Editor’s Note: Will O’Neill, a partner at Newport Beach’s Newmeyer Dillion, is chairman of the Republican Party of Orange County and twice served as mayor of Newport Beach. He can be contacted at ChairmanONeill@ocgop.org.
The old saying that “if you’re not at the table, then you’re on the menu” applies equally well to business and politics.
California residents – and especially California businesses – can try to stay away from politics, but politics won’t stay away from you.
Pacific Palisades burned to the ground more than a year ago. As we all know now, government policies prioritized grass and small creatures over wildfire mitigation and left the smoldering remains of an arsonist to re-ignite. When residents needed their government the most, they were left with dry fire hydrants and an empty reservoir designed specifically to combat fire.
For years, California’s national image has been videos of brazen robberies and toiletries locked behind plexiglass. Recently, murderers and child rapists have received early parole from prison because California’s laws reward prisoners who are “elderly,” a term now defined as over 50 years old. When California voters rose up and demanded that such crimes be made illegal again by overwhelmingly passing Proposition 36, the governor and state legislature failed to fund it anywhere near effective levels.
As our Governor leaves office, he also leaves increasing tax burdens on every employer in California by failing to pay off a $20 billion federal loan. California is, in fact, the only state in the U.S. to still owe its outstanding federal unemployment insurance debt. This means that California businesses are potentially facing a 5.2% federal payroll tax rate, nearly nine times higher than what employers pay in debt-free states.
California’s Spending Problem
California has the most expensive gas in the U.S., driven by taxes, environmental mandates and limited refinery capacity, as well as the nation’s second-highest electricity rates.
Not to be outdone on those necessities, California continues to consider new taxes when affordability is at a premium. The proposed “Billionaire Tax” is waiting in the shadows and sucks up media oxygen, but we need to also pay attention to our local cities to monitor how many tax increases are already being proposed for November.
At the state level, California’s budget has ballooned from $215 billion when Gov. Gavin Newsom took office to a newly proposed $349.4 billion budget eight short years later. Our governments don’t have a revenue problem; they have a spending problem.
Every single one of these impacts is due entirely to policy choices made by elected officials that too many businesses and trade groups have embraced hoping to moderate the legislative outcomes. Their efforts have failed spectacularly.
I worry that we are seeing a similar trend in one of the last bastions of sanity, Orange County. The Democratic majority on the Orange County Board of Supervisors is pushing an aggressive “Climate Action Plan” that takes a giant step away from affordability and development. While pitched as “voluntary” for now, no government program in California remains voluntary for long.
We have lost Yamaha and In-N-Out is moving its co-headquarters to Tennessee. California, in general, and Orange County specifically have stagnated populations since 2020 while red states like Texas and Florida have grown by millions of people; many of them being former Californians.
The Reasons for Hope
Orange County is, without question, a purple county by registration, which surprises many national pundits who remember the Republican heyday of the 1980s, when Ronald Reagan joked that Orange County was “where the good Republicans go before they die.”
Orange County has more registered Democrats (36.4%) than Republicans (33.8%) due largely to our county’s three largest cities: Anaheim, Santa Ana and Irvine. We particularly owe it to the children of Santa Ana to elect better representatives.
While Santa Ana Unified School District’s elected president was railing against President Trump from the dais, he and his board majority were slashing nearly 300 teacher jobs due to poor budget management. A misplaced national focus remains the hallmark of too many elected officials’ priorities these days.
We all know families that have moved away to Franklin, Tennessee; Austin; Boise, Idaho; Phoenix and other more affordable locations. The Public Policy Institute of California analyzed those who have left our state and concluded that (1) housing is the dominant reason cited for leaving and (2) Republicans are much more likely to leave than Democrats.
Despite this exodus, Orange County has seen nearly double the registration growth for Republicans than Democrats since the 2024 presidential election 11,251 to 6,420 (see chart). Twenty-three of Orange County’s 34 cities are run by Republican-majority city councils.
The entire Orange County Board of Education consists of elected Republicans. And before ballots were even cast, Republicans started this primary season 3-0 thanks to the re-election of unopposed candidates Mari Barke (Board of Education, Dist. 2), Dr. Stefan Bean (Superintendent of Schools), and Andrew Hamilton (Auditor-Controller).
The Path to Success
Cities that remain hyper-focused on local human flourishing have succeeded. It should come as no surprise to anyone that conservative Newport Beach now occupies three of the top 10 most expensive zip codes in California. Comparing Newport Beach to Santa Monica – similar population size and coastal enclaves – reminds us that policy choices are the difference between growth and stagnation.
Anyone who has walked through the empty storefronts of Santa Monica’s Third Street Promenade lately knows that.
If we allow L.A. policies to dictate self-checkout policies, police funding, and overtly socialist politics, then we will have deserved the outcomes of our complacency.
My advice is to refocus on local races like county, city, and school board offices. Endorse, support, and engage with those people whose decisions have a significantly greater impact on your day-to-day lives than the fights nearly 3,000 miles away in our nation’s capital.
I’m not ready to be on the menu.
Let’s keep California businesses in our state. I’m ready to do the work. I bet you are too.
Let’s work together to attract high-quality candidates and support and elect them. I stand ready to help.
