Governor: Two “May Revise” Budgets Coming Thursday

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

Governor Schwarzenegger said Monday morning that he will release two revised budget proposals on Thursday to show voters the budget options, depending on whether the May 19 Special Election measures pass or fail.

The governor said one revised budget proposal would show the state spending plan in the event that all six measures pass; the other would show precisely what cuts he will propose if all the measures fail.

He said he was doing this “so that people have a clear understanding” of the situation. Schwarzenegger made this announcement after a meeting with local government officials from around Southern California at the Culver City Senior Center.

UPDATE — Governor’s office clarifies: The official May revise release is May 28. But they are going to release two "summaries" — one if the measures pass, one if they fail — on Thursday.

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Let’s Get the Election Over With So The Real Campaign Can Begin

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

Most of the time, Yogi Berra is right. It’s not over ‘til it’s over. But when it comes to the May 19 special election in California, folks are behaving like it’s over.

The election campaign has been a small, relatively cheap one. The back-and-forth charges have been fairly civil. Given the condition of the state, one would expect a heated campaign. But the only real heat is being generated by fighting over what happens after the election. Schwarzenegger, Democratic legislative leaders, and their allies are predicting that their opponents, by defeating the special election measures, will be pushing the state over the cliff. The left is accusing the governor and legislative leaders of fear-mongering. The right is blasting at the left for planning tax increases.

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Could Feds take over management of California?

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

If you haven’t read this week’s report by the non-partisan Legislative Analyst’s Office, you must. There’s plenty of bad news about the state being low on cash, but that we knew. Here’s what knocked me over:

Federal Assistance Could Come With “Strings Attached.” We believe it is appropriate for the Treasurer to explore the possibility of federal assistance—such as a federal loan guarantee—to address this summer and fall’s grim cash outlook. We caution the Legislature, however, against assuming such federal assistance will be available. By taking prompt actions to reduce the state’s cash flow borrowing need to under $10 billion for 2009–10, policymakers would enhance the ability of the Treasurer and Controller to secure private investment with or without a federal loan guarantee. Moreover, reducing the state’s cash flow borrowing will involve actions that improve the state’s medium– and long–term budgetary outlook. These actions would increase confidence in the bond markets, which are needed to continue providing funds for infrastructure projects that spur economic activity and long–term growth. Finally, and perhaps most importantly, we advise the Legislature and other state policymakers to be cautious about accepting any strings that might be attached to federal assistance. Strings attached to recent corporate bailouts—as well as federal loan guarantees provided to New York City during its fiscal crisis three decades ago—have included measures to remove financial and operational autonomy from executives. We recommend that the Legislature agree to no substantial diminishment in the role of California’s elected state leaders. In our opinion, the difficult decisions to balance the state’s budget now are preferable to Californians losing some control over the state’s finances and priorities to federal officials for years to come. (Italics are mine)

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Swine Flu and the Special Election

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

I’m reluctant to raise this topic. So much of the media discussion of swine flu seems intended to scare, not inform. The government’s basic advice — to go about your business, but wash your hands, stay home if you’re sick, etc. — seems perfectly reasonable. The state shouldn’t do anything that would add to the fear.

But I wonder about the impact the swine flu might have on turnout in the special election. Schools are closing. Some public events are being delayed. And some people seem to be staying inside out of an abundance of caution. It’s a strange time, then, to ask people to get out and vote. And many polling places are schools, after all.

A lifelong student of California politics — someone much older and wise than me — suggested to me earlier this week that the state needs to take a hard look at postponing the election, particularly if the situation grows more serious. And perhaps, even if it’s only the fear about the flu, and not the flu itself, that grows. Apparently, the state is studying the issue. In response to my question about the special election and the state’s rules for postponing elections in the event of pandemics, earthquakes or other serious problems, Kate Folmar, press secretary to Secretary of State Debra Bowen, emailed:

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Arnold the Lawyer

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

I’m rarely surprised by anything Arnold Schwarzenegger says (I literally wrote the book), but his interview with George Skelton for an LA Times column Monday is an exception. The governor is many things when he talks — over-the-top, funny, irreverent — but he’s rarely lawyerly. But lawyerly he was with Skelton. And he was lawyerly in a way that hurts his credibility and undermines the case for the ballot measures.

