All posts by David Dayen

Arnold’s Crusade Against Legislators For Committing The Crime Of Legislating

The Sacramento Bee committed an act of journalism today, taking a look at the consequences of the legislature failing to act on various bills in favor of solving the budget.

Merced County beekeeper Gene Brandi says he had enough problems before getting ensnared in the nasty war of words between Gov. Arnold Schwarzenegger and the Legislature over California’s failure to cure its staggering budget deficit.

His Gene Brandi Apiaries in Los Banos, which once produced 400 drums of honey a year, has turned out just 20 drums so far this year as a searing drought has deprived wildland plants of the nectar that bees turn into honey.

And Brandi says he is facing competition from food processing companies that market sugar-added honey products as the real thing. “We’ve got people who take advantage of the good name of honey to try to sell their product,” he says.

Now some agricultural producers and Democratic lawmakers say Schwarzenegger and his aides are unfairly exploiting the good names of honey, blueberries, pomegranate juice – and cow tails – to bash legislators for fiddling while California burns.

The dust-up stirs debate over whether the budget mess should freeze out all other matters – or whether lawmakers still have a responsibility to continue the business of legislating, no matter how mundane it can appear.

Did this guy really ask to be turned into a punchline by the Governor?  I would argue that the crap that large multinational food producers package and sell as food is a serious problem on a variety of levels, not the least of which is public health.  And given 120 legislators with different committees and responsibilities, we are perfectly able, even with a budget crisis, to deal with additional legislation, particularly that which can make a difference to small businesses and the health and safety of the entire state.  In the past several years, with budget woes in every single one of them, somehow we passed a prescription drug benefit for seniors, an increase to the minimum wage, a landmark smart growth bill, and the Global Warmings Solutions Act, just to name a few.  

Ol’ Stogie And Jacuzzi is guilty of the exact same crime of turning every program that sounds funny, that includes animals or food, into an object of derision, as John McCain when he discussed so-called “pork” in the stimulus package:

McCain’s method of indentifying waste, gleefully repeated by Dowd, is a disgrace. His technique is to focus on programs that mention animals or food, or anythign that sounds silly. He’s clearly not interested in learning whether any of the programs he targets have merit. Here is Dowd recording McCain’s twitter postings:

$1 million for Mormon cricket control in Utah. “Is that the species of cricket or a game played by the brits?” McCain tweeted. …

$2 million “for the promotion of astronomy” in Hawaii, as McCain twittered, “because nothing says new jobs for average Americans like investing in astronomy.” …

$200,000 for a tattoo removal violence outreach program to help gang members or others shed visible signs of their past. “REALLY?” McCain twittered.

I don’t know whether or not cricket control is a necessary program. Maybe crickets are doing many times that amount in crop damage every year. Maybe it’s a boondoggle. I don’t know about the astronomy program, either, though I do think there’s a role for federal support of the sciences, even in silly-sounding places like Hawaii.

I do know that the tattoo-removal program is an effective anti-crime initiative — it allows rehabilitated former to reenter society shorn of visible markings that cut them off from middle-class culture. McCain and Dowd don’t know this, and they don’t care. What’s on display is the worst elements of political demagoguery meeting the worst elements of the instant-reaction internet culture. They think the very idea of trying to learn about something before you take a position on it is a joke.

Who could have expected that going with a chief executive this simple-minded could lead us to such a place of ruin?

Calitics At Netroots Nation 2009

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We often engage in the day-to-day combat of intracacies of the budget or campaign news here at Calitics.  But we should never lose sight of the long-term questions.  Is California governable?  Does the erecting of procedural barriers to sensible governance in this state prefigure a political crisis for the rest of the nation?  Can we build a movement for reforming this broken system and produce a model that allows majorities in the legislature to reflect the intended will of their constituents?  

I’m pleased to announce that I have put together a great panel that will tackle all of these questions at the blogosphere’s signature event, Netroots Nation 2009 in Pittsburgh, Pennsylvania, from August 13-15.  On Saturday, August 15, at 3:00pm, we will discuss the California budget mess and its implications for the nation at large in a panel entitled California: How Process Creates Crisis.

