Dave Johnson, Speak Out California

“People are asking if California is governable.”  Governor Schwarzenegger said in the State of the State address today that California faces insolvency within weeks.  He said there is more gridlock in Sacramento than on our roads, if that is possible.

The governor gave a very short speech, saying there is no sense talking about education or infrastructure or water or anything else as long as we have this huge $42 billion deficit.

But the fact remains that the state’s requirement that 2/3 budget-approval requirement means that the state is, in effect, ungovernable.   A few anti-government extremists are able to continue to block the budget, refusing to compromise or even negotiate, demanding that the state lay off tens of thousands of workers, slash medical help for the elderly, slash police protection and firefighting capability, slash funding for courts, raise class sizes to 40 or 50 students, stop repairing roads and levees and everything else the state government does.

David Greenwald writes at California Progress Report wrote, in State of the People is Grim: More Budget Cuts Are Exactly the Wrong Prescription,

“Budget cuts totaling $16 billion over the last three years have already had severe consequences for the people of California. And the Governor’s proposed 09-10 budget would further harm California families and our economy with an additional $17 billion in cuts to schools, health care, homecare, and state services.”

Leading up to the speech, David Dayen at Calitics wrote, in The State Of The State Is, Well, You Know, “Typically he has done this speech to coincide with the evening news.  This year he’s trying to hide it.”

We at Speak Out California want to invite readers to come up with some solutions for the budget mess.  We are working on some ideas for a prize for the best ideas.

Click through to Speak Out California.

Congratulations to those brave souls who managed to win Assembly delegate elections over the weekend.  Your first state Convention, scheduled for Sacramento in April, should coincide nicely with the mass protests from folks who got IOUs instead of their expected tax refunds, the first double-digit employment numbers in the state in a generation, and essentially the near-total shutdown of state government, by design, from a working conservative majority that uses outdated and anti-majoritarian rules to destroy the state for their own ends.

I have a hard time arguing with the deep pessimism from Dan Walters today.

What, if anything, will come next to pull us out of recession and return California to prosperity? Some think it will be biotechnology, services to baby boomer retirees or solving global warming.

Lurking in the background, however, is a nagging worry that there won’t be anything, that the state’s endemically high costs, political dysfunction and long list of unresolved dilemmas, from transportation to water to education, have made us uncompetitive in a global economy. Just last week, a new federal survey found that California has the nation’s highest adult illiteracy rate.

We have tended to take the future for granted. No matter how moribund the economy may be at the moment, we think, we have the weather, the entrepreneurial spirit and the strategic location to regroup and prosper.

We may have. But then again, maybe we aren’t so special. Maybe we’re not immune to the societal afflictions that have beset other states. Maybe we are a rust-belt-to-be on the left coast, a Michigan with winter sunshine.

This is not a failure of entrepreneurship or a lack of a desirable consumer base.  It’s quite simply a failure of politics, a series of compromises and capitulations that have led the state into a blind alley.  Because legislative Democrats have never effectively rid the process of the constraints of the past, they have made the future impossible.

The biggest burst of meaningful political activism in recent history was the crusade to defeat Arnold’s special election in 2005.  That happened outside the party structure because labor felt threatened and needed to lead an effort, working together with the grassroots and the party establishment to fight back.  There was a singular mission and nobody brought their own single-issue buckets to the table.  Their public relations strategy and the activism they encouraged was nothing short of brilliant.  But it was primarily a defensive maneuver.  Now the CTA is trying to add a penny to the sales tax in a more offensive maneuver to secure funding for schools.  This is precisely the wrong way to go.  It carves out another dedicated funding source for one area while imposing a regressive tax on the state’s most burdened citizens.  Single-issue money grabs will not do the job.  Unity is the great need of the hour.

At one of the AD meetings I attended this weekend, my Assemblywoman, Julia Brownley, got up to speak.  I would call her a pretty mild-mannered woman.  She practically pleaded with everyone in attendance, saying “We need your help… the Governor is breaking this state… we need you to throw your shoes at Arnold.”  She was sending out an urgent call for the kind of unified activism that broke Arnold’s back in 2005.  It’s a heavier lift because it requires something proactive rather than reactive.  But without labor, grassroots activists and the party establishment working in concert, this is going to be the worst 2 years of all these newly-elected delegates’ lives.

