So the State Senate pushed through the creative, $18 billion-dollar lawsuit bait of a budget moments ago by a vote of 23-15.  Republican Sen. Mark Wyland abstained and there are only 39 Senators in the chamber, with Mark Ridley-Thomas’ seat currently vacant.  That means there was one Democratic “No” vote.

Thanks, Lou Correa.  

A vote is expected in the Assembly later today, and I don’t think anybody knows whether or not the Governor will sign it.  He asked for a bunch of “economic stimulus” reforms and only a few of them made their way into the final bill.

Nail-biter time.

…OK, these bills are on the Governor’s desk.

Democratic legislators today sent Gov. Arnold Schwarzenegger a complex and controversial package of tax increases and program cuts, an $18 billion effort designed to avoid the need for Republican votes that GOP leaders called illegal.

The state Senate and Assembly made their way through the package of bills required for the maneuver, voting along party lines on tax increases while jointly backing other proposals to hasten public works spending. Republicans opposed the tax proposals and accused majority Democrats of breaking the law.

There is some relaxation of environmental legislation in the package.  Now we wait to see if the Governor signs it.

…within minutes, the Yacht Party caucus in the Assembly dashed off a letter to the Governor urging him to veto, calling it “the Democrat’s illegal tax package.”  Every member signed it but one – Paul Cook.  And contrary to my musings that he was in a tough election fight and might want some distance from the crazies, Shane Goldmacher sez he’s out sick.

UPDATE by Robert: Sure enough Arnold says no to the deal. Arnold has the Republicans’ back, never let there be doubt about it. He’s perfectly willing to let the state collapse, even after he got his pound of worker and environmental flesh.

I urge anyone who cares about California to listen to yesterday’s Which Way, LA.  It’ll make your hair stand up.  The program was about the decision by the Pooled Money Investment Board (basically Treasurer Lockyer, Controller Chiang and Schwarzenegger’s Finance Secretary Mike Genest) to shut down almost 2,000 public works projects, from schools for the deaf in Riverside to highway improvements along the 405, from hospital construction to transit projects and fire prevention services in heavily forested areas, affecting the entire state and as many as 200,000 jobs over the next several months.

The problem is that California is out of money. But it’s bigger than that.  The state floats revenue anticipation bonds to cover these kind of public works projects, and indeed the voters approved all kinds of infrastructure bonds in 2006.  The issue is that investors simply won’t buy them.  They believe that California will default on their commitments at some point or another (though it’s never happened before) due to the instability of the budget process.  Coming up with a work-around to get the budget more balanced (at the expense of hard-won labor rights for public employees, it appears) will go some of the way to fixing that, but NOT all the way.  We’re at a point of extremely low investor confidence.  California has the worst bond rating in the country.  So it’s not at all clear that the shovels will be picked up again even if the legislature passes and the Governor signs a budget deal.  The systemic budget cycle of catastrophe is what’s keeping investors away.  And of course, if the work-around falls apart or the courts strike it down, the state will be out of money in February and vendors will start receiving IOUs.

What’s more, if the Obama Administration offers massive infrastructure spending as part of a recovery package early in his term, EVEN THAT won’t necessarily get these projects going.  As I understand it, federal grants of this nature often require up-front money from the states, and the opportunity for matching funds if the state kicks in the first 25%.  At this time we don’t have that money, so we wouldn’t be able to access the match.  I assume Speaker Pelosi knows this, but it will be difficult to alter the standard practice on this kind of federal spending.

We’re talking about 200,000 lost jobs and an infrastructure shutdown at precisely the moment when infrastructure spending is seen as the key to economic recovery, with multiple obstacles to getting them going again.  And the state could be liable for whatever rises as a result of the shutdown:

Lockyer and other members of the Pooled Money Investment Board predicted that unless the state balances its budget, the funding shut-off will further harm the economy and expose the state to lawsuits.

“The likelihood of contract breaches is probably 98 percent,” Lockyer said […]

Also at financial risk is a new levee on the lower Feather River in Yuba County and a planned bolstering of Folsom Dam for flood protection.

Assemblyman Dan Logue, R-Linda, said the suspension of state funding for the Feather River levee project, already under construction, would put 40,000 people at risk in an area that has flooded twice in the past 25 years […]

“This (could) put tens of thousands of people’s lives at risk, and I believe the state will be liable if there is any damage,” Logue said. “The state is responsible for those levees in the first place.”

