In the weekly radio addresses, we get some Governator talking points from former Secretary of State George Schultz and a frank discussion from Assembly member John Laird.

In the Governor’s address, we hear that we spend too much money, and that Ronald Reagan wanted to restrict spending. The trouble with that comparison: Ronald Reagan was also willing to look at tax increases and fixes as well. This Governor seems to be taking adjustments to the revenue stream off the table while saying that nothing is off the table. In other words, he’s devouring that cake that he’s hold onto. As George Skelton said today, Arnold “talks like FDR, but walks more like Scrooge.”

On the other hand, Assembly member John Laird talks about actually addressing how we fund our state. He points the finger squarely where it belongs, at the Governor for his full-throated assault of the VLF. Laird acknowledges that cuts seem inevitable, but does not yield to the idea of a cuts-only budget. We must adjust our revenue as well.

Check the flip for the transcripts.

The Governor’s Address, given by former Sec’y of State, George Schultz:

 Hi, this is George Shultz, former Secretary of State, filling in for Governor Arnold Schwarzenegger with another California Report.

    This week the Governor released his budget proposal for the next fiscal year and revealed that California is facing a projected $14 billion deficit. As expected, we’re already hearing cries for higher taxes to close the gap. But the Governor is absolutely right to say we can’t tax our way out of this problem and as he said in his State of the State address, California has a spending problem, not a revenue problem and the people shouldn’t pay for Sacramento’s overspending.  And the numbers back him up. Just a decade ago, the state’s annual budget was around $70 billion, this year taxpayers will send almost $130 billion to Sacramento. Think about that. $130 billion. That’s nearly doubling the size of government – in just 10 years.

    But as I’ve learned in my 50+ years in public service, for the spending lobby, there will simply never be enough to go around.

    As the Governor explained earlier this week, quoting him, “if we can’t function with that kind of money, then there is something wrong with the system rather than with the people.”

    That’s why, rather than raiding the wallets of hard-working taxpayers, his budget reduces spending across the board by 10 percent. This spreads the cuts evenly and doesn’t favor one program over another.

    But just as important as solving this year’s mess, is ensuring that Californians never have to go through this again. This is why I am so encouraged to see the Governor once again push for comprehensive budget reform.

    Throughout my career, whether in Washington, as when I was director of the budget, or Sacramento, I have seen time and time again the inability of legislative bodies to exercise the type of fiscal discipline demanded of families and businesses. There’s always one more program, one more lobbyist, one more special interest group with their hand out and they simply can’t say “No.”

    That is why the only way to permanently solve California’s budget woes is a mechanism to force legislators to live within their means. Governors as far back as Earl Warren have proposed spending controls, including Governors Reagan and Wilson, but none could break through the entrenched spending lobby.

    Governor Schwarzenegger has proposed reforms twice before, but failed. And we have seen what’s happened as a result. Unchecked spending binges, chronic deficits, and the same budget fights year after year in the Capitol.

    Under the Governor’s plan, the legislature would be required to set aside surplus money in the good years, to cover shortfalls in the bad years. Any business or family does that, and so should the government.

    This promises to be a tough year, but the Governor’s budget has laid out a great foundation. Reducing spending, along with long term budget reform, is exactly what California needs and taxpayers deserve.

    This is former Secretary of State George Shultz, thank you for listening.

Democratic Address by Assembly Budget Chair John Laird:

    During this week’s State of the State address, the Governor invoked the name of President Franklin Roosevelt when he said that we need to be visionary in tough times.

    And with California facing a $14 billion budget deficit, these are tough times indeed. But the difference between Roosevelt and the Governor is that FDR leveled with the people in times of crisis. For five years now, the state has been spending at a level that’s higher than the amount of cash we’ve been taking in. The people of California have been getting a higher level of education, parks maintenance and access, and prison services than they have been paying for. We either have to cut these popular services dramatically or pay more ~ one or the other, or a combination of the two. It’s as simple as that.