There are going to be two Democratic legislative initiatives this week: a request for a federal government loan to ensure our unemployment insurance fund doesn’t go broke, and legislation putting a moratorium on foreclosures, which cost roughly $250,000 each to the greater economy in opportunity costs and property value reductions.  There is help coming in the form of hopefully $5-7 billion dollars from the federal recovery package, earmarked for state and local government relief.  But eventually, we’re going to turn to the ballot.  In June of this year, there’s going to be a host of initiatives, and we need there to be more than simply signing off on the bad budget of last year, but real structural reform, whether to do with 2/3 or expanding the budget cycle to 2 years or even the tax increases in the Democratic budget (The LAO thinks that election should happen earlier to relieve this crisis of confusion).  These MUST get on the ballot, and they MUST pass, with a coalition of every progressive in the state working toward that passage.  The survival of the state hangs in the balance.

So good for you, winners.  Now make sure you don’t get picketed during your first convention.  Because if you don’t, I’ll be the first one out there with a sign.

The Governor is “restarting” budget talks today.  Of course, “restarting” should read “using the same failed process that cannot possibly be successful.”  The Governor vetoed the only game in town because he’s controlled by strings held by the Chamber of Commerce, who suddenly looked favorably on the virtues of bankrupting the state, and Arnold had to follow.  The SacBee ed board puts it more judiciously.

Democrats agreed to a 2 percent cut in welfare grants, and some, but not all, of the environmental exemptions. They also have insisted that the governor first negotiate with unions before attempting to furlough state employees and eliminate some paid holidays.

In an interview and op-ed in The Bee Tuesday, Senate President Pro Tem Darrell Steinberg suggested the deal blew up not because of policy differences, but because of political pressure placed on Schwarzenegger. Steinberg says the governor got “cold feet” over the Democrats’ plan to raise taxes and fees through a majority vote.

There may be some truth to this. On Tuesday, the California Chamber of Commerce issued a statement urging the governor to veto the Democrats’ plan, saying it included “unconstitutional and discriminatory tax increases.” Since the chamber is one of the governor’s few political allies, their stern opposition to increasing taxes by a simple majority vote may well have led Schwarzenegger to backpedal.

The ed board goes on to criticize Democratic leaders for not wanting to cut enough.  You know, I thought a mid-year budget deal was designed to fix the budget for the current fiscal year.  If we have two-year budget cycles now, it’s news to me.  I understand the logic of a two-year cycle, but the desire to fill an 18-month gap in January puzzles me and seems designed to further more draconian cuts.

And the continued ignoring of the elephant in the room and casting this as a failure of both sides to compromise is truly absurd.  There has been nothing but compromise coming from the Democrats, not just now but for years.  “Bipartisanship” has always meant “do whatever Republicans want” to the Very Serious Media.  George Skelton today is lamenting the loss of Leon Panetta, as if a guy telling lawmakers they should have more drinks together is the answer to every problem the state faces.

This isn’t rocket science.  Lawmakers aren’t allowed to do their jobs.  We elect a representative government along majority votes, and them load them down with rules that prevent majority rule.  It doesn’t take a genius – or even Leon Panetta! – to fix that.  Just an acknowledgement of the problem.

(Incidentally, a judge threw out the lawsuit from the Howard Jarvis crowd attempting to rule the work-around budget unconstitutional, since it was vetoed and therefore not germane.  If it comes to such a work-around again, however, expect more lawsuits.)

Dan Smith reports that we’re nearing a deal on the work-around budget which would cover half of the state’s projected deficit between now and mid-2010.

“The areas of negotiations have significantly narrowed, and on those issues we’re very close,” said Senate President Pro Tem Darrell Steinberg, D-Sacramento.

Steinberg and Assembly Speaker Karen Bass, D-Los Angeles, talked via videophone to Schwarzenegger, who is vacationing in Idaho. Talks will continue over the weekend, with leaders hoping lawmakers can be called back to Sacramento by the end of next week to approve a final deal.

Schwarzenegger spokesman Aaron McLear said Democrats are “moving closer” to the governor’s demands for deeper spending cuts and an economic stimulus package. “But we don’t have any agreements,” McLear said.

