Overview: Critics argue that Governor Gavin Newsom’s tenure since 2019 has coincided with population declines, rising costs and repeated budget shortfalls in California. High-profile policy choices and projects — from renewable mandates to an expanded high-speed rail price tag — are cited as contributors to the state’s struggles. Reports of slow wildfire recovery, disputed spending on homelessness and mounting budget deficits are presented as warning signs for voters considering Newsom for national office.
Opinion: Gavin Newsom Is Breaking California — Why His Record Should Give Voters Pause
How can anyone other than perhaps his closest relatives view Gavin Newsom (D) as a credible presidential contender? Since taking office as California governor in 2019, Newsom’s tenure has coincided with a string of political and fiscal challenges that critics say weaken the case for national leadership.
Economic Strains and Population Shifts
California — once a national economic powerhouse — is losing residents and businesses. Last year the state led the nation in net domestic outmigration, with 229,077 residents leaving for other states. Between 2020 and 2024 California gained more than 900,000 international migrants but lost 1.46 million net domestic migrants, producing a net decline of nearly half a million residents. Over the past 24 years, more than four million net domestic migrants have departed the state.
Demographers who once forecast California’s population reaching 60 million by 2050 now project roughly 40 million — a dramatic revision that reflects changing economic and quality-of-life calculations by residents and businesses.
Rising Costs and Policy Choices
Cost-of-living pressures are acute. California ranks as the second-most expensive state in the U.S., driven by high taxes, stringent regulations and progressive policies such as aggressive renewable-energy mandates. Gasoline prices in California run roughly 50 percent higher than the national average, a frequent complaint among voters and businesses.
Proposals for what would be the nation’s first wealth tax on billionaires have also drawn criticism and, according to some reports, prompted entrepreneurs and top talent to consider relocating — a concern for a state that relies heavily on innovation and startup activity.
High-Profile Projects and Disasters
Some large-scale projects under state oversight have become symbols of mismanagement for critics. California’s high-speed rail program, once estimated at $33 billion, has been dramatically scaled back and now carries estimates totaling roughly $135 billion — a jump that has drawn national scrutiny and political heat.
Wildfires in and around Los Angeles destroyed approximately 16,000 homes. Rebuilding has proceeded slowly: roughly 4,700 rebuild applications have been filed and about 2,000 approved to date. That sluggish recovery prompted a presidential executive order intended to speed permitting and reconstruction through rare federal intervention.
Questions About Spending and Administration
Concerns have been raised about accountability for large-scale spending. A local federal prosecutor, speaking on network television, accused state leaders of tolerating fraud and questioned the accounting of roughly $24 billion California reportedly spent on homelessness in the past five years. Such allegations echo controversies elsewhere in the country and have, in some cases, prompted political fallout for incumbents.
California’s expansion of services for immigrants has also had budgetary implications. The Los Angeles Times reported that a program to extend healthcare to income-eligible immigrants was estimated at $9.5 billion and already running about $3 billion over earlier projections. Separately, the nonpartisan Legislative Analyst’s Office has forecast an $18 billion budget shortfall this year — the fourth consecutive year in which the state faces significant fiscal gaps.
Political Implications
Population loss carries political consequences. California lost a U.S. House seat after the 2020 census, and forecasts suggest additional seats could be lost if current trends persist. Proposals to exclude undocumented immigrants from census counts — a change pushed by the Trump administration — would further complicate California’s political math given the state’s estimated undocumented population of more than two million.
Newsom’s national prospects have benefited from California’s large Electoral College delegation and a field of Democratic contenders still defining themselves. But critics argue that the governor’s record on migration, budgets, major infrastructure projects and disaster recovery merits close scrutiny before he is viewed as a viable standard-bearer for the party.
About the author: Liz Peek is a former partner at Wall Street firm Wertheim And Company.
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