- I think what you're seeing from voters and the public generally, they work hard every day, but they can't plunk down a quarter of a billion dollars into political campaigns the way, I guess, Elon Musk is doing, that they are buying elections.

- I think half a billion actually.

- Yeah.

Every day it gets higher, right?

- Hey there from KQED in San Francisco, this is Political Breakdown.

I'm Marisa Lagos here with Scott Shafer.

Today on The Breakdown, Xavier Becerra is almost certainly California's next governor, a Democrat who spent nearly a quarter century in Congress and served as California's Attorney General during the first Trump administration.

Becerra most recently was President Joe Biden's health and human services secretary.

Becerra emerged victorious from a messy primary that pitted him against a long list of fellow Democrats.

He was stuck in single digits, then surged after former Representative Eric Swalwell dropped out amid allegations of sexual assault and misconduct.

Since June, Becerra's had a pretty easy sprint to the November 3rd election.

Recent polls show him roughly 25 points ahead of his opponent, Republican Steve Hilton, heading into next week's midterm.

Given all that, we are going to talk today about what he will do if he indeed takes office in January.

Secretary Becerra, welcome back to Political Breakdown.

- Marisa, Scott, thanks for having me.

- Good to have you.

- Great to have you here.

So I wanted to start, if you win on Tuesday, what do you feel like the voters will have given you a mandate to do?

As I said, you've laid pretty low since June.

What do you see as the case you've been making here?

- Pretty low perhaps in the minds of some of the media, but I have traveled the entire state.

And so that media doesn't follow me to some of the smaller parts of the state, that's on you all, not on me.

But we've been active.

We've been all over the place talking to voters and listening, not just talking.

A lot of politicians, all they do is talk at you.

We like to listen.

I think that's the way you learn best.

That's what I learned when I was a kid and I was always taught listen to what your elders say.

What can they expect?

What will be my mandate?

Get things done.

I think people are frustrated.

The cost of living is so high.

They want folks to deliver, not just make promises, but to deliver.

So my, my charge will be to get things done.

- What kind of things?

- Lower costs, build more homes, keep people with health insurance that they can afford, making sure that we don't have these insane policies coming out of Washington DC that continue to hike the price of everything.

I mean, interest rates, have you seen a mortgage rate recently?

It's way above 7%.

It was way below 7%.

I think below 6% when Trump took office.

Try to buy a house today and all of a sudden your mortgage payments monthly have just dramatically increased because of Donald Trump.

And so whether it's gas prices, your mortgage rates, what you pay at the pump, what you pay as a renter, I mean, just try to go buy groceries today.

I heard someone say they were paying 10 bucks a pound for ground beef.

- And it might not even be real ground beef.

- Yeah.

So it's, it's ridiculous.

So fight back.

Don't let the Trump phenomena hit California and the pricing, and then let's do our share to make sure we reduce prices.

- So you have cultivated a reputation, and maybe it's not cultivating, maybe it's just actually true, as an affable, nice guy.

But you know, sometimes the governor has to stand up to his allies, to groups that maybe supported you, but you have to give them bad news or not do what they want.

Would you rather be liked or feared?

I mean, how are you... Give us an example of how you're going to stand up to some of these pressures.

- I'd like to get things done.

I think people will like me if I get things done.

And quite honestly, I think they'll fear me if I know how to get things done.

So if I can get things done, the other side will come.

- A lot of being governor is out of your control.

Before the previous governor took office, there were devastating wildfires, a mass shooting.

This winter, the state is facing down a potentially catastrophic El Nino system.

How involved do you plan to be in things like disaster response and working with the Newsom administration before you even take office if you're elected?

- Marisa, you're talking to a guy who became AG a week after Donald Trump became president in 2020.

I remember.

I had no choice but to go right into it.

And that's why by the time I had finished, I had sued Donald Trump over 120 times.

Didn't have a chance to sort of lay low and hang out.

He had to get to work when I - - But this might be even before you are sworn in.

- Yeah, yeah.

And chances are, just like COVID was hitting before I became secretary.