We know that the main sticking point issues were: 1) eliminating CEQA for certain infrastructure projects, 2) privatizing a lot of those public works contracts and 3) cutting state worker holidays and overtime.  So the fact that Democrats are “moving closer” to those positions isn’t exactly heartening, although it’s contradicted somewhat later in the piece.

Bass said Democrats are trying to meet the governor’s desire to stimulate private investment in public projects without hurting public employees by shifting their jobs to contractors.

The Democrats believe changes to state employee pay must be hashed out at the bargaining table between unions and the administration. “There’s no question that state workers know that they’re going to be part of the solution as well, but we also think it’s very important to respect their ability to have a say in how that is done,” Steinberg said.

Privatization is simply not the answer, it has no relevance on budget savings (cost overruns exist in the private world, too) and is just a way for Arnold to reward his Chamber of Commerce pals.  

But what’s notable here is that these are meetings between the Governor and the Democratic leadership, and the Republicans have been completely frozen out due to their inability to play nice with others.  The byzantine plan for a majority vote on fee increases and tax shifts is still operative, and if it survives the subsequent legal challenge, suddenly the Yacht Party would be powerless.  The Very Serious pundits have already turned against Yacht Party rhetoric on spending as the source of the problem, and even the most casual observer understands that the 2/3 rule is destroying the state.  There ought to be a formal voting down of 2/3 (even this work-around will be insufficient to approve a new budget in June, which requires a 2/3 vote) but this is a creative solution to a crisis largely created by the rulemaking structure of the body and Republican intransigence (not to mention Arnold’s vehicle license fee slash, the dumbest first act by a Governor in many a year).

I appreciate Bob’s sentiment that the time is now to fight the Governor and the Yacht Party and bring some sanity into the fiscal process, but my fear is that the time for that was three years ago, when the successful fight against the special election should have been built upon, and at this point, we’re already swirling in the bowl.

Let’s just get you up to date.  All infrastructure projects are currently shut down.  Unemployment nudged up to 8.4% in November, the state lost 41,700 jobs last month, and up to 200,000 more jobs are on the chopping block from the public works freeze if it continues.  Meanwhile the Governor is ordering up layoffs and furloughs for state workers, so just add those on top of the pile.  You’re likely to see a 10% cut in state employees, and a 10% reduction in the salaries of those who remain.  More job loss means less income tax and probably less sales tax, as well as more need for public assistance.

And that’s before a budget which could have further reductions to state employee paychecks, elimination of overtime and meal breaks, etc., is signed.  Not to mention the billions more in cuts that the Democrats included in their work-around plan which the Governor threatened to veto.  Schools, which were slated for $4 billion in cuts in that budget, have already gotten the jump on the state by cutting back their local budgets.  After-school sports, libraries, and new teachers are probably all going to go.

This is a nightmare beyond the ability of many, even myself, to comprehend.  It’s so big that it’ll affect everything, and the idea that a ragtag band of liberals have the power to stop the freight train from coming down the track is precious, but I think wrong.  This is the accumulation of 30 years of bad policy and worse government structure, and that’s not going to be turned around in the time it needs to be to avoid catastrophe.  Even George Skelton, poohbah of all poohbahs, admits that the Yacht Party is so nakedly ideological that they have made the state dysfunctional.  This work-around budget is good for the time being, but Schwarzenegger is clearly committed to hijacking that process.  It’s a large game of chicken that none of us can afford.  And as I’ve noted, even balancing the budget – which the work-around does not do – will not necessarily restart infrastructure spending, and even federal help might not be able to do that.  

Changing the constitution with a convention is a nice idea, but not so easy in practice, as we all know.

Talk of calling a constitutional convention has been banging around California for at least the last few decades – maybe since 1851, for all I know – and it’s gotten a lot louder recently. Here, however, is the rule for calling a convention:

The Legislature by rollcall vote entered in the journal, two-thirds of the membership of each house concurring, may submit at a general election the question whether to call a convention to revise the Constitution. If the majority vote yes on that question, within 6 months the Legislature shall provide for the convention. Delegates to a constitutional convention shall be voters elected from districts as nearly equal in population as may be practicable.

