I want to publicly thank Jordan Rau and Patrick McGreevey for ripping off my “Scared Straight” moniker to describe yesterday’s joint legislative session. This is par for the course with the traditional media creatively borrowing the work of bloggers without attribution. Hey, at least our site didn’t send us into bankruptcy.
UPDATE: Mr. Rau, in a somewhat snippy but professional email, tells me he doesn’t read the site and the “Scared Straight” idea was independently his. Fair enough.
As for the effectiveness of the “Scared Straight” session, which posited that all state infrastructure projects would be shuttered by the end of the year without a new budget, and that the state would be essentially out of money by February or March, and that doing nothing will make the problem substantially worse… well, let’s just say it could have gone better.
The Republicans, who attended reluctantly, refused to accept tax increases, instead emphasizing the importance of limiting state spending and ferreting out waste and bloat in existing programs.
“I didn’t see a lot of productive work there today,” said Senate minority leader Dave Cogdill (R-Modesto). “I think it was more about trying to heighten the intensity around this thing and push people to a place that they have been trying to push us to for a long time, and I don’t think it’s going to work.”
Sen. Dave Cox (R-Fair Oaks) held aloft two weighty yellow tomes produced by the last effort to trim state government — Schwarzenegger’s 2004 California Performance Review, which suggested 279 ways to save money by reorganizing the state bureaucracy. Almost none were adopted.
Look! The answer is just holding up the performance review and shuffling around the bureaucracy!!! Ahem…
In his comments, Mac Taylor, the Legislature’s nonpartisan fiscal analyst, described the folly of trying to close the gap either by taxes or through spending cuts alone. A tax-only solution would require increasing the sales tax by 2 cents, adding a 15% surcharge to the personal income tax and hiking corporate taxes by 2% — making all of those taxes the highest in the nation, he said.
Taylor said erasing the budget gap by cuts would require lawmakers to end all funding for the University of California and state universities, welfare grants, developmental health services, mental health and in-home supportive services.
It’s of course a red herring that Democrats are seeking a “tax-only” solution, one that Karen Bass sadly saw fit to perpetuate yesterday by stating “I think some of my colleagues on both sides of the aisle are living in denial, frankly.” Um, every Democrat in the Legislature voted for a shared responsibility budget that raised revenue and implemented painful cuts. If Bass doesn’t want to make the fight at all, she ought to let everyone know. It’s not helpful to try and spread the blame equally. We have a Yacht Party that has no intention of lifting a finger in the face of crisis. In fact, they see it as their opportunity to drown government in the bathtub and eliminate the social safety net permanently.
This is why the state GOP is bordering on irrelevancy throughout the state (BTW, if you want to laugh, read Ron Nehring’s prescription for Republicans. Clueless and pathetic). Californians have thoroughly repudiated the Yacht Party vision. However, this is true everywhere but in the legislative chamber in Sacramento, where the 2/3 budget and tax rule allows them to hijack the legislature. In the long term, there is nothing to do but to capture a 2/3 majority and finish the irrelevancy project. In the interim, California’s Democratic lawmakers are better off flying to Washington, DC, where at least they’ll have a chance of getting money for state and local governments in the new stimulus package, then staying in Sacramento, where they have no shot at breaking the stalemate. That’s just reality.
Scared Straight didn’t work. On to DC.
UPDATE: This is better from Karen Bass. I’ll put the whole release on the flip, but she is, as she has been doing repeatedly throughout the crisis, calling for specific aid from DC. A taste:
Meeting with California Congressional leaders and President-elect Obama’s transition staff, Assembly Speaker Karen Bass today outlined specific steps the federal government can take to boost California’s economy and ensure that the state can actually benefit from stimulus packages currently under discussion.
“Infrastructure investment is critical to getting the national and state economies back on track,” Bass said. “But the major spending cuts and tax increases that California and other states will need to balance our budgets could undermine the success of any infrastructure stimulus efforts. Today, I shared with Representative Barbara Lee from the Appropriations Committee and President-elect Obama’s transition office California’s firm belief that direct federal assistance has to be part of an economic stimulus plan.”
more…
Bass was accompanied by Assemblymember Noreen Evans (D-Santa Rosa), Chair of the Assembly Budget Committee, who noted that California’s budget problems are directly linked to the revenue meltdown that followed the national recession and crises in the mortgage, credit and automotive sectors.
“We need federal aid because our troubled finances are the result of our nation’s economic downturn,” said Evans. “$25 billion of our $28 billion deficit comes from a revenue drop after the October stock market crash.”
In their meetings Bass and Evans emphasized several specific avenues for potential federal aid:
Maximize California’s Federal Medicaid Assistance Percentage (FMAP). Although California has a large number of low-income and disabled individuals eligible for the program, we receive only the minimum 50% sharing ratio from the federal government.
Reauthorize the State Children’s Health Insurance Program (SCHIP). Most states, including California, are overspending their SCHIP allocation and have exhausted their prior year unspent allocations. Reauthorization by March 2009 is critical.
Increase Food Stamp Funding. In California, roughly 1.7 million people receive food stamp benefits. Increased funding means more food purchasing power for children, adults and senior citizens.
Further Extend Unemployment Insurance Benefits. With an 8.2% unemployment rate California would benefit from a further UI extension, improved UI coverage and increased administrative funding for states to deal with the increasing number of applicants.
Increase State Criminal Alien Assistance Program Funding. California spends approximately $1 billion per year to incarcerate an estimated 18,000 undocumented felons. However, for the fiscal year 2008-2009, the state will only receive $111 million in reimbursement from the federal government.
Increase Pell Grant Funding. The credit crisis has made it much more difficult for families to qualify for student loans, especially private loans. For FY 09, the estimated overall Pell Grant shortfall is $3.5 billion. Pell Grant funding should be increased to ensure that adequate funds are available for all eligible students.
Bass and Evans also stressed the need for infrastructure investments as part of federal stimulus packages, including investment in transportation, housing, flood control and green technologies:
Transportation: Funding for California’s highways, transit systems, passenger rail and goods movements projects.
Housing: Housing construction related activities, foreclosure prevention and mitigation and housing market improvement policies.
Clean and Green Economic Sector: The economic stimulus infrastructure program should provide funding to help California achieve our renewal portfolio standard (RPS) goals through the siting, planning, and building of transmission lines, as well as funding for green job training programs for displaced workers, at-risk youth and veterans.
Flood Control Projects: California is eligible to receive $15M for flood control feasibility studies and over $112M for flood control projects. Federal funding should be provided for these important public safety projects.
“California stakeholders, including the legislature, the governor, city and county governments and other interested parties, are coming together to develop a list of projects and priorities for immediate federal infrastructure stimulus,” Bass said. “It is in the state’s best interest to speak with a united voice wherever possible in this process, so it’s important to have the stakeholders develop and vet such a list before making the case for individual projects.”
Bass added that the Assembly also intends to work closely with its Congressional partners as reauthorization of the Transportation Act approaches. Because reauthorization has such a potential impact on California and its economy, Speaker Bass will appoint a special Assembly Working Group in 2009 to help advance California’s interests throughout the reauthorization process.