Rick Jacobs, Founder and Chair of the Courage Campaign, wrote the message below explaining the Courage Campaign’s “Four Principles for a United Movement.” The four principles were also distributed by Courage Campaign staffers at the Leadership Summit in San Bernardino last Saturday. Of course, I work as the Public Policy Director for the Courage Campaign.

This past Saturday in San Bernardino, activists gathered for the third in a series of leadership summits to determine the best course of action to win back marriage equality in California.

Winning a campaign to repeal Proposition 8 will take hard work and sacrifice from thousands of activists, community leaders, contributors and volunteers. The marriage equality movement is powerful and determined. The next step for the movement is to add structure that empowers the grassroots and netroots to win as soon as possible.

The Courage Campaign proposes the following “Four Principles for a United Movement” — the foundation of a campaign to restore marriage equality to California:

1. Our campaign to win must begin now, regardless of when the movement decides to place a marriage equality initiative on the ballot.

2. To unite the strength of activists across California, the campaign must be independent, accountable, and not dominated by any one organization.

3. To gain the trust and full commitment of supporters, the campaign needs a representative and functional governance structure.

4. Victory on election day requires a strong, experienced campaign manager who understands California politics and has won battles like this before. Our opposition is well-organized, and we need exceptional leadership on our side to prevail.

Following on these principles, the Courage Campaign does not expect and does not intend to run the next campaign to repeal Prop 8, although we expect to have a voice at the table.

The first step towards victory, no matter the date of the election, is training and empowering marriage equality activists across the state. The Courage Campaign has been laying the groundwork for a victorious campaign by conducting intensive training, coordinating online, mobilizing volunteers, partnering with progressive organizations and building infrastructure for the long-term.

More below…

Since January, the Courage Campaign has been training and empowering marriage equality activists across the state at “Camp Courage” training events as well as building 44 “Equality Teams” in 23 counties across California — serving the organizations and individuals that are fueling the movement toward marriage equality. So far, these Equality Teams have participated in 128 events statewide since March — including canvasses, trainings, and phone banks — with more events taking place every week. These teams will be the backbone of any future campaign effort to repeal Prop 8:

http://www.couragecampaign.org/EqualityTeams

The Courage Campaign will host the fifth Camp Courage training event in East Los Angeles on August 1-2. Modeled after Camp Obama, these intensive one or two-day programs have been instrumental in channeling the enthusiasm of activists into effective action. More than 700 activists have been trained in Los Angeles, Fresno, San Diego and Oakland. Some of the lead co-sponsors of Camp Courage include the Human Rights Campaign, CREDO Mobile, Dr. Bill Resnick, HONOR PAC, California Nurses Association and the Dolby Family.

Several community organizations will be co-hosting Camp Courage East Los Angeles, including API Equality LA, Bienestar, California Faith for Equality, Equal Roots, HONOR PAC, Latino Equality Alliance, Somos Familia, and The Wall Las Memorias Project. This unique training will serve a diverse cross-section of the Los Angeles community. Registration pages for Camp Courage East LA are set up in English and Spanish:

ENGLISH: http://www.couragecampaign.org/CampEastLA

SPANISH: http://www.couragecampaign.org/EastLAEspanol

As we deal with the wreckage of the recent and deeply destructive budget deal, one of the last things we need is for the Obama Administration to twist the knife and worsen the collapse of public services in California. Unfortunately that is precisely what is poised to occur as President Obama and Education Secretary Arne Duncan threatened to withhold funds from California schools unless we embark on a questionable and reckless education “reform” the administration is championing:

President Obama singled out California on Friday for failing to use education data to distinguish poor teachers from good ones, a situation that his administration said must change for the state to receive competitive, federal school dollars.

Obama’s comments echo recent criticisms by his Education secretary, Arne Duncan, who warned that states that bar the use of student test scores to evaluate teachers, as California does, are risking those funds. In an announcement Friday at the Education Department in Washington, Obama and Duncan said the “Race to the Top” awards will be allocated to school districts that institute reforms using data-driven analysis, among other things.

“You cannot ignore facts,” Obama said. “That is why any state that makes it unlawful to link student progress to teacher evaluations will have to change its ways.”

The remarks escalate a disagreement between the Obama administration and California education leaders. While a 2006 law prohibits the use of student test scores to evaluate teachers on a state level, it does not mention local districts, where state officials say pupil data can be used to judge instructors. A handful of districts currently are doing that; L.A. Unified is not.

