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California is defined by contrasts: One of the world’s most important democracies and its fourth-largest economy, the enormous scope of this state includes rain-soaked forests and bone-dry deserts. Its economic base comprehends some of the country’s most dynamic urban regions and largest agricultural producers. Another striking contrast is the chasm between its capability to invent and its capacity to build. California has remained the pulsating center of the global innovation ecosystem from the manufacturing of semiconductors in the 1970s to the current artificial intelligence revolution. Yet it has struggled, especially in recent years, to build housing that accommodates population growth and to construct climate-friendly infrastructure that can achieve its ambitious sustainability goals.
The recent debate about the merits of an “abundance agenda” oriented toward facilitating the supply of otherwise scarce goods like housing and infrastructure channels perennial disagreements in California: Can the state—for all its economic dynamism, trans-Pacific connectivity, and status as a pioneer of democracy—govern effectively enough to build infrastructure, meet the basic needs of its people, and rebut arguments about its allegedly sclerotic capacity to perform and adapt? The stakes of this conversation have been raised significantly in recent months, as California has emerged as a self-proclaimed alternative democratic model to its nation’s capital.
Can the state—for all its economic dynamism, trans-Pacific connectivity, and status as a pioneer of democracy—govern effectively enough to build infrastructure, meet the basic needs of its people, and rebut arguments about its allegedly sclerotic capacity to perform and adapt?
At least this year, it seems, the “abundance” idea may have the upper hand. In June, California’s governor and leading legislators, including Assemblymember Buffy Wicks, leveraged the budget process to exempt “housing rich” projects and advanced manufacturing facilities from legal review, a major change to the state’s landmark California Environmental Quality Act. This law from 1970 institutionalized a process to allow legal challenges to building projects that could have an impact on their surrounding ecosystems. And at the end of the legislative session, longtime housing advocate State Senator Scott Wiener scored another policy win, significantly increasing the amount of density allowed for buildings near transit stops.
Advocates from legacy environmental organizations excoriated these reforms, saying they would gut protections that “ensure that new development does not irreversibly harm air quality, water supplies, wildlife, and public health.” Reformers—clamoring for fewer restrictions on building in a state where demand for housing units is much greater than available supply—felt the changes did not go nearly far enough and did not expect “an increase in deliveries in 2026 because of these changes.” They argued that local fees, permitting delays, restrictive zoning laws, and funding shortages would still slow down California’s vast economy and keep state and local governments from delivering affordable housing and transportation to its residents. The debate rages on. What the abundance argument may miss, though, is a crucial dose of historical context and a more thorough diagnosis of the challenges California and similar polities face.
No one who cares about California’s future or its place in the world should be unwilling to consider whether the state’s government and institutions set a compelling example for similar democracies. While acknowledging that the state’s brand of pluralist democracy and public investment has delivered considerable success over the years, it is important to question whether California’s governing coalition has too often prioritized accommodation of competing interests over government efficiency and meaningful structural reform.
Nevertheless, taking California’s pluralist political logic seriously also may offer a path to constructive action. The success of political leaders in states that are committed to international cooperation, the rights of migrants, the rule of law, and principles of pluralistic democratic practice may ride on embracing a project of more comprehensive democratic renewal. But before offering a prescription for more enduring success for this project, we need to better understand how California evolved over the past eighty years into the state it is today.
The success of political leaders in states that are committed to international cooperation, the rights of migrants, the rule of law, and principles of pluralistic democratic practice may ride on embracing a project of more comprehensive democratic renewal.
Abundant California
During World War II, California’s population ballooned by over 30 percent as it became an epicenter of the American military enterprise, while its temperate weather and economic opportunity lured millions of Americans to its expanding suburban subdivisions. Over the course of the ensuing decades, four giant public-sector projects emerged that define modern California and belie the trope that the state is congenitally ineffective at governing. The state was, in fact, shaped by its ability to deliver an abundant “California Dream” while improving its environment. The state that Californians have inherited today is a result of abundance.