California is the nation’s largest state, and is often seen as a bellweather for economic and social change. However, the peculiar dynamic of state government institutions has threatened that role, as the state has slipped into an almost perpetual crisis mode. Despite an overwhelming majority of progressive lawmakers in the state legislature, the two-thirds rule for passing a budget and tax increases, among other issues, handcuffs them and empowers a radical conservative minority. Thirty years of short-term fixes and failed leadership have only exacerbated the problem and put the state-and the nation-in real danger. As Paul Krugman recently said, “Years of neglect, followed by economic disaster-and with all reasonable responses blocked by a fanatical, irrational minority … This could be America next.” In this session, we will look at the reasons for California’s budget tangle, the larger implications for the progressive movement at large, and what some organizations are doing to change these outdated rules and take back state government for the people.

In addition to myself, the panel will feature Robert Cruickshank of Calitics and the Courage Campaign; Jean Ross of the California Budget Project; and Kai Stinchcombe, a candidate for State Assembly in AD-21 in 2010.  There may be an additional special guest, which I will reveal later.

If you have not registered for Netroots Nation, you can do so at their website.  If you have, please join us for a wide-ranging discussion on California, a kind of 75-minute blog post on the challenges ahead.

Another Special Election Merry Go-Round

If you look at state economic statistics and the consistently worsening projections as each month of revenue collection goes by, you would recognize that, even if the positive talks on closing the current budget gap result in a deal, the possibility – even probability – of another deficit requiring a revision could take hold as early as this winter.  That’s what happened last year, and if anything the economy in the state has softened since then.  At this time, the value of having a fully seated Senate and Assembly, due to the need for 54 Assembly votes and 27 Senate votes to move anything, becomes even more pronounced.  Right now, we are down one Assembly seat owing to Curren Price’s move to the Senate (owing to Mark Ridley-Thomas’ election as LA County Supervisor last November).  The CA-10 race could leave another opening if Sen. Mark DeSaulnier or Asm. Joan Buchanan emerge victorious.  And in Los Angeles, an opening on the City Council may cost the Assembly another seat for a period of time.

Los Angeles voters showed a profound disinterest in the civic election in March when just 18% turned out, but there was a virtual stampede of candidates this week to run for the San Fernando Valley seat of former City Councilwoman Wendy Greuel, who won the race for city controller.

The slate of 14 candidates for the Sept. 22 special election reflects the varied geography of the 2nd District, which stretches from Studio City and Sherman Oaks at its southern border, through Van Nuys, Valley Glen, North Hollywood and Sun Valley to the rugged reaches of Sunland-Tujunga at its northern edge […]

With just two months to raise money, a number of City Hall watchers are eyeing several strong contenders: former Paramount Pictures executive Chris Essel; state Assemblyman Paul Krekorian, a Democrat who lived in Burbank until moving this spring to Valley Glen; and Los Angeles Unified School District board member Tamar Galatzan.

Krekorian, who is an assistant majority leader, moved into the Council District but not out of his own Assembly District (Valley Glen is on the edge) to pursue this seat.  If he wins, it probably wouldn’t take effect until December 8, assuming that he doesn’t reach 50% +1 on September 22.  AD-51 (Curren Price’s old seat) will have a new Assemblymember by November 3 at the latest, but Joan Buchanan or Mark DeSaulnier could reach the US Congress on the same day, and Krekorian might move to the LA city council and vacate AD-43 soon after.  By the time all these special elections shake out, we’ll be well into 2010.

All of this shows the need to modernize our system of filling special elections, which always seem to be more widespread in California.  Wendy Greuel was elected City Controller back in March.  There’s little reason to drag out the search for her replacement this long.  And if we had Instant Runoff Voting for the first round, we would not need to wait two months for an additional round, paralyzing state and local government and costing the state money in setting up additional elections.  In the case of federal and state legislative elections, this is particularly perverse, since the way in which runoffs occur (with the top vote-getter in each party) almost always become useless races where the ultimate victor is well-known from the beginning.