This looks to me like an unending nightmare.  If I were Hilda Solis or any California politician, I would want to get the hell out of this state too.  It looks like it’ll fall into the ocean.  But hiding from the problem is a mistake.  This has the potential to take down whatever economic recovery we may see come January.  The federal government needs to provide direct relief, not grants, to the state, or at the very least guarantee the bond issues so that we can restart the issuance of revenue anticipation notes.  You can run, but you can’t hide from California.

Nobody could have predicted that the Yacht Party wouldn’t budge.

Democrats in the state Assembly on Tuesday countered the plan by Republican lawmakers for deep cuts to help bridge California’s gaping budget hole, putting up for a floor vote a new $19 billion plan through mid-2010 that would adopt Gov. Arnold Schwarzenegger’s tax ideas.

But the Democrats’ latest plan failed to garner the required two-thirds majority support as partisan bickering over tax increases continued and Republicans refused to approve taxes […]

Late Tuesday, Assembly Speaker Karen Bass, D-Baldwin Vista (Los Angeles County) ordered lawmakers to remain in the chambers until the Republican proposal could be written in bill form, with hopes to vote on it. But the night ended without a vote because the bill wasn’t ready, Bass said. She plans to bring the GOP proposal to the Assembly floor for a vote today […]

After more than two hours of debate, Assembly members initially voted 46-27, along party lines, on the Democrats’ tax bill, missing the two-thirds majority threshold by eight votes. A separate budget bill that contained spending cuts also failed to gain the required support, receiving a 48-27 party-line vote in early evening.

But rather than end the floor session, Bass announced that lawmakers were locked in, preventing them from leaving the Assembly floor and nearby meeting rooms.

At nearly 11 p.m., Bass reopened the vote for the two bills, and all Democrats but one who voted “yes” earlier decided to abstain instead, making the final tally 0-26 for the budget bill and 1-27 for the tax bill.

One interesting sidelight – there are 29 Assembly Republicans, yet the “No” vote on the budget never got more than 27 votes.  So two cowards must have taken a walk.  I’d find the bill to note exactly which cowards took a walk, but LegInfo is labyrinthine (UPDATE: Randy Bayne helpfully informs that the culprits are Paul Cook, Cameron Smyth and Sam Blakeslee.  Cook and Smyth in particular were in somewhat tough re-election fights in November, so that’s interesting).  We do have abstentions on the budget and tax votes on the Democratic side as well, including all four of the new lawmakers (Huber, Block, Perez and Buchanan) and Charles Calderon on the tax plan.  Huber and Calderon abstained on the budget cuts, and Mariko Yamada voted against it because of specific agricultural cuts.  The bill was fated to fail, but I’d want to know more about the freshman abstentions.

What this means is that $5 billion in public works projects will likely be shut down, at precisely the time when fiscal spending is needed to jump-start the economy.  It will lead to thousands of layoffs (thanks, pro-growth Republicans!).  This is really not that hard.  State budgets with balanced budget amendments have very little maneuverability.  They can cut spending or raise taxes.  Counter-cyclical spending is CLEARLY preferable.

Almost every single economist agrees, the last thing we want to do in a recession is slash government spending. We want, in fact, to increase that spending so that it is a counter-cyclical force to a deteriorating economy. So the question, then, is how to most safely generate the revenue to maintain or increase that spending. By “most safely” I mean how to raise the revenue in a way that will minimize any negative economic impact. And the answer comes from Joseph Stiglitz:

“[T]ax increases on higher-income families are the least damaging mechanism for closing state fiscal deficits in the short run. Reductions in government spending on goods and services, or reductions in transfer payments to lower-income families, are likely to be more damaging to the economy in the short run than tax increases focused on higher-income families.”

So, first and foremost, you don’t want dramatic spending cuts (beyond the usual rooting out of waste/fraud) and you don’t want to raise taxes on middle- and lower-income citizens who both need the money for necessities, and are the demographics that will most quickly spend money in a stimulative way. That leaves taxes on the super-rich, and Stiglitz – unlike anti-tax ideologues – has actual data to make his case. We know Bill Clinton raised top marginal tax rates in a hobbled economy in 1993, and the economy then boomed. We also know the results of a recent Princeton University study, which looked at states that had raised taxes on the very wealthy during the post-9/11 recession. The analysis found that the tax increases were both the most reliable revenue generator and the safest in terms of minimizing any negative economic impact. Indeed, the states that pursued this course of action saw a net job growth, and almost no tax flight (ie. people fleeing the state because of the tax increase).