There’s so much wrong with this White House attack on California’s schools that it is difficult to know where to begin. As anyone with any passing familiarity with the state’s budget crisis knows, the main problem facing our schools isn’t accountability, but cuts. It’s so simple a 12 year old can explain it:

Timothy Dominguez was surprised to hear he’ll have six more classmates in his seventh-grade classes when school resumes.

“Wow, 31 students? That’s too many kids for one adult,” the 12-year-old said.

I am curious to hear how Arne Duncan and Barack Obama believe California test scores will rise when you have classes of 30-35 students. When instructional days are being cut. When school buses are being cut (meaning many students will have a harder time getting to school, or will have longer travel times, leaving less time to study and do homework).

There is a very rich and deep discussion in the educational community on the value of focusing on test scores as a method of improving education. I fall squarely in the camp of those who are skeptical. I’ve taught college courses in two states with a heavy emphasis on testing – Washington and California – and in my experience, it hasn’t done a goddamned thing to help students learn to write, to study, to think.

Still, even if I am wrong and it were true that focusing on tests is a great way to improve education, it is extremely difficult to imagine how scores will rise when the basic elements of education in California are under a sustained assault. Teachers are going to have their hands full maintaining the existing level of educational quality with larger classes and fewer assistants and resources. I cannot see how Arne Duncan and Barack Obama can reasonably expect California teachers to improve test scores in such an environment. If they know how it can be done, by all means come here and teach us.

This isn’t the first time Obama has shown a stunning disregard for the education crisis in California. At his Southern California townhalls back in March Obama made similar remarks and appeared to not have been briefed on the massive school layoffs facing California’s students.

As Paul Rosenberg remarks at Open Left, this appears to be motivated by ideological concerns:

Of course, as I blogged recently, there’s no evidence that charter schools “work”–they do not differ dramatically in performance, but rather slightly underperform standard public schools.  Nor is there any substantial research showing that merit pay tied to test scores is an effective way to improve educational outcomes.  Thus, Obama’s competition is based entirely on ideology–an ideology that is primarily about shifting control of education as far out of the classrooms and into America’s boardrooms as possible.

Rosenberg also showed that the $4.3 billion total being offered by the Obama Administration in this “Race to the Top” program is not nearly enough to patch the $10 billion hole blown in our education budget by the legislature and the governor this year. Since the $4.3 billion sum must be split among all the states and territories, it is difficult to imagine that California will get much more than a couple hundred million at best.

California’s schools are facing a severe crisis. Without an educated population it is difficult to imagine how we will have economic recovery, either in the near or the long term. Numerous studies have shown that students who finish high school, and who attend college, earn more money and have fewer run-ins with the law than those that do not.

Fueled by ideology, and seemingly ignorant of the dire realities about to be experienced on California campuses, the Obama Administration needs to take a time-out and reconsider its entire approach to education policy. A program like “Rise to the Top”, leveraging desperately needed funds to impose merit pay, might have some intrinsic value (though I am doubtful). But not now. Not when California’s schools face a much more fundamental crisis.

The president would be doing education a much better service if he spoke out against the mania to slash school spending instead of cluelessly chiding California for refusing to saddle teachers and students with an unbearable burden. Let’s hope that the White House figures this out sooner, not later, and in time to help save education in our state.

Back in May one of the main reasons Calitics, the Courage Campaign, and numerous other progressive organizations mobilized to defeat Proposition 1A was to prevent the massive cuts that had already been made from being locked into place, as they would have had the spending cap of Prop 1A become part of the state constitution. As was reported at the time, Prop 1A would have created a budget deficit of nearly $20 billion by 2013, mandating long-term program reductions. Stopping that from happening was one of the key victories in the May 19 battle.

And yet those long-term cuts may well happen anyway.  The billions in cuts being made right now in Sacramento are unlikely to ever be restored. The news that Republicans don’t want to repay the education funds is just the tip of the iceberg.

As the United Ways of California noted on their twitter feed last night, it took 7 years to cut the number of uninsured kids in half. That work has been undone by the Legislature last night. The work done in the late 1990s to ensure that federal welfare reform did not destroy the safety net for the poor is being undone with the attacks on Cal-WORKS. Years of battling to properly fund IHSS is out the window. And many decades of work to fund public education is now being undone as well, including 50 years of the Master Plan for Higher Education.