The Post-IOU World

Today is the first day that most large banks stop taking IOUs from individuals and small businesses.  For those left holding them, the options are limited.  Citibank agreed to a one-week extension, and Bank of the West will accept them – but only for existing customers.  Other big banks may offer lines of credit or other short-term bridges for customers, but on a case-by-case basis.  IOU holders needing cash might be able to try credit unions, or inevitably, check-cashing stores.  And this all appears to suit Arnold Antionette just fine:

State Treasurer Bill Lockyer tried to persuade the big banks to change their minds about the IOUs. “We’re just trying to convince them that it would be in the best interest of their customers and the best interest of taxpayers to give it more time,” said his spokesman Tom Dresslar.

Gov. Arnold Schwarzenegger made no such attempt at persuasion. “His focus is to get a solution to our budget so we don’t have to deal with IOUs,” said his spokesman Aaron McLear. “I don’t think it was anyone’s expectation that they would honor them forever.”

Emerging from a meeting with legislative leaders Friday, the governor would say only that “IOUs are one more reason to get the budget done as quickly as possible.”

In 1992, the last time the state issued IOUs, the major banks accepted them for about a month. Their refusal to go any further was widely seen as a move to pressure officials to pass a budget.

Yes, of course, this is why he vetoed solutions that would have stopped the issuance of IOUs in the first place.

Meanwhile, John Chiang’s latest release of the state economic picture shows a $10 billion dollar shortfall in Fiscal Year 2009, and a still-contracting revenue picture that has led to a $4 billion dollar delay in payments to local school districts.  They has planned on sending out the money Friday; now they will hold off until July 30.

And the Big Five have returned to the negotiating table today, where they claim “constructive” negotiations, which we’ve heard plenty of times before.  No word on whether the Governor continues to hinge a budget deal on uncorroborated fictions about fraud in social services or fiscally unwise cuts to programs like welfare.

A Lawsuit Challenges The Two-Thirds Rule

It seems thirty years or so too late, but a former UCLA chancellor and director of the MOCA in Los Angeles named Charles Young filed suit against the provision in Proposition 13, passed in 1978, that requires a two-thirds vote in the Legislature to raise taxes.  The legal theory behind the case mirrors the theory behind the attempted repeal of Prop. 8 this year, which was ultimately unsuccessful.

The legal theory of the suit, which names the Legislature’s chief clerks as the technical defendants, is that when voters passed Proposition 13 in 1978, cutting property taxes and requiring a two-thirds vote for tax increases, it was a “revision” of the state constitution rather than an “amendment.”

The constitution allows amendments to be made by initiative petition but allows revisions – generally a more fundamental change – to be made only through a constitutional revision commission or a constitutional convention.

It’s essentially the same argument that opponents of Proposition 8, the 2008 measure that outlawed same-sex marriages, made in attempting to persuade the state Supreme Court to void that measure. But the court, which had earlier sanctioned same-sex marriages, ruled that Proposition 8 was valid.

I’m a bit surprised that Young didn’t include the single-subject rule in his charges, as the property tax rules and the two-thirds requirement for taxes don’t seem to bear much relationship to one another.  Of course, that has already been argued before the state Supreme Court, along with the revision argument, equal protection concerns and about a half-dozen other charges, four months after passage, in Amador Valley, and the Supreme Court upheld the initiative.  Here’s the way the revision argument played out back then.

The California Supreme Court held that although Proposition 13 would result in various substantial changes to the constitution, it was only an amendment because the changes were narrowly tailored to the objective of changing the taxation system. Id. at 228.  According to the Court, a change in the voting requirement did not amount to a revision of the constitution.  The Court further stated it was not uncommon to have similar voting requirements for financial matters, and that the Proposition would not effect home rule.  Id.  The Court cited Article XIII, Section 20 of the State Constitution that authorizes the legislature to set maximum property tax rates. Id. at 228.   The Court concluded this new article, implemented by Proposition 13, would be no more threatening to home rule than Article XIII, § 20. Id.  The Court, while not endorsing the Proposition, did state the initiative process was a direct form of government from the people. Id.  Finally, the court held that it would not limit the ability of people, through the initiative process, to achieve such a limited purpose of a new system of taxation. Id.

The Court upheld every aspect of Prop. 13 at that time, and the law has withstood multiple legal challenges over the years.  Like with Proposition 8, the Court seems loath to overturn a vote of the people, and now we’re 31 years down the road.  Of course, this forms the core of Charles Young’s argument, that the effects of Prop. 13 are powerful evidence that it is not merely an amendment, but a major revision affecting the lives of all California’s citizens.