The California State Water Project spread its tendrils across the state, moving vast quantities of water from the wet north to the parched south, benefiting not only the agriculture sector but also, in previous generations, the construction of suburban developments. California’s network of urban and interstate highways was a marvel of engineering, built in partnership with the federal government. The University of California grew steadily over generations, yielding 137 million square feet of building space as it became perhaps the world’s leading public university system, while the California State University system expanded to cover an even greater swath of the state and educated legions of engineers and teachers. Finally, California’s air quality went from being heavily polluted to a model for other jurisdictions. Such projects were feats of political leadership as much as engineering skill. To build the water project, California had to stitch together a coalition of farmers and urban interests and strategically invest vast public resources. And cleaning the air on such a giant scale took more than technology: Public agencies minted new standards and built the capacity to monitor compliance as the state drastically reduced particulate matter emissions.
This last achievement, though, underscores one of the major challenges that have come to bedevil California in more recent years. In a giant, globally-networked state with vast cities, a massive agricultural sector, swelling demand for quality housing, and enormous natural resources, policy and process have become overburdened with complexity by a gradual accumulation of pluralist responses—sometimes from the ballot box—that have sought to accommodate all interests at once on public concerns like property tax increases, water use, insurance, pollution, and infrastructure. Changing governing coalitions, deeply alarmed by pollution and worsening ecological conditions, have not always had the inclination or the means to explore fully the trade-offs between multiple goals valued by Californians. An anti-tax revolt further limited the state’s capabilities. As California’s demographic growth strained public budgets, in 1978, longer-term residents concerned about rising property taxes embraced Proposition 13, an initiative that hit the brakes on these increases, depriving the state of revenues for future public investment.
Policy and process have become overburdened with complexity by a gradual accumulation of pluralist responses—sometimes from the ballot box—that have sought to accommodate all interests at once on public concerns like property tax increases, water use, insurance, pollution, and infrastructure.
The shifting coalitions governing the state managed internal fissures largely by avoiding conflicts over sensitive issues like land use, and the common cause made between alarmed environmentalists and upset homeowners gradually but inexorably reduced housing production in the state. Consequently, the value of the typical California home ballooned from more than four times average household income in the 1960s to over eleven times the average household income today. At the same time, the number of renters who paid more than 30 percent of their household income to their landlords each month rose from about one-third of California’s population to 56 percent in 2024. The crises of one era gave way to, and in some cases hastened, the birth of a novel set of challenges.
It is far from clear that these actions were intentional. A recent statewide survey by the Carnegie Endowment for International Peace showed that two-thirds of California residents believed policy choices should consider the needs of future generations. Nevertheless, though today’s concerns about the cost of living are driven primarily by high housing costs, it has now been a generation since California produced homes at the scale that would address demand and bring down these skyrocketing living expenses. And the sprawling administrative state created in previous generations is one of the main culprits of this under-building.
But the state’s shifting coalitions are anchored in more than concerns about the cost of living. Strong majorities in the state support bold action to address climate change, but California has very little capacity to build climate-friendly infrastructure such as subways and rail lines—most famously its long-awaited high-speed rail system—and struggles even to fund the operations of existing public transit modes that are currently facing a funding cliff, especially in the San Francisco Bay Area. Destructive fires represent another existential crisis, ravaging highly urbanized areas (most recently the communities of Altadena and the Palisades in Los Angeles) as well as the forests that blanket much of the state. But progress to address this crisis by managing forests and processing the biomass created by forest management activities as well as massive tree die-offs has been elusive. This is due in part to a policy and administrative regime largely designed to prevent emissions rather than to build facilities that emit particulate matter vastly less damaging to the environment than that produced by unmanaged wildfires.
Streamlining Processes or Something Deeper?
These difficulties have not gone unnoticed. The swelling interest in reducing regulatory and process complexity to grow the supply of housing and build infrastructure—a focus on “abundance”—is one response to the challenges in California and jurisdictions with similar policy buildup. And this diagnosis and associated policy plan are not without a measure of support. Our earlier description of California’s changing fortunes, though, suggests there is more to the story. Taking a broader view of the causes of policy and project gridlock in California and similar states and subnational units around the world tells a more interesting tale, with implications for democracies beyond California. The first thing to recognize is that governance in California and other pluralist democracies has become more complicated in every policy domain, not only the worlds of housing and infrastructure.
