Change the Voters Want

Our friends over at the lively website, Calbuzz, lamented the fact that with the exit of Gavin Newsom from the gubernatorial race there is no candidate that stands for authentic change. The particulars of the change they highlighted from the Newsom campaign were supporting a constitutional convention, changing the budget process, and taking a hammer and wrench to Proposition 13.

Perhaps the reason for Newsom’s early exit from the campaign is because those are not the kind of changes the voters want.

Citizens are angry and disgusted because government doesn’t work. However, voters are smart enough to know that not all medicine will revive the patient and some remedies could make the patient sicker. Taxing business property would not jumpstart the economy. It would cost jobs. Lowering the two-thirds vote to raise taxes leads to increased tax rates, but will it result in the expected revenue? The tax increase of February is already coming up short by billions of dollars. California’s economy doesn’t need another punch in the gut.

The Dominoes Fall and the Next Governor Is…..

Gavin Newsom pulled out of the governor’s race and set the punditry world abuzz about the possibilities of another Democrat jumping into the June primary. While some Democrats like the idea of a clear field for Attorney General Jerry Brown, still nominally exploring a run, others asked, as expressed by former Assembly Speaker Willie Brown in his S.F. Chronicle column in reference to the 71 year old Brown with 40 years in the political world, “Can’t we find someone with a newer paint job?”

Names flying off the page include Treasurer Bill Lockyer, former Controller Steve Westly, L.A. Mayor Antonio Villaraigosa, Congress members Loretta Sanchez and Jane Harman, and, of course, the old standby, U. S. Senator Dianne Feinstein.

Old not being an indication of age here, even though she is Brown’s senior by five years. Old in the sense her name has been linked to the governor’s chair for twenty years.

All the Would–Be Governors’ Men

For the first time since the field of potential gubernatorial candidates narrowed to five, consultants for all the candidates appeared on the same stage at the California Chamber of Commerce’s Fall Public Affairs retreat in Napa yesterday.

Steve Glazer, advisor to Jerry Brown’s exploratory committee, joined Garry South chief advisor to the Gavin Newsom campaign, Jim Bognet, Steve Poizner’s campaign manager, Jamie Fisfis with Tom Campbell and Rob Stutzman, consultant to Meg Whitman.

The spin masters dodged and weaved and spun their way through a lively hour-plus presentation.

South said his candidate, Gavin Newsom, did not have to worry about his standing in the polls well behind Jerry Brown, pointing to a number of gubernatorial races over the past two decades in which the leading candidate for governor in early polls did not win.

Can This Con-Con Measure Pass?

The game is on in quest of a new constitution for California. In filing the initiative to call a state constitutional convention, Jim Wunderman of the Bay Area Council said this is an “historic day” for the state.

Perhaps. Getting the call for a constitutional convention approved by the voters and successfully creating a new constitution faces many hurdles. Elsewhere on this site, Joe Mathews gives a run down on the details involved with establishing the convention, including the complicated delegate selection process. Loren Kaye contributes his view on the powerful Clerk position created for the convention as proposed by the initiative.

My purpose is to give some thought to whether this constitutional convention measure might pass if it qualifies for the ballot.

The complication of the delegate selection process will work against it. Just reading the paragraph dealing with delegate selection in the million-plus population cities repeated word for word in the Mathews piece would move voters to grab bottles of aspirin. Not knowing where a convention could lead will make for an unsteady hand as voters reach to mark a ballot.

A Backward Oil Tax Strategy

Once again there is a call for a tax on oil to help solve California’s budget problems. Assemblyman Pedro Nava called for a 10 percent oil severance tax piling on Assemblyman Alberto Torrico’s bill that would establish a 9.9 percent oil tax dedicated to higher education.

Both plans are a backward way to look at taxing oil extraction.

Adding another tax on oil companies for taking crude out of the ground will discourage production. Since practically all oil taken from the ground in California stays in the state, lower production will mean more reliance on foreign oil.