In plain English: you need a two-thirds vote of the legislature to put an initiative on the ballot and then you have to get it approved by the voters. The problem is that no matter how sweetly liberals might croon about what a convention could do, conservatives all know the truth: the whole point of the thing would be to get rid of our insane two-thirds requirements for passing budgets and raising taxes. Unfortunately, our whole problem is that Republicans control (slightly more than) one-third of the legislature. And if we can’t get them to vote for a tax increase in the first place, what are the odds we could get them to vote for a constitutional convention called for the express purpose of making it easier to increase taxes? About zero.

OK, but how about a simple initiative? We could get rid of the two-thirds rule just by collecting signatures and getting a majority vote, right?

Right. And we tried that just a few years ago. Prop 56 was supported by all the usual good government groups and would have reduced the majority needed to pass budget and tax measure from two-thirds to 55%. A bunch of other fluff was added to make it more popular (“rainy day” funds, no pay for legislators if they don’t pass a budget, etc.), and in the end…..

….it got whomped 66%-34%. No one was fooled for a second. Everyone knew the whole point was to make it easier to raise taxes, and so it lost in a landslide.

I think a similar proposition to 56 wouldn’t crash so hard today, but it would certainly go in as an underdog, because the majority of the state still doesn’t understand the consequences of all this failure.  It’s a “dysfunctional electorate,” as K-Drum puts it, as well as a dysfunctional government.

Do we need to fight?  Yes.  But we need some arms shipments from Washington (metaphorically speaking) before we can do that.  A rescue package for the state is desperately needed, and it got a whole lot more so yesterday when the Governor vetoed the work-around.

The most remarkable quote of the week came from a backbencher Yacht Party Republican named Mark Wyland, commenting on the historically late state budget.  If the California Democratic Party had a locker room, this would be serious bulletin-board material:

Voters are unlikely to punish lawmakers for the budget delay in any substantive way on Nov. 4  unless it’s to pass a ballot measure that would change how political districts are drawn, said state Sen. Mark Wyland (R-Carlsbad).

“My experience with voters is that they really don’t care how long it takes to get a budget,” Wyland said, following his participation in a panel discussion at an event on reforming state government.

According to Wyland, prolonged budget stalemates like this year’s sometimes encourage voters to keep their incumbents. Because districts are usually heavily skewed in registration to one party or another, he said, sitting legislators are more likely to hear encouragement for their party’s ideological position than disfavor.

And voting against the party – in Wyland’s example, for tax raises or to reinstate the unpopular vehicle-license fee – is an invitation to face a primary challenge in the next election cycle, he said.

This is the calcified opinion from the Yacht Party, and why they’ll never be moved from their ideological perches.  They believe that they have more to fear from internal challenges on the grounds of insufficient fealty to failed conservative policies than from the consequences of those policies.  And there’s a lot of evidence on their side, although not as much as they think.  

But the most glaring point made in this statement is one of contempt.  It shows contempt for voters to act in the best interest of an ideology than in the best interest of the state.  It shows contempt for voters to hold the budget hostage, causing extreme hardship in the lives of state employees, community health centers, policemen and firefighters, and public schools,  and expect nobody to notice.  It shows contempt for voters to use the tyranny of the minority to advance a cause completely at odds with the prevailing opinion of the state.  Real people were affected and harmed by this budget, and all of us will be in the future as the bills of conservative borrow-and-spend economics and systematic destruction of government come due.

And the thing is, Wyland is relying on a failed model.  Demographic shifts and a reckoning of the failure of conservatism has made no district safe.  Indeed Californians can punish Yacht Party Republicans for their intransigence and obstructionism.  There are a number of races at the federal and state level where Democrats have more than a chance to unseat Republicans and turn seats blue.  In fact, with some luck and proper resources we can get very close to that 2/3 majority needed to pass budgets and fix the structural revenue deficit.  That’s where you come in.

The Calitics Editorial Board has identified five seats which strike a balance between winnable races and progressive leadership.  We’ve decided to start a major fundraising push for these five candidates between now and the end of the quarterly reporting requirement on September 30.  That gives us only a few days, but here’s the kicker – Calitics will match every donation made to these candidates up to $500 each, for a grand total of a $2,500 candidate match.  

