Under the Roman Empire, the rich people lived in villas. Large windows allowed residents to look out on urban life — and for urban life to look in. More often than not, the villa’s entrances opened directly onto city streets. As the power of the Roman Empire began to wane, the cities became less safe. Villa walls got thicker and their windows became smaller. Some moved into military fortifications that the empire had abandoned.

Out of these changes, the medieval castle gradually emerged as the new dwelling of choice for the well-to-do. Usually elevated above the homes of commoners, the castle’s walls, moats, and drawbridges could easily be mistaken for a show of strength. But in truth, they were a symbol of the decline of pax romana, a testament to the absence of a centralized source of protection and power. In this new world, every man was on his own.

--

Watching Los Angeles burn, it is hard not to think of the fractal-like ways in which America’s governments — local, state, and federal — have failed the residents of America’s second-largest city. State and federal environmental permitting laws made prudent fire prevention close to impossible. Mismanaged water resources meant that firefighters had no ammunition. Public land — especially the land owned by the state and municipal governments — was left without basic preventative care. California’s price-controlled property insurance system barred homeowners from receiving market signals about the riskiness of their properties. Amid the chaos, Los Angeles’ fire departments were overwhelmed. As their homes and schools and churches burned, perhaps some Angelenos, rich and poor alike, wondered whether they, too, were now on their own.

It’s hard to know when, exactly, the shocking decline in state capacity that is an ambient part of our daily life began. Many of the laws mentioned above date to between the late 1960s and the 1980s, and many more laws have piled on since then. Left to enforce these laws are a complex web of government agencies with vague and often overlapping mandates.

The supporters of these agencies might say they are “chronically underfunded,” but in truth California spends more on government than nearly any society in the developed world. Combined, California’s state and local government entities spent, conservatively, nearly $600 billion in 2021 alone. Vast amounts of that — nearly $75 billion in 2024 — are used to pay for the six-figure pensions guaranteed to public employees from retirement to their death. And even with that, the pension system is only 72% funded, leaving a $150 billion liability that there is, simply put, no real plan to deal with beyond kicking the can down the road. Untold billions also go to quasi-governmental nonprofit “social service providers.” Often, these billions truly are untold: the Governor has, for example, consistently vetoed spending transparency efforts in the state’s immense homelessness system. Last September, just months after a state audit revealed that California spent $24 billion on homelessness programs over five years but did not consistently track or measure outcomes, Newsom vetoed AB 2903, which would have required state-run homelessness programs to report cost and outcome data annually. A year before that, he vetoed AB 2570, which would have required annual reviews of state funds allocated to cities and counties for homelessness initiatives.

None of this should come as a surprise. California’s government is, increasingly, in business for itself rather than for its citizens. Many of the most powerful interest groups in the state are government interest groups, namely public sector unions. The majority of California’s unionized workforce are government employees; 60% of the government workforce is unionized, compared to less than 10% in the private sector. These public employees’ union dues — often deducted directly from their paychecks — fund roughly $600 million in union political activity throughout the state every two years. Thus, every taxpayer in California is obligated to fund political activity that most estimates suggest skews heavily toward funding Democratic Party candidates.

In other words, government employees and their representatives drive the political economy of the state. Their blessing is a de facto requirement for successfully holding almost any elected office in California. It is not a surprise that the system works this way. It is not even a failure. It is, instead, the system working as designed. The problem is that the system doesn’t live up to the basic agreement between the people and the government that is supposed to be at the foundation of a republic.

All that largesse is funded disproportionately by the wealthy (and by debt) — even by the standards of most progressive income taxation regimes: just 0.05% of California taxpayers pay around 20% of the state’s income taxes. Many of those same households also pay a disproportionate share of California’s highest-in-the-country capital gains taxes. Many of these people just saw their houses burn down, owing in large part to the incompetence of the government they pay so heavily for.

Eventually, those people are going to wonder what it is, exactly, that their money buys them. Many are probably asking themselves that very question now.

--

California is not unique among American cities and states, many of which exhibit similar problems. But it does exhibit them more dramatically than anywhere else in America. No single phenomenon explains what has gone wrong. Instead, California typifies a fractal-like breakdown of responsibility, competence, trust, and purpose we have seen again and again in American bureaucracy and government. Repair is possible in theory, but unlikely in practice.

What we are likely to see instead is the gradual replacement of heretofore public services with private versions of those services. These private services are not novel: private police, firefighting, schools, and other services have existed in American life for well over a century. It’s just that their size and relevance is likely to grow. And facing a threat to its power, you can expect the state to fight back.

Struggles in education have been in the headlines for decades, with private schools, charter schools, and homeschoolers on one side and the public school system on the other. California has among the highest rates of exodus from its public school system of any state in the country. Between the 2019-20 and 2022-23 school years, the state saw a reduction of approximately 420,000 students, representing a 6.7% decrease. Comparatively, data from the National Center for Education Statistics indicates that from fall 2019 to fall 2023, just 18 states experienced public school enrollment declines exceeding 4%, with California among the states witnessing the most significant drops of more than 5%. This is a particular threat in wealthy areas, where public schools rely on de facto mandatory “suggested donations” from parents because of Proposition 13, a state law that caps property tax increases and with that, school budgets. As you might expect, California’s lawmakers — in thrall to the teacher and other public school employee unions — are constantly fighting this exodus.