I’m skeptical that this can get off the ground, but I see little harm in it.  And maybe putting Prop. 13 on trial, and laying out the effects in sharp detail, could lead to closing the loophole and building a sustainable revenue base.

Pushback: SEIU Potential Walk-Out, Corporate Tax Cut Repeal, Court Overturns Medi-Cal Cuts

Rumors ran rampant yesterday that state employees, pushed too far by yet another salary cut (totaling 20% over the course of the year), would potentially strike.

Doug Crooks, Director of Communications with the Service Employees International Union’s local 1000, which represents more than 95,000 state employees, declined to confirm the rumor but said any decision would be made by the employees through an authorization vote.

“In the first place, that decision hasn’t been made yet,” said Crooks about the plan to strike. “That decision hasn’t been made yet. We are definitely going to strongly oppose and do everything we can to prevent the governor from imposing a fourth furlough day. But check back with me Monday.”

“The bottom line is we negotiated with this governor in good faith and we agreed on a contract that would save $340 million dollars immediately, and if applied to all state employees it would save the state a billion dollars. That’s billion with a ‘B.’ And for the governor to undermine that contract now is beyond irresponsible. He’s made the state employee a pawn” in the state budget negotiations.

“Well actually, it’s a five percent cut on top of those three furlough days,” explained Alicia Trost, a spokesperson for Senate leader Darrell Steinberg. “It’s simply a scare tactic by the governor, yet another, and we feel the state workforce has already paid their fair share. What’s worse is that it would have a horrible effect on the economy if state workers were to lose up to 20 percent of their buying power.”

By the way, Mr. Stogie just lost a furlough case, with a judge tentatively ruling that he cannot furlough  the legal staff of the State Compensation Insurance Fund, which has emboldened the larger pool of workers in SEIU.  But more to the point, in the world of Arnold Antionette and the Yacht Party, workers making a median income getting 20% salary cuts while the largest corporations doing business in the state get a massive corporate tax break is considered “everyone paying their fair share.”

Speaking of which, Lenny Goldberg offers the text of an initiative to repeal the negotiated-in-secret corporate tax cuts and save the state $2.5 billion dollars a year.  Opponents typically respond with race-to-the-bottom rhetoric about businesses leaving the state, which isn’t true, by the way.

UPDATE: Here’s a study out TODAY from the PPIC confirming that the whole “the rich are leaving California” line is a flat-out lie.

Finally, a federal appeals court ruled that California cannot cut Medi-Cal reimbursements, in an opinion written by a George W. Bush appointee.  The familiar pattern of breaking the law to cut the budget often runs up against judicial review, and so the criminals in Sacramento – considering what they’re attempting, I don’t consider that hyperbole – will have to try something else to achieve their long-sought destruction of the social safety net.  

CA-45: Pougnet Has Big Fundraising Quarter

While candidates for state and federal office have until July 15 to announce their fundraising totals to the FEC, we’re starting to see some of the numbers trickle out.  And this is a pretty good one.  Steve Pougnet, the openly gay mayor of Palm Springs, husband and father of two, reportedly raised over $200,000 in the second quarter.  He claimed to have outraised his opponent, incumbent Mary Bono Mack, although the Republican has not yet released her numbers.

$200,000 is a better quarter than almost all Democratic challengers achieved at any point in the last Congressional cycle until the final fundraising quarter.  It’s particularly impressive this far out of the race.

With Bono Mack facing heat from her right flank over her vote for the Waxman-Markey energy bill, she may not have the kind of national backing she could need.  Bono Mack has performed impressively in this seat throughout her career and she remains heavily favored, but Pougnet will have a chance in a district that went 52-47 for Barack Obama in 2008.

They should grant early release of the whole parole system

Today’s LA Times story about a handful of prisoners released with 60 days or less remaining on their sentences probably raises hackles on the backs of the necks of the Tough on Crime crowd, but it really shows how fundamentally broken the state’s prison system remains.  Because look what the charges were on all of the prisoners released.

Reporting from Sacramento — California prison officials, facing severe overcrowding and a financial crisis, have been granting early releases to inmates serving time for parole violations.