Please visit our special Calitics Match ActBlue page and support any or all of these five great candidates:

Charlie Brown (CA-04): A recent Research 2000 poll showed Brown leading perennial candidate Tom McClintock 46-41 in this deep red district.  Brown, a retired Air Force Lt. Colonel, nearly defeated indicted Congressman John Doolittle in 2006 and has shown tremendous leadership on veteran’s issues and the FISA fight before even coming to Congress.  He’s a better Democrat we can all be proud of.

Debbie Cook (CA-46): Running in a tough district against certifiably crazy Rep. Dana Rohrabacher, Debbie Cook is running with an unabashedly progressive message.  The Mayor of Huntington Beach, Cook is an expert on peak oil and energy issues, and would instantly be one of the most knowledgeable voices in the Congress on how to move toward a post-carbon future.  She also believes in ending the Iraq occupation responsibly and achieving the goal of quality and affordable health care for all.

Hannah-Beth Jackson (SD-19): A former Assemblywoman and creator of Speak Out California, a blog and resource for Golden State progressives, Hannah-Beth Jackson has proven her progressive bona fides time and again.  Running in rapidly changing Ventura County against the former state director of the Club for Growth, Tony Strickland, Jackson can prove that even Tom McClintock’s old seat is not safe from the progressive wave.  She would lead in the State Senate on issues of economic justice and the environment.

Alyson Huber (AD-10): AD-10 is another district where the demographics are changing, and Alyson Huber is perfectly suited to take advantage of this and turn the seat blue.  Huber, an attorney and working mother, is focused on increasing access to health care and education for all Californians.  She would help tremendously in bringing us closer to that needed 2/3 majority.

Manuel Perez (AD-80): A transformative leader, Manuel Perez is ready to take that leadership to Sacramento.  Part of a growing group of Hispanic-Americans in the Coachella Valley who are leading a major progressive challenge to the typical politics of the region, Manuel has created community health clinics, served on the Coachella School Board as a trustee, taught classes, and organized his community to fight for change.  He is uniquely suited to take his varied experience and lead in the State Legislature.

The time is tight, but we need to make Mark Wyland and the Yacht Party Republicans he represents cry.  Please contribute to our Calitics Match fundraising effort before Tuesday!

Aside from calling for a Constitutional convention or a special election to eliminate the 2/3 requirement for budget and taxes, the best thing we can do is make the Yacht Party pay for putting our state in this position by defeating them at the ballot box.  There are a number of seats that we have the ability to capture this year, when we will be helped by increased voter registration and expected increases in turnout thanks to the Obama campaign on the top of the ticket.  

Much like the DCCC (House of Representatives) and the DSCC (Senate), there is an organization called the DLCC (Democratic Legislative Campaign Committee) that exists to elect Democrats in state legislatures all over the country.  They are currently accepting submissions on races that they can inject money into in 2008 to make a difference.  Obviously, achieving 2/3 in a bellweather state like California, giving us the ability to enact far-reaching legislation that will affect the whole country, should be atop the DLCC’s agenda.

So I invite everyone to write to the DLCC at this website and list some of the winnable seats here in California that they ought to attend to.  Examples include:

AD-80 (Manuel Perez)

AD-10 (Alyson Huber)

AD-78 (Marty Block)

AD-15 (Joan Buchanan)

AD-26 (John Eisenhut)

SD-19 (Hannah-Beth Jackson)

We’ll be coming out shortly with the Calitics editorial board recommended list of candidates shortly, but getting on the DLCC’s radar screen would be pretty critical as well.  So go to the DLCC action page and write in some of these candidates.  Thanks.

…I should mention that you can nominate multiple candidates at the site, so, you know, do that.  Write in all of them!

This was kind of a no-brainer for the Governor.  While his popularity has stumbled during the budget crisis, the legislature is worse, and the early reviews of the budget are very negative.  By vetoing it, Arnold sets himself apart from the failed budget process and gets to say that “I did all I could” when he is inevitably overridden.  

A budget veto would be a first for California, but legislative leaders in both parties said early this morning that it is likely the Legislature would override it.

“I’m pretty confident we are not going to have any difficulty” overriding a veto, said Assembly Speaker Karen Bass (D-Los Angeles). “We would do it in rapid fire.”

