Two nominations here.  By the way, since it recently came up in comments, the reason we here at Calitics call the California Republican Party the “Yacht Party” can be best explained here and here.

Nominee #1: Sen. Roy Ashburn of Bakersfield, who introduced a bill that would eliminate IOUs for tax refunds.

State Sen. Roy Ashburn, R-Bakersfield, has introduced legislation requiring California’s controller to issue state income tax refunds in cash.

Controller John Chiang has announced his office will have to delay refunds for 30 days starting Feb. 1 because of the state’s cash-flow problems. He has threatened he may have to issue refunds in the form of IOUs if a budget addressing the $41 billion shortfall the state’s projected to have by mid-2010 isn’t passed.

Chiang has said refunds will resume when he’s sure there’s enough state cash on hand.

Ashburn has said tax refund money belongs to the taxpayers, not the government, and taxpayers should get it back in the form it was paid – “cold, hard cash.” California’s constantly taking in cash, he’s said.

Hey Roy, I know a bill you could pass that would get cold hard cash back in the hands of your constituents.  It’s called the budget, and without it California is out of money, and fiduciary responsibilities (sorry for the $1 word) stipulate that other priorities must be paid first.  It’s called “how government works,” and though you’re a State Senator I’m not surprised at your ignorance.

Nominee #2: Faux-moderate Abel Maldonado, angry about the Controller’s office “requesting new furniture” even though the current Controller, uh, didn’t do that.

“I don’t like the fact that hard working people in my district are getting IOUs and he’s buying millions of dollars worth of furniture,” Maldonado said in an interview. (For the record, taxpayers due refunds from the state and others missing payments aren’t getting IOUs just yet. They’re simply not receiving anything at all.) […]

Chiang’s office struck back, calling Maldonado’s accusation “pathetic.”

“Had he done any homework, the senator should have realized that the expansion project, including furniture,…began before Controller Chiang took office,” his office said.

Further, Chiang’s office argued, the controller “demanded that staff cut down the costs, and by changing financing, materials, design, and construction, reduced the overall expense of the project by more than 50 percent” – a $4 million savings.

Next for Maldonado, he’ll lambaste Arnold Schwarzenegger for Prop. 187.  Wanker.

Everything that is corrosive and broken about California politics can be seen in this incredible article by Kevin Yamamura.  In it, he explains that negotiations on the budget are being held by the Assembly and Senate leadership in secret, so as not to upset the critical balance needed to pass it.

Five Californians are trying to solve the state’s budget crisis, in part by keeping the other 38 million residents in the dark.

Gov. Arnold Schwarzenegger and the four legislative leaders have continued their negotiations behind closed doors for weeks, bypassing open legislative committees and offering the outside world few details as a precondition of their talks.

See, what happens is that the population of 38 million elects 120 representatives to go to Sacramento, and they vest all their power in the hands of four leaders, and they go off to run the state by themselves.  It’s such a brilliant program, not subject to personal ambitions or petty jealousies. Not at all.

Among the people the Big Five are hiding from are their own fellow legislators, and lobbyists:

They fear special interests will mobilize on every proposal they hear about, ramp up pressure on lawmakers and prevent any possibility of reaching a deal that could secure enough votes.

“Whether it’s education or labor or any of the other groups, when we get wind of something that has significant jeopardy for us, we fight against it,” said Kevin Gordon, a lobbyist for hundreds of California school districts. “It’s a (lobbying) system set up to defeat the latest idea that’s been hatched, which makes it that much harder to get a solution.”

When they do reach a deal, legislative leaders intend to hide it as long as they can until a floor vote, for fear that lobbyists may undermine the agreement by persuading key legislators to vote against it.

Wow, there’s an honest lobbyist.

So let’s get this straight: budget negotiations are happening in secret, because if they were even remotely public, special interests would scuttle the deal.  And when an agreement is reached, they’re going to SNEAK IT ONTO THE FLOOR so no wayward lawmaker gets in his silly little head that he wants to read it.

The increased secrecy behind this year’s “Big Five” leadership negotiations has made interest groups nervous and has alarmed open-government proponents.

“The thought that to be able to solve this you have to ram it down members’ throats just to lock something up before a constituency finds it outrageous is evidence of how bad the process has gotten,” said Terry Francke of Californians Aware, an open-government advocacy group.