So why am I skeptical those funds will ever return? Consider the political consensus in Sacramento, which Democrats are working very hard to reinforce. It is a consensus that holds that budget cuts are necessary and taxes are bad, that California “overspent” in recent years. When you have people like Jerry Brown going on CNBC to say that California had a spending problem this decade, you’re witnessing the creation of a powerful political urge to resist new spending for many years to come.

Economic recovery will eventually arrive, though not for several more years. When it does, there will be intense pressure from Republicans and their allies in the state media such as George Skelton and Dan Walters to resist using increased revenues to increase spending. Even if the state runs multi-billion dollar surpluses, Democrats will come under pressure to put it in a rainy day fund – or to rebate it in the form of permanent tax cuts, as was done in 1978 and 1998. Any restoration of lost spending will be framed as “new spending” that somehow the state “cannot afford.”

In short, what we are witnessing is the construction of a new normal, a political spending cap that lacks the force of law but carries with it the equally powerful force of precedent and conventional wisdom. Given that the state is already committing itself to billions in spending in future years to repay the robbery of local government funds with no identifiable source of repayment, it will be even more difficult to restore the other program cuts.

This is something you would think Democrats would be keeping in mind as they vote for all these cuts…

Former Speaker of the Assembly Antonio Villaraigosa, now in his second term as Mayor of Los Angeles, is stepping up to provide the leadership other Democrats have been unwilling to offer. He has written to the Assembly asking its members to reject the budget deal:

Dear Honorable Assembly Member:

I write to ask that you vote no on the proposed budget deal.

On Monday night, our state’s leaders emerged from negotiations to announce a so-called “landmark deal” – a proposal that would balance our books, close the fiscal gap, end the budget stalemate, and place California back on sound financial footing. Though some have tried to paint a portrait of progress, allow me to remind you of a few sobering facts.

This deal throws thousands of local government budgets out of balance and rips open deficits that local leaders have worked tirelessly to close. In the City of Los Angeles, the budget proposal adds an additional $261 million to our current year deficit.

If the proposed budget deal is approved, the very constituents the state is claiming to protect will experience drastic cuts in services that impact every facet of their daily lives. More municipal employees will lose jobs, essential economic development projects will cease, and transportation and traffic woes will worsen.

Furthermore, these cuts will undermine the expectations brought by the passage of the Federal Stimulus Package, the 2006 State Infrastructure Bonds, and other local voter-approved investments in infrastructure and programs. Together, these impacts will deepen our financial woes, erode voter confidence and cripple our ability to initiate a financial recovery.

Despite several trips to Sacramento with other California mayors, state leaders failed to include us in the budget discussion. Our offers of partnership and collaboration were cast aside even as critical local government funds were used to fill the budget gap.

Suggestions that would have helped the state move forward while keeping local government whole were ignored.

From the beginning, we acknowledged that local governments would to be a part of the solution, but never fathomed that our offer to be a partner would result in us carrying the disproportionate load. Consequently, I urge you to engage with cities and counties to find a more balanced approach to solve this deficit.

This is a good letter overall, explaining that the budget will hurt vulnerable Californians, undermine the national economic recovery effort, and hammers local governments that have already had to make difficult decisions to balance their own recession-battered budgets.

Still no word from Gavin Newsom or Jerry Brown, the two men who Villaraigosa left standing in the race for the Democratic nomination for governor. Villaraigosa, like Newsom, has generated his share of controversy and opposition from progressives during his term as mayor, but this is a welcome sign of leadership.

Will the legislature heed his call? There are rumors that some Assembly Dems may balk at K-14 cuts. The legislative sessions are about to begin – it is going to be a long and very interesting night in the Capitol.

UPDATE by Robert: It is worth noting that there is a specific dispute here about raiding local government funds. Villaraigosa joined mayors from Fresno, San Jose, Santa Ana, Sacramento and Long Beach on a conference call today to argue against the raid on redevelopment funds – but they might be OK with a Prop 1A raid:

The mayors said they’d prefer the state borrow money from cities and counties under Proposition 1-A, rather than seize redevelopment and transportation funds. Santa Ana Mayor Miguel Pulido echoed his peers.

Prop 1A, passed in 2004, enables the state to raid local government funds, but only with a 2/3 vote of the legislature and with an ironclad requirement that the money be repaid – with interest – within 3 years.

