Stephen Klubeck (12:45)

Chicago, actually, but Chicago. Grew up in California since I was six. I'm a Californian.

Mark Halperin (12:51)

I read you were born in Los Angeles, but apparently not. Steve Hilton was not born in Los Angeles. He was born in the UK but he came to the United States and believes in free markets and lots of other things you'll hear about. Former Fox News host. He also is putting himself forward for this job. It's a wide open field. Anybody who tells you that they know who the top tier is or who can win are wrong. And so here now, two men running against each other, but are very friendly with each other. Stephen Klubeck, Steve Hilton. Gentlemen, welcome in.

Steve Hilton (13:23)

Thank you, Mark. Great to be with you. Thank you for doing this.

Mark Halperin (13:25)

Very happy to have you here. And, you know, I always, I always resent when reporters say, well, this person can't win or that person can't win. I've talked to you both, and you're both super thoughtful people. And you, you, you, I know you both think you've got a good chance in this race, not just because the field's weak, let's be honest, or I'd say weak. It doesn't have a clear front runner. And you're both outsiders. And right now, the mood for a lot of the electorate is outsiders, people who would try different things. And you both are very iconoclastic, willing to criticize not just business as usual, but your own parties at times. So with that and with my thanks for your being here, let's start with the economy. I read a lot about people saying Gavin Newsom's California is a disaster. Gavin Newsom. And some people say the economy is actually great. And it's still, you know, a massive economy, one of the largest in the world. So, Stephen, I'll go to you first. What's working well with the California economy now that you would want to keep going or make work even better?

Stephen Klubeck (14:23)

We have a lot of sunshine, huh?

Mark Halperin (14:26)

So you're saying nothing.

Stephen Klubeck (14:28)

This is not the California I grew up in, in the late 60s, 70s, 80s, an economy that I was told that you could do anything. It was the land of innovation, the land of manufacturing. You would survive and you thrive. And I do not see that today. I moved back to California, grew up here. I left for a hot minute to grow my worldwide hotel business. And. And there was no better place in the world that I wanted to actually reside other than California. It's the greatest state. It's a country, actually. We know that it's fourth largest GDP in the world. It's not being run the same way. When I grew up here, the opportunities, the contract's not being fulfilled. And look, Gavin Newsom's popularity is over 50% today. I, I, I see it differently. I, I don't prescribe to the same way that the state's being run right now. We're number one in poverty, we're number one in homelessness. We don't execute properly. We don't account for where our money is, the customers of California, we don't show results and we don't enforce the law. As I see it, the way I grew up, I'm an old school Democrat, a blue dog Democrat, balance sheet income statement, very conservative. We don't steal, what is this? $950. That's okay. It's not okay in my book. And I think today, Mark, you're going to find that Steve Hilton, who I respect immensely, he and I do share a lot of very similar views. We share the views of the hard center and I think that these are well schooled comments. You'll hear from me and you'll hear from Steve and you're going to find, you know, I have a D behind my name and I argue within my own party. I think it's lost its way. The polls are the polls. I pulled the customer of Californian and 65% plus of us want something different. There's nobody in the heart center today and I think Steve and I do actually represent that we're coming into this race as outsiders. We have been involved in politics and policies around the world. We're not just looking at local guys and we bring fresh ideas, we bring disruption and we all know Einstein's definition of insanity doing the same thing over and over again. And we are living in it. And the hard right and the hard left. I think Steve and I are both getting beat up by both sides.

Mark Halperin (17:20)

Steve Hilton, do you see anything that's working well in the economy in California now?

Steve Hilton (17:24)

Yeah, I love the way you frame the question mark. I think that's right because I do try to be positive. I think the simple answer to your question is that what's going right in the California economy is everything. That's nothing to do with the government. In other words, we have amazing businesses and entrepreneurs. I'm on the road the whole time in California. Day after day. You're meeting people who have founded what is now the world's biggest cheese producer, the biggest producer of software in a particular space. World dominating industries and businesses as well as incredible small businesses. You know, we have the greatest ag industry, obviously tech, and those sorts of industries that are more familiar that lead the world. However, as well as a great success story that contributes to what Steve just mentioned correctly is the gdp that's the fourth biggest in the world. I'm incredibly proud of that. But at the same time as that we have right now in California, America's highest unemployment rate and America's highest poverty rate. And then you look at a recent survey. United Way does a survey every two years about what it's like to live in California. Just a couple of months ago, the latest survey, 35% of California's cannot afford to meet their basic needs. And so I think a story that really captures what's gone wrong, both ends of that story, as it were. You saw a recent announcement a couple of months ago from Nvidia, the world's most valuable company. Fantastic California success story in the Bay Area where I live, a huge new investment in America, half a trillion dollars. None of it going to California, to that company's home state. All of it going to Texas and Phoenix.

Mark Halperin (19:09)

All of it.

Steve Hilton (19:09)

Why? Because it's impossible for companies to just operate in a reasonable way in California anymore. Look, you mentioned that I was for many years a host on Fox News. That's my most recent career. Most of my career has actually been in business, starting and running companies back in the UK and here in California. When I started a business here in California, a tech company, actually it was harder than in the uk and you think, what's that about? This is supposed to be the home of innovation and enterprise and opportunity. A story just the other day, and I hear these stories every single day, a lady who runs a small restaurant in wine country, actually in California, Northern California, very business close to my heart because I started and ran restaurants in the uk. That is a tough business. And anytime anywhere, Steve knows this. He's been in that sector. This lady wanted to expand her patio that you built a larger patio. She could have more guests. Growth and opportunity, that's what we want, right? It took her six years and a million dollars to do that in fees and permits and inspections. And that little story tells the bigger story that actually businesses are leaving California. They're not locating in California. The jobs aren't being created here because it's so difficult. And it's the comb of factors that we've had now, 15 years of one party rule and we've ended up in a state which has. The Chief executive magazine has an annual survey of what it's like to do business in the different states. For the last 10 years, California has been 50th out of 50. The regulations, the hassle, the fees, the permits. Energy cost the highest in the country. Electricity double the national average. Gas price is the highest. If you're delivering goods, if you're trying to run anything, it's also expensive, complicated, a hassle, the accumulation of bureaucracy, the lawsuits. And it all goes back to this structural problem, I think, when you have 15 years of one party in power because you've got three things going on, I think, that actually are driving all of these costs and all of these complexities for business which make it such a nightmare to operate here. Number one, the unions. The unions have an iron grip on the Democrat politicians. Number two, the lawyers. Litigation is a massive issue for every business in California. Whether you're running a small restaurant and you have things called PAGA lawsuits, private attorney general act completely exploitative lawsuits that add to your costs. Whether you're a house builder trying to build homes in California, takes you years to get through the litigation. That's the second factor. And then the third factor that underlies all of this is the climate ideology of the Democrats who've been in charge here. The that just absolutely make it impossible to build anything, to do anything, to grow, to expand, and adds to the costs of all of that. And that's why my argument is that we have to have a change of political direction if we're going to get California back on track.

Mark Halperin (22:12)

Stephen, do you agree with that list of lawyers and unions and regulation on energy? Do you agree with that list?

Stephen Klubeck (22:19)

Well, look, I see it somewhat the same, but a little bit different, okay? Putting my ledge hat on, my regulatory hat and my judge hat, where I've done these jobs too, appointed, as you said. I can tell you this. When I've traveled the state too, as Steve has done, we're finding similar things. When I find this CEO of Chevron telling me the same thing that the head of the farm workers is telling me, okay, which is what? Leadership is not talking to its best customers. We forgot about. We are all customers in California and we need to receive equal or greater value. When I grew up in Southern California, you couldn't see across the San Fernando Valley. Today you can, okay, so with regard to us improving the environment of California, yes, it's much healthier. But now what is the incremental cost in the form of billions and billions of dollars to make it infinitesimally better at the cost of not feeding families at the Cost of so and when.

Mark Halperin (23:32)

You go ahead, I want to say, I want to get you guys to be more specific. You're, you're talking about what the problems are, but I want you to talk about your solutions. I was on specific thing which is tech. Every big tech leader I talked to and again, as Steve pointed out, you both have worked in the private sector and have had great success. You get what it means to run a business in a regulatory state. So big tech says the Democrats in Washington under Biden Harris, the Democrats in Sacramento don't understand what big tech needs to survive right now. It's the crown jewel, not just the California economy, of the American economy. So what are the Steve and Steven thoughts? Talk amongst yourselves about how to deal with your tech sector.

Steve Hilton (24:12)

So I think that's the look, it is the crown jewel in the sense of creating the big numbers in terms of the economy because you've got these companies that have huge valuations and they generate a lot of revenue, but they don't create many jobs, Mark. And that's the reason that you have at the same time, fourth biggest economy, highest unemployment rate in America. So actually the real thing that we can do to, to make the most of the tech revolution that I'm proud to say the next wave of it is happening in San Francisco with the AI boom, OpenAI and all those fantastic companies. What do they need more than anything else? They need energy. And we have an insane energy policy in California, for example. Let's get specific. We have the highest electricity costs anywhere in America.