Yep.  Keep in mind that there has not been one Budget Committee hearing this year.  When a deal is reached, that committee will probably meet in the middle of the night and rubber-stamp the deal, moving to the floor as fast as possible to outflank the special interests who clearly run the state.

The Big Five process is absurd.  There are ways to decrease the influence of special interests, the biggest being full public financing of all elections.  The best practice is NOT to hide from them so that the legislative process is like a team of burglars trying to rob a jewelry store without being detected.  And the less people involved in any negotiation, the more possibility for eventual corruption through backroom dealing.

The entire brief for a Constitutional convention can now be “Read A-1 of the Sac Bee on February 4, 2009.”

While we push for this program or that program to be kept out or left in the final budget, the investor class has rendered their verdict on California, and you can hardly blame them.

The downgrade of $46 billion of California’s general obligation bonds by Standard and Poor’s on Tuesday sets the stage for similar actions by Moody’s Investors Service and Fitch Ratings as the state’s budget crisis persists, analysts said on Tuesday.

“It’s a red flag,” said Christopher Thornberg, an economist with Beacon Economics in Los Angeles. “What they’re responding to is the fact that the state is running out of cash.”

S&P cited the state’s weakening finances and slow talks between Gov. Arnold Schwarzenegger and lawmakers over closing a budget gap topping $40 billion through this fiscal year and the fiscal year beginning in July.

The agency cut its rating late on Monday on California’s GO debt, which is backed by the state’s general fund, to “A” with a stable outlook from “A+.”

The final straw was California’s cash shortage. “It just to us indicated another level of distress in the overall situation,” said S&P director Gabriel Petek.

What this means is that the value of outstanding bonds will be lowered, and more importantly, it will become incredibly steep for the state to borrow money.  If you weren’t aware, that’s how we finance the state.  It will not be possible to do so at usurious rates, which we brought completely upon ourselves, and so there is now no reasonable way out of the death spiral.  No matter what the budget solution.

Congratulations, Yacht Party.  You sunk California.  Have fun living in it.

Aren’t you excited that, with nearly two years until the next election, here I am offering campaign news?

Except there are two significant developments today in California of which you should be aware.

First, Jerry Brown is throwing his hat in the ring to be California’s governor for a second time.  He hasn’t formally announced, but this interview signals that he will.

It was 1974 when Jerry Brown ran for governor as a dashing 36-year-old reformer, the embodiment of change in Watergate’s aftermath.

“I was the new spirit,” Brown recalled. “That was my slogan.”

No one would mistake Brown for a new spirit today. At 70, he occupies a prime spot among the elders of California politics. His career has spanned four decades, with three failed tries for the White House along his way up, down and back up the elective ranks.

Now, after two years as state attorney general, this Democrat who first ran for office in the era of Janis Joplin and the Beatles is remaking himself yet again. This time, Brown’s quest is to recapture the job he won 35 years ago: governor of California.

California doesn’t have a good history of Democratic candidates for Governor not named Brown over the last 50 years, so that alone is something.  Brown has a lot to recommend him for the job and almost as much to reject him.  He would be solid on the environment, energy and infrastructure but an absolute mess on prison policy.  Right now, the field includes Gavin Newsom and John Garamendi, with several other possibles.  If there’s a movement candidate on the horizon, I don’t see him or her.

The second development is that the DCCC, the campaign arm for Democrats in the House, has launched radio ads in 28 districts nationwide attacking House Republicans for their obstruction on the stimulus package.

The Democratic Congressional Campaign Committee (DCCC), chaired by Congressman Chris Van Hollen, today announced the DCCC is launching a Putting Families First ad and grassroots campaign in 28 targeted Republican districts.  The ads focus on the Republicans out of step priorities by putting bank bail outs and building schools in Iraq before the needs of the Americans in the struggling economy. The Putting Families First ads begin airing on Tuesday morning during drive time and will run for a week.

In addition to the strategic radio ads in 28 Republican districts, the DCCC will also begin a grassroots initiative which includes targeted e-mails to 3 million voters and nearly 100,000 person-to-person telephone calls.

This is pretty early to be making such a move.  And what’s very notable is the districts in California the D-Trip is hitting.