    The Governor’s approach would have us make significant cuts to every single state service without bringing any new revenue into the system. His budget relies on higher fees and enrollment limits at UC and CSU campuses, and he supports mid-year cuts to K-12 education.  He wants to close state parks and release prisoners early, and he expects low-income Social Security recipients to handle significant cuts to their aid.

    And these are just the headlines.

    When the Governor cut the vehicle license fee a few years back, he also supported a voter-approved measure that locked in the expenditures that the VLF used to help fund.  And instead of putting the state on a pay as you go basis in 2004, the Governor supported $15 billion in debt bonds to finance the state debt over a number of years. Those two actions alone account for $8 billion of our $14 billion problem right now. And our state budget relies on sales tax and personal income tax for over 80% of its revenue. These sources swing wildly with the economy, regardless of what the state spends. We are in this crisis because our revenue dropped, not because we dramatically increased state spending.

    In his speech, the Governor proposed a new formula to deal with budget problems in the future. But in 2005, the voters rejected a similar formula proposed by the Governor by a 2-1 margin.

    We have to level with you, the people of California. You have voted to protect education, roads, prisons, local government and after-school care. This year, unfortunately, you can no longer get what you want without paying for it someway, somehow. As Assembly Budget Chair, I will make sure everything is on the table during our deliberations the next six months. We will eliminate inefficiencies, close tax loopholes, remove the tax write off for yacht owners, and much more. But ultimately, either we decimate our education, infrastructure, and social services programs, or new revenue will have to come from somewhere.

    We face tough decisions this year, and we want your input.

    Thanks for listening. This has been Assemblymember John Laird, chair of the Assembly Budget Committee.

Well, we're in one. Under Prop 58 approved right after the recall, the Governor has the authority to declare these emergencies to allow him to hold the Legislature hostage. More deets at the SacBee:

It will mark the first time Schwarzenegger has used the “fiscal emergency” authority that he asked voters to create by passing Proposition 58 in 2004. The provision allows the governor to declare an emergency when revenues are “substantially below” what was anticipated when the budget was signed. Such an emergency would summon the Legislature into special session.

If lawmakers fail to send the governor legislation addressing the budget problem within 45 days, they cannot take action on any other bills or adjourn until they do so. (SacBee 12.14.07)

Well, this puts a damper on our ever-so-sunny outlook in Sacramento. Spending will likely be slashed, but when are we going to address the real problem? We can't keep going on this boom/bust budget roller coaster that we are riding. Maybe we can appoint John Laird as our fiscal administrator. Trust me, things would be way better than they are now.

So…um…John Laird for Fiscal Overlord '08!

Disclosure: I’m quite proud to do some work for Yes on 93. Also in orange.

Last week, I sat down with Assemblymember John Laird of Santa Cruz/Monterey, to talk about Prop 93, the environment, and civil rights.  I’ll be editing up more of the video where we talk about these issues in more detail. However, I wanted to share this video first.

John Laird has a long history of fighting as both a progressive activist and now in the Assembly. He’s worked extensively on promoting a sustainable economy, and has spent much of his time in the Assembly by going through each of California’s non-discrimination laws to ensure that the rights of all Californians are honored. And given his experience as Assembly budget chair, few have the breadth or depth of knowledge about the priorities of the California government. After all, as he told me, the budget is the one document that represents all of our priorities, our hopes, and our dreams for the state. Flip it for more.

So, why does he think that Prop 93 is important? Well, I’m pretty sure he says it better than I ever could, so I’ll summarize it with this sentence. “The outcome depends on … long-term fights to take the knowledge we’ve learned and the relationships we’ve made to accomplish these goals.” See, beyond the personality conflicts of yesterday, today, or tomorrow, we still have the goal of accomplishing progressive action. Yet, as they say, Rome was not built in a day. And it certainly wasn’t built why Romulus was looking for a new gig in Sicily.

Take, for example, Assemblyman Laird’s efforts to resolve the civil rights bills in California code that I discussed above. Each bill requires a conversation here, a little shove there; in the end, it’s a lot of time. And if each legislator has got their eye on their next position up, down, or anywhere around in public service. Don’t get me wrong, I laud their dedication to public service. I simply suggest that we are best served when we have experienced legislators that are focused on accomplishments rather than the next rung.

