Is Newsome's Rationale for Palisades Fire Rebuild a Political Hoax?

Is this a repeat of the Ruse of the 2001 California Energy Crisis?

“Rebuilding the Pacific Palisades will just delay the next tragedy 30 to 40 years. It will burn down again but current politicians just think they will all be dead by then. Their rationale for rebuilding now is “let’s get re-elected and make it look like we really care about people who got hurt”. Zeke Lunder, The Lookout, wildfire spotters’ organization, Chico, California. But is there something else that is the rationale for Gov. Newsome’s Palisades Fire Build Out Plan?

California today is divided into ideological camps about the recent blast furnace like firestorms that have wracked California. The adherents of each tell us with great assurance where we’re at, what we should do about it. We should not believe either ideological camp. Their ideologies are non sequiturs that have nothing to do with the causes of the fire storms: a combination of atmospheric high-pressure air in high deserts and lower elevation topography of mountain passes, valleys and gullies that make for the infamous Santa Ana (Devil) Winds. These winds can blow across high density home tracts facilitating a fire storm by rapidly hopping from home to home. The firestorms were prevented from spreading into Malibu due to the Franklin Fire in November 2024, and spreading northerly due to the 2021 Paradise Fire, both fires of which denied vegetative fuel to the Palisade fire of 2025. The fire was stopped from spreading to Brentwood and Santa Monica to the south by the California Department of Forestry and Fire Management. The CDF&FM saved Mandeville Canyon and Topanga Oaks homes by a large fleet of bulldozers widening fire breaks, enormous amounts of fire retardant dropped from aircraft, setting backfires, water tanker trucks used to put out spot fires with hoses along the demarcated fire line, and an army of hands-on firefighters on the ground with shovels. Contrary to ideologists’ contentions that government entirely failed, the state fire fighters stopped the fire at crucial firebreak lines to prevent the leap frogging of the fire to Malibu and Santa Monica.

Conservative historian Victor Davis Hanson of Stanford University illogically blames a lack of water allocation from Northern California reservoirs to Southern California to fight the fires due to state policies to divert water to the ocean to preserve fish populations. I spoke with an anonymous civil engineer who told me the problem was that no small lot home subdivision is ever designed to provide sufficient water pressure if everyone turns on a hose to water their roof at the same time. It would take economically infeasible large water tanks for every 3 to 5 homes to provide fire hydrant water pressure sufficient to fight such a firestorm. But the small sized lots in Palisades preclude any tanks anywhere. And the blast furnace like fire temperature together with hurricane level wind would just evaporate moisture more rapidly than water could be delivered.

Conversely, liberals such as environmentalist Michael Schellenberger, professor of Politics, Censorship and Free Speech at the University of Austin, Texas, claims that the empty Santa Ynez Reservoir at the Pacific Palisades was the culprit. But Zeke Lunder of The Lookout fire spotter’s organization said: “100 times the amount of water in that reservoir would not have made a difference because the fire moved so fast at temperatures around 1,000 degrees that melted steel on automobiles”. Moreover, Lunder says even if there was no fire the 100 mph winds would have wreaked damage the same as hurricanes and cyclones do. It is notable that satellite images of the fires show Santa Cruz and Santa Rosa Islands in the background without any blazing fires. But those islands are surrounded by water and are not proximate to hot high desert windstorms, downed power lines, homeless campfires, natural gas lines, sparking machinery, automobile gas tanks, or arsonists. Additionally, once ignited, fire embers can travel long distances and can get sucked into external vents of homes and ignite the dwelling from the inside.

In an online video, Lunder presents data showing that the Palisades area has been devastated for firestorms once every ten years. Lunder reports: Malibu has burned 9 times since 1930. He says:

“(Historical) Odds are 10 out of 10 you’re going to have a fire there again. Newsome’s fast track rebuild seems crazy to me since you’re just setting up the next one. Modern building materials will make things more resilient but once one house is on fire it doesn’t make a difference (as fire/wind/storms rapidly hop from one home to another). A lot of homes already had stucco fire resistant building materials and burned down” (including the modern brick clad Corpus Christi Catholic Church in Montecito, with the exception of the tabernable). Technical solutions would help but are no substitute for planning and home hardening. Rebuilding is just kicking the can again down the road. Newsome’s executive order suspends environmental review, fast tracks permitting, and streamlines the building code process but is not a long-term strategic plan”.