Stephen Klubeck (25:03)

And it's unnecessary, Steve.

Steve Hilton (25:05)

It's unnecessary anywhere except for one of.

Stephen Klubeck (25:07)

The greatest minerals in this state.

Steve Hilton (25:09)

Yes. So let's just put, I want to stick with energy, the highest cost for energy, huge amounts of electricity needed to power the data centers and so on. Right. But why do we have the highest cost? Why do we have expensive and actually unreliable power? Because the climate ideology pushed by the Democrats for all these years is obsessed with wind and solar power.

Mark Halperin (25:31)

Tell me what you, tell me what you do differently and then what I.

Steve Hilton (25:34)

Would do is, is kill when here's the list, right. Kill windmills, end the solar subsidies, use natural gas, which we have in abundance in California to power up gas fired power stations. Let me please be specific on that. Right. We have a fleet of gas fired power stations in California running on natural gas that are currently running on about 10 to 15% of their capacity as a deliberate choice because they are only there as backup for intermittent wind and solar power. We also have abundant reserves of natural gas in California. But again, because of climate ideology, the industry is not being given the permits it needs to actually get it out of the ground. As a result, we are currently the smaller and relatively small amount of natural gas that we do use in California. 90% of it is imported, which is completely insane and, and counterproductive and adds to carbon emissions. So here's what I would do, which is use the current fleet of natural gas power stations to their full capacity. By the way, if we did that, that would generate 300,000 gigawatt hours of electricity, which is more than halfway towards the target that the Democrats have set for 2045 when they say we need 500,000 gigawatt hours to meet all the demands of AI and the electrification of the entire economy. More than half of that will we can do with our current gas fired power stations that they're using at 10 to 15% of capacity because of their climate ideology. It makes no sense at all. Just to show you how insane it is, Mark. Right. The plan from the Democrats for the future electricity needs the wind. Part of it is to expand offshore wind in California. They want to put windmills 20 miles off the shore from the central coast at Morro Bay in the north Humboldt county, because you get more wind if you go further out. They're very tall, 1,000ft high, but the ocean's very deep there. So what are they going to do? Floating wind turbines, never been done anywhere else before. Floating wind turbines 20 miles offshore. Totally industrializing those parts of our coast for what? Unreliable, extraordinarily expensive wind power when we have natural gas abundantly here. But they don't want to use it, they. Because of their climate ideology. It's totally insane, Steven. So that's just one example of how we can help that industry. But the real point, Sorry, to get back to the original question on tech is the industries that I really want to help in California are not tech, which can pretty much look after itself apart from the energy point. It's actually the industries that create blue collar jobs for working people in California so we can raise incomes for regular people. Because what you've got going on right now in California is, is a state where the rich get richer but regular working people get screwed. So the industries that I actually want to help are farming and manufacturing and house building. Those are the industries that are really being crushed by the current regime. And that's where I think the focus needs to be.

Mark Halperin (28:35)

Stephen?

Stephen Klubeck (28:36)

Yes, Mark?

Mark Halperin (28:38)

Thoughts on the tech sector and on.

Stephen Klubeck (28:41)

Well, look, I'm not going to, I'm not going to disagree with Steve with regard to wind and solar, their fancy ideas of fantasy because they are not as efficient as I'm a big Nuke Gen 4 guy. The ability for mini Nuke and Nuke Gen 4 that that's really can be rolled out is highly successful. And you saw the pivot in the Democratic Party keeping Diablo open longer and not shutting it down.

Steve Hilton (29:12)

So can I just say Diablo Canyon is the last remaining nuclear power station in California. Just around 10% of our power currently.

Stephen Klubeck (29:20)

Extended to 10% of our power during non peak periods. Yes, high peak periods, about 5%.

Mark Halperin (29:26)

So look, do you both want to build more nuclear power plants?

Steve Hilton (29:31)

Very much I agree with Steve. But do you agree with me, Steve, that actually nuclear is just going to take a bit of time, Steve?

Stephen Klubeck (29:40)

100%.

Steve Hilton (29:41)

And so to me the idea is natural gas as a bridge to nuclear while we bring the nuclear.

Stephen Klubeck (29:48)

We use the key word. I use pivot to the future. We're aspirational. We. I don't believe in mandates, Steve. I've said it many a time. We're over regulated, we're overlawed, we're over regulated. And if you look over the last seven years in our state, look at the full time employees that have gone onto the state payroll because of the regulations that I've come up through, silly Sacramento, 45,000 extra jobs. We're not getting more value, we're getting less value. And that's about $6.4 billion.

Mark Halperin (30:15)

Do you, do you agree with Steve that there should be more natural gas used?

Stephen Klubeck (30:19)

Not just natural gas, but other resources we have like lithium. The Salton Sea is filled with lithium.

Mark Halperin (30:24)

Okay.

Stephen Klubeck (30:24)

We have one of the largest lithium deposits in the world sitting in our state. Right.

Mark Halperin (30:29)

So let's just again, the economy needs energy. You both want nuclear long term. You both think natural gas is part of a short term solution. How do you get the, how do you get what's necessarily done to allow more natural gas use?

Steve Hilton (30:43)

Well, I think that you've got to start with the. And that is a really key question that relates to the power of the governor in the reality of the political framework that we have in California, which is the legislature right now has a Democrat supermajority, Democrats who are not like Steve Klubeck, who aren't common sense and practical. They are more ideological and crucially, they are frankly owned and controlled by the two biggest donors to the Democrat politicians. You look at Gavin Newsom's breakdown of his donors. Number one, the government unions, number two, the lawyers, number three, private sector unions. Number four, healthcare and number five, Indian tribes. So that's the makeup of the legislature too. They're not going to like what we're talking about, but generally the power to actually make all this happen. Any of the changes Steve or I would want to do is through the control of the executive branch, the multiplicity of agencies and bureaucracies. In California now, I worked in the government back in the day in the uk, I was senior advisor to Prime Minister David Cameron. I've been there inside of a government battling the bureaucracy. I know it's incredibly difficult and very hard to make change happen, but actually you do have some direct control there as the governor. For example, on this energy question, so much of the negative policies coming out of carb, the California Air Resources Board, the governor appoints a majority of the members of carb. And so you can really redirect that agency by. And I think the starting point is actually to dismantle this fantasy of net 0 20, 45. Now that has been legislatively established and so you can't just ignore it, but in the way you implement policy, you can actually have more common sense. But a lot of these regulations, for example, on forcing truckers and farmers to upgrade their trucks when they're perfectly useful life years of useful life ahead of them and they have to pay a fortune to get some mildly clean engine. It's exactly what Steve was just talking about. For some tiny, tiny notional improvement.

Stephen Klubeck (32:41)

You're layering, Steve, we're going to end up.

Steve Hilton (32:43)

But you can appoint new people to. The central answer to your question mark is you control the regulatory regime pretty directly and you can control the, the, both the regulations that come out of that and the enforcement of them. That's how we make all this happen, Steve.

Stephen Klubeck (33:00)

So look, we've both been in government, you in uk and I will tell you that I've operated in the UK and it is equally as difficult in the UK as it is in California sometimes.

Steve Hilton (33:11)

Oh, yes, no, I'm not saying we succeeded so.

Stephen Klubeck (33:13)

No, no, quite the opposite. So we've come from a similar frame of reference, but I can tell you we know that disruption works and in our government in California, we're going to lead. They don't like these words because I've used them quite often. They're going to need some teaching, coaching, counseling and training of unintended consequences. And that only comes from experience.

Mark Halperin (33:35)

Yeah. Stephen, give an example. How would you disrupt the economy beyond energy, what we just talked about, how would you disrupt the economy by using the office of the Governor I think.

Stephen Klubeck (33:46)

There has to be. Look, I have become an expert at disrupting business and disrupting industries and fixing broken. And by doing that, you got to create a level of trust. You have to teach, coach and counsel those in Sacramento and the Senate and the Assembly.

Mark Halperin (34:04)

Give a specific example of if you're elected governor after a year or so, what would you have done to disrupt the business as usual to make the economy better for working Californians?

Stephen Klubeck (34:14)

Well, first of all, I'd go after insurance. Top priorities for me would be insurance. Equally as important affordability. Second is homelessness. Those would be my three top priorities.

Steve Hilton (34:27)

And I would say on insurance, I mean the insurance commissioner, which is a position I disagree with because you Proposition 103. Yeah, no, I understand, but you, the insurance commissioner really runs the regulation of the industry. Now. I think we would agree on the. What's gone wrong again? Insurance, highest costs in the country.

Mark Halperin (34:47)

Which kind of, which kind of insurance are we talking about? Our homeowners, all of it.

Stephen Klubeck (34:51)

Property liability casualty, automotive homeowners.

Steve Hilton (34:55)

And, and, and car, auto. I mean, on auto, I believe we're the highest in the country. On homeowners, it's the issue is less the cost, but availability.