So, check out Prop 93, and ask questions.  I’ll be around here for a little while or I’m always available at brian AT calitics DOT com. It’s a complicated measure, but it’s one that will help put California in a better position for the future.

(Bumped to move the 2 budget diaries together. – promoted by Brian Leubitz)

The Schwarzenegger era will be remembered as the era of “blockbuster politics,” where the Governor took the same marketing techniques that made his movies popular and transferred them to the political stage.  He wouldn’t just make an issue a priority, he would structure the entire year around it.  “The Year of Reform!”  “The Year of Education!”  “The Year of Healthcare!”  “The Year of The Environment!” As an actor he only put out one movie a year, so one legislative initiative a year sounded about right for the average attention span.  The details of governance would be pushed backstage; the thrust would be to go big on one issue and hope the goodwill gained from success would mask whatever failures occurred.  This has not been a slam dunk; the year of reform crashed badly, other signature issues have yielded fruit.  Now, with this year’s blockbuster on the rocks due to Republican resistance, legal challenges, initiative politics and structural roadblocks, the inattention to the small problems that weren’t on the big agenda are starting to consume the state.  In an excellent editorial, Assemblyman John Laird, Chairman of the Budget Committee, explains how our current mess of a $10 billion dollar shortfall could have been easily avoided if the Governor would have paid attention to something other than staging the next blockbuster.

… [T]he chronic boom-and-bust budget cycle is rooted in a simple problem: Californians generally believe in government and want it adequately funded — so much so that they repeatedly have voted for laws or constitutional amendments that lock in guaranteed spending for, say, education or transportation. At the same time, the state’s revenue system is antiquated and volatile. It is heavily reliant on income taxes, for instance, and so the pains of an economic downturn have a magnified effect on state revenue.

The short-term solutions that get us through on a year-to-year basis all have been tried — and tried. It’s time for bipartisan hard work to bring California’s long-term spending demands into balance with long-term revenues. It won’t be easy, but the easy paths have been taken, and they’ve left the state awash in red ink.

Wingnut conservatives are calling on the Governor to declare a fiscal crisis.  It’s one of their own doing.  When California could have eliminated the constant catastrophes of the budget process by restructuring the revenue offsets to services the population desires, instead the Governor floated a $15 billion dollar bond in 2004.  The result is $3 billion a year extra in debt, every year, to repay the costs of a senseless short-term fix.  If sound Republican budgeting means “put the problem off to children and grandchildren,” then we’ve got a lot of sound budgeters in Sacramento:

On paper, it may look like spending has increased in recent years, but that is largely driven by the expiration of earlier budget-balancing tricks — such as temporarily shifting school funding to local governments, shifting costs to special funds and the multibillion-dollar temporary cut to education.

There really haven’t been significant program spending increases, with three exceptions: public safety, the result of various court cases regarding our prison system and implementation of “Jessica’s Law” to track sex offenders; debt service, primarily the annual $3-billion payment on the $15-billion deficit bond; and local government funding, a result of the vehicle license fee cut because billions from that fee used to go to cities and counties.

Sacramento does not have a spending problem.  It has a denial-of-reality problem.  The cuts are always accommodated in the state budget, like this year’s delay of COLA (cost of living adjustments) for elderly public assistance, and the $1.3 billion in transportation funding.  The revenue increases are always blocked.  Stopgaps that run out and increases in population wipe out the cuts.  We’re left on an unsustainable track.

The state is rapidly headed toward bankruptcy if it continues down this stupid, temper-tantrum approach to the budget.  if Arnold Schwarzenegger wants to leave a lasting legacy, and let’s face it, that’s all he wants to do, he can work hard to fix the structural problems that will always put the state’s financial picture in peril.  That would require sitting in his office and doing his job, not holding big speeches behind backdrops that say “The Year of the Tiger!” or whatever he’s trying to peddle to the electorate.

