Larry Kudlow on the California wildfires

Leftist political failures are ruining California, and it’s a riff topic nightmare in california is a natural disaster. No one can control the Santa Ana winds.My own brother and his wife who live in Hollywood had to evacuate their apartment.

Fortunately, the Hollywood fire was contained and they returned home. When it comes to catastrophic fires, there are no heroes. It’s always better to be safe than sorry. Unfortunately, there’s plenty of evidence that the leftist policies of California’s blue state politicians have compounded the tragedy.

Officials failed to fill the reservoir properly, and as a result, there was no water in the fire hydrants in several districts. Gov. Newsom apparently cut the flow of water that never reached Southern California to save a dark fish called a “smelt.” Hear President Trump on the smelts.

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TRUMP: “Well, it’s very sad, because I was trying to get Gavin Newsom to come. You’d have a huge amount of water if they sent it to the Pacific Ocean, because they’re trying to protect the little fish, which in other areas, by the way, are called scent and , for the sake of the flock, they have no water.”

Again, this is a tragic nightmare of a natural disaster in California. Lives lost, homes destroyed, and I’m no expert on all of this, but if the reservoirs are empty, or if the water is flowing into the Pacific Ocean instead of being piped into a fire hydrant, it government error of the first order. Many people tell me that California’s infrastructure, especially the pipeline and power system, has been neglected for quite some time, in part because all the money is flowing into so-called climate projects by green politicians.

Perhaps if Governor Newsom, Mayor Bass and others had spent more on water and power infrastructure and reservoir management, some of the tragedy in Southern California could have been mitigated.

At this point, I’m sure the people of Los Angeles are more concerned about their safety than the blame game, but at some point it would be useful to do a post-mortem and see what went wrong and what could be done better about this natural disaster. to mitigate disasters.

There is also a financial angle to this story.The preliminary estimates of one of the major banks suggest a loss of 50 billion dollars, of which 20 billion dollars will be the insured losses. Some very large home insurers, like State Farm and Allstate, are pulling out.

State Farm dropped home insurance last spring. I’m no expert here either, but you have to wonder if they were looking at the same infrastructure issues and assessing the same risks as others and these insurers decide they don’t want to blow up. their balance sheet or their entire company balance sheet.

They have to answer to shareholders and California state insurance regulators won’t allow insurance companies to charge high enough premiums to cover natural disaster risks and yes those premiums keep going up but that’s the only way insurance companies can make a living if they don’t come out at all.

In addition, California’s state insurance regulator, called the FAIR Plan, is preparing to take a big hit from wildfire losses and is preparing to assess private insurance companies a huge sum of money that private companies in many cases they simply cannot pay.

California was already in a home insurance crisis before the latest disaster, and this may be the costliest fire in U.S. history. It’s not entirely different from the Florida hurricane disasters. Some property values ​​in these hard-hit areas are set to drop even as insurance premiums rise. I understand that the citizens of southern California are far more concerned about their survival than dollars and cents right now.

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One reality, of course, is that the nation’s highest-taxed state could do far better than it has done in managing its vital pipelines and power systems, reservoirs, forests and insurance systems.

I’m going to say what a lot of people are thinking. Leftist politics have failed once again. If you want to help the people and businesses of California, how about a lot less money for climate extremists and a lot more money for improving basic services and fattening the wallets of ordinary workers? is the riff.

This article is adapted from Larry Kudlow’s opening commentary in the January 9, 2025 edition of Kudlow.