Author: Joel Fox

Reforming California’s dysfunctional government has become a boom industry. The legislature, foundations, activists, and reformers of all stripes are trying to find the golden key to set California straight. Now academic institutions are offering symposiums to study the problem and perhaps move toward solutions.

Two conferences are set in the coming weeks. Both are free to the public. Academics will join interest group leaders and policymakers to explore the state of the state. (I’ll be a panelist at both events.)

On Wednesday, October 14 the conference at the Sacramento Convention Center is titled: Getting to Reform: Avenues to Constitutional Change in California. Sponsored by UC Berkeley’s Robert T. Matsui Center for Politics & Public Service; Center for California Studies at Cal State Sacramento; and Stanford’s Bill Lane Center for the Study of the American West, the one-day conference will examine the advantages and drawbacks of alternative paths to constitutional change, including a look at a potential constitutional convention. See the conference agenda here.

Yes siree, ladies and gentleman, the horse race for governor has begun. The horses are jockeying for position, mud flying, as they hurtle down the straightaway.

There’s Meg Whitman splattered over and over again with her voting record. She’s trying to avoid some more mud as she moves to the outside, hollering that she did so vote … once or twice.

Steve Poizner is moving to the right to get away from a smash-up in the middle of the track. But he can’t duck the glob of donations he made to Al Gore, or was that his stable mate. We can’t quite tell from here, but it seems the mud is sticking.

And, there’s the old war horse, Jerry Brown, biding his time along the rail. Brown still has mud stains splattered on his shirt from forty years of going around the track. And, there appears to be a new stain. Did he actually appear at a fundraiser for a hard core Republican DA in San Bernadino County? Wow! That won’t wash out so easily. Like trying to explain to your wife that lipstick on the collar.

Powerful interests are making last minute decisions on which initiatives to put forward to achieve their goals. At the same time they are practicing a bit of brinkmanship, determining which measures their opponents truly back, while deciding which ones their side will file if opponents put up an initiative they abhor.

Call it MAD – a case of Mutually Assured Destruction. The old Cold War term has been defined as a doctrine that “assumes that each side has enough nuclear weaponry to destroy the other side and that either side, if attacked for any reason by the other, would retaliate with equal or greater force.”

Over the next three weeks or so, initiatives will be filed in hopes of qualifying for the November 2010 ballot. Some initiatives would prompt counter moves setting off a true initiative war. There are, of course, a number of initiatives that have already emerged from the Attorney General’s Office but we’re looking for the measures that expect to receive big money support.

The push is on for a soda tax. Supporters say it’s a way to improve health problems, and oh, by the way, you could close those messy government budget gaps. Well, which is it? If raising taxes on sugary drinks is supposed to cut down on the use of those products why expect a declining revenue source to deal with a budget problem?

This is the same argument often made to support tobacco tax increases. While raising taxes would cut consumption that means that any tax revenue attached to a product would likely fall over time. Such taxes will not be the answer to solving the budget crisis.

Yet, according to a Los Angeles Times article, the Center for Science in the Public Interest, said billions of dollars can be raised to offset budget problems with a soda tax increase. Yale University has a calculator on a website to determine how much a state or city could raise with a tax on sugary drinks.

The California Target Book, published by Fox and Hounds Daily contributor Allan Hoffenblum, tracks the state’s political races. The Target Book sponsored a conference yesterday to peer into the crystal ball at the 2010 races; the attitude of California voters; and a look at the dysfunction of California governance. Some notes jotted down at the conference:

• Democratic Pollster David Binder says its wrong to think voters are against all taxes. They are opposed to taxes on themselves but are willing to approve taxes on corporations and businesses. But, Binder admits, a counter argument that raising taxes on business could affect jobs in the state has some effect.

• Binder says Decline to State voters (DTS) are becoming disenchanted with the Republican Party. DTS voters make up 20% of the electorate, and as Republican pollster, Steve Kinney, commented, the independents decide elections.

• State Treasurer Bill Lockyer, in trying to explain the discord in the legislature, said he believes Republicans who serve in the legislature have changed since his day. They are less pragmatic.

Governor Arnold Schwarzenegger liked what he saw and heard from the tax commission when commissioners handed over their report to him. He gave the proposal a thumbs up and said he’d sign the plan into law immediately if he could. However, those thumbs were way up and his energy was much higher when he addressed the gathering at the Governors’ Climate Summit 2 in Los Angeles, yesterday,

To be sure, there were stark differences in the two events. At the climate summit the governor was playing to an admiring audience of world and environmental leaders while at the press conference he was talking to a bunch of grumpy reporters who he sees on a regular basis.

The environmental extravaganza plays into his grassroots stirring of a “Green Revolution”, as he called it, for which he has received international acclaim. With the tax proposal he faces an unruly legislature, which will demand changes and then most likely sink the whole proposal. He’s been down that rocky road too many times before to think its any fun.

Nine members of the tax commission signed the final report submitted yesterday to the governor and the legislature. Five members refused to sign. Ironically, if this proposal were a tax measure it would fail because it did not receive a two-thirds vote.

Justification for the two-thirds vote found multiple times in the state and federal constitutions means consensus has been achieved on important matters. There was no consensus within the commission that this tax plan is the remedy for what ails California.

The final report from the Commission on the 21st Century Economy was a bold attempt to re-make the state’s tax landscape. The spirit of what was attempted – restructuring tax codes to fund government through economic growth – should be applauded. There should be no penalty for producing a daring, experimental plan.

However, the plan is centered on a new tax proposal that violates a basic canon of good tax policy. The business nets receipts tax (BNRT) is unclear. Taxpayers do not know how it will affect them.

Protests at UC Berkeley and other UCs yesterday objected to budget cuts to the university system. The day before, at UC Berkeley, professors told an audience of students why the university was in such difficulties and why they should actively protest. Many speakers blamed Proposition 13, of course. But, according to the Daily Californian one political science professor said that the tax revolt was "rebellion against democracy; keep what you earn and no democracy can tell you otherwise."

Under the faded letters on a building wall spelling out CALIFORNIA, hung a banner declaring: Meg 2010, A New California. The juxtaposition of the faded letters with the hope of renewal was quite intentional as Meg Whitman announced the theme for her gubernatorial campaign.

Declaring her candidacy under a blazing sun in Fullerton, Whitman promised to focus on three key issues to build a New California: creating jobs, stopping and slashing regulations, and improving education.

Timing is everything, they say, and the candidate’s hard-hitting attack on business regulations could not have been better timed. Less than a day before the announcement, a study mandated by the legislature on the cost of regulation on California small business was released. It revealed some staggering numbers.

The report said that regulation costs small business nearly $493 billion and 3.8 million jobs in California. In her speech, Whitman promised, “On my first day in office, I’ll issue a moratorium on all new regulations until our economy has begun to recover.”