When I was secretary, thousands of people, remember these days, thousands of people were dying every day from COVID.

And that was as big a crisis as any we've ever faced as a country.

More than a million Americans died because of COVID.

They're still dying, just not in those numbers anymore.

And so you had to be on top of things.

I intend to be someone who's on top of things.

If you're going to get things done, if you're going to show accountability, if you're going to produce results, you can't afford to be on the sidelines.

You can't afford a delegate.

You got to be on top of it.

- When President Trump took office day one, he issued a lot of executive orders.

They clearly had thought about what was going to happen in those first 24, 48 hours.

What's your day one plan?

- And I'm going to, when I have a chance post November 3rd, if everything goes well, sit down with the team and sit down with those who are still in government who understand this to make sure I can, when I say I'm going to do something on day one, I can do it.

But I will tell you right now, I intend to follow through on my promise to try to shake up utility charges and home insurance, casualty insurance rates because they're just out of whack.

They have grown dramatically more so.

And I don't think it's fair.

Maybe some people are paying what they should.

I don't know.

I can tell you my mom, when she lost her home coverage on a home she'd had for what, 20, 30 years, never once having submitted a claim, but always paying her premiums on time.

She wanted to understand why she was just canceled all of a sudden.

Give people an answer and hopefully once they, we look at these pricing policies, we end up letting people know what their fair share is.

People are willing to pay their fair share.

They just don't like these skyrocketing prices that never get explained.

And so if I'm smart, day one, I'm trying to lower those insurance premiums, lower those utility rates, and quite honestly, building more housing so we reduce the pressures through the demand of people who want to get into a place.

- And you think those are things you could do through potentially executive action?

- Some of those, yes.

Some of those will require the legislature and I already have reached out to legislators to try to make sure that I not only have a good relationship, but we're on the same page and get things done.

But yeah, I'm going to use the authority of the governor's office to do as much as I can.

I had to do that when I was secretary of HHS to deal with COVID.

I had to do it when I was attorney general when I decided how to best protect the state of California.

So I'm not new to this.

As I keep saying, the last thing you need is someone who needs on the job training to be governor.

- So I wonder then, when you look back at the state and the many colorful characters we've had in the governor's office who have brought different skillsets and approaches, who would you point to as your model?

- You know what?

The Browns.

Why?

Not just Jerry Brown, but Pat - Brown.

Yeah.

- Jerry Brown, because I think he understood fiscal policy.

Not because he was a whiz with numbers, and he probably was, but because he meant it when he said he was going to balance the books and leave the place in better shape fiscally than when he got it.

- So Jerry Brown 2.0, not 1.0.

Yeah.

- Yeah.

Yeah, 1.0.

But, but also Edmund Pat Brown, who I think you can probably, if there's a father of our higher education system, which is the envy of the world, there is no better system of higher education in the world with our UC, Cal State and our community college system, nobody compares.

The roads that we have today, the infrastructure for transportation was built during Pat Brown's days and continued from there.

He, he did so much to build up infrastructure.

You know, you don't get a lot of credit for infrastructure because chances are you're gone from office before that infrastructure's completed.

- Yeah, you got credit like 50 years later.

- Yeah.

Well, and I'm giving him credit because, you know, amen for Pat Brown that he helped California become the fourth largest economy in the world.

- So, you know, you have a lot of expertise in healthcare through both your time in Congress as HHS secretary.

And as you know, you are inheriting a budget that is about to lose an estimated $30 billion a year in Medicaid funds.

That's known as Medi-Cal here in California.

You've opposed Prop 40, the billionaire tax aimed at kind of backfilling those cuts.

Will you support some other sort of tax increase to make up for that lost money?

- And so Marisa, first I have to clarify, it's not just the loss of funds through the Medi-Cal program.

It's the loss of insurance coverage and help for those policies under Obamacare.

So the Trump administration, for a lot of middle class families, gutted the Obamacare program that made those insurance plans affordable for so many middle class families.

- And there's a huge concern about the trickle down effect to hospitals, clinics, all of that - Obviously.

Absolutely.

Absolutely.