Still, Villaraigosa’s letter made a broader attack on the budget deal, and did clearly call for a “no” vote. So I leave it to you to decide what exactly is going on here.

UPDATE by Robert: As we settle in for what is likely to be a long night, one of the best resources for info is the #cabudget hashtag on Twitter, which includes @ccleague reporting that “CalWORKs, Redevelopment securitization/1A/HUTA and oil drilling” are “threatening” the budget deal.

Anyone who thinks this budget is the best that Sacramento could have produced, that it is remotely acceptable, has likely been around Sacramento too long and lost their perspective on reality. That seems to be what’s happened to George Skelton, who wrote a a remarkable column in today’s LA Times defending the indefensible deal:

Just as when Sacramento seizes money from cities and counties, it is not “living within its means,” as Schwarzenegger pledged the state would.

But that’s OK. Right now, the most important thing is to slap on a tourniquet and stop the bleeding that is flowing mainly from the worst recession since the Great Depression. Get the cash flowing. Revive the credit ratings.

There’s a classic quote from the German politician Otto von Bismarck: “Politics is the art of the possible.” Schwarzenegger and legislative leaders finally boned up on Bismarck.

I suppose it’s appropriate that Skelton holds up the man of blood and iron, who unified Germany at the point of a gun and disdained democracy, as a political model for California. Skelton has always been one of the more credulous members of the Sacramento press corps, and spends this column repeating the claims of longtime insiders  like Rick Simpson or failed politicians like Arnold Schwarzenegger without offering a critical or skeptical eye.

From the notion that the budget deal is a tourniquet – it ensures billions in deficits in future years as no provision whatsoever has been made to fund the promised repayments to schools and local governments – to the idea that our state’s credit rating will be repaired by this (the credit rating agencies are engaged in questionable practices and the bond markets still eagerly anticipate our issuances), Skelton would do well to question and challenge his sources instead of merely repeat their spin.

Particularly on the notion that the May 19 election is responsible for this:

The negotiated solution to the state’s projected $26-billion budget deficit — roughly $15 billion in spending cuts, and the rest mostly in raids on local government, problematic revenue and accounting tricks — was preordained by the May 19 special election.

The electorate soundly rejected the plan by Gov. Arnold Schwarzenegger and the Legislature to create a modest spending cap, raise nearly $6 billion in general fund revenue immediately and generate $16 billion in future tax hikes. Liberal groups adamantly opposed the spending cap. Conservatives hated the taxes. And the $6 billion in immediate revenue went down with the rest of it.

After that, any new tax increase was politically impossible. To think otherwise was fantasy, especially since taxes already had been hiked by a hefty $12.5 billion in February.

And yet the budget proposal does NOT reflect the will of the people. As the David Binder poll made clear, Californians are willing to support higher taxes to fund core services. What they rejected on May 19, and what they are rejecting now, are budget “solutions” that hurt working people who depend on public services, “solutions” full of gimmicks that solve nothing and cause worse problems in the future.

We all know that the structure of our government must be changed as the first, necessary step to get our state out of crisis. But it doesn’t help matters to pretend that there aren’t innovative, sensible solutions out there that the Legislature could and should have embraced. The refusal to close the irresponsible $2 billion corporate tax loophole from the February budget deal, the unwillingness to levy the same oil tax every other state, including right-wing states like Texas and Alaska, levies shows a legislature that has essentially given up on the task of government and has already decided to let Arnold Schwarzenegger set the agenda within the boundaries Howard Jarvis, Grover Norquist and Milton Friedman laid down.

When legislators like Mark DeSaulnier stand up and call bullshit it shows that there is still some spark of life left in the Capitol. Instead of defending failure, folks with an LA Times column would do better to encourage people like DeSaulnier to reject the status quo and imagine better ways out of the mess.

For example, several commentators have pointed out that California should follow North Dakota’s lead and charter its own bank to lend to itself and start to escape the downward financial spiral. The Legislature could also start caring about economic recovery and reject Hooverite solutions that would merely worsen our economic and budgetary plight.

That’s what’s ultimately so pernicious and troubling about Skelton’s column – the notion that we should accept, even welcome legislative failure. It follows on his lower your horizons and suffer mentality of dealing with crisis – and therefore it suggests that if we are to ever escape this morass and rebuild California, its economy, and its government, we should vigorously reject this budget deal and demand our legislators get serious about repairing our government, our budget, and our economy.