Stephen Klubeck (35:04)

Well, that's supply and demand.

Steve Hilton (35:06)

You can't get insurance.

Stephen Klubeck (35:07)

That's right. And so if you look at the problem, which I have in great totality and I had to do this in my worldwide company, I had to dismantle the insurance component in my worldwide company. So we've got to treat California as a country. Okay. And I think there's a financial fix where we insulate. So first of all, what is the problem? The problem is the insurers have pulled out of California because they can't price a product. If they can't price a product because of last loss, you can't offer a product. So they have left along with the regulatory impediments, along with the inexperienced individual that has run for the office. I believe it should be an appointed office. I agree. So I know.

Steve Hilton (35:51)

But you don't agree with. You can't change that. That has to be done through a ballot initiative.

Stephen Klubeck (35:55)

Well, I think. But you get if we can teach, coach and counsel the Senate, the Assembly, how important experience is in this job. There's two jobs in the state that I see that are. That are elected that should be appointed. Our school system and, and our insurance. Yeah, I agree with that experience to run these jobs. I know, Steve, we agree with so much.

Mark Halperin (36:13)

So, so you both, you'd both work on the insurance sector, whether you could eliminate the person or maybe work with an insurance elected insurance commissioner. You both believe there needs to be fundamental changes in how the availability and cost of different kinds of insurance.

Steve Hilton (36:28)

Can I just be specific about it, Mark? And I know you like specifics. So the reason that we've got in this mess is that there's been two. Because. Because it's been an elected position. You've ended up with people in that position who for obvious reasons pander to the voters. So their priority has been to keep rates down. This is going back more than a decade now. In fact, the previous guy was worse than the current guy. And as part of that they have. The system that's been set up in California is that insurers have to go and get approval for rate increases. And it's really micromanaged.

Stephen Klubeck (37:04)

And the commissioner and there's an intervener called the Consumer Watchdog Group of California which has killed the customer. California.

Steve Hilton (37:13)

Exactly. They were responsible for setting up this whole system in the first place by putting it on the ballot.

Stephen Klubeck (37:17)

So the fox is in the hen house.

Mark Halperin (37:19)

I want to move on from insurance, but I want to close it up and then move to infrastructure transportation. What are the things you guys think would be a way to address insurance right away?

Steve Hilton (37:30)

Two of them have been done by the. Have just been done in December last year by the current guy, which is allowing the insurers to take into account future risk to price their policies. That's now happened.

Stephen Klubeck (37:42)

Should have happened because it used to be the almanac and now it's future risk. Keep going.

Steve Hilton (37:46)

Secondly, to allow the insurers to incorporate their cost of reinsurance into their business models. That has now been allowed. It should have been allowed years ago. But the third piece which hasn't been done is the micromanagement. There's endless fussing around with the rates. Anytime an insurance company wants to change anything, they have to go to the bureaucracy, go through a process, hearings. It's ridiculous. And so that's the third piece that should be changed. Also small thing. There's ridiculous political biases shoved into it. For example, they're not allowed to take account of gender differences. I mean, this relates to auto insurance. And you've had the kind of crazy outcome there of actually because statistically women are safer drivers than men. So we've actually ended up women paying more in general.

Mark Halperin (38:38)

Does the insurance market in all these different areas and not every market in insurance same. Does it need more regulation or less? Or does it. Does it.

Steve Hilton (38:46)

No less. Much less. It's massively over regulated.

Stephen Klubeck (38:50)

Steve. I would Take it further with specificity. Since Mark Lexis, I think we need a financial fix to 103 where we insulate the last loss and allow more insurers to come in the market because they can only price it and they can't price last loss right now. So I think if we trapeze, net it with the captive of the state and you take our fair plan concept, which is captive, okay. And we insulate the last loss, we can't handle catastrophic. Catastrophic because we're all gone. But there is a component part where we can price the product, where we use this financial instrument. I've done this before with the captive and insulate maybe the last five, 6% of last loss, we will have more insurers coming into the state. We reduce the time of those that have been here because that's an regulatory impediment. As long as they have balance sheet to handle the policies that they've written and they pay on those policies and they don't have to delay, deny and depose because we know that's bad.

Mark Halperin (39:50)

Do you both have confidence this is fixable by a governor? Yes.

Stephen Klubeck (39:54)

Yes, yes, yes, yes.

Steve Hilton (39:57)

Can I. I'm not so sure because you got this elected person. Yeah, but, but can I. And can I just ask you. Sorry, can I just pick up on just a very quick answer to your question earlier, Mark, which I really appreciate, which is something specific that you can do to help working people. And I just want to play out this example because a lot of people just assume, well, nothing can change and it's all a nightmare. And I think actually if you do the work in terms of understanding how government works and how you can make change happen, you can offer people hope. So this is an issue. I touched on it earlier, but I promise you, every business that I speak to who's interacting with the real world, right, not tech as actually, but restaurants close to my heart because I used to run them. Farmers, manufacturing, anyone who's operating a facility, anyone engaging with the real world, the PAGA lawsuits Private Attorney General act are an absolute nightmare, crushing them. This is an act that was passed in 2004, the private attorney General act.

Stephen Klubeck (41:01)

Amended last July.

Steve Hilton (41:03)

Well, hang on, let me just explain how it works.

Mark Halperin (41:06)

Wait, I got, I got. I'm sorry, I got to stop because we're going to take a break. I want you to be able to explain how it works, but we're going to take a break and then move on. So appreciate that we won't get to cover everything. We're going to come back Next up, Stephen Klubeck and Steve Hilton, two candidates for governor of California. We're going to talk about getting around the state. That's next up. Sometimes you got to ask yourself are you being lied to? They tell you that you max out on your 401k and on your IRA and then make you beg for permission to use your own money. It's time to get the full truth and discover a better way to grow and protect your money. Bank on yourself is the proven retirement plan. That's an alternative to banks and Wall street and they desperately don't want you to ever hear about it. It gives you guaranteed growth and tax free retirement income. Your plan stays protected even when the markets dip. You're in control with access to your money anytime for emergencies or opportunities that come along without any penalties or restrictions. And even when you use your fund, your money keeps growing like you never touched it. Plus with built in inflation protection, your savings grow by a larger dollar amount every year. Its real financial security and peace of mind. With a retirement plan that works for you right now, you can get a free report that reveals how you can bank on yourself and enjoy tax free retirement income, guaranteed growth and control of your own money. Just go to bankonyourself.com mark and get your free report again. That's bankonyourself.com mark bankonyourself.com.

Stephen Klubeck (42:44)

The holidays mean more travel, more shopping, more time online and more personal info in more places that could expose you more to identity theft. But LifeLock monitors millions of data points per second. If your identity is stolen, our US based restoration specialists will fix it, guaranteed or your money back. Don't face drained accounts, fraudulent loans or financial losses alone. Get more holiday fun and less Holiday worry with LifeLock. Save up to 40% your first year. Visit LifeLock.com SpecialOffer terms apply.

Mark Halperin (43:16)

All right, welcome back. Next up, we're talking to our two candidates for governor of California as part of our inaugural debate. In our debate series, Stephen Kubeck, the Democrat, Republican, Steve Hilton, both putting themselves forward for one of the biggest and toughest jobs in the country. Gentlemen, I don't think we're ever going to see the rail exist between Northern and Southern California. Even though your state has spent a lot of my tax money on it as well as California money, what are solutions for how people get around the state besides cars? Are you going to build more roads? You're going to build flying cars? You got to build more airplanes. What is a solution for allowing people to get around the state? Steve?

Stephen Klubeck (43:55)

Stephen Klubeck, we've got the most beautiful state in the United States, is the greatest state to drive around in. You know, look, it's not so difficult getting around the state. It's. Believe me, I, I've, I've lived in traffic my entire life growing up in Southern California, and you know, it. It's. It's part of the badge of honor of living here. Look, the high speed rail project, I think we can all agree, is a debacle for many reasons. I think Steve and I. Steve, you and I have talked about that. I mean, it's just. I don't know why it wasn't outsourced. I don't know why it wasn't built on top of an existing right of way. There's a lot of things we can talk about here, but flying cars. Yeah, we're going to see flying cars. It's going to happen. It's going to happen. We have to embrace technology in our state because we were the land of innovation. We shall be tomorrowland because that's what California has always been. Look, blockchain.

Mark Halperin (45:00)

But Stephen, just, just so I understand, are you saying there don't need to be fundamental reforms and new projects for transportation?

Stephen Klubeck (45:07)

Oh, no, we always have to. Look, we were the land of infrastructure. We should always grow.

Mark Halperin (45:12)

What's a specific. What's a specific change for either the whole state or one of the crowded regions that you want to. You want to help build to make transportation better?

Stephen Klubeck (45:21)

Well, look, I think first off, we've got to deal with affordability, and I think we have to declare an affordability emergency and disband ceqa. We're talking about regulation. CEQA is a highly regulated.