So it's a double whammy that Donald Trump has stuck on everyone in the country, but certainly California.

We will make sure that we cover the cost of these things.

I have said that- - That's a lot of money, 30 billion a year.

- It is.

It is.

But there's a lot of money in the healthcare system.

- What do you mean by that?

You talk about that a lot, but tell me specifics.

What are you saying here?

- What's the estimate that the cost of health insurance coverage for a person in this country, so I don't know if it's just California, is around $28,000 a person?

- A year.

- Multiply that a year.

Multiply that by near 40 million people.

You get hundreds of billions of dollars that we spend on healthcare.

30 billion is a lot of money, especially when you've got all this money allocated throughout the state for healthcare.

Finding it is not easy, but it's there.

And there are - - Like you mean insurance companies are hiding money?

Like - There's- There's so many tricks that are used.

Let me give you an example.

I've used this often.

Billing is based on coding.

Every condition, every ailment, every procedure, every service is coded.

You don't go in for a, for a cast for your broken arm.

You don't go in to get pills for your high blood pressure.

You get, there's a code designated for those things and that's how the billing is done.

Well, surprise, surprise, the providers of those services and procedures try to bill at the highest code they can find to get the most money reimbursed.

The payers, usually the insurance companies, the employers, sometimes you individually, you're going to try to figure out how to claim that that's a lower base code that you have to pay off of, so you don't have to pay as much money.

So there's a coding war that goes on where attorneys, accountants, people who have nothing to do with healthcare get paid billions of dollars to fight that billing war.

It's a food fight.

Who wins?

And who wins means a lot of money.

You can get rid of that or at least try to get rid of as much as you can.

That means billions of dollars that are right now spent on lawyers and accountants can be spent on actual healthcare.

- So you don't think more higher taxes are going to be needed?

- I would first try to make sure that we are trying to extract efficiency and get rid of the waste in our healthcare system.

There is a ton of it.

And everybody gets accustomed to doing things a certain way and nobody wants to break from that habit.

We got to break some habits.

- Over the years, California has expanded eligibility for Medi-Cal, including to many undocumented members of California, residents of California.

Governor Newsom tried to sort of push back that and put a pause on that.

The legislature pushed back.

For you, is that off the table as a way to possibly save money?

Would you consider pausing in some way or reducing eligibility for people who are not citizens?

- Scott, my values and my fiscal beliefs tell me that anyone who works hard in California should have access to the healthcare they need for themselves and for their family and they should be able to afford it.

And that includes undocumented.

If you're working really hard in this state and you're lifting it up, you're helping other Californians, you deserve to have access to the same doctors and hospitals that others do.

And so when it comes to healthcare, I'm not looking to have anyone kicked off.

If you're working hard, I want you to have the coverage you need because you're lifting up my state.

I have to pay for it.

I will find ways, as I just said to Marisa, we have to find the ways to pay for this, but what I'm not going to do is say that I'm going to follow Donald Trump's lead in gutting money out of our healthcare system and then saying as a result, I got to kick people off of their insurance coverage.

That's not the way you go because at the end of the day, that costs you way, way more money.

You and I, whether it's through our taxpayer dollars or through our own insurance premiums, you end up paying for the cost of those who are unable to pay because that provider's not providing care for free.

At some point they're going to get paid, whether it's by the person who got the care or billing somebody else a little bit more for the care that they're getting because you're insured.

And so why do the pay me later that costs much more?

I'm going to do... And by the way, when you pay later, guess what?

Usually the way that they go in to get healthcare is not to go see a doctor, they go into the emergency room.

- And they're sicker.

- Yeah.

And they're sicker.

So it's compounded and they're going to the most expensive place to get healthcare, the emergency room.

- Yeah.

I mean, more broadly, you've talked about potentially looking at taxing the wealthiest more, taxing corporations more.

You told Scott in February, "We're going to raise the revenue we need, but do it in a predictable, stable way."

Yes.

As I said, you oppose Prop 40, but many of the wealthiest people in California structure not just their wealth, but their income to avoid the taxes that we all pay.

- Yeah, really?

- I mean, but it's wild.