(I’ve changed the title, but all else is straight from the candidate’s fingers. – promoted by Brian Leubitz)

We have a real chance to do something good for California and I think for the country since this State leads the nation in many ways. California governance is currently hamstrung by a fraction. That fraction is two thirds. We are embarrassingly only one of just three States in the Union that requires a two thirds majority to pass a budget or manage tax revenues. This is in a State, a nation state really, that is the 6th largest economy in the world-equal to France.

That is why, along with eventually achieving universal, single payer healthcare, I am running as a Democrat for the 15th Assembly seat for the California State Legislature.

It’s a long time held Republican seat right on the doorstep of the Bay area. Jerry McNerney won his race, Tauscher gets re-elected, State Senator Torlakson too and yet with these same voters the Assembly seat has stubbornly remained in red hands.  ….more on the flip.

The 15th Assembly district is ripe for the picking but I am not running this race because it will be easy-far from it. The Governor has hand picked a Republican replacement for Guy Houston (termed out incumbent) and they are pulling out all the stops because they know they may lose it. They are running a statewide race. So am I. I wanted to briefly introduce myself as a candidate for this seat.

I am a strong proponent that government, business, and labor are equal partners in protecting our families and communities. Particularly I am a strong believer in the aggressive place for government in that equation whose coefficient has been cruelly dropped by the Republican mantra of “you’re on your own” ownership society.  President Bush’s recent veto of SCHIP couldn’t be a more blatant example of that calculus.

Beyond universal healthcare coverage, I am an ardent student of our State’s water issues. The 15th Assembly district covers most of the Delta but it’s really an issue that affects all Californians. If we don’t bridge the disputes of a vast array of ardent stakeholders fast, we will find ourselves turning the tap one day with either nothing coming out or worse, a stream of salt water. Robert in Monterey and John Laird have the picture.

I support the immediate order to begin the immediate withdrawal of troops from Iraq-that in itself is a nine month timeline. Just throw the switch for crying out loud. As a Federal issue our impact can only come with a State resolution. I would have supported the Speaker Pro Temp, Don Perata, with his resolution to end the war.

And the one vote I will consistently cast is to support medical use of marijuana. My extensive corporate management experience with employees, who fell victim, albeit rarely, to substance abuse is based on medical and other professional training, not on the viewpoint of archaic hysteria. As an expert in employee recovery programs, I know this drug to be fully appropriate for medicinal uses and it does not constitute a “domino” step to harder drugs.

I do not seek the support from high elected officials. I have the support of teachers, environmental activists, and working families. Democracy is about the bottom up and not the top down. On that, I’ve learned my lesson.

My intent is to try and set a schedule for blogging about issues that I feel are important to you and myself on hopefully a weekly basis. Our website will try to post the plan.  I look forward to hearing from anyone who cares about the future of this State and the country or wants to know more about me. I can’t answer everything but I’ll give it my best.

Thank you. Let’s pick up this seat for Democrats!
Steve Filson, Assembly Candidate for the 15th District.

You don’t need to explain the looming water crisis to John Laird (AD-27). For his district, there’s nothing “looming” about it. His home city of Santa Cruz has recently implemented water restrictions due to the dry winter of 2007. Down here in the Monterey Peninsula portion of his district, we’ve been in Stage 1 rationing since 1999 and I am only able to take a shower in the morning or get a glass of water as I sit to write this post because we pump the Carmel River dry.

It’s fitting, then, that Laird has become the Assembly’s point person on water as the special session kicks into high gear this week. A combination of growth, overpumping in the Delta, drought and the specter of climate change has forced California to face its water crisis. And as such, it’s worth taking a bit of time this Sunday afternoon to get everyone up to speed on where things currently stand in Sacramento.

First, the issues. Not only does California face a long-term problem in providing water to residents, but it has been overpumping what resources it already uses – particularly the Delta.

The Sacramento-San Joaquin Delta provides drinking water to over 20 million people, is the basis for California’s agricultural industry – and is in peril. Overpumping has threatened several endangered species, and by reducing the amount of fresh water in the delta, results in an increasing amount of inundation by salt water. This threatens the reliability of Delta water for the millions who depend upon it. Already a federal judge has mandated significant cuts to the amount of water pumped out of the Delta this summer, and cities from San José to San Diego are facing mandatory rationing.