Mark Halperin (45:33)

What is, what is CEQA?

Steve Hilton (45:36)

California Environmental Quality act, passed in 1970, signed by Governor Reagan.

Stephen Klubeck (45:42)

I was going to say something different, but it's the biggest impediment to get anything built.

Mark Halperin (45:47)

But again, when that's, if that's repealed.

Stephen Klubeck (45:49)

In addition to the Wildlife and Species act and the Coastal Commission, what do you want to.

Mark Halperin (45:53)

What do you. What, if anything, do you want to build to make getting around within cities and between cities easier?

Stephen Klubeck (45:59)

If anything, I definitely think we should look at high speed rail and scrap everything that we've looked at and put it on the table.

Steve Hilton (46:07)

Okay, but Steve, come on. I. Actually, here's a little point, I think, of disagreement in the debate we're having, which is I don't think it's easy to get around. I mean, I'm on the road the whole time, and for people, you know, they're Constantly stuck in traffic. And, and that's getting worse because you've got this attitude that driving a car is bad. And I'll give you an example of this. They've introduced and it all driven going back to my original three things, Steve, which is the structural forces that have created this nightmare in California of making it the Most expensive place, 50th out of 50 on affordability and the worst business climate in the country, which has led to us being 50th out of 50th of state, 50th out of 50 states on opportunity. And that is unions, lawsuits, climate. You again, you see it all coming together in this issue of infrastructure. Look at this thing they introduced called VMT vehicle Miles Traveled that is coming out of the California Air Resources Board and all these regional air quality agencies and whatever used to block anything that will actually help people drive more. Because driving is seen as evil because it's bad for the.

Stephen Klubeck (47:21)

Even though, by the way, it's not evil. Steve. And then look, Steve, with all due respect, look, I, I drove from the San Fernando Valley to Orange County, Irvine every day for one year. Okay. I remember one day it took me three hours in the in it was 1984. It took me three hours to get from Irvine back to the San Fernando Valley. Okay. The other day I went from Costa Mesa, Irvine to Los Angeles. It took me 50 minutes.

Steve Hilton (47:53)

So no, you can find times. I agree. But look, by the way, that for the 4 or 5 freeway going from Orange county, thank you for saying they just added some express lanes. Made a big difference. That's the kind of thing we need. Thoughtful.

Mark Halperin (48:06)

Okay, so express lanes. Express lanes. Steve Kubect, Stephen Klubeck, you said maybe light rail. I want to hear more specifics. What if you say to the voters of California because, because a lot of voters do think the state's transportation is, is not working for them. It takes three hour drives you might think is okay. But most people I know that was in the.

Stephen Klubeck (48:27)

I was in the 80s. I haven't done.

Mark Halperin (48:29)

I understand. Well, I once, I once had a three hour drive within Los Angeles from, from. From.

Steve Hilton (48:33)

No, exactly.

Mark Halperin (48:34)

From. From the west on the Pacific coast just to downtown. Took me three years.

Steve Hilton (48:39)

But we've got on. You know, this is the, in 2015, I wrote a book called More Human Designing a World where People Come First. And the theme of the book is that you've got to actually, you know, operate policy in every single area in line with what people want and how people live and not impose ideological. Brutal.

Mark Halperin (48:59)

I say Again, I will move on from transportation if neither of you have ideas. But I'm just saying. Let me just, let me just.

Steve Hilton (49:05)

California was developed as a car society, right? It goes, it spreads outwards.

Mark Halperin (49:13)

There's going to be, there's going to be cars. There's going to be driving. I'm just asking you both say deregulation, right? There needs to be deregulation so people can build stuff. What do you want to build to make it easier to get more.

Stephen Klubeck (49:26)

We've seen more free. More roads. We've seen more freeways. If I see. Tell you all the new freeways that have been developed from the 70s till today, I mean, there's dozens of new.

Mark Halperin (49:37)

So give me an example, give me an example of a road that's not currently existing that you want to build. Where does it start? Where does it go?

Stephen Klubeck (49:45)

I build an expressway from the Santa Monica area to downtown L. A.

Mark Halperin (49:51)

Where would that, where would that go?

Stephen Klubeck (49:53)

On top of the 10, I build.

Mark Halperin (49:55)

A double, a double decker, double it up. How long, how long would that take? How long would that take and how much would it cost?

Stephen Klubeck (50:02)

Well, if Steve and I do it, we could probably get it done. Well, Governor Wilson rebuilt 18, 18 months.

Steve Hilton (50:08)

Governor Wilson rebuilt the 10 freeway after the Northridge earthquake in a matter of months. You know, you can do it, Steve.

Stephen Klubeck (50:14)

The best one was, the best one ongoing the fire, the unfortunate fire in downtown L. A on the 10 Freeway. And they said it would take six months and all of a sudden they got it done in eight days.

Steve Hilton (50:24)

I think the point I want to make on this is that there's a driving ideology at work in relation to transportation, as with everything else in California right now, which is that we have to get people out of their cars and into something else in order to improve transportation. And that is because there's a fantasy that you can operate California's transportation needs as if it were some kind of European city developed in, in, you know, over, over centuries with a medieval city center and, and, and high rises and, or medium rise building. That's not California. It's not the reality of how we develop. California developed outwards. They call it sprawl. I call it the California dream. Low rise, single family homes. You have a nice house where your kids can play in the yard. That's the reality of California. Well, so transportation policy needs to reflect that reality of not some ideology.

Stephen Klubeck (51:22)

Then we agree, Steve, you and I, you and I can aggressively mandate to pause Sequoia wildlife species and coastal commission till something's written that is proper for Rural, urban, suburban and coastal. Four areas only simplify it the way it was one time in the 80s. I mean, the first shopping center I built was in 1984 in Burbank, and I pulled a permit in 120 days.

Mark Halperin (51:48)

Okay, just go back, just go back to rail for a second. Steve Klubeck, you said you want to see light rail, but you also denigrated the failed project. Where should light rail go?

Stephen Klubeck (51:59)

I think appropriately, a connection between Los Angeles and San Francisco is appropriate as long as we can account for it.

Steve Hilton (52:09)

Why would anyone use it? It'll be slower than flying for the small number of people who need to make that trip. Most people are driving around, taking the kids to school, getting to work. The real issue with transportation is connecting.

Stephen Klubeck (52:20)

Time out, Steve. If we had a whiteboard and you and I were in charge and we said, okay, let's connect Southern California to Northern California and have, let's just say a half a dozen stops on the way, okay? And it was 300 miles per hour and we allowed the Chinese or the Japanese to bid on it because I believe in having the best interest, ingenuity and effectiveness do the work. Okay. Whatever it may be. And we go ahead and put an RFP out and we say, okay, you got to build it within three years. And this is the, this, this is the guaranteed maximum price to do it.

Steve Hilton (52:59)

But why would you do that? Okay, let me just again, please do. I'm going to put something specific to you, Steve, and tell me if you disagree. Right. Let's just look at a much better use of the money. That's the $30 billion that's already been spent on high speed rail without a single track being laid. What has been built is ridiculous pointless infrastructure in the Central Valley. I drive up and down there all the time. The greatest.

Stephen Klubeck (53:22)

That's a train to nowhere.

Steve Hilton (53:24)

Exactly. I drive up and down the two sort of main transportation routes, 99 and the 5. Right. The 99 highway, the 5 interstate. Right. And all up and down the 99. You see these ridiculous bridges and whatever that are never going to be used for high speed rail. That's never going to work. Instead, what you should have done and what I would want to do is expand the 99 highway. Why? So that the farmers and the industry can get their produce to the ports quicker and more easily. We're losing.

Mark Halperin (53:55)

Expanded by adding lanes, or maybe.

Steve Hilton (53:57)

Yes, by adding lanes. By adding lanes. In most places.

Stephen Klubeck (54:00)

I'm not disagreeing with it.

Steve Hilton (54:01)

In most places it's two lanes. Right. So if you did that, then you would take some of the truck traffic off of the five, and that would make the parts of that less congested, particularly as you get near la. You're trying to get to the how.

Mark Halperin (54:15)

Much would the expansion cost and how long would it take?

Steve Hilton (54:18)

You need to do the A study to establish that. I mean, we can't sit here and look as candidates for governor and draw, you know, maps with roads that we're just going to make up. But the strategy is, here's the point, to actually go with the grain of how California works. And instead of trying to implement a fantasy that we're going to get people out of cars and trucks, we're going to actually go with how the state works and make it work better. And that means expanding our road network to reduce congestion and reduce times to get from A to B, rather than forcing people to do something that they will never do.

Stephen Klubeck (54:56)

It's not mutually exclusive. Steve, you know that we're saying the same things. We're talking about thinking about unintended consequences. We're thinking about executing properly, accounting for our money properly and showing us results. And none of those things have happened.

Steve Hilton (55:11)

Here's another thing on trust.