It’s a no-brainer.  It’s sad to say that David Paterson is making the wrong choice in New York State, and that most of the tax hokes in the Democratic package are regressive, and impact low- and middle-income citizens.  It’s far sadder that we’re now going to shut down infrastructure projects passed by voters at a time when we need nothing BUT infrastructure spending, and fling ourselves into something approaching bankruptcy, solely because of ideology.

Something for the legislature to read while they’re on LOCKDOWN.

• We’re in a special session of the legislature, separate from their normal work.  So while the Yacht Party stonewalls and both sides bicker, they are making $173 a day for the privilege, with the current total at $128,000 and counting.  Good work if you can get it.

• Stockton, Merced and Modesto were dead last nationally in home prices, with homes in all three metro areas losing at least 30% of their value in the first nine months of the year.  The Central Valley is just getting buried.  If you want to know where the rest of the state (and the nation) is headed, look there.

• The state’s Healthy Families program, California’s contribution to S-CHIP, was on the verge of becoming extinct until First 5 provided a $16 million dollar cash infusion, allowing their enrollment to remain open through the end of the fiscal year in June.  This is of course one of the programs on the Yacht Party’s chopping block.  Because who likes healthy kids?

• Peter Schrag tore the Yacht Party a new one today, and it was most satisfying.

Today’s GOP is a very different party, a hard-line group of self-insulated ideologues, more like a political cult than like an inclusive party that stretches its core principles to be inviting to people at or beyond that core.

Couldn’t have said it better myself.

• SD-26: Mark Ridley-Thomas, now an LA County Supervisor, has endorsed Assemblymember Curren Price to fill his seat in the upcoming special election, the primary of which is scheduled for March 24.  Price is expected to be challenged by Assemblymember Mike Davis.  Either of them winning would trigger ANOTHER special election for their vacant Assembly seat.  And on and on.

• CA-31: Ben Smith is reporting that Xavier Becerra will turn down the position of US Trade Representative.  When there was a two-week lull after the rumor leaked with no announcement, I figured as much.  All the more reason for Hilda Solis to run for Governor, as the Vice-Chair of the House Dem caucus won’t be opening up.

There’s an interesting dynamic happening in California.  At the national level, the state’s power is growing.  Californians hold the Speaker of the House and four key committee chairs, including the powerful Energy and Commerce Committee.  The Senate Environment and Public Works Committee and now the Senate Select Committee on Intelligence have Californians at the helm.  Any energy and environmental policies will have to go through the committees of Californians, and they’ll have California allies inside the Administration, with the selection of Lawrence Berkeley National Laboratory’s Dr. Steven Chu as Energy Secretary and Los Angeles Deputy Mayor Nancy Sutley as head of the White House Council on Environmental Quality.  Other Californians are up for possible Administration jobs, like CA-31’s Xavier Becerra (US Trade Representative) and CA-36’s Jane Harman (CIA Director).  It’s a good time to be a California politician in Washington.

It’s a TERRIBLE time to be a California politician in California, as it dawns on everyone in Sacramento that the state is ungovernable and hurtling toward total chaos.  The two parties are miles apart from a budget deal, and even their biggest and boldest efforts would only fill about half the budget gap.  The peculiar mechanisms of state government, with its 2/3 rule for budget and tax provisions, and its artificial deadlines for bills to get through the legislature, which causes remarkable bottlenecks and “gut and amend” legislation changed wholesale in a matter of hours, and the failed experiment with direct democracy which has created unsustainable demands and mandates, make the state impossible to reform and even get working semi-coherently.  The state’s citizens hate their government and hate virtually everyone in it with almost equal fervor, yet find themselves helpless to actually change anything about it, and believe it or not, ACTUALLY THINK THEY’RE DOING A GOOD JOB setting policy through the initiative process, which is simply ignorant (though they paradoxically think that other voters aren’t doing a good job on initiatives).  The activist base does amazing grassroots work, very little of it in this state.  We have a political trade deficit where money and volunteerism leaves the state and nothing returns.  And the political media for a state of 38 million consists of a handful of reporters in Sacramento and a couple dudes with blogs.