Sergei Bryn taking a dollar a year salary, so he's not paying income tax, things like that.

Taking loans against their capital or their stocks and bonds.

How could you get at those issues without fundamentally looking at different ways to tax like assets or just changing the whole system?

- Yeah.

No, there are clever ways to avoid paying taxes.

And the more money you have, the more clever attorneys you can find to help you avoid paying taxes.

No mas.

We have to make sure that everyone is paying their fair share.

- Do you have specific ideas on how to do that?

- I actually do.

Having served for 20 years in Congress on the committee that does tax policy, the Ways and Means Committee, we went through a lot of these.

People talk about how we went after welfare for the welfare cheats and so forth.

Well, there's a lot of welfare that goes on for corporations.

We give them tax breaks.

My dad worked for decades in construction.

Every morning, because my mom would make him a lunch the night before, he'd take his lunch pail and he'd go to work and at lunchtime he'd eat from his lunch bail.

At the same time, probably the owner of the development where my dad was working, probably went out to lunch, some nice restaurant, maybe took some folks with him, and then he had - - Wrote that off.

- Yeah, he paid for his lunch and then wrote it off in his taxes as an expense and got taxpayers to cover part of that bill for that expensive lunch.

- So you want to take a broader look at the tax system it sounds like.

- Absolutely.

We'll take a broader look because why is it that my dad who ate lunch as well never got to deduct the cost of his lunch from his tax bill, but somebody who's an executive can't.

Now, I understand we've got a system in place.

We have to look at everything closely, but what I'm saying is there are breaks that we give people who have money, who know how to come up with these loopholes.

We have to take a look because right now we have a whole bunch of Californians, millions of Californians who may lose their healthcare.

We have a whole bunch of Californians who can't afford to buy a house.

Why should we say that?

If you can't afford to buy a house, yet you're going to pay taxes so that some executive could go out for a martini lunch and deduct that from their taxes and have taxpayers cover that load.

We have to take a look.

The way I boil it down to saying this, if you are mega wealthy and you're paying tax rates that are lower than the teacher, the nurse, the firefighter, the police officer, you're not paying your fair share, period.

- We've seen, you know, to that, to your point, Meta is issuing a new class of shares to Mark Zuckerberg so it doesn't cut if Prop 40 were to pass, it wouldn't cut into his, you know, power that he has as a shareholder in Meta.

What do you say to Californians who are angry that things like that happen and yet you and Governor Newsom and many Democrats are opposing Prop 40, which some voters see as a way of leveling the playing field a little bit?

- Well, first, I think what you're seeing from voters and the public generally is a reaction to this obscene wealth where they know that they work hard every day, but they can't plunk down a quarter of a billion dollars into political campaigns the way I guess Elon Musk is doing, that they are buying elections.

- I think half a billion actually.

- Half a billion.

Yeah.

Every day it gets higher, right?

And I think they react and amen that they react.

I hope the public sends a really clear message to anyone who is becoming uber profitable, over wealthy - - No pun intended.

- Yeah.

Yeah.

On the backs of California workers.

And so I think they're sending, the public is sending a message.

I just think you have to do it the right way because taxes, nobody wants to pay taxes, but we have to pay taxes if we want to build our roads, if we want to have safe streets.

And so what I say is let's have rational policy.

Marisa, you said it.

It's got to be fair, stable, and predictable.

And I will support policies, including revenue generating policies that are fair, stable, and predictable.

Not always easy to get there because everybody's got an opinion about those three things, but we will pay for the services that we provide and we'll make sure everyone in our state, including the uber wealthy, pay their fair share.

- I want to ask you about AI.

This is obviously a huge industry here in California, stands to change many aspects of our society.

And I know you have a lot of concerns about workers and protecting them, but some of the concerns go well beyond that to like existential questions, right?

- Yes.

- You were attorney general, obviously, so you know how to go to court to enforce laws.

I wonder if you think prosecutors should be looking at some of these hacks like the hugging face incident and thinking about whether our current laws would allow, I mean, individuals to be prosecuted for these.

And if not, should the lobby change?