Representative Dan Lungren (CA-03)

Representative Elton Gallegy (CA-24)

Representative Ken Calvert* (CA-44)

Representative Brian Bilbray (CA-50)

CA-03 is an obvious choice, as it’s the most ripe district in the state for a turnover, and Bill Durston has already announced for a third run after his good showing in 2008.  It’s good to see CA-44 get some action; Bill Hedrick came the second-closest in the state to defeating a Republican, and he’s running again.  (The asterisk on that race means that they are actually using two separate ads in his district, one on children’s heath care and one on the bank bailout, so they’re actually targeting Calvert more than the others.)  CA-50 is a perennial tease, with the Democrat never besting 46% against Brian Bilbray, but it’s just close enough to target.

The inclusion of CA-24 is interesting.  We basically had no candidate there this time, as Marta Jorgensen spent pocket change to go against Elton Gallegly.  She still managed 42% of the vote, showing that the floor for Democrats is fairly substantial.  Gallegly has threatened retirement in the past and this is probably just pressure to get him to leave Congress.  Perhaps the D-Trip knows of a good candidate waiting in the wings.

No CA-26, CA-46 or CA-04 on this list, probably because Debbie Cook, Russ Warner and Charlie Brown have made no indication that they’re running again.

We’re hearing that there could be a budget vote as early as tomorrow, although with the Big Five meeting today, that doesn’t seem physically likely, and the AP says no deal has been reached.  Nevertheless, according to Greg Lucas:

Allegedly the spending reductions – and tax increases – have been agreed to and the focus of continuing budget talks is the shape of the so-called “economic stimulus” legal changes sought by Gov. Schwarzenegger and his GOP allies.

Those changes, such as relaxing state environmental review of less than a dozen highway projects and allowing more outside engineers to design such projects, having been a sticking point for the Republican governor since last year when he criticized – and this year vetoed – a Democratic budget plan for not doing enough to boost the economy.

The new taxes are said to include a half-cent boost in the sales tax, which generates roughly $4 billion annually, and a return of vehicle license fees to 2 percent of a vehicle’s value. At 2 percent, the license fees, much of which are deductible on federal taxes, would generate $6 billion in new revenue for the state – and increase over time.

Returning the VLF to a historically consistent number would be poetic for a failed governor who based practically his whole campaign on reducing it and breaking the state in the process.  

What happens in between the taxes and the spending is going to be a key.  Whether the GOP is fighting old battles by trying to invalidate past environmental laws, or whether they are demanding a state spending cap, those details matter.  Dan Walters thinks that a “carefully written spending cap with realistic emergency provisions” could work in a swap for eliminating the 2/3 budget requirement, but when you’re adding emergency measures and writing it so carefully, you might as well raise enough revenue to pay for services people desire and be done with it.  Spending caps don’t work.

In the meantime, while these details are hashed out, citizens are paying the price, as this week California begins to stiff creditors and defer payments to individuals and businesses.

Wendy Hansen, a 52-year-old single mom in Monrovia, says she cannot afford a delay in her anticipated state income tax refund of $1,800.

Without the check, Hansen said, she will have to put off debt payments, long-needed repairs on her house and treatment for a back problem that she believes has been aggravated by stress over finances.

An estimated 2.7 million Californians expecting income tax refunds this month won’t receive them for now, because the state’s prolonged budget impasse has emptied its treasury.

“It’s horrendous,” said Hansen, an office manager for a doctors’ office. “I’m someone who counts on that refund every year to make ends meet.”

This will disproportionately hit those how make too little money to owe taxes and expect their entire withholding to return to them, as well as those expecting public assistance payments.  In other words, the least of society.

Who in Sacramento will speak for them?

This certainly made for a great picture – thousands of teachers in Pershing Square in downtown LA rallying against budget cuts to education.  You can put it next to state employees rallying against state employee cuts.  And nurses rallying against health care cuts.  And, I don’t know, park rangers rallying against park closures.  But social movements don’t happen in a vacuum.  History shows us that coalitions built across platforms succeed in galvanizing public opinion and forcing through progress.  Teachers angry about education cuts is something I endorse.  They’re well within their sphere of expertise to complain about that area of the budget.  I don’t know that it’s helpful at all in the midst of this crisis.  Especially when it’s so narrowcast and specific.