Because as anyone who has ever taught a classroom knows, if you expect failure, then your students will fail. If you expect success, then they will work hard to try and achieve it. And even if they don’t all get A’s, they’ll be doing themselves and their community a service by achieving something better than failure.

We’ve been focusing a lot here on Calitics in the last day or so on the losers in the recent budget deal. But who are the winners? Pretty high on that list would have to be Big Oil. They were able to convince Democrats to drop their demands for an oil severance tax, and were able to convince Democrats to agree to allow the first offshore oil drilling in 40 years to begin off the unspoiled coast of Santa Barbara County near Point Conception.

Every other oil-producing state in the union taxes the extraction of oil from its lands – including Texas and Wyoming. Even Sarah Palin raised the oil severance tax in Alaska to 25% in 2007. Instead, as Paul Hogarth pointed out, California is defining itself to the right of Sarah Palin by refusing to embrace such a tax.

The California Budget Project estimated a 9.9% oil severance tax would bring it at least $1 billion to state coffers. If oil prices rose again above $100/bbl then we could see $2 billion in revenue per year. Given the high likelihood of such increases, an oil severance tax would be a significant long-term boon to the state’s coffers, since oil companies can’t exactly shift production out of state, since oil is only going to become more valuable over time.

And that money could help prevent the most egregious human services cuts that were agreed to in the budget deal – the cuts to healthy families that will cost 500,000 children their health care coverage, the cuts to in home supportive services that people like Nori need to survive.

There are many possible responses to the budget deal. The Courage Campaign is asking our members to zero in on the oil severance tax and ask their legislators to vote “no” on a budget that does not include that tax. We will collect signatures to our letter and deliver it to every legislator in the Capitol ahead of the Thursday budget vote.

Californians are being asked to make a choice: give the oil companies a sweetheart deal unprecedented in the United States, or demand that oil companies pay their fair share and help prevent a humanitarian catastrophe that budget cuts will cause.

The Courage Campaign thinks the choice is clear. Let’s let make sure our legislators hear about that clear choice before the vote on Thursday.

Over the flip is the email we sent to our members, which includes the California Closed video produced by community organizers Marta Evry and Laura Velkei.

Dear Robert —

Are oil companies more important than children and the disabled? Our legislative leaders and the governor seem to think so.

Last night, Governor Arnold Schwarzenegger and the leaders of the state legislature announced they had reached a deal to close the state’s budget deficit. And it’s a horrific deal. They agreed to $15 billion in cuts that will cause 500,000 children to lose their health care and will cause thousands of disabled Californians to lose their in-home caregivers.

Too often we see these cuts as abstract — as mere numbers on a page. That’s why community organizers Marta Evry and Laura Velkei produced a heartbreaking video that shows the impact of these cuts. They call it “California Closed” and it is a powerful call to action on behalf of the Californians who will suffer the most if this deal is approved.

To add insult to injury, the budget deal benefits oil companies at the expense of children and the disabled. And despite widespread public support for an oil severance tax, the Governor and legislative leaders chose not to include such a tax as part of the budget deal. Instead they agreed to allow the first new offshore drilling off the California coast in 40 years.

The budget isn’t a done deal yet — legislators will vote on it Thursday. We have 48 hours to tell them to protect children and the disabled by passing a budget that makes oil companies pay their fair share in taxes. Please watch the “California Closed” video and then sign a letter that we will deliver to every legislator before the budget vote:

http://www.couragecampaign.org/CaliforniaClosed

According to the nonpartisan California Budget Project, an oil severance tax of 9.9% could generate as much as $1 billion per year — without requiring any new drilling. That is enough to prevent the cuts to in-home supportive services, to children’s health care, and to Medi-Cal.

Last year, Chevron — the largest California corporation in terms of revenue — banked $24 billion in profits. Yet California is the only major oil-producing state that does not tax the extraction of oil from its lands. Even Sarah Palin’s Alaska has an oil severance tax.

Our legislators need to hear from you right now that you will not support any budget deal that does not include an oil severance tax to protect children and the disabled.

Please click here to watch the “California Closed” video, and sign the Courage Campaign letter to the legislature demanding an oil severance tax to stop the health care cuts. We will deliver your signatures to your legislators before they vote on the budget on Thursday:

http://www.couragecampaign.org/CaliforniaClosed

It’s time progressives like you made your voice heard in Sacramento. Thank you for standing up for a more progressive and fair California.