The cost of the product will undoubtedly increase, although Nava intends to prevent that with government price controls. He wants the Board of Equalization to monitor price increases to make sure that price increases at the pump are not a backfill for the tax. If prices do increase to make up for the tax, the bill would allow the attorney general to take action against the oil company. Did we mention Nava wants to be the next attorney general?

‘Pension Tsunami’ Spreads the Word

As I stated last week, the pension issue is gaining traction.

One major reason is that the mainstream media has taken notice. The media  has had help. The website, Pension Tsunami, gathers articles and facts about  public pension news from around the country. Collected and assembled by Jack Dean, one time Libertarian candidate for U. S. Senate in California and president of the Fullerton Association of Concerned Taxpayers, the articles are distributed to more than 1,400 subscribers nationally, with the heaviest concentration in California.

While others have raised concerns about the pension issue, such as the Calpensions web site, I mentioned last week and talk radio hosts, Dean has been feeding material to radio hosts and news reporters and bloggers for five years.

He’s had a major impact.

Lessons from Bill Lockyer

State Treasurer Bill Lockyer generated a storm last week with his testimony before the Senate and Assembly Select Committees on Improving State Government.

He warned that public pensions and health care costs could bankrupt the state, that taxes will not go up, and that the legislature should clean up its act by getting rid of “junk” bills. An edited clip of his testimony can be viewed here.

Some might argue this was Lockyer’s Nixon-to-China moment, telling his Democratic colleagues to deal forthrightly with the state’s fiscal realities. In FlashReport, Former Republican State Senator Ray Haynes that Lockyer as the state senate leader had a different view of pensions, but now welcomed him to the fight.

The former legislative leader and former attorney general is no stranger to bold speaking.

More and More Initiatives; Newsom; Status Quo Debate

Initiatives, initiatives and more initiatives. By my count there are 50 initiative measures either already cleared by the Attorney General’s Office or sitting in the IN basket. And, some of the expected big money initiatives have not been filed yet. No split roll, spending limit, oil severance tax or even the measure to call for a constitutional convention.

Voters could get an advanced degree in political science if the ballot book is chock full of legal language, analysis and political arguments next Fall. Measures already filed cover familiar ground including abortions; the two-thirds vote requirement (both dealing with taxes and the budget and the budget alone); term limits; local government protections; and closing tax loopholes or denying business incentives, depending on your point of view.

Hold on to your hat, the initiative battles could outshine the governor’s race and certainly outspend the gubernatorial candidates even with a couple of billionaires vying for the state’s top spot.

Solving the Budget Crisis is Like Living Through “Groundhog Day”

I had a sense I was in the movie “Groundhog Day” at the Milken Institute State of the State conference in Beverly Hills yesterday. Each year it seems experts at the annual conference are discussing how California can right the ship and solve the state’s fiscal problems. Different actors but the same play over again.

The morning panel session called Time For Change: How to Reform the State’s Budget Process featured an all-star cast. Former Governor Pete Wilson shared the podium with Treasurer Bill Lockyer, Former Assembly Speaker Bob Hertzberg, State Controller John Chiang, and California Finance Director Mike Genest.

Solutions were familiar as were objections to proposed solutions. Differences were aired. There was no lightening strike solving the budget crisis. However, some interesting points were made.

Pension Issue Rises

The public employee pension issue is gaining traction. Results from the recent Field Poll indicate that voters are becoming concerned with the potential cost to the taxpayers as a majority of those polled support changes to the government pension system. Polling the public on pension issues has hardly ever been done.

Public pressure from newspaper editorials and a radio ad campaign by the Howard Jarvis Taxpayers Association against a Metropolitan Water District pension increase plan forced the water district’s governing body to pull the pension proposal off its agenda last week. Rallying public opposition to a pension program is not something you see everyday.

Part of the responsibility for this public awareness of pensions falls to the California Foundation for Fiscal Responsibility founded by former Assemblyman Keith Richman. Current president Marcia Fritz has led the organization on an aggressive education campaign to inform the public about pension excesses and potential taxpayer liability.