not here.] With Jerry Brown back in office decades later, everything seemed aligned.
However, by 2018, it was evident the project was far from completion. The cost estimates had ballooned from $33 billion to a staggering $76 billion. [CLIP: Let’s — Let’s level about the high speed rail.] The new governor in 2019, Gavin Newsom, had to reconcile with the reality that the envisioned LA to San Francisco link was financially out of reach. The focus shifted to completing a much shorter link between Merced and Bakersfield, which itself had a hefty price tag of $35 billion—the initial cost for the whole line back in 2008.
So, where did it all go wrong? In October 2023, I traveled to Fresno to understand the delays from those directly involved. It wasn’t the engineering; it was the political entanglements causing the delays. Work halts for months due to freight rail line intersections and limited construction seasons. This, compounded with the fact that initial federal funding prioritized areas addressing poor air quality over strategic ridership, led to a chain reaction of delays.
Every inch of the rail construction had to pass strict environmental reviews which met lawsuits at every turn. Starting in 2012, these reviews stretched into 2024. The challenge wasn’t laying tracks, but navigating bureaucracy. [CLIP: Good morning all. Welcome to the California High-Speed Rail finance and audit committee meeting.] The amount of time and capital spent on negotiations with courts, funders, landowners, and more is staggering.
While California faces these hurdles, other countries like China have been forging ahead, completing thousands of miles of high-speed rail. [CLIP: The train doors are closing. Step all the way in.] Let’s look closer to home. New York’s Second Avenue subway became the priciest per kilometer worldwide, yet structural reforms to make future projects smoother remain absent. Even after the costly Big Dig in Boston, not much changed in Massachusetts’ approach to public construction projects.
The housing crisis in California is especially stark. With only 12% of the country’s populace, it shockingly holds about half of the unsheltered homeless population. If there’s any sign the state needs more housing development, this is it—yet nothing significant has shifted.
Democrats have veered off course, favoring defense of the government’s inefficiencies over ensuring its productivity. This isn’t to say we ought to emulate disruptive forces led by figures like Musk, who offer alternatives devoid of actionable plans or feasibility. Musk’s touted Hyperloop remains an impractical vision against the backdrop of tangible projects like high-speed rail.
Misdirected efforts over generations have led to scarcity—scarcity of affordable housing, robust infrastructure, clean energy, and other public amenities. Though the populist right thrives on scarcity, pointing fingers rather than creating solutions, the path forward must embrace the politics of abundance. The focus should be on understanding the people’s needs and mobilizing government and markets to meet them.
Democrats must be ready to offer more than oppositional defiance if they wish to counter the rise of charismatic demagogues. They must overhaul their approach, moving away from overbearing bureaucratic processes that stifle growth. Housing reform, in particular, should prioritize getting out of the way of development, while other areas may require more active governance.
The road ahead demands acknowledging failures and harnessing them into opportunities for improvement, allowing effective government to become a great equalizer in society. The challenge lies in crafting a vision based on abundant opportunity, not scarce resources, to lead a nation that’s hungry for progress.