Robert Cruickshank

Public Policy Director, Courage Campaign

That’s the prescription for the economic crisis coming from the remaining media observers of California state government. For people like Dan Walters and George Skelton, the collapsing economy and the budget mess aren’t calls for innovation and plans for recovery. Instead they are an excuse to shoot down any and all new ideas in favor of a mindless neo-Hooverism, a mentality of giving up on everything and just quietly suffering as we wait for the economy to magically recover as if it were some sort of angry god or inscrutable force of nature and not a product of human activity that can be directed and changed by collective effort.

Over at the California High Speed Rail Blog I gave a pretty thorough evisceration of Dan Walters’ attack on high speed rail. Walters claimed “now is not the time to build a railroad” – which is bizarre considering that 75 years ago in the depths of the Great Depression, we took on some of the largest and most important infrastructure projects in the state, such as the Golden Gate Bridge, the Central Valley Water Project, and Shasta Dam.

Today George Skelton arrives at the same neo-Hooverite conclusion, albeit from a different direction. Skelton’s column attacks Arnold Schwarzenegger for his reckless tax cuts, but also bizarrely throws in his support for the California Institute for Regenerative Medicine and high speed rail as supposed “evidence” of irresponsibility:

He has a pattern of supporting exotic ballot measures that authorize discretionary spending without the revenue streams to pay for them, thus piling more of a burden on the bleeding general fund.

One example: the nearly $10-billion bond measure last November to make a down payment on a bullet train from Los Angeles to San Francisco. That will cost the treasury $647 million annually for 30 years.

Example two: the $3-billion stem-cell research bond in 2004, costing the state $200 million annually for 30 years.

Skelton is throwing the baby out with the bathwater here. Like Walters he seems allergic to the notion of “economic recovery.” High speed rail and stem cell research are the 21st century equivalents of the Golden Gate Bridge and Shasta Dam – infrastructure projects that will provide jobs and economic activity for many decades to come.

Using bonds instead of new revenues to pay for ongoing budget expenses is stupid. Using bonds to build a train or a biotech research institute is extremely smart. That’s what government bonds are there to do.

But not for George Skelton, not for Dan Walters. Using bonds for their intended purpose – to provide economic recovery and long-term benefits by building big projects with a proven track record of success around the world – offends their hairshirt sensibility. Their prescription for what ails California is to bleed us dry – to leech all good and necessary spending out of the economy, to refuse to utter the phrase “economic recovery” and to eschew the policies and innovations that would make recovery possible. All in pursuit of a shared misery that is supposed to somehow make the present crisis tolerable.

The crisis engulfing California is an indictment of the entire political system in our state, from the structure of government to the failed leadership of its politicians to the neo-Hooverite mindset of what media remains to cover Sacramento. It is a strange and sad irony that people who benefited all their lives from the massive investments of the Great Depression are now insisting we lower our horizons and suffer in the Great Recession. They have no vision for our future, no conception of economic recovery. It is time they left the stage to those people willing to actually try and salvage California’s future.

And so the budget drama hurtles toward its inevitable conclusion, perhaps as soon as tomorrow. Democrats have caved and given Arnold Schwarzenegger what he wanted – a cuts-only budget that does massive and lasting damage to the state of California, to the people who live here, and to our collective future. It’s taken 31 years, but Howard Jarvis is finally going to get the wholesale destruction of public services he always wanted.

After resolving their major education dispute Friday, Gov. Arnold Schwarzenegger and legislative leaders hope to finalize a budget deal today that closes California’s $26 billion deficit with spending cuts, accounting shifts and revenues from local governments.

State leaders have agreed on a general budget framework and gave attorneys and budget aides time Saturday to draft a bill, sources close to negotiations said….

Besides spending cuts, the budget proposal includes capturing more than $4 billion from cities, counties and special districts.

It also relies on accounting tricks, such as increasing income tax withholding schedules by 10 percent to shift money from 2010-11 to 2009-10, as well as delaying state worker paychecks next June 30 to July 1.

In the coming days we will hear Democratic legislators claiming this is some sort of victory – that Cal-WORKS wasn’t eliminated, that California can again pay its bills. These are hollow, pyrrhic victories. The raid on local government funds will ensure dozens of cities go bankrupt and will lead to reckless public safety cuts, especially to firefighters. Schools are going to get another hit without any firm guarantee that they will be repaid – we haven’t seen details of the “agreement” to repay the $9.5 billion schools are owed, but Arnold seems to have won the battle to prevent repayment from becoming a constitutional mandate, meaning that repayment shouldn’t be counted on until the checks are actually cut.

