Keeping It Real: Steve Hilton on California’s Power Machine and Reform

Jillian Michaels (0:01)

When California starts to feel less like a dream and more like a warning sign, you know something deeper is broken. On this episode of Keeping It Real, Jillian Michaels sits down with Steve Hilton, who's running for governor against Xavier Becerra, and the conversation gets intense fast. It really does. Hilton's central argument is pretty stark—he says California has become the place people flee, not the place they run to. And he's backing that up with some hard numbers: high poverty, high unemployment, and get this— the state budget has doubled in just ten years. Doubled? That's staggering. And yet we're seeing these massive failures, like the high-speed rail that's burned through billions without actually laying track. So where's all that money going? That's exactly what Hilton zeroes in on. He talks about what he calls the hidden power of nonprofits and unions. His claim is that public money gets routed away from its original purpose and funneled into political operations—voter registration, ballot harvesting, that kind of thing. Building on that point, he uses homelessness as a case study. Hilton calls it a "homeless industrial complex," with billions that can't be properly tracked and housing projects that cost way too much because of forced labor arrangements and special interests. It's a system built to sustain itself, not solve the problem.

Right. And his solution? He says it plainly: "The quickest way to get more money in people's pockets is for the government to take less out." But he also digs into environmental rules, water policy, and housing restrictions, arguing they've been turned into tools of control.

That's interesting, especially the water issue. California hasn't built meaningful new water infrastructure since 1979, even as the population exploded. And when people try to clear brush or build homes, they're blocked by lawsuits and bureaucracy. Hilton says "skilled and trained" has become a euphemism for "union-only."

Then the episode takes a darker turn. Hilton directly accuses Xavier Becerra of overseeing disastrous federal child placement practices when he led Health and Human Services. He says, "There are still hundreds of thousands of children missing today." He also ties Becerra to Medicaid fraud problems.

From there, Hilton broadens the attack to California politics itself—trial lawyers and unions capturing the legislature, weaponizing lawsuits through PAGA, making it nearly impossible for small businesses to survive. "They are building a political machine, and that is the scam," he says.

But his closing message offers hope. California can still be fixed, but only if voters break the old system. He wants to cut the budget, lower taxes, cap fees, and refocus schools on literacy and phonics.

Michaels frames the choice as urgent: stay trapped in the current model, or fight to take the state back. It's a hard look at what Hilton says is really running California.