The California Teachers Association released a TV ad Friday that says “some Sacramento politicians are going too far” in considering changes to the schools budget.

Specifically, the teachers union attacks a proposal floating around the Capitol to give school administrators more flexibility in how to use so-called categorical money that is currently earmarked for class-size reduction.

“Tell your lawmakers: Ending the class size reduction program won’t save California one dime. It only hurts our kids,” the voice in the ad says.

Now, nobody wants class sizes to inflate.  But when each single-issue silo zealously guards their small piece of power and tries to call to action only for that specific piece, several things happen.  First of all, the counterpoint is easily cast as “special interests clinging to power.”  Second, there is absolutely no continuity of message across the groups, and in fact their messages can conflict with one another.  As I’ve said many times, unity is the great need of the hour.  And there seems to be no comprehension on the part of CTA or frankly any other progressive or labor group that budget money is fungible and everything that the state does affects their single issue in one form or another.

By way of example, how great would it be if CTA put up an ad saying, “Times are tough, and yet the state spends billions of dollars warehousing low-level drug offenders who need treatment and not jail.  We need education and not incarceration.  Tell the governor and your legislator to end 30 years of failure in our prisons and return to sensible sentencing policy to save us billions and help fund our schools.”  It’s really not that hard.  Even Dan Walters can do it.

The fastest growing segment of the state’s deficit-ridden budget, by far, has been its prison system, reflecting severe overcrowding, generous labor contracts and federal court pressure to reform inmate health care.

“Corrections,” an ironic misnomer, has jumped from less than $5 billion a year to more than $10 billion in the last decade, over twice as fast as school spending, the biggest budget item. It now costs about $45,000 a year to feed, clothe and medicate each of the state’s 170,000-plus inmates, or roughly five times what taxpayers spend on a typical public school student. And that doesn’t count what it costs to supervise tens of thousands of parolees.

One element of any plan to close the state’s immense deficit, as well as relieve the overcrowding that invites federal intervention, must be to get a handle on prison costs by shedding some low-intensity inmates.

We could see the state employees union demand to restore the car tax.  The firefighters could call for full funding of education.  Etc.

If each group goes after their piece of the pie, ultimately we’re all going to lose.  History teaches us that only with a movement united together can we create prosperity and security for all Californians.

The State Lands Commission scuttled a proposed compromise that would have brought new oil drilling to the Santa Barbara coast for the first time in California since 1969, in what is seemingly a victory for environmental and coastal protection advocates.  However, some are arguing that the proposal, which would have mandated closure of 4 additional oil platforms off the coast within 13 years, should have gone through.

But a parade of local officials, residents and environmental activists insisted the plan would have advanced efforts to protect the coast by eventually closing four of the region’s 20 platforms.

“For the first time in history, the public and the state will be able to shut down existing oil production,” argued Linda Krop, an attorney for the Environmental Defense Center and one of the people behind the proposal. “Without this project, they’ll continue indefinitely — perhaps another 40 years.” […]

Nineteen of the 20 platforms that dot the ocean off Santa Barbara and Ventura counties are in federal waters. Shuttering four of them, says Krop of the Environmental Defense Center, would make it difficult for the federal government to lease underwater tracts accessible from those platforms.

And with closure of the two processing plants, the prospect would have been more unlikely, she said.

Read the whole article.  There was a significant green alliance in favor of this drilling-for-closure exchange.  I tend to agree with the Lands Commission that the proposal for closure wasn’t completely enforceable, but then, that’s their job to write the law with some enforcement, isn’t it? (I guess their concern is that these are federal waters and the state would be limited to enforce end-dates.)  I also understand John Garamendi’s stated rationale, that approving one lease would set off a parade of oil companies coming to sully the coast, but off course those are approved on a case-by-case basis as well.

If we’re going to talk seriously about drilling off the coast in the future, there should be at least a couple bright lines – closure deals like this, and the implementation of an oil severance tax so that we’re not the only state in the country that doesn’t charge a fee to industry for taking our natural resources out of the ground.

It’s an interesting debate – legislators are split, with coastal Assemblymembers opposing but the locals in Santa Barbara in favor, and even Lois Capps thinks it’s a worthwhile deal.  Endless oil and gas concerns off the coast ought to be dealt with, it’s a good question to ask whether this is the right way.