The last bill override was in 1979, when Jerry Brown was governor (the bills concerned state employees and insurance).

That last bit of information should tell you all you need to know about the dysfunctional state political system.  No veto overrides in 30 years?  What a farce.

Now, the flip side to this political move by the Governor is that he will be shown to have essentially no power in Sacramento.  He’s been completely divorced from the Yacht Party, having no ability to move them on any significant issue.  And now the budget will be passed over his veto (I’m guessing this eliminates his ability to blue-pencil anything out of it, too).  Schwarzenegger’s power is at its lowest ebb now.

But he’s playing a post-partisan game, and he’ll hope to regain some of that relevancy with the presumed March ’09 special election.  Wherein there will be no talk of the slashing of the vehicle license fee which contributed mightily to this mess, of course….

…adding, there’s one other wrinkle to this, and that’s this:

If lawmakers vote to override the veto, Schwarzenegger said, he will veto all the bills awaiting action on his desk.

This gives a measure of leverage to the Governor, but it looks to me like he’s learned from his Republican friends how to hijack… amazingly, at his press conference he immediately backed off this “tough guy” tactic when challenged on it, revising that he would “look closely” at those bills which involved spending, and veto an unspecified number of them.  In other words, what he does every year.  What a girlie-man.

UPDATE: Karen Bass’ statement is here.

They were only some of the victims of a chronic budget problem in California that has been going on for decades. Over the past few months it became clear that California’s chronic budget problems couldn’t be resolved in a single session of the legislature. Not when we have a 2/3 requirement to pass a budget and raise revenues – a disastrous tyranny of the minority that other states have sensibly avoided. Not when we have a revenue system based on what made sense in the 1930s – a system that careens from year to year with no long term stability.”

If the people of California are the victims in the chronic budget crisis, the 2/3 vote and the outdated revenue system are the villains. Because of the two thirds vote requirement when legislative Democrats made cuts and supported taxes– and when the governor made cuts and supported taxes-a small Republican minority was still able to hold the budget hostage for almost three months.”

If Governor Schwarzenegger had been able to convince even a handful of legislators from his party to support a budget – AS EVERY OTHER GOVERNOR IN HISTORY HAS BEEN ABLE TO DO – we wouldn’t be in this situation. But Governor Schwarzenegger was not able to produce a single vote — and the people of California were hurting — so we stepped in to pass a compromise budget that, while ugly in many aspects, at least buys us time to make progress on the real reforms we need.

I think she’s interested in changing the 2/3 requirement.

UPDATE by Robert – Garamendi supports the budget veto:

The Governor is correct to veto the proposed budget as it does not meet the minimum investment that California must make to maintain its economic competitiveness. All levels of education remain on a starvation diet that is sapping the strength of tomorrow’s workforce and leaving California employers with insufficient skilled workers, ill-prepared to compete in the world’s economy. Furthermore the most vulnerable in our society, the poor, the aged, the blind and the disabled are denied the basic needs that they deserve. We are the sixth wealthiest economy in the world – we can and we must do better – for our future and our children’s future.

This budget “kicks the can down the road” because it does nothing to solve the structural deficit, nothing to fund or to improve the efficiency and effectiveness of our poorly performing education system, the prison system or address the need for affordable health care. It uses accounting gimmicks and borrowing to plug the hole, a hole that is guaranteed to be only bigger and deeper next fiscal year.

It’s time for Californians to take a stand together. We must modernize our economy, stabilize our budget, reform and fully fund our education programs, establish a universal health care system, address the threat of climate change and adapt our water and transportation systems to the reality of the new and changing environment.

We must reestablish the successful California tradition of investing in both the public and the private sectors. We cannot allow a continuation of the gridlock caused by the Republicans’ refusal to adequately fund those investments that create economic growth and social advancement. The two-thirds vote requirement must end along with the ideology that we can continue to cut essential services and education and end up with a vibrant economy and a peaceful society.

The Legislature should return to serious daily negotiations and adopt a budget that invests in California’s future. The Republican’s have already agreed to a tax hike for every Californian who receives a pay check and for every California Corporation. A 10% increase in tax withholding is nothing more than a tax increase. This flawed budget affects those least able to put food on the table. California’s working families deserve real solutions and vital investments which ensure a better tomorrow.”