Many of these problems have accumulated over a number of years and cannot be laid at the feet of anybody in particular.  But in general, the reason that we’ve gotten to this crisis point, the reason that California is a failed state, is because by and large the dominant political parties WANT IT THAT WAY.  I’m not saying that the state Democratic Party or its elected officials, for example, wants the state to be flung into the sea, metaphorically speaking, but there’s certainly a tendency toward the closed loops of insiders that prefer a predictable and stable status quo, that naturally restricts reform and leads to corruption, gridlock and crisis.  I’ll give you an example.  Last night I was on a conference call where Eric Bauman, Chair of the Los Angeles County Democratic Party, announced that he would drop out of the race for state party Chair and run for Vice-Chair, because when 78 year-old former State Senator John Burton entered the race, all his labor, organizational and elected support dried up.  Fitting that he didn’t mention his grassroots support, because it clearly doesn’t matter who they prefer.  

There is little doubt in my mind that John Burton will run the party, or rather delegate it to whatever lieutenant will run the party, in the exact same way it has been run for the last decade or so, characterized by missed opportunities to expand majorities, a lost recall election for Governor, cave-in after cave-in on key budget priorities and a failure to capitalize on the progressive wave of the last two electoral cycles.  These are not abstractions, and they have real-world effects, $41.8 billion of them at last count.  And honestly, the Special Assistant to Gray Davis didn’t represent all that much change, either.

We have an ossified party structure, and a phlegmatic legislative leadership that is unable to get its objectives met because the deck is essentially stacked against them.  The times call for a completely new vision, one that can energize a grassroots base and use citizen action to leverage the necessary unraveling of this dysfunctional government to make it work again.  The work on Prop. 8 since the election has been tremendous, but ultimately, if public schools are closing and unemployment is above 10% and the uninsured are rising and the pain felt in local communities is acute, then we have a much larger problem, one that requires a bigger movement allied with the civil rights movement to make change.

The key flashpoint is the 2010 Governor’s race.  There is currently no one in the field with the ability to break the lock that the status quo has on California and deliver a new majority empowered to bring the state back from the brink.  In an article published last month, Randy Shaw put it best.

None of the current field appears likely to galvanize a grassroots base, or to be willing to take on the “third rails” of California politics: massive prison spending, Prop 13 funding restrictions, or the need for major new education funding. Dianne Feinstein? She’ll be 77 years old on Election Day 2010, and she has long resisted, rather than supported, progressive change.

Jerry Brown just finished campaigning to defeat Proposition 5, which would have saved billions of unnecessary spending on the state’s prison industrial complex. This follows Brown’s television ads for the 2004 election, which helped narrowly defeat a reform of the draconian and extremely expensive “three strikes” law. Brown’s consistent coddling up to the prison guards union is the smoking gun showing that he is not a candidate for change.

Gavin Newsom came out against Prop 5 on the eve of the election, undermining his own “break from the past” image. He also spent another local election cycle opposing the very constituencies who an Obama-style grassroots campaign would need to attract.

With her Senate Intel. Committee post, it is unlikely that Feinstein will run.  He forgets John Garamendi, who supported Prop. 2 (!) because of his fealty to farming interests and who first ran for governor in 1982.

Shaw mentions that the state is ready for a Latina governor, and mentions the Sanchez sisters.  He’s right in part, but has the wrong individual in mind.  I am more convinced than ever that the only person with the strength, talent, grassroots appeal and forward-thinking progressive mindset to fundamentally change the electorate and work toward reform is Congresswoman Hilda Solis.  She authored the green jobs bill that Barack Obama is using as a national model.  She is a national leader on the issue of environmental justice and has the connections to working Californians that can inspire a new set of voters.  She beat an 18-year Democratic incumbent, Matthew Martinez, by 38 points to win her first Congressional primary.  She has worked tirelessly for progressive candidates across the state and the country.  In a state whose demographics are rapidly changing, she could be a powerful symbol of progress that could grab a mandate to finally overhaul this rot at the heart of California’s politial system once and for all.  This is not about one woman as a magic bullet that can change the system; this is about a woman at the heart of a movement.  A movement for justice and equality and dignity and respect.  A movement for boldness and progressive principles and inclusiveness and openness.  A movement that can spark across the state.