Even in the more obscure domain of fire prevention, this conflict is already unfolding. Private firefighting services have worked alongside the Los Angeles Fire Department during the ongoing fires in Los Angeles. Some of these services are personally contracted by home and business owners, while others are provided by high-end property insurance companies like Chubb and Pure, who specialize in ensuring luxury assets. On top of this, some homeowners have even purchased six-figure private fire hydrants for their homes for both city and private firefighting forces to use.

Rick Caruso, the real estate developer and principal opponent to Los Angeles’ current mayor in the most recent election, used private firefighting to preserve his upscale Palisades Village Mall. Many other homes and businesses were saved throughout the devastated parts of Los Angeles by private firefighting services. In principle, this should be a fact everyone can celebrate: there are homes, businesses, and other buildings standing intact today because of private firefighters.

But that is not how some see it. Caruso attracted viral criticism on Twitter for daring to use private firefighters. Some wealthy Los Angeles residents took to social media to find private firefighters and were excoriated for their efforts to protect their homes, possessions, and, sometimes, no doubt, their pets. This is a collectivist mind disease of the highest order: we must all suffer together in the name of equality — or really, if we are to be honest, in the name of the state.

Pushback against private firefighting goes beyond mere rhetoric. Emergency first response is, indeed, a key state function — and like virtually all state functions in California, its employees are part of public sector unions. They do not take kindly to others intruding upon their turf.

In 2018, the State of California passed AB 2380, a bill intended to put private firefighting services in their place — or, as the statute itself describes it, to “[declare] that firefighting and fire protection services are a municipal function and a public good to be provided by public agencies and their employees.” Among other things, the bill directs state agencies to develop regulations to ensure that private firefighters “shall, whenever possible, focus on prefire treatment activities and pretreatment of values-at-risk and other nonemergency activities.” In other words, back off.

In short: California has endangered their citizens through public policy at every step of the way, even though each step was in the ostensible “public interest.” California’s heavily regulated insurance system made properly functioning insurance markets illegal in the state, meaning that homeowners in high-risk areas could not be warned of the danger through price signals, the primary way human beings communicate sophisticated information about risk in capitalist societies. Many insurers fled the state, and those that remained had less flexibility to offer homeowners discounts for taking protective measures against wildfires, because profits for insurance companies were close to illegal. A small number of disproportionately wealthy people had good enough insurance or other means to procure private firefighting, and the state has fought those private services tooth and nail for the past seven years.

In fairness, California’s insurance system came about by plebiscite (Proposition 103, passed by the voters of the state in 1988), not a piece of legislation. But nonetheless, the result is a public policy regime designed to deny reality rather than grapple with it. In its efforts to subsume reality under the regulatory will of the state, California left its citizens vulnerable to the cruelty of nature.

--

Faced with these uncomfortable truths, some California residents will flee — a trend that has been ongoing for much of the 21st century. Others, attached to the state by employment or family or by simple affinity for its natural beauty, will take matters ever more into their own hands.

It is a good time for them to be doing so. Today more than ever, technology is putting capabilities once reserved for governments and large corporations into the hands of smaller organizations. Increasingly autonomous drones could offer new, lower-cost, and less dangerous ways to combat fires. Companies like Skydio already make drones that have been used in firefighting, and Anduril’s CEO Palmer Luckey has discussed the potential for his company’s products to be used in similar applications. Artificial intelligence could enable radical innovations in education, with new kinds of schools that require far fewer human instructors, or even dramatically better homeschooling. Khan Academy, which has aggressively adopted AI, provides a preview of the opportunities to come; startups like Eureka Labs, created by OpenAI Co-Founder Andrej Karpathy, could one day show us the path as well.

How many other necessary regulations and public services will small groups of people be able to administer with computers in the not-too-distant future? Depending on how the frontiers of AI proceed, perhaps quite a bit indeed.

These and other technologies point toward a more decentralized future, where individuals and small groups are able to procure services once provided only by urban or state governments. They may be just what the doctor ordered: given the decline in state capacity we are witnessing, those who desire safety for their families and opportunity for their children may have little choice but to turn away from public services.

California’s government will almost surely fight those people at every turn. More and more, it will become clear that California’s government does not see itself as serving its citizens — especially its rich ones; it sees its citizens as serving it. This has been the case for a while now, so in truth, it might not be so bad: harsh realities might as well be explicit rather than hidden beneath euphemisms and platitudes.

The state will erect barriers to those who seek new institutions for protection and other basic services. Overcoming those barriers will require agency. In a way, this is as American an outcome as any: our country was founded, after all, on high-agency people building institutions anew. Once, those institutions were those of Britain and the Old World. Now, they are our own threadbare, failing institutions. But no matter: life in a frontier republic was never guaranteed to be easy, and no one ever said the American Revolution was over.

—Dean W. Ball