Author: Joel Fox

California is sinking in a quicksand of debt but an initiative awaiting title and summary may have the answer to reduce the debt burden.

First, a review of the problem.

On Monday, the Assembly Budget Committee met to bemoan California’s rising debt obligation. With California sitting on $83.5 billion of long-term debt, the debt is costing the state treasury $6 billion a year. Over the last decade, cost of servicing the debt has increased 6.5 times faster than the increase of general fund revenues, which are used to pay down general obligation bonded debt.

Treasurer Bill Lockyer and Legislative Analyst Mac Taylor told the legislative hearing that bond service would hit ten percent in a few years. Since servicing debt has first call on the state’s revenue after schools that means that one out of every ten dollars will be used to retire debt and squeeze out funding for other government services.

The venue that snares the March boxing match between Floyd Mayweather Jr. and Manny Pacquiao will add millions to the host city’s bottom line. Count California cities out. The reason? Taxes.

The Mayweather-Pacquiao fight is one of the most anticipated in the pugilist world in a long time. Looking forward to a big payday, the Staples Center in Los Angeles offered a $20 million site fee to host the event. Not to be outdone, Jerry Jones, owner of the Dallas Cowboys, said he would host the event in his new football stadium and pay $25 million for the event.

Before any serious bidding war could take place, Pacquiao’s U.S. business advisor threw cold water on the Staples Center offer. Noting that Paciquino would have to pay millions in taxes to California under the current 10.55% top tax rate, the advisor said the fighter didn’t want to fight in California when there were alternatives in no income tax states like Texas and Nevada.

The battle over Race to the Top federal education grants is a perfect example of what’s wrong with California lawmaking and lawmakers. To satisfy federal guidelines and capture up to $700 million in federal Race to the Top school reform funds, separate factions in the legislature have engaged in a tug of war instead of pulling on the same end of the rope to secure the funds.

As usual, there is one faction of lawmakers doing union bidding. The unions object to the stronger charter school language in the bill passed by the Senate that also gives more power to those pesky parents who demand excellence from their children’s schools.

Under the Senate bill, authored by Gloria Romero (D-Los Angeles), if a petition is signed by more than fifty percent of the parents, the school may be taken over by new leadership, including charter school operators. The union backed Assembly bill put forward by Julia Brownley (D-Santa Monica) offers a watered down version of the parent trigger, which would just set off a bureaucratic paradise of hearings and little action to improve education for students.

On a cold, bright winter day in December 1986 I waited with a throng of reporters and aircraft devotees in the Mojave Desert for the return of the Voyager. The specially built aircraft designed by Burt Rutan and piloted by his brother Dick Rutan and Jean Yeager was completing a nine-day first ever non-stop flight around the globe. I thought of that event as I watched on the Internet the Mojave ceremony unveiling the latest Burt Rutan flying craft, the Virgin Space Ship Enterprise – the first commercial manned spacecraft.

Sponsored in large part by entrepreneur Sir Richard Branson, the spacecraft, which can carry six passengers and two pilots, was developed and built in California at the Mojave Air and Space Port. It will be tested there for a couple of years before moving to its home at Spaceport America in New Mexico.

Both California Governor Arnold Schwarzenegger and New Mexico Governor Bill Richardson attended the ceremony on Monday.

Is there another Willie Brown in the house, a Democratic assembly member who can play political chess as adeptly as the legendary former Assembly Speaker? The ghost of Willie Brown-Past and his political maneuvering hovers over the current Assembly speakership fight.

Competing for the Speaker’s post are two Los Angeles Democrats—John Perez and Kevin DeLeon. Current Speaker Karen Bass believes Perez has the votes in the Democratic caucus to take the position but those votes have not been counted yet. DeLeon’s supporters think he can still prevail.

Another Democratic assembly member might seize the opportunity caused by the caucus split to sneak into the speaker’s chair with the help of unusual allies: Republicans. Nearly thirty years ago, Willie Brown rounded up Republicans to pull the speakership from under the noses of fellow Democrats Leo McCarthy and Howard Berman who were tussling over the post. Brown began his record setting fifteen-year run as speaker by persuading 28 Republicans to join 23 Democrats and put him in the speaker’s chair.

The California Tax Reform Association claims to have the formula to solve the budget crisis. The association issued a list of ten tax increases, which it claims will raise more than $20 billion dollars. According to the group, these tax increases will have little impact on economic recovery, so the governor and legislature should immediately go after the listed taxes, which the organization described as “low hanging fruit.”

The problem is this ”low hanging fruit” is rotten. Devouring it will lead to economic illness and the death of jobs.

The rotten fruit list includes tax increases on business property, oil, tobacco, alcohol, businesses, vehicle licenses, top income brackets and more.

All these tax increases and no damage to an economic recovery? These must be magical tax increases.

The Open Primary measure on the June 2010 primary ballot is identified with state Senator Abel Maldonado who was instrumental in getting the proposal on the ballot. However, Republican gubernatorial candidate Tom Campbell might see the measure as a device that could help pull him across the finish line and gain the nomination.

Campbell has legitimate grounds for attaching himself to the Open Primary measure and calling it his own. He was the major sponsor of California’s original Open Primary effort, Proposition 198 on the March 1996 primary ballot. That proposition passed 60-percent to 40-percent despite united opposition from the Republican and Democratic parties. (The United States Supreme Court on constitutional grounds later threw it out; but the new measure supposedly deals with the court’s concerns.)

An Open Primary allows the top two finishers in a primary race, regardless of party, to face each other in the general election. Campbell’s argument more than a decade ago was that an Open Primary would elect more moderate candidates who could work together in Sacramento and get things done. That argument very well could register with voters today. The voters in poll after poll have revealed their disgust with the goings-on and lack of productivity in Sacramento.

Look up a mention of Assemblyman John Perez and invariably you see his identification as cousin of Los Angeles Mayor Antonio Villaraigosa. Soon, however, Perez may not need his cousin’s fame as a reference point if he secures the votes necessary to become the next speaker of the California Assembly.

Reports have Perez closing in on the 26 Democratic members’ votes he will need to capture the top spot in the Assembly. Only one year in office serving in the same district of former speaker Fabian Nunez, Perez could hold the speaker’s chair for five years in the term-limited legislature.

One of the big questions about Perez will be how he will deal with public employee unions. The public unions are strong supporters of the Democratic Party and Perez is a union man. In his pre-Assembly days, he was a leader of the United Food and Commercial Workers union.

Big names in the movie business are stepping up to support Jerry Brown’s gubernatorial bid, Carla Marinucci noted in her San Francisco Chronicle blog yesterday. So what is Jerry Brown saying about saving the movie industry for California?

Here’s hoping the Steven Spielbergs and Rob Reiners of the world put in a good word along with their donations for keeping the movie industry in the state where it blossomed. And, here’s also hoping that the big time movie execs realize that moving movie productions out of California add to the state’s unemployment and fiscal woes.

Not many people would mistake Santa Barbara for New York. However, the movie, “It’s Complicated,” starring Meryl Streep, Alec Baldwin and Steve Martin debuting Christmas Day is a story set in Santa Barbara but filmed mostly in New York City. The producers swept into Santa Barbara for only three days of shooting exterior scenes. They spent months filming in New York.