Author: Joel Fox

The sequel, “Special Session 2, The Budget Monster is Still With Us” will have to end differently than “Special Session 1, Taming the Budget Monster.” You remember that one. It bombed at the box office, wasn’t around very long. In the end of that Special Session nothing much happened. The monster won.

So now a new cast of characters has joined the fight against the monster. Fortified by fresh blood from new recruits freshly arrived in Sacramento, the plan is to take down the monster this time. And there’s no question that this sequel will have a different ending. Because if nothing happens to the monster, quite a lot will happen to the state of California.

The state will run out of money to pay its bills. Vendors, recipients of state largess and probably public employees will feel the blow. But, all Californians will feel the effects. Interest rates on state bonds will explode, bankruptcies could ensue. It’s not a pretty picture.

Welcome new legislators! Here’s the first thing you have to do in the capitol once you are sworn in. Go find the bathrooms. Take a tour. Get a architectural plan of the capitol. Do what is ever necessary to find the bathrooms. Do it now. Why? Because in this era of term limits you have very little time to become experts on governing California.

We’ve all heard the phrase attached to the argument that because of term limits new legislators only have enough time to “find the bathroom” before they are term limited out. That means that the legislators cannot come to grips with the policy and politics of Sacramento to make important changes in California’s governance. They only have time to get their feet wet—then presto, they’re gone.

Whether current term limits are good or not is not the point here. Term limits is the law that the new class of 25 novice legislators will serve under. So there is no time for excuses, they have to get up to speed quickly.

Where do reporters who cover California politics think the state is heading post election 2008? That was the area under discussion behind the Friday lunch time panel at a post election conference held at the University of Southern California sponsored by USC’s Jesse Unruh Institute and Politico.

Unruh Institute Director Dan Schnur and USC Daily Trojan political reporter Catherine Lyons fired questions at a panel of California reporters and editors who combined have been watching Golden State politics for well over a century.

To the question, can President-elect Barack Obama look to California as a model for bi-partisanship or, as Governor Schwarzenegger frequently trumpets in his speeches away from the capitol, a post-partisan world? The answer was a decided No. Amy Chance of the Sacramento Bee noted that in the eyes of Republican elected officials post partisanship means one Republican, the governor, and the Democrats. Capitol Weekly’s Anthony York said the lesson for Obama out of California is to beware of your friends, they are more dangerous than your enemies.

Can small businesses band together to influence policy that relates to their interests? That optimistic hope floated in the air at the first Governor’s Conference on Small Business and Entrepreneurship in Los Angeles last week.

The two day conference led by the state’s Small Business Advocate, Marty Keller, focused on issues important to the small business community.

Listening to experts on business and the need to create an entrepreneurial state, attendees considered a number of areas to improve small business in the state.

The ten issues addressed by the conference were: Concerns over the AB-32 greenhouse gases law; Access to Capital; Entrepreneurial Encouragement; Health Care; Innovation and Technology; Procurement (for small business wanting to do business with the state); Regulatory Reform; Transportation; Taxation; and Workforce Development.

Talk in Sacramento is that a deal on the budget deficit has advanced along these lines: Return the vehicle license fee (the car tax) to the former level of 2% from the current tax on a car’s value of two-thirds of 1% and put a population/inflation spending cap on the ballot.

Since the tax goes up before the voters have a chance to vote on the spending cap (probably in June; perhaps March) there is a risk that taxes will be increased but spending will not be capped. Spending interests will surely try to defeat a spending cap measure.

To off set this problem, any tax increase proposed as part of the budget solution should carry a sunset provision in case the spending cap fails at the polls. The sunset could occur at an agreed upon set time following the spending cap election.

Little progress seems to be made on the state’s budget fiasco during the special session called by the governor. Now we have a new report from Beacon Economics, commissioned by California Forward, that fiscal matters are worse than we thought. The report says we are at the edge of a "fiscal cliff."

And, during this dire crisis where are some of our elected representatives? Wandering on "fact-finding" trips all over the globe.

The San Francisco Chronicle reported about two dozen lawmakers are traveling to places like India, China, and Hawaii. You can find a list of the wandering members in the Chronicle article.

Sacramento Bee columnist Dan Walters today raised the question whether a split roll property tax increase will be considered to increase tax revenues. The split roll refers to the fact that all property is taxed the same under Proposition 13 (as it was before Proposition 13, by the way) but the roll could be split between business and residential property by putting different rules and thus a heavier tax burden on business property.

Walters points out that critics of Prop 13 have long claimed that business gets a break under Proposition 13. The theory goes business property changes hands less frequently than residential property, therefore is re-assessed less frequently and pays proportionately less.

Scholar and analyst Joel Kotkin gives his perspective on California’s troubles in an article entitled, "Sundown for California."

Kotkin writes, "The real problem lies in the decline of the state’s political culture. "Our society may be evolving spectacularly but our politics are devolving," suggests (Kevin) Starr, the state’s most eminent historian. "California is in no way a role model for anyone from outside the state."

Read the entire piece here.

Political consultant Garry South usually has a pretty interesting take on things, and that especially goes for the 2010 governor’s race. South offered his opinions at the California Chamber of Commerce post election conference last week.

South has a candidate who may jump into the governor’s race—San Francisco Mayor Gavin Newsom. But South doesn’t think the other California big city mayor, Antonio Villaraigosa, makes the leap. His reasoning is timing. Villaraigosa runs for re-election in March. Even if he wins, the L.A. mayor is not sworn in until July. South can’t see Villaraigosa pledging fidelity to the Los Angeles voters right up to swearing-in day and suddenly announcing a run for governor. On top of whatever embarrassment that would bring, South points out Villaraigosa will only have eleven months to build up a campaign war chest before the primary. Not enough time, says South.