Gov. signs several budget bills over the weekend

by Brian Leubitz

The Governor took little time to sign a first big batch of bills after the Legislature ended session. Specifically, he signed seven budget bills on Saturday:

• AB 109 by Assemblymember Philip Y. Ting (D-San Francisco) – Budget Act of 2017.
• AB 129 by the Committee on Budget – Education finance.
• AB 130 by the Committee on Budget – Health and human services.
• AB 131 by the Committee on Budget – Taxation.
• AB 133 by the Committee on Budget – Cannabis Regulation.
• AB 134 by the Committee on Budget – Budget Act of 2017.
• AB 135 by the Committee on Budget – Transportation.

The Budget Acts do basically what you would expect of budget bills: appropriating money to one expense or another. But one part of AB 134 seems to be getting a lot of attention:

Up to $140,000,000 shall be used for the Clean Vehicle Rebate Project.
(1) The State Air Resources Board shall work with the Labor and Workforce Development Agency to develop procedures for certifying manufacturers of vehicles included in the Clean Vehicle Rebate Project as being fair and responsible in the treatment of their workers. It is the intent of the Legislature that beginning in 2018–19 fiscal year, the Labor Secretary shall first certify manufacturers as fair and responsible in the treatment of their workers before their vehicles are included in any rebate program funded with state funds.

Two things here: First, it takes cap and trade money and ships it off to help make electric and plug-in hybrid cars cheaper. I suppose I should issue some sort of trigger warning, as the cap and trade extension bill was controversial to put it mildly. The second point to that, and probably more interesting, was the labor provision put into that extension. (See my added emphasis in the quote above.)

This has been getting a lot of attention as summary stories of the legislative session come out. Many of them are framing in this “unions are powerful” and win everything, which plainly is not true. Yet, clearly they win more they than they lose.

This provision is directed at Tesla, which as of yet, is mostly beating back attempts to organize their work force. The standard of “fair and responsible” seems a little open to interpretation, so how much this matters is an open question. Denying the incentive money to a California based company would certainly be a controversial decision, and Tesla has a backlog of Model 3 orders from across the country, but if the Labor Secretary is strict on that provision, it would certainly draw Elon Musk’s attention/ire.

Many more bills will be signed as we head into the October; even despite some setbacks (single payer to name one) this has been a very busy legislative year.

State pokes stick in the eye of Sessions, Trump, and their neo-nativist supporters

by Brian Leubitz

Governor Brown doesn’t mind confronting the federal government. He’s shown that particularly in the climate change arena as he has become the de facto American leader taking on that global crisis. However, he also likes to tread carefully.

And that was his hangup about Senator Kevin de Leon’s sanctuary bill, SB 54. And yesterday, the governor apparently got the changes he felt were necessary:

The amendments would give law enforcement agencies more discretion to notify federal immigration officials about convicted offenders in their custody and to transfer those offenders to immigration authorities.

The bill would still allow federal immigration officials to interview those in custody, though it will not permit those officials to maintain permanent office space in state prisons or local jails.

“This bill protects public safety and people who come to California to work hard and make this state a better place,” Brown said in a statement.(The Hill 9/12/17)

The changes also helped ease some of the opposition from law enforcement leaders that had been troubling to the governor’s office. And now, I suppose the ball is in the court of AG Sessions to get all mad and storm off with whatever block grants to the state aren’t glued down to the floor.

The agreement is getting praise from other state leaders as well.

“From the moment Donald Trump won the White House, California Democrats have been tirelessly working to protect and shield undocumented Californians from the federal Government,” said California Democratic Party Chair Eric Bauman.

“One of the cornerstones of that effort is SB 54 by Senator Kevin de Leon, and California Democrats are deeply grateful that he and Governor Brown have reached agreement on final language that ensures California’s law enforcement agencies are not used as instruments of federal immigration enforcement. Californians welcome our undocumented brothers and sisters, and the use of California’s peace officers against our own brothers and sisters would have been unconscionable and dangerously corrosive to the trust law enforcement needs from the community to keep Californians safe. This is a powerful message of inclusion and reassurance to Undocumented Californians, and I urge the Legislature to approve this bill as swiftly as possible.”

Legislative package faces steep hurdles this week

by Brian Leubitz

The California housing situation is bad. Really, extremely bad in some places like San Francisco where housing affordability levels put families making over $100,000 into contention for affordable units. Getting housing at less than $2000/bedroom/month is really hard. I think we can all agree that is crazy. And across the state, there is a long-standing shortage of both market rate and affordable housing. That situation was not improved with the ending of the redevelopment districts a few years ago. While supply and demand cannot fix everything, we clearly need to build a lot of additional housing units (of every affordability level) across the state.