Consider healthcare, where the state has achieved nearly universal insurance coverage but only through topping up (where fiscally feasible) a federal reform that tweaked our many healthcare financing systems without replacing any of them wholesale. The complexity is exponentially increased by the fact that each of California’s fifty-eight counties has a distinct public healthcare financing and delivery system. Progressive reformers have long advocated for a state single-payer system to provide a simpler and fairer alternative to this current patchwork. But the elements of governing coalitions that would prefer a more energetic and generous government and would like the state be able to raise more substantial and consistent revenue have had their efforts stymied—in spite of relatively broad public support—by a system that makes policy action of any kind more challenging. It is not simply the priorities of the builders that the current system slows down or prevents. Governments in places like California have become increasingly impotent regardless of whether their priorities could be categorized as conservative, moderate, or progressive.
The root cause of this stagnation, though, is not legal and regulatory processes; it is the metastasizing complexity of the basic structure of these governments and their democratic systems. California’s lack of coordination begins at the top. It has ten separately elected constitutional officers, such as the governor or the insurance commissioner, none of whom is required to coordinate comprehensively with the others (nor do they so in practice).
The root cause of this stagnation . . . is not legal and regulatory processes; it is the metastasizing complexity of the basic structure of these governments and their democratic systems. California’s lack of coordination begins at the top.
We can also drill down into the specific policy domain of transportation. Hundreds of state, regional, and local agencies in California manage thousands of priority projects, each with distinct and complicated funding plans. The inability of the state to marshal these many agencies to set collective priorities and act with unity and purpose leads to imperfect repairs or cost overruns, further eroding public support. For example, the original estimate for California’s high-speed rail system was that it would be completed by 2020 at a cost of $33 billion to connect the cities of San Francisco and Los Angeles. At the time of writing, the first—and easiest to execute—segment from Merced to Bakersfield in the Central Valley is slated to open in 2030 at the earliest and estimates to complete the entire project ranged from $88.5 to $127.9 billion.
On energy, meanwhile, the state has largely avoided repeating the rickety days of an overstressed energy grid during the administration of former governor Gray Davis in the early 2000s. Yet energy costs for Californians are more than twice the national average. This is also a function of the incredible complexity of the governmental systems overseeing energy policy. The Public Utilities Commission, the California Air Resources Board, the California Energy Commission, the California Independent System Operator, the California legislature, the governor, and a multiplicity of other state and local agencies all hold varying degrees of authority in a loosely integrated system. They attempt to balance a myriad of priorities, including the environmental and procurement goals outlined in the state’s Scoping Plan and the land-use patterns preferred by regional Sustainable Communities Strategies, while redressing punishing rate increases, modernizing a transmission system straining to accommodate population and economic growth, and electrifying the grid. Coordination across all the actors attempting to achieve these goals, however, is neither required nor achieved.
The problem is not just the number of key players within the government. It’s California’s recent tradition of accommodating competing stakeholders without facing up to the broader implications of compromise, alongside the difficulty of periodically subjecting existing procedures and government structures—not just regulatory rules, but decisionmaking procedures, allocations of agency jurisdiction, and relationships with the private sector and other stakeholders (themselves often protected by powerful interests)—to interrogation, improvement, and reform. Pluralist accommodation has created a “vetocracy” that slows down many building and infrastructure projects and raises their cost, while also discouraging structural policy reforms with longer-term payoffs, such as education reform, greater investments in basic research, or regionally-focused incentives for economic development in California’s poorer areas.
Pluralist accommodation has created a “vetocracy” that slows down many building and infrastructure projects and raises their cost, while also discouraging structural policy reforms with longer-term payoffs.
For example, on this last point, the recently created California Jobs First program is an important step forward in developing a statewide economic development strategy based on plans reflective of the state’s diverse economic regions. But the development of the plans for each region is overseen by an incredibly complex governance structure that requires accommodation of business, environmental justice, racial equity, and other stakeholder groups. Though commendable in intention, in practice this has resulted in a broad set of small-bore investments that support the priorities of different groups without overly offending the sensibilities of any of these diverse stakeholders, instead of massive investments on the scale of those from earlier generations that could be truly economically transformative.
The challenge of complexity is compounded by Californians’ long-term institutional commitment to both representative democracy and legislating at the ballot box. A further challenge is the intergovernmental conflict born of the state’s (sometimes laudable but often costly) commitment to local control of key matters such as land use. The past decade of California’s housing policy has largely been directed at rebalancing that system of local control by, for example, requiring localities to provide administrative rather than discretionary approval of accessory dwelling units or suing localities that are out of compliance with the state’s Housing Accountability Act. And economic regions within California are themselves a tangle of local governments, special districts, and transportation agencies creating insoluble collective action problems in spite of the best efforts of coordinating agencies. The San Francisco Bay Area alone has 101 city and county governments, and hundreds of additional special districts, school districts, transit operators, joint powers authorities, and other governmental groups, all of which have limited capacity to effectively execute on their own governing missions—let alone sync up in a way that addresses long-standing public concerns around affordability, commute times, and economic inclusion.