State officials said the dozens of prisoners set free from the California Institution for Men in Chino and from lockups in San Diego and Shasta counties had 60 days or less left on their terms, or had been accused of violations and were awaiting hearings. The releases were approved by the state parole board.

At least 89 inmates have been freed or approved for early release during the last two months. Others have been sent to home detention, drug rehabilitation programs or similar alternative punishments.

It’s not an anomaly to see just 89 inmates charged with parole violations.  In fact, more than two-thirds of all prisoners admitted to state prisons in 2007 commit the crime of violating parole guidelines.  This is at least twice as many as virtually any other state.

On average, the nation’s state and federal prisons took in almost two new offenders for every parole violator, but in California, the reverse is true. In 2007, California prisons took in 139,608 inmates and 92,628 of them were parole violators, almost a 2-1 ratio. In only one other state, Washington, did parole violators outnumber those being jailed by the courts, and that was only by 126 inmates.

If Arnie Antionette were truly talking about reform instead of policies that destroy the social safety net, he’d talk about completely overhauling a parole system that is clearly too constrictive, that fails Californians and makes us all less safe.  When you warehouse 170,000 inmates in jails that only fit 100,000, you turn them into institutes of higher learning for violent crime instead of rehabilitation centers.  In addition to the cost of overtime for parole officers and prison guards, the costs to the criminal justice system naturally increase with the revolving door for inmates, not to mention the societal and human costs.

Unfortunately, we don’t have a reform agenda in this state, just a bunch of lawmakers trying to get across the line to the next budget, to the next election.  If there was such a thing as innovation and leadership we would have revamped this failed parole policy long ago.

An Aggressive Strategy

As the Governor has tried to hijack the budget crisis to serve his own ends of punishing union workers and shredding the social services net, over the last couple days we’ve seen Democrats fighting back.  For example, Dean Florez surgically took apart the Governor’s idiotic smear attempt on legislators for doing their job of legislation.  Considering that the Governor has never invited all 120 lawmakers into his smoking tent for a pow-wow, I think there’s room for multitasking here.  But understanding that would involve basic knowledge about how government works, as Florez said:

Assembly bill 606 creates a commission to serve the marketing interests of the blueberry industry. Another bill defines “honey” to mean the natural food product resulting from the harvest of nectar by honey bees, and a third bill adopts regulations establishing definitions and standards for 100-percent pomegranate juice.

“Look, we’re pro-condiment, we’re pro-fruit, but the focus needs to be on the budget crisis,” McLear said.

Senate Majority Leader Dean Florez (D-Fresno) called Governor Schwarzenegger’s criticism “childish” and said he is fed up.

“The governor’s turned from an action hero into just another politician,” Senator Florez said. “He should really, really take a course on fundamental government on how the legislature works.”

“The fact that he doesn’t understand these things worries me,” he added.

Asm. Nancy Skinner held a press event with small business owners, again using the imagery of Arnold Antionette smoking a stogie in his Jacuzzi to contrast with the state’s struggles:

Skinner called a news conference at the corner of Solano Avenue and The Alameda in Berkeley, outside the vacant storefront formerly occupied by A Child’s Place. Near her podium was a poster of Arnold Schwarzenegger with a cigar in his mouth, with the headline “While the state drowns in IOUs ARNOLD DOESN’T CARE” and featuring a quotation from this past Sunday’s New York Times Magazine article on the governor’s method of coping with the stress of the budget crisis: “I will sit down in my Jacuzzi tonight. I’m going to lay back with a stogie.”

Skinner said that’s pretty cheeky talk for a governor who nixed bills that would’ve helped solve the state’s cash crisis, avoided the need for the IOUs now going out and kept the deficit from growing by another several billion dollars. And it’s particularly distasteful, she said, to small businesses that are struggling through this recession even as Schwarzenegger proudly talks about vetoing a plan to collect sales tax from large online retailers doing business through California-based affiliates.

You can debate AB 178, the plan to collect sales tax on affiliate sales (I don’t sell enough in affiliate sales to have much skin in the game, but there are decent arguments on both sides), but aligning with small business to attack a supposedly business-friendly Governor has good optics.