Mark Halperin (55:12)

Hold on, hold on. Sorry, sorry. I got it. I apologize. We're going to move to a different topic here, which is education, okay? And a huge topic. And the governor is not in charge of education. There's local control, there's role for the federal government. The teachers union is obviously a huge impediment. I know at least one of you would say that's a huge impediment. What are one or two realistic things? Realistic things you could do to make educational quality better in California public schools. Don't tell me what's wrong. Don't tell me what you can't do. Tell me one or two things you're confident you could get done as governor to make the schools in California better. Steve and Klupek, two things.

Stephen Klubeck (55:47)

One, have every young adult be ready for the real world when they graduate. And two, teach them civics. How do you judge it? Give them the immigration test of the United States. Already approved those two things.

Mark Halperin (55:59)

How would you do. How would you do the first one? How would you get them ready?

Stephen Klubeck (56:04)

Basic reading, writing, arithmetic, can. Do you know what it costs to have a child? Do you know what it costs to live in an apartment? Do you know what it costs to live in the real world and work it back?

Mark Halperin (56:15)

So you want to. You want a new mandated statewide curriculum?

Stephen Klubeck (56:20)

100%. 100%. With regard to those two component parts yes.

Mark Halperin (56:26)

Steve Hilton.

Steve Hilton (56:27)

I agree that there's a lot of problems with the curriculum, but I think the fundamental problem is that the basics aren't being taught properly, which is why we have the worst third grade reading results in the country. Less than half of the kids in California public schools read at grade level. For math, it's 30%. It's a total disaster.

Stephen Klubeck (56:42)

Once again, are you ready for the real world?

Steve Hilton (56:45)

Yeah. Okay. So what you've got to do is refocus on getting the basics right. Accountability. So here's a couple of specific things. Right now it's almost impossible for parents to actually figure out how kids, how individual schools and teachers are performing because they've made it so complicated with the information. The starting point for improvement is good information. And so one thing we can do right now, and I would do is make sure you have a simple letter grade for every school and every teacher so we can see who's performing well, who's performing badly. Reward the good teachers, remove the bad teachers.

Mark Halperin (57:20)

Does the legislature have to sign off.

Steve Hilton (57:22)

On that or could you do. No, we have the information. We don't need any legislative input.

Stephen Klubeck (57:26)

And explain to me how you're going to get that through the cta, the most powerful union.

Steve Hilton (57:31)

They have no say in it. This is. The information is already there.

Mark Halperin (57:34)

You're saying publicize. Publicize existing information.

Steve Hilton (57:37)

Exactly right. Clarify it to parents as the starting point for putting power in parents hands to actually make changes. My friend and colleague at my policy organization, Golden Together, Gloria Romero, she was the Democrat leader of the state Senate back more than a decade ago. She wrote a law back then. She's a Democrat called the parent trigger law. And the point of the parent trigger law was to enable parents, when schools were failing and kids were not doing well, to trigger, hence the name changes. Whether that's removing a principal or the superintendent or converting to a charter school, all of those things. She wrote that law as a Democrat. Ever since then, the legislature, of course, controlled by the teacher unions, have been reducing the information that's available and the accountability and reducing the amount of.

Stephen Klubeck (58:25)

You just told me the teachers union doesn't have power.

Steve Hilton (58:28)

They don't have power over the providing of the information.

Stephen Klubeck (58:31)

Oh, you're being so naive, Steve. That California teachers union is one of the biggest problems in our state.

Steve Hilton (58:36)

Of course it is. Of course it is. That's why we have, we agree, violently agree that we have to break the public school monopoly. But it's. And so the second stage, first stage, publish the information so we know what's Going on which schools.

Stephen Klubeck (58:48)

So that's a meritocracy. Meritocracy.

Steve Hilton (58:51)

Let's first stage, publish the information. Second stage, actually start to put power back in parents hands to make changes. For example, the charter schools which have progressively over the years they've made it harder and harder for schools to convert into charters so that they can set their own curriculum and teach the way that they want out of the control of the teacher unions. They've made it more difficult. I just sat down with the head of the charter schools association to go into detail about how through the state board of education which the governor appoints, you can make changes to the process for becoming a charter. That would actually accelerate the move away from the public school teacher union controlled monopoly.

Mark Halperin (59:33)

Steve, how many, what percentage of California K through 12 would you like to see in charter schools?

Steve Hilton (59:39)

I would like to see 100% of the school system in direct control of parents and what they want. Now I think a realistic goal would be to double the proportion of charters. We're about 10%. I think we could get higher. But I think that over my long term, well laid out in everything I've written and argued for years is that parent that we should end the government school monopoly because kids are different, parents needs are different. Some kids want a more academic approach, others want a more vocational and skills based approach that Steve was talking about. I totally agree with that. This kind of factory school model, one size fits all, controlled by the government and therefore the teacher unions. It's got to go. But, but I'm not pie in the sky. You can't do that overnight. You certainly can't do it without the legislature. But these are small steps you can take is number one, provide better information. Number two, improve the process of becoming a charter school. Because that's the simplest way of actual and the most achievable way of starting to move in the direction of accountability for educational performance rather than what you got now which is endless indoctrination and the results are a disaster.

Mark Halperin (60:48)

Stephen Klubeck what's the necessary posture of a governor of California towards the teachers union to be a successful governor? On education, what's the, what are the elements of how you have to approach the union?

Stephen Klubeck (61:01)

I think, look, a lot of the problems in California, including education, are that we all have to take responsibility for the predicament we are now in because we voted for what we got today. Do we want change? And you know I, and I'm sure Steve also has heard this. Everyone's talking a good game, but are we willing to show up and fight for change in the education.

Mark Halperin (61:28)

But I'm asking you specifically about the union, which most analysts say is an impediment to the fundamental change.

Stephen Klubeck (61:34)

So again, would you be, would you.

Mark Halperin (61:37)

Be business as usual with the teachers union?

Stephen Klubeck (61:39)

No. You demand? No, no, no. I wouldn't, I wouldn't mandate it. I would, I would try to build a level of trust. When you disrupt, you've got to come in and build, build a level of trust with the people you're working with and unify you, you, you can't just battle. Look at Arnold. He went, he took on X number of unions. His, his first stage out as a neophyte coming into politics, that didn't work so well. You can't, You've gotta, when you disrupt, you've gotta build trust. We have a, a tremendous level of distrust and we're all upset. The level of anxiety out in the streets today and in business is, is DEFCON 6. And the only way you can disrupt is trying to get everyone to sit in a room, scream it out, and come up with ideas that we can unify around and start building that trust again and work on the things that we are discussing today, Steve Hilton and I, because these are new ideas. We're fresh set of eyes here. We're not same old, same old. We're here coming in to disrupt the system. But I think Steve would agree with me on this. You have to build that level of trust. It doesn't exist today and it's hard work.

Steve Hilton (62:46)

Yeah, I mean, look, I tried that, Steve. That would 100% be my posture.

Mark Halperin (62:50)

Right.

Steve Hilton (62:50)

I would go into this as the newly elected governor of California, a Republican. That's a political revolution in California.

Stephen Klubeck (62:56)

You mean when you're my chief. When you're my chief of staff? Right.

Steve Hilton (62:59)

And I would sit down and I would want to sit down and say, look, let's work together with everyone, because I understand that you're being divided government. You'd have a Democrat legislature. So let's work together. I just have to tell you, it seems to me that the Democratic Party and its institutions, especially in California, have really been captured by ideologues who actually aren't interested in that kind of common check.

Stephen Klubeck (63:23)

We know that they have no experience, they're unqualified, they haven't signed the front of a check and we haven't held them accountable.

Mark Halperin (63:29)

Yeah. All right, next up, we're going to talk about two calm issues. We talk about crime and immigration.

Stephen Klubeck (63:34)

Crime.

Mark Halperin (63:34)

That's next up. Attention everybody. If you're a homeowner in America. You need to listen to this. The FBI has been warning about a type of real estate fraud on the rise. It's called title theft and your equity is the target. Here's how it works. Criminals forge your signature on a single document, then use a fake notary stamp and file it with the county. And just like that, on record, they own your home using your ownership. They can then take out loans against your equity or even sell your property. And you won't know about any of this until foreclosure or collection notices start showing up in the mail. That's why I've partnered with the folks at home Title lock. So you can protect your equity. And find out today if you're already a victim. Use my promo code mark@hometitlelock.com and you'll get a free title history report and a free trial of their million dollar triple lock protection. That includes 247 monitoring of your title records, urgent alerts to any changes, and if fraud does occur, their US based restoration team will spend up to $1 million to fix it. Don't be a victim. Protect your Equity today. That's hometitlelock.com use the promo code Mark again. Hometitlelock.com use the Promo Code mark.

Stephen Klubeck (64:49)

The holidays mean more travel, more shopping, more time online and more personal info in more places that could expose you more to identity theft. But Lifelock monitors millions of data points per second. If your identity is stolen, our US Based restoration specialists will fix it, guaranteed or your money back. Don't face drained accounts, fraudulent loans or financial losses alone. Get more holiday fun and less holiday worry with Lifelock. Save up to 40% your first year. Visit lifelock.com Specialoffer terms apply.