There are two main solutions. Republicans, led by Arnold and in the Legislature by Senator Dave Cogdill (SD-14, Modesto), want to revive the Peripheral Canal, which would take water from rivers like the Sacramento and Mokelumne and divert it around the Delta to the California Aqueduct near Tracy. They would have the state float a $2 billion bond for an “alternate conveyance” system – aka a Peripheral Canal.

This idea has been floated before, in the late 1970s. It deeply divided the state – Northern California was convinced it was a SoCal plot to steal their water – and the idea was soundly rejected in a statewide referendum in 1982.

The problem with the Peripheral Canal, however, is that it will not solve the Delta’s problems. Taking more fresh water out of the Delta would only make the salination problems much worse – it would be sacrificing the Delta once and for all in order to continue allowing California users to overuse what they already have.

As Hannah-Beth Jackson notes, Senator Don Perata’s proposals are much more favorable to the Delta. Groups such as Restore the Delta support Perata’s plan which offers $600 million for levee repair and other improvements to Delta habitat.

In contrast to the canals and dams solution the Republicans offer, John Laird has instead proposed several core principles that must govern the water special session (SacBee Capitol Alert, subscription req’d) that seem to suggest that they would prefer other solutions:

(b) Water agencies and local governments within each region should collaborate to develop, to the extent reasonably possible, regional reliance on water resources within their region, in order to minimize reliance on water resources from other regions.

(d) Water use efficiency, including conservation, recycling, reuse, and stormwater capture, provides one of the least expensive and least resource-intensive methods to enhance water supply reliability.

(e) Safe and reliable drinking water for all communities, including disadvantaged communities, should be among the state’s top water policy objectives.

(i) State and local agencies should consider the effects of a changing climate on the reliable availability of water resources for beneficial needs in the years ahead.

In other words, Laird insists that we look at conservation, at sharing the costs, at ensuring that disadvantaged populations are not made to spend money they don’t have to ensure a reliable water supply, and that climate change is considered in the process.

The plans offered by both Laird and Perata also emphasize local control and local planning. This is itself important in getting Californians to again live within their means. The 20th century solution of simply building a canal to some other watershed and taking that water will no longer work. It has failed the Delta, failed the Klamath Basin, and will soon fail the Sierra itself if we do not shift priorities.

The Planning and Conservation League has weighed in with its own plan that emphasizes conservation programs, watershed restoration, and groundwater retention (in other words, pumping the water back into aquifers to be stored underground, a more environmentally friendly and sustainable solution than dams). If properly funded, they note, several million acre feet of water could be produced through these more sustainable methods. One acre foot typically equals the annual water usage by a family of four. The state’s own water assessment plan shows that conservation can eliminate the “need” for these new dams.

As I explained back in July, California is a very drought-prone climate. Climate change in California is expected to produce a hotter and drier climate, with a reduced snowpack. Precipitation in the Sierra is expected to fall as rain more often than snow, forcing significant shifts in how water is stored.

But the problem isn’t just that the Sierra will see less snow and more rain, but that it will see less water, period. And the problem isn’t limited to the Sierra – as anyone who’s been to the Southwest recently knows, the whole region is suffering from reduced rainfall. Some experts suggest we may be on the verge of a 90 year drought in the US Southwest, and that Lakes Powell and Mead may never return to their previous levels.

Faced with the prospect of prolonged drought, it seems foolish for California to assume it can solve its problem merely through added storage – why build more storage for less rain?

So far in 2007, there has been way too much backsliding on the critical issues that face our society. Congressional Democrats failed to do anything meaningful to end the war in Iraq. Arnold helped force through major cuts to public transportation at a time we should be starting to move California away from dependence on the automobile.

We face a major crossroads in California in this special session, on both health care and water. It’s important to our future that we get it right.  We need to ensure that our water solutions are right for our watersheds, right for the Delta, and right for we who rely on water for survival.