The Senate has a legislative package for that:

The two marquee measures — Senate Bill 35 from Sen. Scott Wiener (D-San Francisco) and Senate Bill 3 from Sen. Jim Beall (D-San Jose) — would force cities that have fallen behind on their state housing production goals to reduce some of the hoops they put in place to approve developments and would authorize a $3-billion bond to spend on low-income housing on the 2018 statewide ballot.

“What the bill does do is create actual accountability,” Wiener said of SB 35. “Because local control is about how you meet your housing goals, not whether you meet your housing goals.” (LAT – 6/30/17)

Much of the package passed one house already, but several of the bills in this package have faced stumbling blocks. Most notably, Sen. Toni Atkins is trying to pass a $75 fee on non-home sale real estate transactions, but the 2/3 requirement is giving a lot of power to Bakersfield’s Rudy Salas in providing the final vote. Though, he seems to have found something that would work for him by presenting a bill that added a low-income exception to the fee. And then there’s Richard Bloom’s bill to allow municipalities to require some number of affordable units:

Also late Friday, Assemblyman Richard Bloom (D-Santa Monica) changed his legislation, AB 1505, which would allow cities to force developers to set aside a certain number of homes in their projects for low-income residents. Brown has long opposed the policy, vetoing a similar bill in 2013 and saying the policy generally makes it harder to attract development to low- and middle-income communities.(LAT – 9/11/17)

The next week will decide the fate of several of these bills, though many will face some pretty tough scrutiny in Gov. Brown’s Horseshoe as well.

National group funded by gun manufacturers files suit against assault weapons regulations

by Brian Leubitz

The NRA has a problem in California. They don’t have their normal power here, but they are still awash in money. So, the money goes to the lawyers instead of the politicians, because it is pretty tough to get Democrats to touch the stuff these days. The lawyers are getting quite creative too:

The new lawsuit, filed Thursday in Fresno Superior Court, seeks to block the new regulations, arguing that new rules requiring registration of existing assault weapons “go far beyond” the allowed registration process, and “unlawfully expand the scope” of the state’s registration requirement. (LA Times)

Long story short, the legislation banned guns with a “bullet button” that allowed for easy clip transfer. The NRA already sued on that one. But the guns that were out in circulation get to stay in their owners possession, but they have to be registered. The NRA likes neither of these, and sued on both aspects.

It will be a while before we get a final ruling on these cases, but we may see some sort of short term action in the interim.

PPIC poll shows support for single payer

by Brian Leubitz

Building on Robert’s recent post about the cost of single payer, we now have some new data showing that Californians would like to see some form of single payer in the state. PPIC has just released a new poll showing strong support…with a hitch:

As the state legislature considers Senate Bill 562, which would establish a single-payer state health insurance program, 65 percent of all adults and 56 percent of likely voters say they favor such a plan. But support falls to 42 percent of adults and 43 percent of likely voters if the plan would raise taxes. Overall, strong majorities of Democrats (75%) and independents (64%) favor a single-payer plan, while a strong majority of Republicans (66%) are opposed.

Now, the thing is that given the premium model that we are all used to, there wouldn’t have to be additional taxes. We could even keep the insurance companies around to manage the collection of premiums and the payment, if you are inclined to do so.

All that being said, a new economic analysis by a team of economists at the Political Economy Research Institute (PERI) at the University of Massachusetts Amherst, shows that the $400 Billion figure may have been too high. The report says that the total cost of healthcare in California will fall from $368.5 billion to $331 billion with the passage of SB 562.

As Robert showed in his post, premiums would likely go down for most, if not all, consumers. Depending on who you ask, average premiums are approaching $400 per person in California. That’s close to the $200 billion that we need to come up with according to the (rather high) LAO estimates, and more than the UMass analysis estimates.

Single payer is doable. Moreover, it now appears to be the only stable (and just) system of health care that we have come up with. The AHCA is an incomplete mess. The ACA could last for a few more years if we had an administration that wasn’t trying to kneecap it at every opportunity, but when you look at this graph, are there really any mysteries left about whether we need radical change in our health care delivery model?

The argument for single-payer health care is primarily moral. It’s just wrong to make anyone’s ability to get the health care they need dependent on their ability to pay.

Still, even when we win the moral argument, we still have to figure out how to get the system up and running – and how to fund it. It’s a sign of just how quickly the politics are moving on this in California, as the single-payer debate is increasingly about “how” and not “whether.” As will be shown below, the first analysis out of the state legislature suggests that single-payer would cost Californians just a third of what they currently spend on health care – and likely even less.

To that end, the Senate Appropriations Committee published today their fiscal analysis of Sen. Ricardo Lara’s SB 562. The headline that the media has run with is that the total cost would be $400 billion per year, and the state would need to cover about $200 billion of that cost (the other half comes from existing health care spending). Due to other savings, they conclude that “total new spending required under the bill would be between $50 and $100 billion per year.”