I know that Solis is interested in the Vice Chair of the Democratic caucus if Becerra takes the job in the Obama Administration.  Congresswoman, your state needs you desperately.  Please consider running for Governor and leaving a legacy of progress in California.

A remarkable little report appeared over the weekend, one that should have been on the desks of every member in the Legislature come Monday morning, but one which I suspect wasn’t.  In fact, I don’t think it even made any of the papers, relegated to a sidebar on CapAlert.

California has more men and women locked up in prison than any other state, a new federal report finds, and unlike any other state, the vast majority of those placed behind bars are parole violators.

The report bolsters contentions by critics of the much-overcrowded prison system that state parole officers, who belong to the same union as prison guards, are extraordinarily willing to slap a parole inmate back behind bars, thereby exacerbating a prison overcrowding problem […]

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.

Here’s the report from the Department of Justice.

It is a financial and moral disaster that we are throwing men and women back in jail for parole violations at such an accelerated rate, far beyond any other state in the country.  This is clearly a factor of the state’s parole policy, which is too constrictive and too quick to return people to prison.  It surely leads to the high recidivism rate for those who commit crimes multiple times – if they feel they can’t escape the system once they’re in it, they simply have no incentive to rehabilitate themselves.

Yet instead of reforming parole policy and getting some much-needed sanity into our sentencing laws, the bipartisan Tough on Crime machine squashes an independent sentencing commission and allows the passage of Prop. 9, which would implement an even MORE restrictive parole system, so much so that it violates the state constitution.

A federal judge has blocked enforcement of portions of a ballot measure approved last month by California voters that modify the state’s parole revocation system.

The so-called Victims’ Bill of Rights of 2008, passed on Nov. 4 as Proposition 9, amends the Penal Code to restrict or eliminate rights gained in a 14-year-old class action lawsuit in Sacramento federal court, parolees’ attorneys argue.

Parolees and the state agreed in March 2004 to a permanent injunction issued by U.S. District Judge Lawrence K. Karlton mandating an overhaul of parole revocation procedures and guaranteeing due process for ex-convicts accused of parole violations.

Ten days after the election, attorneys for the parolees filed a motion seeking to enforce the 2004 injunction, saying Proposition 9 “purports to eliminate nearly all due process rights of parolees and directly conflicts with the protections put in place by the injunction and established constitutional law.”

We are diseased by the prison-industrial complex.  Prison construction is good for the CCPOA and supposedly good for the economy but it’s based on a flawed notion that all construction spending is valuable.  In fact, prison construction, especially of the type so needless that bringing parole policy in line with the other 49 states in the union would practically eliminate the overcrowding crisis and rendering the need for more beds moot, crowds out other, more valuable building projects that have a tangible value to people’s lives.  We are violating the human rights of inmates and the Constitutional provision against cruel and unusual punishment, as well as stifling innovative public investment, because the parole officers have a powerful lobby and the Tough on Crime dementia has infested the minds of practically every legislator in the state for 30 years.  

Fixing parole policy and putting up-front money into drug treatment and prevention programs would save the state billions.  It requires leadership.  That’s a limited resource right now in Sacramento.

Open Left’s Paul Rosenberg summarized our site over the past week by musing that California is a failed state.  It’s hard to argue with that.  We have a political system governed in exactly the opposite direction of the will of the people.  Despite 63% majorities in the Assembly and the Senate, in Sacramento the Yacht Party rules.

California is bleeding Republican red as the state’s minority party tries to squeeze a spending cap and pro-business policies from fiscal chaos.

Badly outnumbered and often ignored by the Democratic-dominated Legislature, the GOP is not getting sand kicked in its face these days.

California is hurtling toward a financial abyss, projecting a $40 billion shortfall by July 2010, and no deal can be struck without at least three Republican votes in both the Assembly and Senate.

GOP officials clutch that trump card with relish as the state braces to pull the plug on $5 billion in public works projects and warns it won’t be able to pay all its bills by February or March.

Kind of amusing that the Treasurer thought he was making a threat to Yacht Party regulars when he vowed to shut down infrastructure projects without a budget deal.  To the GOP, that’s a GOAL.  All the posturing and tut-tutting at the lack of compromise, along with the horror stories spun out as a consequence of doing nothing, simply bolster the Yacht Party argument.  If you haven’t been paying attention, they want to do nothing.  They want to end government.  In a way they are the ultimate anarchists.

