How Matt Mahan Thinks He Can Save California - All-In with Chamath, Jason, Sacks & Friedberg Recap

Podcast: All-In with Chamath, Jason, Sacks & Friedberg

Published: 2026-03-23

Guests: Matt Mahan

What Happened

Matt Mahan, Mayor of San Jose and gubernatorial candidate, is running for governor of California due to his dissatisfaction with the state's spending inefficiencies. He highlights that California's state government spending has increased by 75% over the past six years, adding $150 billion more annually without significant improvements in outcomes. Mahan criticizes expensive projects like the high-speed rail, which has consumed $14 billion over 20 years without delivering results.

Mahan notes that California's bureaucratic processes and litigation environment contribute to inefficiencies and high costs, particularly in housing and infrastructure. During the pandemic, fraudulent unemployment claims in California amounted to over $30 billion, showcasing the need for better accountability and performance measurement in government spending. Mahan advocates for setting public goals and measuring performance to ensure taxpayer money is effectively utilized.

In San Jose, Mahan has managed to reduce crime and unsheltered homelessness without increasing taxes, a model he believes could be replicated statewide. He criticizes California's approach to homelessness, arguing for more cost-effective solutions like sleeping cabins instead of expensive housing units. Mahan also aims to increase housing production and reduce building costs by at least a third through regulatory reforms.

Mahan is critical of the influence that public sector unions and organized interests have on California politics, often defending the status quo. He highlights that many Democratic legislators privately acknowledge systemic issues but are reluctant to address them publicly due to donor pressures. Social media, he suggests, offers new avenues for direct communication with voters, which can be leveraged for change.

California's housing crisis is attributed to supply issues, high fees, zoning laws, and litigation risks. Mahan believes that increasing housing supply and reducing costs through reforms can alleviate homelessness, which is exacerbated by high housing costs and an educational system not preparing children for future jobs. He also proposes addressing the drug crisis by reducing demand through public drug use intervention and treatment.

The state's financial issues are compounded by a 70 cents per gallon gas tax, high wildfire risks, and a public employee retirement system facing a massive shortfall. Mahan suggests reforms such as zero-based budgeting and a pragmatic governor to tackle these challenges. He also opposes the proposed wealth tax, arguing it would ultimately harm middle-class and working families more than billionaires.

Mahan emphasizes the importance of closing loopholes in the tax code as a better solution to economic inequality. He argues that public policy failures, such as underperforming public schools and unaffordable housing, are the primary causes of declining social mobility in California. AI, according to Mahan, will create new opportunities for economic mobility, and San Jose has already begun offering AI upskilling courses and partnerships with AI companies.

On immigration, Mahan supports protecting undocumented immigrants who are not committing serious crimes and advocates for a pathway to legal status. He criticizes both political parties for being complicit in not solving immigration issues due to economic incentives. As a compromise, he proposes a path to residency without voting rights for undocumented immigrants.

Key Insights