Mark Halperin (65:23)

All right, we're back. Next up with our conversation with two gubernatorial candidates from California. Stephen Klubeck, businessman and Democrat, and another businessman, Steve Hilton. Both of whom have been around government a long time and both of whom know enough about how it works to know it ain't working well for the people of California in a lot of ways. Gentlemen, let's talk about crime again. There's local law enforcement, there's federal law enforcement. The governor sits between them. Stephen. Steve Hilton, what are things you would do as governor if you want to make Californians safer as governor?

Stephen Klubeck (65:58)

Well, look, I've said it before. Woke is.

Steve Hilton (66:01)

Oh, Steve, look at him jumping in.

Mark Halperin (66:03)

All right, go ahead. Stephen Klubeck, go ahead.

Steve Hilton (66:05)

Fine, you go for it.

Mark Halperin (66:06)

Go ahead.

Stephen Klubeck (66:07)

I've learned from, from a great journalist like you. Come on you do this all the time. This is your trick. Woke is weak. And we need brass balls. We need leadership. Look, we have laws. We have rule of law. We all have to follow the laws. Okay? It starts with the governor of California. And if we have a mask mandate, we wear masks. Yeah, I just took a swipe because that was really bad. I mean, you must follow the laws. And we don't steal. We don't steal, but at the same time, we have warmth and compassion. If somebody needs a loaf of bread. But we don't give away what we don't have. We must take care of family first. And if you want to go into. We were talking about immigration, too. Seen in human immigration. Nobody wants criminals in their homes, their schools, or their workplace.

Mark Halperin (66:52)

So be stand crime for a minute. And again, I'm asking for specifics so the voters can understand. If you were governor, what would you do? What proposition?

Stephen Klubeck (67:00)

Proposition I would float a new proposition to enhance Proposition 36. Okay. And make sure that we don't steal. It's not $950, it's zero.

Mark Halperin (67:10)

Okay, go ahead. Go ahead, Steve.

Steve Hilton (67:13)

So, look, you're right that it's a very decentralized area of policy, probably more than most and without the reality. Here's what I would do as governor is reverse. In a way, one of the main drivers of the crime explosion in California, which has been the prison closure program that really started with Jerry Brown, accelerated under Gavin Newsom, but part of criminal justice reform. This idea of decarceration, that nobody should be in jail because jail is racist. Because every time you see a disproportionate racial profile and anything that's the result of racism, there's all this ideology. They said we're closing state prisons. They've closed four in the last few years, big prisons. And there's another fifth, slated foreclosure. What's the consequence of that? Tens of thousands of dangerous, violent criminals have been released either into the community directly. Many of them have committed crimes, terrible crimes, and we see stories of that all the time, or transferred to county jails. County jails are now completely overcrowded. What does that mean? That means that judges at the local level know that the jails are full, so they're not giving criminals who should be in jail custodial sentences. What does that mean? It means that law enforcement, I talk to them all the time. Are totally demoralized because they know that. That if they apprehend and they put themselves at risk, apprehend criminals, they're just going to, you're going to get what they refer to now as catch and release in California. Go in one door, out the other, because everyone knows the jails are full. What does that mean in turn, when the law enforcement doesn't bother because they know nothing's going to happen? People have no confidence in the system. The public has no confidence. And so they don't even bother reporting crime because they know nothing's going to happen. So all of that is the consequence of the prison closure program. So the single most specific and useful thing that a governor could do would be to reverse that program, increase prison capacity, not only so that we can actually hold criminals accountable for their behavior, the punishment part of it, but also the rehabilitation part of it. When you don't have enough prison capacity, you can't do proper rehabilitation.

Mark Halperin (69:21)

Are those buildings. Are those buildings still available?

Steve Hilton (69:24)

Some of them. I mean, I did an event. When I announced my policy, I stood in front of one of them. That's still there. But again, you don't. We got to be thoughtful about it.

Stephen Klubeck (69:32)

Okay.

Steve Hilton (69:32)

So back in the day. Can I just make this point? It's very important about rehabilitation.

Mark Halperin (69:36)

So long.

Stephen Klubeck (69:36)

You just.

Steve Hilton (69:38)

I'm trying to give you an answer to the question. Rehabilitation is actually one of the most important things we can do to cut crime because a large proportion of crime is repeat crime from repeat offenders. And so actually, if you look at some of the states with the best record on rehabilitation, I think Virginia currently has. Has the best. It's around 20%. In California, it's nearly 50%. That's a huge difference. And if we had more prison capacity, we could do real rehabilitation and thereby reduce crime.

Mark Halperin (70:05)

So, Stephen, what are your thoughts on more prison capacity, and what are your thoughts on ending recidivism rates as high as California has?

Stephen Klubeck (70:13)

Thank you. Well, I didn't stand outside the prison. I was in Lancaster State Prison in cell block five. Okay. And I spoke with 30. Prisoner's life without the possibility of parole. I did push ups with one. I kicked his ass. But I can tell you this. I've talked to the guards, I've talked to the inmates. It's bespoke. There has to be new set of eyes on the entire policy and procedure. And again, you've got the prison guard union. That is an impediment here. And you'd have to sit down and speak with them. We let out about 35% of the inmates in California prisons, but, you know, our budget stayed the same. How does that math work? It doesn't. It doesn't work. And 20% of, you know, 100% of the crimes are done by 20% of the individuals. And frankly, some of them need to be locked up for the rest of their life. Okay? It has to be extremely bespoke. And even the parole system in California, with all these enhancements that these regulations have been put on, you could be standing next to somebody, unfortunately, as a juvenile and witness a shooting, and you get caught up in that shooting, and you could have life without the possibility of parole. That is egregious and wrong. And there's so many individuals in the system that have done well, that have gotten their degree in school that should come out that want to help the system, and they're not being left out, they're not being let out to help fix the system. It totally needs to be relooked at in totality. And Steve and I are saying somewhat the same. And if he and I work together, we could fix the entire system and make California safer in everyone's home, school.

Mark Halperin (72:00)

Stipulating. These are all topics. We could spend an hour on each. I just want to move to a few more things. Let's use the president's relationship with Gavin Newsom, around immigration, the National Guard, deportation, as kind of a case study, an opportunity to folks to understand how you would approach not just Washington, but specifically Donald Trump. Because if you, if either of you win, you're going to be dealing with them for, you know, months at a time. So, Stephen Klubeck, just analyze how did Gavin Newsom deal with President Trump in Washington on the issues of National Guard? It's an ongoing fight. How would, how did he do with. Deal with it that you would do the same? What would you have done differently?

Stephen Klubeck (72:38)

I think they came at each other at the beginning of their relationship, not even looking, listening to one another. You have to unify. Gavin Newsom went in and immediately said, let's resist, and I vociferously disagree. And we must unify California. You should be the bully pulpit of the United States as it was and should be in the future.

Mark Halperin (73:03)

So stylistically, you'd be, you'd be more accommodating. But in terms of the policy, would you, would you object to the deportations? Would you object to the use of the national look?

Stephen Klubeck (73:13)

The Biden administration did an absolutely horrific job. And, and Ms. Harris, no IQ, no EQ, and paying attention to immigration. Immigration needs to be done in a sane, humane way. We need proper immigration. I'm a, I'm a grandson of immigrants, and my family didn't violate the law. You come Here, as an immigrant, it's a privilege. You follow our laws. And if you don't follow our laws, you get your day in court. And if it's not adjudicated properly, you get booted. But you have to add value. But there needs to be a pathway to citizenship for all of those folks that have been here over the last 10, 20, 25 years or that have paid taxes properly, that have added value. Okay? And we need a Just a unified approach in the great country of California with the United States of America to work together to come up with sane, humane immigration. Okay? It's as simple as that. You violate our laws, you're here privilege, you get your day in court. Look, we don't have enough judges right now. I was head of tourism in the United States. I worked with DHS and CBP very closely. They know who the bad people are. But I don't like having the National Guard not unified with the federal government coming into our communities. We should be working close together to make sure our communities are safe. Because you know what? We're actually putting customs and borders and Homeland Security at risk going into those communities. Okay? We're not allowing them perimeters to be advanced. Like when Denny was arrested, DHS was involved in HSI under Homeland Security. There was a perimeter set up around his homes in Miami and Los Angeles, and everyone was protected. They went into the asset, they got the bad people, they got all the evidence, and it was seamless. But there's a better way of doing it. But you can only do that when you unify. And I got a problem with this resistance philosophy. We must unify. You gotta be collaborative.

Steve Hilton (75:16)

Yeah, I agree that we've gotta work together. And that would be my attitude generally as governor with the federal administration, frankly, of whatever party. But right now, certainly for the first two years, we know it's gonna be the Trump administration. I have a relationship with the president. I'm friends with half the cabinet. I can work with them.