Still unclear is the fate of health care, IHSS, state parks, and other proposed cuts. But at this point it’s not clear that their exact fate matters much. Democrats have signaled that they will abandon their half-hearted efforts to demand new revenues, to close corporate tax loopholes, and to have a more fairly balanced budget. When the next mid-year budget adjustment has to be done in 6 to 9 months from now, or in the battle over the 2010-11 budget a year from now, Arnold will have little incentive to listen to Democratic proposals, since he has proved once and for all that he can get Democrats to do his bidding by holding firm and demanding massive cuts.

For their part, Democratic legislators likely believe that they are merely living to fight another day, especially on Election Day in November 2010 when they hope to elect a 2/3 majority in both houses.

It seems highly unlikely they will get that result. Democrats have given Californians no good reason to vote for them in state legislative races, as they refused to stand up for Californians and the services they need to survive. They refused to make a strong push for tax fairness. And they refused to plan for economic recovery.

This is the way California ends. Not with a bang, but a whimper. With a failure of leadership so complete, so total, as to leave the state bereft of hope for its future.

The Parsky Commission is asking for another delay in presenting its final report, now to come some time between July 31 and September 15, in order to “reconcile” the progressive and regressive solutions. Fred Keeley and Chris Edley’s “blue plan” and progressive criticism, including that of Calitics has succeeded in killing the worst, most regressive proposals:

The new approach rejects further consideration of a flat income tax rate that would apply across all income brackets. The effect of such a change, critics charged, would have been to increase the share of taxes paid by middle-income taxpayers while lowering taxes on the wealthy.

“Concerns about increasing the burden on the middle class at the expense of the higher-income group need to be taken into account,” Parsky said.

He recommended instead that commissioners consider changes that would include at least three graduated tax brackets and perhaps maintain all six existing brackets, “but under the condition that all brackets get a reduction.”

So obviously Parsky wants to maintain the basic concept of moving away from income taxes, an effective method of raising revenue, and shift the burden toward the middle and working classes through higher taxes on services that are more frequently used by those groups than by the rich.

Dan Walters takes a look at a possible compromise:

Finally, after several hours of discussion, the commission agreed to consider elements of both, including a simpler income tax, a “split roll” that would eliminate Proposition 13’s property tax limits for commercial property, a “rainy-day” reserve similar to Schwarzenegger’s oft-rejected proposal, a new “carbon tax” on fuel of as much as 18 cents a gallon and either a net receipts tax or a revised sales tax that would apply to services as well as hard goods.

Depending on the details this could be rather interesting. The main flaw with this commission, of course, is its mandate to be “revenue-neutral”, which is nonsensical given the state’s desperate need for new revenue to prevent lasting economic and human damage.

Of course, the right is still peddling the discredited “volatility” argument – that relying on wealthy people to pay income taxes makes California’s revenue go in a boom-and-bust cycle. Dan Walters is an especially prominent purveyor of this theory:

The volatility of California’s tax revenue – booming one year, plummeting the next – plagues the state budget.

The volatility, born of the state’s reliance on personal income taxes from a relative handful of high-income Californians, is the underlying factor in revising the current state budget to close a whopping deficit.

Walters later on admits that the recession plays a role in shaping tax revenues, but he doesn’t pursue this to its logical end – for if he had it might undermine the overall volatility argument.

The fact is that there is no tax that is not volatile. All taxes we have today are dependent on economic activity. If there is an economic boom, then all forms of taxes will boom as well. If there is a bust, all forms of taxes will fall too. And while the state’s personal income tax has fallen off a cliff, so too have sales tax receipts, as tends to happen in a consumer-led downturn.

Further proof that this isn’t actually about volatility is the fact that neither Walters nor Parsky are willing to revisit the residential property tax protections of Prop 13. Property taxes are volatile too, but usually much less so than income or sales taxes. The present collapse in real estate values is producing volatility there, but this collapse is not a normal phenomenon, and comes after nearly 20 years of uninterrupted growth in land values.

But because the goal here is to protect Prop 13 and to let the rich out from their obligations to society, things like higher property taxes aren’t on the menu. Volatility matters only until it clashes with the underlying purpose of shifting the burden of state taxes onto those least able to bear it.