This writer has experience as a real estate appraiser of large single-family home subdivisions for financing of the public improvements in California Community Facility Districts (e.g, fire stations, sewer plants, schools, parks, required off-site freeway interchange upgrades, etc.). Such public improvements were financed by the sale of municipal bonds. Today a land subdivision for 8,892 total houses such as the Palisades, would be required to process a master plan including a fire suppression plan; and all public infrastructure would be required to be built before construction of homes could commence.

But the Palisades land was purchased in 1922 by the Methodist-Episcopal Church. Church members bought up ocean view lots and lived in tents until their custom home was built, one at a time. As is typical of many wealthier persons, they are always looking for an investment in which the costs of public improvements are born by government with any price appreciation accruing to their benefit (e.g., socialize costs and privatize benefits such as is done with sports stadiums and redevelopment projects). Up until 1978, local governments and municipal utilities were responsible for financing streets and public utilities. But in 1978, Proposition 13 was passed which required developers to finance public improvements which brought about the need of master plans and environmental permitting.

The homes built in the Palisades are grandfathered under zoning laws but are considered legal, but building code non-conforming, improvements. Thus, the Palisades evolved and there is no way to go back and master plan the area unless many homes are condemned and purchased under eminent domain law to provide public improvements, the cost of which would be astronomical.

Which brings us back full circle to Gov. Gavin Newsome’s (and LA City Mayor Karen Bass’s) rebuild plan to allow 110% of original size of each home and fast track the re-building presumably with fire insurance proceeds. But the Palisades homes are uninsurable for fire loss as they are in a high-risk area without the necessary infrastructure. Thus, the Palisades homes are covered for fire loss through California’s FAIR Plan (Fair Access to Insurance Plan Requirements), which has a cap of $3 million per home. However, the FAIR Plan reportedly has a surplus of about $200 million and about $700 million in cash to handle the $35 to $45 billions of exposure from the Palisades fire (estimated by Core Logic).

California has enacted a recent insurance regulation allowing an increase of coverage through the FAIR Plan (to increase the $3 million cap per home) with the extra cost to be borne by all policy holders in the state (socialize costs and privatize benefits). In sync with this new insurance regulation, a legislative bill was introduced on January 9 to authorize the issuance of catastrophe bonds to increase the capacity of the FAIR Plan. The Fair Plan Stabilization Act (Assembly Bill 226) would provide for California to issue catastrophe bonds through the California Infrastructure and Economic Development Bank, which typically bond finances public improvements for large land subdivisions.

Put in different words, the Palisades Fire will raise premiums for all property insurance in the state. There is an incentive for the City of Los Angeles to support this as the portion of property taxes for local government (not schools) generated from Palisades’ 6,390 burned homes, reflecting only 0.20% of the city’s housing stock, is estimated at $230,000,000 ($40 billion @ a 1.25% property tax rate x 46% local government share of property taxes). This would reflect about 10.5% of the City annual general fund budget. This might be called back door revenue financing for the City of Los Angeles through the FAIR Plan.

The question I would raise is: was there a pre-fire incentive for the City of Los Angeles to benefit from any fire of the magnitude of the Palisades Fire? This may sound conspiratorial. But the California Energy Crisis of 2001 did not involve any lack of energy but an inability to finance existing mortgages and bonds on 19 polluting old diesel power plants that were moth balled to meet a federal requirement to clean up smog traps by 2001 or lose federal funds for roads, schools and public health. In other words, the California Energy Crisis of 2001 was a hoax in order to finance the cleanup of air pollution by shifting $43 billion in unpaid bonds onto water rate payers (see my article “Recent Science Hoaxes Rerun of 2001 California Energy Crisis). My question is there something like this going on with the Palisades and Altadena Fires? Did California need a big fire to bail out its FAIR Plan insurance fund deficit and its $58 billion State General Fund budget deficit? Is the purpose of Newsome’s Fire Rebuild Plan to bail out the state and city budgets?