There’s supposed to be some kind of “cuts only” package released by Republican leaders today, by the way:

The GOP is scheduled to unveil its own proposal Monday, with no tax hike. The plan is expected to identify about $11 billion in budget cuts and, among other things, propose asking voters to redirect money designated for mental health programs and preschool programs and services.

State Treasurer Bill Lockyer, a Democrat, characterized the high-stakes showdown between legislative Democrats and Republicans as political “chicken,” with each party expecting the other to blink.

“I think they’re going to run off a cliff,” Lockyer said.

Incidentally, Bass and Steinberg are willing to come together on good government reforms, which we shouldn’t oppose in a knee-jerk fashion.  Liberals support reforming government and making it effective because they believe in it.  Republicans, under the guise of “reform,” mean to destroy government.  I don’t think there’s anything wrong with a performance review that looks at duplication or ineffective programs and seeks to mend them.  That’s what oversight is all about, and it’s a core function of the legislature.  What I do take issue with is the idea that reform is a “magic bullet” that will end all budgetary worries without anyone having to feel the pain.  That’s irrational and ridiculous, especially in this moment of crisis.

The Secretary of State has formally released the final numbers on the 2008 General Election.  You can see the Presidential vote by county here.  The Congressional vote is here.  The State Senate races are here.  The State Assembly races are here.  The ballot measures are here.  A couple thoughts.

• We had 79.42% turnout among registered voters, which is pretty fabulous.  Among all eligible voters including those who haven’t registered, turnout was 59.22%, so there’s a lot of room for improvement and to change the elctorate there.  The best turnout was in Sonoma County, with 93.43% of all registered voters.  The worst was Merced County with 66.57%, one of only two under 70% (Imperial County had 68.48%).

• 13,743,177 voted this year.  13,561,900 people cast a vote in the Presidential election.  That’s over 200,000 undervotes at the top of the ticket.  As a point of reference, Prop. 3 received 12,638,905 votes, an undervote of 1.1 million (one out of every 13 or so voters, in other words, stopped at the top).  Most of the propositions are the same, except for Prop. 8 which received 13,402,566 votes and lost by over 560,000.

• Hannah-Beth Jackson lost by 857 votes.  Thanks, Don Perata.

• In CA-03, Dan Lungren would up with just 49.5% of the vote and the center-left coalition (Bill Durston and the Peace and Freedom Party candidate) got 48.2%.  This is clearly the top priority among House races in 2010.  The final spread in CA-04 was 1,800 votes.  In CA-44, Bill Hedrick wound up 6,047 votes shy of Ken Calvert, and if he runs again, that will be a race to watch.  The center-left coalition in CA-46 (Debbie Cook and the Green candidate) received 45.9% of the vote, a good achievement in that district.  Nick Leibham would up with 45.2% in CA-50, which seems to be the ceiling, as Francine Busby topped out around there as well.

• Lots of interesting numbers in the Assembly.  Alyson Huber’s final margin of victory was 474 votes.  John Eisenhut was only 4,680 votes shy in AD-26, Fran Florez lost by 1,310 votes in AD-30 (with pathetic participation), Linda Jones came up 4,761 shy in AD-36, and Ferial Masry lost by 8,230 votes in AD-37.  There’s a path to 2/3 here, considering that we’re three seats away.  AD-65 and AD-68 are marginally promising as well.

Something for your weekend:

• The real pain in the economic slowdown will be seen at the local and county-wide level.  Orange County has kicked it off by laying off 210 social service employees and forcing 4,000 others to take an unpaid two-week holiday.

• One of the documents the Yacht Party is wielding is the California Performance Review, which is supposed to save $36 billion dollars by streamlining state government and giving everyone a pony.  Unfortunately, the truth is not quite so cut and dried, as the California Budget Project explained in 2004.  Good thing to remember when you hear this from the GOP.

• Anthony Wright at Health Access correctly argues that cuts to health care would have twice the impact on the bottom line of the budget as tax increases, because state health spending is typically augmented with federal matching funds.  For this reason, it is crucial we do not slash health care and instead invest in it to maintain our federal share of resources.  Darrell Steinberg has signaled that he would like to get all children in the state covered at a minimum, relying very much on those matching funds.

• Oh, and the state’s credit rating was lowered.  Great.

• Michael Lukens at San Joaquin Valleyfornia has the quotes of the week.