For the wonks, the Assembly produced an analysis of the Governor’s so-called “reform” agenda, showing that most of it would be completely irrelevant to the current budget year, and all of it uses math that magically eliminates implementation costs but assumes outrageously oversized savings years down the road.  These are cuts to social services pretending to be reform.  I guess it’s a step up from completely eliminating programs like CalWorks, but it’s fundamentally dishonest.

Moments after the Governor’s press conference yesterday about CalWorks “reform” (fact-checked here by the CBP), welfare advocates held their own press event that made most of the news items:

“I’ve never liked when people pick on the poor because they haven’t got the ability to fight back,” said John Burton, the state Democratic Party chairman and former Senate leader known as a fierce advocate for the poor. “It’s a Republican syndrome. It isn’t tough for Republicans to beat up on poor people. When finances are terrible, they go after the poor and blame the poor. Republicans constantly use that and don’t worry about all the benefits government gives to businesses.” […]

Welfare advocates countered that nearly two-thirds of recipients are working or participating in training, and that half are making some kind of income. They also said that the governor’s own May revised budget proposal estimated an annual savings of $100 million with that reform.

“He’s reinforcing negative stereotypes and scapegoating people for the failure of his own administration,” said Frank Mecca, executive director of the County Welfare Directors Association of California. “It’s a reflection of a bully mentality, to go after the problems of struggling families when he doesn’t get his way. The last thing those families need is to have a powerful figure accuse them of fraud, of not trying.”

Furthermore, the CA Democratic Party has collected budget horror stories to highlight the human cost of the crisis.  Here’s one picked at random:

I am on Social Security Disability and with the amounts allowed to get SSI having been cut, it has also cut my income. Also, my medical coverage is being hit as well as so many of the social programs all of us depend on. Fortunately, I am not homeless yet, but it is a good possibility. I just do not understand how you could make all Californians suffer, especially those of us who are very low income, in favor of giving a huge tax break to oil and tobacco. This is not just or right and I believe that the solution is to sign the compromise bill, and tax the big corporations that are not now paying their fair share! – Christine, Victorville

The structural barriers in the state are so high that I’m not sure any of this can work.  One thing is certain, however – this aggressive strategy creates energy in the grassroots, inspires changes to the system and can leverage public opinion far better than desperately seeking some compromise behind closed doors.

Assembly Adds Pressure While Labor Moves To Repeal Corporate Tax Breaks

It’s sad that one comment can mean more to a debate than years of attacking public employees and public works and months of attempting to destroy the California dream.  That should be disqualifying enough.  But Governor Hot Tubs and Stogies’ “let them eat cake” comment in the New York Times has gained some traction.  Apparently this was a target big enough for everyone in Sacramento to hit.  The Assembly Democrats included it in a video showing the Governor’s hypocrisy during recent budget talks.

And that’s great.  Narrative-setting can be powerful and important.  That’s what’s behind the Governor’s idiotic crusade to criticize legislators for legislating while he stamps his little feet.  At least for today, I think the Democrats are getting the better of ol’ Hot Tubs and Stogies.

But I’m more excited about this:

Labor groups file initiative to repeal corporate tax breaks included in recent budget deals.

These are the massive corporate tax breaks, which could cost the state up to $2.5 billion dollars a year, agreed to in secret by the Governor and the Legislature during the February budget agreement.  In a time of recession, the state’s political leadership, hijacked by the 2/3 requirement, gave away billions of dollars to the largest corporations in America while crying poor about social services for the indigent and the needy.  And those corporate tax breaks are the ONLY permanent tax changes made in the budget this year.

Damn right they should be repealed.  They offend the conscience, cost the state needless cash, and do nothing to help the vast majority of businesses (80-90% of the proceeds of these tax breaks will go to just 200 corporations).

Bottom line: Budgets are about values, and they are about priorities. Before lawmakers take health coverage away from children whose parents are struggling to make ends meet, eliminate financial aid for students who understand that hard work and a college education provide the best promise of future success, or shutter state parks that protect California’s natural environment and provide affordable recreational opportunities, they should reverse these permanent and massive giveaways that will compromise the state’s long-term financial security.

With newfound spunk from Democrats, at least in the Assembly, and serious moves by progressive advocates to reverse the horrible decisions made in past budget years, I think the ground is being prepared for a legitimate reform of the broken structure that has brought us to this point.