California is on the brink of multiple converging crises, notably financial instability exacerbated by dependence on federal aid under President Trump. Governor Gavin Newsom's recent approach reflects this vulnerability, as he seeks support from Washington amidst growing domestic challenges. The Southern California Edison utility may be implicated in the Eaton Fire, which has caused substantial damage and threatens its financial viability. The potential of Edison going bankrupt poses a dilemma for state leaders, raising concerns over economic implications and their commitment to affordability for Californians.
If authorities were to formally attribute the cause of this fire to Edison and the company's stock price were to continue to tank, the market value of the company would be a fraction of its financial exposure.
The governor's sudden change in rhetoric is because he and California have never been so dependent on Trump as they are now.
The Eaton fire caused about $10 billion in damage, according to a preliminary estimate, raising concerns over the financial future of Southern California Edison.
But that's only the beginning of our potential problems, as fiscal darkness is gathering in California with several crises converging.
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