The challenge of complexity is compounded by Californians’ long-term institutional commitment to both representative democracy and legislating at the ballot box.
The Need for Fundamental Political Reform
What all this suggests is that the primary battles motivating the conflict around abundance may be missing the point. If the people of the state of California and similarly positioned polities come to understand that the real problem is complexity of government, and that these Rube Goldberg machines we have created stand in the way of achieving of any end associated with the preferences of any ideological faction, they could come together across differences to address these challenges through fundamental political reform.
And, indeed, a variety of organizations and efforts have taken on pieces of a comprehensive political reform agenda in recent years, including the Think Long Committee and California Forward. Certain successes have been achieved, although one of the major wins, the California Citizens Redistricting Commission, is imperiled by the current political moment of partisan conflict. Governor Gavin Newsom’s current efforts to launch a more thorough reform agenda focused on enhancing efficiency in the executive branch are also an opportunity to enact more lasting reforms, as is his Engaged California project, which aims to enhance public input into political decisionmaking (a project for which Carnegie California has been an adviser).
But ultimately, the reform agenda must be ambitious enough to take on the broader range of challenges that limit California’s ability to live up to its full potential. The first set of reforms could build on current efforts such as Engaged California to leverage new technologies to improve rather than to restrict how public input from a variety of stakeholders shapes state and local government action in areas from service delivery to homelessness policy. The sensemaking capabilities of artificial intelligence tools, for example, can shortcut the time and effort needed to analyze and respond to the input of large numbers of people, making public comment processes less time- and effort-intensive. Implementing new technologies and integrating them into public systems can be practically challenging at times, but such upgrades to our public engagement systems stand out because they are pragmatic. They don’t assume wholesale change in Californian democracy. Yet they are still meaningful enough to move the state in a constructive direction.
Improving public input into policy processes, though, is not enough. California and similar polities will need to tackle the overwhelming complexity of their government structures. Otherwise, they will not have the capacity to respond in a timely and coherent manner to this input. This should involve a certain degree of simplification and streamlining of the byzantine legal and regulatory processes that evoke the ire of abundance-minded reformers. But bigger-picture reforms will result in bigger dividends.
Improving public input into policy processes . . . is not enough. California and similar polities will need to tackle the overwhelming complexity of their government structures.
What are some comprehensive reforms the state should tackle? California could place stricter limits on the number of bills legislators can advance in each year and devote substantially more time to legislative oversight to ensure that the state’s elected officials understand the systems they continually seek to reform and which interventions have been more and less successful in the past. Efforts to reduce the complexity of the state’s governing system could also include reducing the number of constitutionally elected officials; creating an executive branch structure with clearer lines of democratic accountability across each policy area, with clear verticals between state and county or municipal levels of government; and rationalizing the relationship between the state’s direct and representative systems of government to align with best practices from around the globe. California could also vastly reduce the number of local and state agencies with overlapping jurisdictions and mandates that make implementing any policy prescription incredibly difficult.
This litany of potential structural governing changes risks depicting California as both incurably broken and as distinctive in its maladies as it is in its scale and physical geography. What we see instead is a more complicated picture: The state is neither completely fractured nor fully functional. The path forward therefore requires steady, incremental renewal, rather than silver bullets.
The California story of the past half century reprises certain themes that are likely to bedevil large, complex, relatively wealthy democracies that engage in repeated rounds of pluralist accommodation and are ill-prepared to resist the temptation to postpone difficult choices and paper over hard trade-offs. These actions become self-reinforcing as the complex systems they create in turn struggle to deliver large enough policy wins to justify future trade-offs. Therefore, steady, thoughtful, comprehensive political reform that returns agency and capacity to these governments is essential. Echoes of California’s story resonate in jurisdictions ranging from New York to South Korea to EU member countries. But if history is any guide, California is distinctive not only in its economic scale but its capacity for creative reinvention and global influence. Those qualities will need to be supplemented with candor about lingering problems, failed schemes, and new possibilities, because California’s fate will play an outsized role in the story of democracy around the world.
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