Here’s one problem quote: “It’s not fair, really, to say that [1A] raises taxes. I understand that the right spins it that way. But it’s disingenuous.” Yes, technically, Prop 1A doesn’t include a tax increase, but other legislation would extend temporary tax increases for two years if 1A passes. For us non-lawyers, that’s a distinction without a difference.

Here’s another: “We should just simply describe 1A as a measure that will fix the broken budget system once and for all so that you never have to make those severe cuts again. And you never have to go back to the people for tax increases again. That’s it.”

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The End for Bass? Villines?

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

Three weeks to the special election, and defeat looks likely for Props 1A-1E. The governor and legislators who cut the budget deal that includes the measures have talked in the broadest, scariest terms about what happens if the measures fail – the state could go bankrupt! Or off a cliff! Or it goes bankrupt as it goes off the cliff! (Does the long fall erase the debt?).

But the first casualties of defeat likely would be political, not economic. It’s hard for me to see the Democratic and Republican leaders in the Assembly surviving such a defeat. Both Karen Bass and Mike Villines have put their prestige and credibility on the line in making the deal, and defending it. In doing so, they’ve taken a big political risk, and for a good reason. Without a deal, the state’s cash crunch would have hurt not only the government but also the economy.

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Your House Is On Fire — The Special Election Choice.

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

I recently asked Assembly Speaker Karen Bass to respond to the argument against the special election ballot measures that I most often hear from people on the left. In its essence, that argument is: these measures were produced by a bad deal that was forced upon Democrats by Republicans using the leverage of the two-thirds vote requirement for passing taxes and the budget. So we should vote down these measures and use the crisis to push for reforms, like replacing the two-thirds requirement with a majority vote.

Bass responded to my question quickly and fiercely: “The house is on fire! The house is on fire!” she repeated. She went on to say that she’s for eliminating the two-thirds requirement too, and for other bigger structural reforms. But those will take time. Right now, the state is in a crisis. When your house is on fire, she argued, you have to put the fire out.

One could argue with Bass’ stance, but I think she’s 100 percent right in her choice of metaphor. The choice facing voters in the special election boils down to as much a question of strategy as ideology: when your house is burning, what do you do?

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Is SEIU Setting Fire to the House of Labor?

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

After all the rumors and build-up and speculation about how much the Service Employees International Union might campaign against Prop 1A, the SEIU state council came out strongly against the rainy day fund proposal last week because… well, let’s look at the press release from SEIU and its coalition of anti-1A unions.

1A is disturbingly long…. (“close to 3000 words”)… and full of “confusing information”… and “complex formulas.” Who, the unions ask, would responsibly vote on such a document?

Of course, such a description – long, confusing, full of complex financial formulas — could apply to other documents. For example, union contracts. Except those union contracts would be closer to 30,000 words than 3,000. But I appreciate SEIU’s newfound devotion to simplicity. In the name of consistency, I’m sure the union will renounce its support for collective bargaining and ask the legislature and governor not to approve Local 1000’s new contract. After all, who would vote responsibly on such a long and confusing document?

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The State of California Owes Me Money

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

INVOICE

From: Joe Mathews
To: State Controller
CC: The Legislature, the Governor
Re: Unpaid Wages And Back Pay

Please consider this my bill for $7786 in unpaid wages and back pay for my work as a California lawmaker.

Yes, I know we have a highly professional, full-time legislature, but those guys keep kicking the toughest decisions about laws and constitutional amendments to me. They can’t even pass a budget these days without putting six measures on the ballot and calling a special election. And big interest groups and rich guys keep throwing things on the ballot for me to decide too.

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Do Editorial Boards Still Matter?

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

One day back in 2005, when I was reporting a book on Gov. Schwarzenegger and his use of ballot initiatives, Todd Harris, then a political consultant for the governor, greeted me triumphantly.

“36 for 36!” he said.

Harris was talking about Prop 77, the redistricting reform initiative the governor was backing on the special election ballot that year. After many weeks of work, the governor’s campaign had convinced all 36 of the state’s largest newspapers to endorse Prop 77.

The editorials didn’t make a bit of difference. Prop 77 lost.

In recent weeks, when I ask people on different sides of the special election ballot measures what they’re up to, the answer is often: I’m on my way to meet an editorial board.

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