California Governor Gavin Newsom, long a darling of the progressive elite, has donned a new mask. On June 30, he signed Assembly Bill 130/Senate Bill 131, claiming the move would:
“…build more housing, faster, and create strong affordable pathways for every Californian. Today’s bill is a game changer, which will be felt for generations to come.”
Typically, that kind of rhetoric from Newsom would signal government subsidies and boondoggles, but this is not the case.
This time, the bills eliminate provisions of the California Environmental Quality Act (CEQA), a 1970 law that has ballooned into a bureaucratic behemoth, strangling home building and inflating costs. Newsom’s move, as detailed by Steven Greenhut, for Reason, appears to be a calculated pivot—a bid to shed his radical leftist image as he eyes a 2028 presidential run. But don’t be fooled. This reform, while substantial, is a drop in the bucket for a state drowning in a housing crisis and hemorrhaging residents, largely due to the very policies Newsom has championed.
Signed by Ronald Reagan in 1970, CEQA was meant to ensure what agents of the government called “environmental accountability.” Of course, it actually was a weapon for special interests—labor unions, competitors, and litigious neighbors—who wield its mandates to delay or kill projects, and for the explosion of “Not In My Back Yard” “NIMBY” blockages by neighbors.
The law’s labyrinthine requirements, often demanding thousand-page environmental impact reports, have driven up costs and choked housing supply.
According to a 2025 report from the California Association of Realtors, median home prices hit $874,290 in Q3 2024, up 5.2% year-over-year, while housing affordability plummeted to 15% for first-time buyers. Supply remains throttled—only 4,120 new permits were issued statewide in Q2 2024, a 20% drop from 2023.
Writes Greenhut:
“Just in time for the July 1 budget-signing deadline, the legislature overwhelmingly passed the measure, which ended up as two bills. They exempt ‘nine types of projects from environmental reviews: child care centers, health clinics, food banks, farmworker housing, broadband, wildfire prevention, water infrastructure, public parks or trails and, notably, advanced manufacturing,’ per a CalMatters report. One of the bills also ‘restricts legal challenges under CEQA by narrowing which documents courts can consider.’"
Greenhut also notes that Newsom engaged in some fairly powerful “arm-twisting” to secure passage by tying it to the $321 billion state budget—a rare and aggressive move.
Yet, this reform is less a libertarian triumph than a political maneuver. Newsom, facing a legacy tarnished by California’s spiraling cost of living, homelessness, and crime, could be desperate to appear pragmatic. His earlier stances—defiant lawsuits against Trump, grandstanding on ICE raids—catered to the progressive base but did little to address the state’s rot. Now, with 18 months left in office, he might be pivoting to the center, hoping to burnish his national profile.
The hypocrisy is stark.
Newsom’s 2018 pledge to build 3.5 million homes by 2025 was a collectivist, tax-burning, pipe dream; fewer than 500,000 units were completed from 2019 to 2023, per state data. His new goal of 2.5 million by 2030 feels equally hollow without dismantling the regulatory state he’s long propped up.
And, of course, Californians are fleeing. A 2025 Public Policy Institute of California study
shows that the state experienced significant net domestic out-migration (movement to other US states) in recent years. Between July 2020 and July 2023, the state lost 412,000 people due to net domestic migration, with the majority of this loss attributed to US citizens moving to other states.
The U-Haul Growth Index for 2024 ranked California 50th for one-way moves, with Texas and Florida soaking up the exodus.
It’s a policy catastrophe, rooted in the same collectivist ethos Newsom now feigns to reject.
Even Newsom cannot deny that the cost of CEQA has been staggering. A 2021 UC Berkeley study estimated compliance costs at $1.5 billion annually, with delays adding years and millions to projects. Newsom’s reforms nibble at the edges—exempting select projects but leaving CEQA’s framework for others to exploit.
Newsom’s gambit may win headlines, but it’s a Band-Aid on a broken system. California’s housing crisis and the burdens Newsom and the Assembly have placed on business owners and consumers demand a free-market revolution—slashing regulations, taxes, and union strangleholds—not a politician’s posturing. Until Newsom embraces that, his “reform” is just another camera-ready stunt, leaving Californians to foot the bill or flee the state.