Stephen Klubeck (75:33)

Do you have a cell phone? Yeah.

Steve Hilton (75:35)

I mean.

Stephen Klubeck (75:35)

Oh, so do I.

Steve Hilton (75:37)

Okay. But so do a lot of people. I think the thing is that. So the attitude completely with you on immigration specifically. Look, I'm a legal immigrant and I'm proudly. So, you know, moved here in 2012. My wife and two sons became an American. Couldn't be more proud to be an American and a Californian.

Stephen Klubeck (75:58)

Did you get rid of that funny accent, though?

Steve Hilton (76:00)

No. We're gonna. I'm working on it. There's certain words you have to say in an American accent, otherwise you sound Much too hoity toity. So, you know, like big one. By the way, Steve, I know you and I talk about, about it a lot when we're in the Central Valley talking to our great farmers about how we need to get them water. I find if you say, you know, you got to say water, we need water for our farm.

Stephen Klubeck (76:20)

Water.

Steve Hilton (76:20)

Exactly. Look, on immigration, I think that it's just very clear that the vast majority of people expect us to enforce the law. I proudly want to support our legal immigrant community to have a shot at the California dream. All the other things we're doing to help with that. But you've got to enforce the law. And, and that's what's happening now with federal immigration law. I think the problem is this attitude of resistance. Exactly as you say, Steve. And it goes back right to the first Trump administration in California when we passed here SB 54, the original sanctuary state law, and they hide behind that. And you saw that in the confrontation in Los Angeles where you saw the National Guard and all of that as well as sanctuary state, we can't cooperate with federal government.

Stephen Klubeck (77:05)

You don't just run hum visas into a community.

Steve Hilton (77:07)

No, no, no, wait, wait, wait. Let me just get to the point on the sanctuary state law, which is that they say because of that law we can't cooperate with federal law enforcement at all in terms of their operations. Not true. If you actually look at that bill, and it was criticized by some Democrats at the time for this exact point, there's a long list there of specific crimes, over 200 specific crimes listed in the sanctuary state law for which it is the term in the legislation is discretion. Local law enforcement has discretion to cooperate with federal immigration enforcement. When you're dealing with people who have either have committed or suspected of committed committing a long list of crimes, whether that's serious ones, like murder and violence, even drug possession, it's true to say that they can't cooperate because of the sanctuary state law. They can and they should.

Stephen Klubeck (78:02)

Are you saying then sanctuary state law is like Hamas being allowed to weapon keep their weapons in hospitals and mosques, churches, so our all of that kind.

Steve Hilton (78:17)

Of thing could be avoided?

Stephen Klubeck (78:18)

I bet no one's ever actually had.

Steve Hilton (78:20)

Common sense, practical cooperation between federal and state and local law enforcement wouldn't need any of that.

Stephen Klubeck (78:28)

Sanctuary city Hamas.

Steve Hilton (78:30)

I don't really understand the comparison. I'm just telling you that the law allows for even the sanctuary state law, which I disagree with, but even that allows for cooperation between state and local law enforcement and federal immigration enforcement. Even within California's sanctuary state law. It's entirely political, this attitude of resistance, your word. And you're completely right to use it. And it is causing the kind of confrontation and. And chaos in immigrant communities that would be. It's the Democrats causing that because they are forcing the federal law enforcement to go into.

Stephen Klubeck (79:05)

I think it's the lack of unification.

Mark Halperin (79:07)

Yeah, we've talked about issues. I want to talk about leadership now. Very hard job. And it's in part hard because the legislature is very liberal and very ideological and the lobbyists for the interest groups and Steve cited are very powerful. And it's a hard job because it's a. It's a super state. It's a. It's a. It's a nation state. So start with you, Stephen. Who is the last great governor of California and what can you learn from them if you win about how to do the job?

Stephen Klubeck (79:35)

Well, Ed. Ben G. Brown.

Mark Halperin (79:39)

Pat Brown.

Steve Hilton (79:40)

Pat Brown.

Stephen Klubeck (79:40)

Pat Brown, yeah.

Mark Halperin (79:42)

So he was governor. He was governor. He was governor when? In the 60s. Right.

Stephen Klubeck (79:46)

I was around.

Steve Hilton (79:47)

Was it 50?

Stephen Klubeck (79:48)

Yeah. One of. One of the greatest infrastructure governors. Look, Ronald Reagan, great governor, Stoic, a Democrat, became a Republican.

Mark Halperin (79:56)

There hasn't been a great governor in California in over 50 years. Is that what you're saying?

Stephen Klubeck (80:01)

Well, well, look, I'll tell you this. Steve and I should not be doing this. So that tells you there's no succession in the state. So Schwarzenegger, Jerry Brown, nor Nome have provided any succession. Because guess what? Hilton and I should not be doing this.

Mark Halperin (80:17)

Right. You're outsiders who are doing it because you don't see political leadership. But you're saying he was a great governor, but no one since then. What was he great at that you would emulate infrastructure?

Stephen Klubeck (80:26)

Innovation. Innovation. Innovation. Yeah. Of course we agree it's unequivocal. We can't dispute this. And look, we've got this great state that if we embrace blockchain and crypto, because, you know, all blockchain is crypto, but not all crypto is blockchain. And there's so many great things. Our state is being run analog. It is. Makes no sense. I've been in cities, counties in the state, and we are running analog when we should be running digital. Okay. I don't know where this Edd Covid fraud money is. This $30 billion. I don't know where this $20 billion of homeless money.

Mark Halperin (81:06)

Steve Hilton. Steve Hilton, who was the last great governor of California?

Steve Hilton (81:09)

You know, I think that so many of them. Arnold, a friend of mine, and I love Arnold. And he Was he a great.

Mark Halperin (81:14)

Was he a great. Was he a great governor?

Steve Hilton (81:16)

Yeah, I think he was a great governor. He brought incredible energy and dynamism to the job and represented California in a fantastic 60s. No. Well, no, I love. Look, I'm just going to give you a. I'm afraid, a very frustrating answer, which is that I think that Ander was great for that, the quality that he brought to it. Pete Wilson was. I wasn't here, but. But I mean, I know Pete Wilson and he did a. He's taught me a lot already about.

Stephen Klubeck (81:43)

How I was only on business only, but not compassion and warmth, but whatever.

Steve Hilton (81:48)

I'm just saying he's giving me already very useful advice on dealing with the legislature. I think he was great with that. Reagan had an amazing optimism, which I love. Pat Brown, I always say. I think when I was on your show before Mark, I said Pat Brown because I love the. He had that great can do spirit. We built amazing things. The freeways and the UC system and the state water project. Incredible things. I think we want to get back to that in California, leading on, you know, being the best place in the amazing things.

Stephen Klubeck (82:19)

You do have to say. Jerry Brown, too. Not Moonbeam, Jerry. Jerry Brown, too. Look, balance.

Steve Hilton (82:25)

I disagree with you. I think that, funny enough, I read there's a great book called the Browns of California from which I learned a lot. And funnily enough, what I really learned there was I kind of liked some of the. Certainly I don't know about his rank, I wasn't here. But the philosophical approaches of Jerry Brown, 1, particularly on the decentralization of power, local government and so on. I thought it was interesting, actually. I don't know. I mean, look, if you look at the numbers, he's certainly better than Newsom. I mean, you hear that from a lot of Republicans. Wow, Newsom so bad. We could just go back to Jerry Brown. We'd take it. Let.

Mark Halperin (82:58)

Let's finish by talking about what we've just done here. This is a pretty substantive conversation, right? Do you guys get opera? I don't know if you agree or not. From your poker faces, I can't tell.

Stephen Klubeck (83:07)

Oh, no, there's no poker face. No, this was this. This is what should happen.

Mark Halperin (83:11)

Right. So do you have opportunities to do this in the course of running for governor? Is this an aberration?

Steve Hilton (83:17)

You mean with another Democrat? This is the first time. I mean, do you mean with the Democrat?

Mark Halperin (83:21)

Well, just in general, being able to have conversations on television or in person that allow you to reach voters to say, here's what I'd be like. Here's what I'd be like.

Stephen Klubeck (83:30)

As governor, we're going to tell your audience this. And, and I, this is shocking. When I tell my friends I talk to Steve Hilton more than any other candidate. Yeah, he and I, he and I speak. We have, we have open lines of communication. We speak maybe once a week or sometimes twice in a week, but a couple times during the month we share thoughts because we care about California. We truly care about California, the two of us.

Steve Hilton (83:55)

By the way, can I just add to that, Steve, there's another outsider candidate, Ethan Agrawal coming from the Bay Area who's a great guy, who I have Democrat who have great conversations with. And I think that, I mean I, I, I really do have conversations like this all the time when we're doing our events, you know, up and down the state. It is always very substantive and I do my kind of, here's what I'm fighting for, working people, small business, the next generation, all of that stuff, do my thing. And then you get into the questions, which is the part that I love from all of these meetings. We're doing 10 or so every week, pretty much all up and down the state. And every single time, the questions are always on these direct, substantive, policy based things. And I love that because it shows you that people really do care about exactly the kind of conversation.