The analysis doesn’t make clear exactly how that sum was reached. But $400 billion is 16% of California’s overall GDP of about $2.5 trillion. That is in line with the current percentage of GDP that the United States as a whole spends on its inefficient, privatized health care system in which many people don’t get the health care that they need.

As the Senate Appropriations analysis notes, however, that $400 billion sum is about twice the amount spent in other industrialized nations. The Organization for Economic Co-operation and Development (OECD) published an analysis using 2013 numbers that showed the average percentage of GDP for health care spending in an industrialized nation is half the sum of the United States – about 8.9 percent.

Canada is a useful point of comparison, as a fellow North American economy with a population similar to that of California (36 million in Canada, 40 million in California). The OECD reports they spend about 10% of GDP on health care. In 2016, Canada’s actual sum spent was $228 billion.

So it stands to reason that a California single-payer system would be cheaper than the Senate Appropriations analysis assumes, and their figure should be considered as conservative.

But let’s say they’re right and the cost is closer to $400 billion overall, and that $100 billion in new revenues is needed (the high end of their $50b-$100b scale). That would pencil out to a monthly cost to each Californian of $208. ($100 billion / 40 million = $2500, which is the annual sum; divide that by 12 and you’re at $208.)

The average monthly premium for a Californian, as of 2016, was just under $600. For a household, it’s just above $1600.

In other words, even assuming the fiscally conservative analysis of the Senate Appropriations Committee and spreading the cost evenly across every Californian, single-payer would cost a third of what it currently costs Californians – just for health insurance alone. And unlike the present system, this would mean Californians don’t have to pay anything else beyond that $208/mo. No copays. No co-insurance. No out of pocket costs (at least within the Golden State). The ultimate savings would therefore be even greater. Californians could wind up paying just a quarter of what they pay now, if not less.

Of course, you wouldn’t actually pay for single-payer by levying just a flat fee across the state. A low-income family would pay far less in taxes than a wealthy family. The Senate Appropriations committee assumes using a 15% payroll tax to pay for single-payer, but there’s no reason we have to actually do it that way. A mixture of corporate and income taxes, especially geared toward the higher end of the scale, could bring down the cost to the median-income household even more.

Finally, the analysis notes that this would require voter approval because of the idiotic Gann Limit adopted in 1979 in the wake of the passage of Prop 13. If this does go to voters, I’d love it to be in the form of a constitutional amendment that, among other things, eliminates the Gann Limit for good.

The media will crow about the cost of single-payer. They should be emphasizing the savings. And we as activists should bring it back to the moral argument. If you can guarantee health care to every person in California as a right of being alive, and do it so for no more than a third of what people spend right now, why the hell would you say no?

Sens. Atkins and Lara keep up the fight

by Brian Leubitz

There is content on Calitics about single payer from the early days.  Shiela Kuehl was pushing it back then, but the legislation goes back to the 90s.

A grassroots movement for the establishment of a single-payer health care financing system in California (CA) has been building since the 1990s. In 1992, state Senator Nick Petris introduced a single-payer bill in the state legislature. Insurance Commissioner John Garamendi created a plan for universal coverage with a modified single-payer approach that passed the legislature, but was vetoed by Governor Pete Wilson. In 1994, a single-payer ballot initiative, Proposition 186, was defeated in the face of strong opposition by industry stakeholders. The initiative increased public awareness of single payer and was followed up in 1998 by introduction of Senate Bill (SB) 2123, calling for establishment of a universal single-payer system in the state. This bill led to a resolution calling for a study to compare different models of financing universal health care, including single payer. (Healthcare For All)

The history goes on and on. And it is still going today:

California lawmakers are considering an audacious proposal that would substantially remake the state’s health care system by eliminating insurance companies and guaranteeing coverage for everyone.

The idea known as single-payer health care has long been popular on the left. It’s gaining traction with liberals as President Donald Trump struggles with his efforts to repeal and replace the Affordable Care Act(AP)

Given Gov. Brown’s previous hesitance and the many outstanding questions surrounding the future of Obamacare, this is a big lift. Ultimately, single payer is the way we have to be going if we are to truly control health care costs. But for a California single payer system to work, it would need a lot of federal money and a lot of federal waivers. Federal waivers that are very unlikely to come under the current administration.

That being said, the bill, co-authored by Sens. Ricardo Lara and Toni Atkins, is important if for nothing else than getting stories like the AP story above. If we are to move towards a more fair health care system, we need to do whatever we can to move the ball forward, even if it is just the smallest amount. Senators Atkins and Lara are doing just that.