Because from what I've heard from experts, some of these things, if they were perpetrated by an individual human, would be felonies already.

- Marisa, you said it perfectly well.

Why is it that a machine isn't charged when that machine was built by humans and is committing what would otherwise be considered a crime by a human being?

Why do they get a break?

See, this is why the public feels that there's an unfairness.

They see these uber wealthy folks that create these machines or computers or these programs and bad things happen and guess what?

Nobody is punished.

It's like what happened in the Great Recession 2008, as if by some fabrication and error, everyone lost value in their homes all of a sudden, and that nobody was responsible, including the banks that lend out money like there was no tomorrow.

And all of a sudden - - And couldn't even keep track of what they had signed.

- And then they get bailed out.

Who gets bailed out in that great recession crisis?

Not the people who own these homes and were hoping desperately to be able to maintain their home, even though they were underwater, they were still willing to pay their mortgage, even though the mortgage was costing them more than the house that they could sell it for.

It was the banks.

The banks got all... By the way, I voted against that bailout.

It was called the TARP bailout.

I voted against it for that very reason that the $800 billion that went into the economy went to banks.

I wanted it to go to the families who were willing to then use that leverage to negotiate with the banks a better mortgage so they could stay in their home.

- So on AI, you're here for looking at the laws and seeing if they need to be changed?

- Absolutely.

Well, not only do they need to be changed, we have to add some laws.

We have to have the protections, not just for workers, for children, for public safety.

We need those guardrails.

And quite honestly, unless someone can explain why we shouldn't, we should have a circuit breaker if this thing gets really ugly.

- Like a kill switch type.

- Yeah.

Something that stops this thing from going where you said existentially threatening the lives and the realities of our life.

- Question about immigration, border security.

During the Biden administration, the border for much of the administration was overwhelmed by migrants seeking asylum, cost Democrats a lot of support.

Even some Latinos were upset with the lack of border security.

Some Republican governors were sending undocumented immigrants to New York City and Chicago and so forth to make a point.

If Democrats take back the house, which seems likely, what would you like their priority to be as a border state governor in terms of immigration, border security, ICE, all of that?

- Smart, tough immigration policy to fix a broken immigration system.

- What's the tough part?

- The tough part is border enforcement, but done properly, not with masked mercenaries patrolling the streets, but with a lot of the technology that lets us surveil and detect individuals, especially if they're trying to cross without documents, that lets us apprehend, and then a process that lets us fairly adjudicate their cases.

Some people are here because they're seeking asylum.

If it's a legitimate case, I think we're still, as far as I know, the Statute of Liberty still stands in New York, so we have a process.

But if you're here and you're doing it the wrong way and you have no basis to stay, then you should not stay.

That's the tough part.

By the way, comprehensive immigration reform, which I worked on for the 24 years I was in Congress, included always a tough stance on the border because we're a sovereign.

We have a right to control who comes into our country.

We have a right to determine if you should exit the country.

That's never been a question.

It's just that, as I've always said, it takes two to tango.

And all those folks who've been in this country as undocumented for 20 or 30 years, working hard, somebody's employing them.

By the way, if you employ an undocumented, you're breaking the law.

How many Americans can you tell me have ever been prosecuted for breaking the law for hiring an undocumented individual?

- Would you like to see that like the e-verification system implemented?

- No, I think it's the wrong way to go to start punishing criminally workers and people who hire workers.

But I think what we have to understand is that we're tangling with these undocumented individuals who cross because they see a job insight.

These guys, these folks want to work.

My dad and my mom were immigrants.

They worked all their lives.

I know very few immigrants who come over here and think they're going to have a luxurious, easy life.

They're ready to work.

They're the folks who right now are picking the food in the fields of California.

They're the ones that are cleaning our shops and our homes.

They're the ones that are taking care of our infirm and our children.

They're working and I just want them to do it the right way.

And we can make that happen by having smart, straightforward, common sense policies that have already been presented on a bipartisan basis.

So it's just a matter of getting the politics out of that.

It's always the politics that interferes.

We can get rid of that.