Mark Halperin (84:45)

That's what the people ask you about. What do political reporters in California ask you about?

Steve Hilton (84:49)

Oh, can you win? What do you think of Katie Porter's meltdown? How can you win as a Republican? I mean, look, so far that's going well. I mean, to the extent the polls mean anything right now, the last two polls that have come out, I'm actually leading ahead of all the Democrats. So I think there is a mood for change in California that I think will get stronger and stronger through the year.

Stephen Klubeck (85:12)

Which poll have you even, you and I read polls all the time. We have friends that are in this business. Have you seen one poll in the last 10 years or eight years or six years that has been right.

Steve Hilton (85:25)

I think the ones where I'm leading.

Stephen Klubeck (85:28)

I'm going to look at right now. Go to the betting polls.

Mark Halperin (85:30)

Go to the betting polls. You both hope and I assume think that an outsider will be elected governor of California, not a career politician. Right.

Stephen Klubeck (85:40)

We both hope that for the state because you know what? Steve and I agree on one thing. We care about the state so much. We want our children to survive and thrive here. We want everyone to do well. We know it's broken. Everyone acknowledges it's broken, but what's everyone going to do about it?

Mark Halperin (85:59)

We've had insiders, with the exception of Schwarzenegger, We've had political. We've had career politicians and insiders elected to this office. What makes you believe. Because neither of you, I believe, is an action movie hero. What leads you to believe that the mood in California is for an outsider?

Stephen Klubeck (86:16)

No, I'm Iron Man. That's bull. That's baloney. No, I'm.

Mark Halperin (86:20)

What do you look at? What do you look at? What do you look at to say that. That besides Schwarzenegger's exception, you will be the exception. One of you will be the exception.

Steve Hilton (86:29)

Well, I think the answer to that question is that there's a. There's a very clear majority for change in California. You look at that basic number that experts like yourself look at, which is, is this a change election? Are we going to get a change of direct right track, wrong track that's been very, very strongly negative for the Democrats in the last couple of years, 60% or above saying the state's going in the wrong direction. Now, when you've had 15 years now of one party rule where the Democrat machine has controlled everything, I think by definition that means people are looking for something else, something different from the control of the party machine, the Democratic Party machine.

Stephen Klubeck (87:09)

Steve, you've been doing this a long time and so have I, okay? And yes, that's what people are saying. They do want change. But will they vote for it? Will they vote for it? And if you look at the data analytics of the state, just looking at the state, we got 5.6 million approximate Republicans, 10.387 Democrats and 6.3 million independents.

Steve Hilton (87:36)

That's registration. That's not voting.

Stephen Klubeck (87:38)

That's correct. And let's just assume 50% vote of that, okay? Let's just do the math. The math doesn't work for a Republican. With all due respect to the party, with all due respect. So do you want the most conservative Democrat running the state? And I think for your pocketbook you would agree. So I appreciate your vote, Stephen.

Mark Halperin (88:01)

Who would. Who would win? If it were Eric Swalwell against Steve Hilton in a general election, who would win?

Stephen Klubeck (88:09)

Where'd that question come from?

Mark Halperin (88:11)

Huh?

Stephen Klubeck (88:12)

Where'd that question come from?

Mark Halperin (88:13)

I'm just. I'm just trying to test your preference. Well, you just seem to think no Republican could win in general election election. I'm just wondering whether there's any matchup where you think your friend Steve Hilton could win.

Stephen Klubeck (88:26)

With all due Respect.

Mark Halperin (88:29)

No, no, Steve Hill, with all due respect.

Stephen Klubeck (88:32)

And you just asked me the question. Swalwell versus Steve Hilton. Yeah, I think it's 60, 40. Swalwell.

Mark Halperin (88:40)

60, 40.

Steve Hilton (88:41)

No way.

Stephen Klubeck (88:43)

And by the way, if it's Padilla, it's 7030 Padilla.

Mark Halperin (88:48)

Steve Hilton. Give me one minute on why you think a Republican could win in what has become an extremely blue state.

Steve Hilton (88:55)

Because everyone can see it's time for change. Change means a Republican. My question in response to that, it says, well, how can, with the record that we've got here, which is as we've been through, I'm gonna repeat it. The worst outcomes on everything that matters anywhere in America. Hang on.

Stephen Klubeck (89:13)

You know, I'm going to call that. I'm going to call the tooth fairy right now because I have her number and I'm going to put something under my bed, a little note. Maybe we'll, we'll, you know, maybe we'll. Let's wait for 11:11 right now. We'll manifest something. I don't know if you believe in this, but I look at data and analytics.

Steve Hilton (89:31)

But with their record, my question is, how can a Democrat, does the Democratic Party, on the basis of its record, deserve another four years of one party rule in California? Obviously not. And so by the time we get to next November, I think that will be clear. People will see what they're getting from me is a non ideological, positive, practical, common sense thing pronounced water property. Hang on a second. My, the simple basis of my campaign, $3 gas.

Stephen Klubeck (90:00)

I love you. I love you. I love you, I love you.

Mark Halperin (90:02)

Hold on, hold on.

Steve Hilton (90:03)

Not enough to let him speak in your pants.

Mark Halperin (90:05)

Stephen, hold on one second. Go ahead, Steve.

Steve Hilton (90:08)

The simple, the simple promises that I can show you how I'm going to get it done. $3 gas, cut your electric bills in half a home you can afford, make California golden again. Those are the things that I think are going to bring people together. They're not divisive, they're not ideological, they're just practical things. That's what people are desperate for in California. And I'm very confident that they will vote for change next. That's why I'm doing it. I'm not doing it for fun. I'm doing it because we're doing it.

Stephen Klubeck (90:38)

For the same reason.

Steve Hilton (90:39)

But I'm very confident that people will vote for change next year. And the question is, can a Democrat possibly be the change in California after all these years of one party, a very conservative Democrat?

Stephen Klubeck (90:50)

Yes.

Steve Hilton (90:50)

I think the answer is no. It has to be Gentlemen, gentlemen, It has to be a different party. And that's not just about the change. It's also about balance. And that's an argument that I think works. I've seen Democrats agree it's not healthy to have one party rule for so long. And so just injecting a bit of balance into the system, the Democrats will still control the legislature. They'll still run the big cities and the big counties. We're just saying it's time for change and time for balance. I think that argument will prevail next November.

Stephen Klubeck (91:20)

Yeah. I'll send you the two thirds number. Okay.

Mark Halperin (91:23)

Gentlemen, I love having you on because I think it's so important for people in my business not to do what so many California reporters do, which is say you guys can't win. I believe you both are in it for the right reasons. I believe you both care a lot about the state. I believe you both have thought a lot about what kind of leadership the state needs. And I think it's vitally important that people like you get a platform to talk about your vision for the state and not just be written off. So I'm proud of my folks for putting this together and for giving you an opportunity. And I'm very, very eager to see how you do going forward. Now, with not much time left between now and the June primary, both of you have a lot of work to do. But this is, as I said, an extremely wide open field, and there are lots of people either running or thinking about running who haven't thought nearly as much as you two have about what it will take to lead the state. So I'm grateful to you for that. And the people of California should be grateful, too. And the political reporters of California should stop leaving you out of stories talking about who can win this race. Thank you.

Stephen Klubeck (92:21)

Thank you very much. Thank you.

Steve Hilton (92:22)

Thank you, Steve.

Stephen Klubeck (92:24)

Appreciate it. Be well again, Steve.

Mark Halperin (92:25)

Stephen Klubeck, Democrat, running for governor, California. Steve Hilton, a Republican, both of whom are looking forward to to engaging with the other candidates in the race. We thank them both for making time. Grateful to you all for being here and listening to this. And again, think about the candidates in your state. Think about the races you have in your state, a debate format that allows them to talk about substance in new media with a moderator who's not biased, who just wants you to have the best information you can have before you vote in your primaries and before you vote. Next November 2026 begins now. That's it for today's program. We'll be back Thursday. Brand new episode. I'll have all my reporting and analysis about the election results this week in New Jersey, Virginia, New York and elsewhere and what all of that signals for the midterms. Trust me, you won't want to miss that. If you haven't already, make sure you subscribe to our channel on YouTube. You can watch all of our 2026 coverage. Coming up, it's YouTube.com nextup. Halperin. Listen to the show. If you don't have the ability to watch on YouTube because you're moving around, you can subscribe to NextUp with Mark Halpern wherever you get your podcast, download so you never miss an episode. I want to know what you thought about today's debate. Any suggestions you have about how we can stage these other races you'd like to see us convene on. Send me your email. Send me your thoughts at halperin next week. Uphalperin@gmail com Again, nextuphalperin@gmail.com. grateful to our two candidates for joining us. I'm Mark Halperin. Come back Thursday for a brand new episode on everything that's happening this week. So you know what's coming next up.