And I suspect if Democrats take over the Congress, they will put in front of Donald Trump a comprehensive fix to our broken immigration laws that I think will be sensible, fair, tough.

I just don't believe Donald Trump has it in him to sign a decent law.

- It'll be fascinating to watch that.

Closer to home, you mentioned at the top that energy and insurance rates are a high priority.

Those are two industries that are kind of pitting against each other in Sacramento.

We saw a deal fall apart at the end of the session, which was aimed at sort of helping folks being squeezed by raising insurance and utility rates.

The debate is sort of broadly, and it's very complicated, but about whether utilities should be on the hook for the cost of wildfires they cause or if home insurance companies should shoulder more of the burden.

Where do you stand on that?

- I hopefully stand nowhere near either one of them because - - You mean either industry?

- Yeah, because what they've done does not work.

Look, Marisa, I would break it down this way.

Wildfires are going to happen.

So for me, the most important thing is how do we mitigate the impact of a wildfire?

How do we prepare so that people don't automatically lose their home when it's a severe wind with a big fire coming our way?

Mitigation has to be addressed.

It's not being addressed the way we need it given the severity of these wildfires.

So to me, it's how do we mitigate?

How do we take care of what we know is coming first and foremost?

I don't think the current system we have with utilities and insurers is doing what we need.

Do you see enough money being put into this program of mitigation by either utilities or the insurance industry to stop the wildfires?

I don't.

- I mean, does that mean looking at whether there should be a public takeover of these or a change?

I mean, these are both publicly traded industries that we rely on.

- I think it means more pinning the responsibilities on the right rear end.

And the tail, I don't think right now is on the right rear end.

And I would say that what we have to do is decide how we want to treat mitigation.

Do we want homes, the rate payers, to pay for mitigation?

Do we want homeowners who have insurance policies to pay for mitigation?

Do we want the entire public?

We just spread it across the whole public to pay for mitigation.

- I mean, either way, it's us paying for it, - Right.

- Right.

- But it's got to be done fairly, and I don't believe the system we have today is fair.

When my mom lost her insurance coverage for the home she had after paying for 20 or 30 years for the policy and never submitting one claim, why?

How is that fair?

How is it fair for a family in Fresno that is as far away from wildfire country as you can get, is paying so much on their utility bill if they're not doing anything to cause the fire or be in the path of a wildfire?

We have to try to do a better job of understanding who should pay and how we prevent the devastation.

- Last question.

On Tuesday, you are likely to become the first Latino elected governor of California in modern times.

55% of voters, your voters say they feel proud about that fact.

And I'm wondering, as the first Latino governor, will you feel a special obligation to Latino Californians?

How do you think being Latino in your history, your family history and so on will change the way you look at your job, at what your obligation is as governor?

- Scott, a few days ago I would have answered differently than I'm going to answer now.

Dolores Huerta just passed.

- Yeah.

- I would have loved so much to have Dolores Huerta be at my victory celebration because she represents in so many ways why I get to be governor.

She represents in so many ways the families I want to stand up for.

And to have had her there present would have just been a validation of what my parents worked so hard for.

She's not with us, but I am going to work doubly hard to still see her in everything I do because Dolores Huerta, as I said, she was everywhere.

She did everything.

And I want to pay tribute to that because there are so many Dolores Huertas in this state who never get recognized and too bad she can't be at the victory celebration because she owns it as much as anybody does.

And I guess what I'm saying is I feel proud of who I am, but I'm going to do this for everybody.

It's just that if I'm smart, I'll do it the Dolores Huerta way, be everywhere, do everything and do it for the same folks I've been fighting for all my life.

- Thank you, Xavier Becerra.

Thank you so much.

- Thank you.

Great to be with you.

- That's going to be a wrap for Friday, October 30th.

Political Breakdown a production of KQED.

Our engineer is Jim Bennett.

Our producer is Izzy Bloom.

Our team includes Susie Britton, Jared Servantes, Rick Santangelo, Derek Lartaud, and Ethan Tovin Lindsay.

I'm Marisa Lagos here with Scott Shafer.

Thanks for being here.