Governor Must Stay Strong on Budget Math, Compromise on Taxes

Governor Schwarzenegger is right to demand that the legislature deal with the entire $24 billion shortfall. Why? Because the budget crisis we face now is itself product of previous budget deals that didn’t solve the whole problem.

The examples are immediate. Even before the ink was dry on February’s deal, the state had another $8 billion shortfall. With the voters’ rejection of some $6 billion in budget solutions and the continued decline in revenues, that shortfall has grown to today’s shortfall. And last fall’s budget was out of balance nearly as soon as it’s signed.

The Importance of Governors And Their Schedules

The self-destruction of Mark Sanford raises an issue that usually only gets talked about in newsrooms: the need for governors and other elected executives to put out detailed schedules, and the fact that many of them fail to do so.

Sanford, according to press reports, didn’t release his schedules. Reporters and editors in South Carolina complained, but the issue never attracted public attention. And so the governor of the Palmetto State managed to escape scrutiny of his activities for far too long.

That – and not Sanford’s personal behavior – is the public outrage in this sordid story.

Yes, yes, I’ve heard all the arguments from the staffers who advise governors and elected officials. “Disclosing our full schedule would compromise strategy.” “The governor has the right to secrecy in his deliberations.” “It’s a matter of protecting the governor’s security, though I’m not at liberty to discuss the details…” Blah. Blah. Blah.

Was Pete Wilson Right?

I’m interviewing former Gov. Pete Wilson this evening (MONDAY JUNE 29) at 7 p.m. at the RAND Corporation in Santa Monica. The event, sponsored by Zocalo Public Square, is free and open to the public.

Wilson left office more than 10 years ago, but a look at his record as governor couldn’t be more timely. There’s a conventional wisdom now that our state is ungovernable. But Wilson faced nearly all of the challenges that currently face our state – an economic downturn, the collapse of the real estate market, a cash shortage that could require IOUs, a huge budget deficit, partisan infighting. He had to battle with all the same powerful interest groups that are blamed for gridlock today. But, whatever you think of his policies, he managed to make some progress and leave his successor with a balanced budget.

Prop 13: What Is to Be Done?

Prop 13 is once again being blamed for just about everything. I don’t agree with this site’s master, Joel Fox, on much, but I do agree with him that Prop 13 gets blamed far too often for California’s troubles, and for far too many of those troubles.

Where we don’t agree is on 13 itself. I think the state’s future requires making changes in it. We’re going to see attempts next year to use the ballot to lift the Prop 13 limits on property tax increases, at least as they apply to commercial property. This is the so-called split roll. We’ll also may see an initiative to roll back the requirement of a two-thirds vote to raise taxes.

I’d like to see both changes, but the time is right only for one, not the other.

Ending the super-majority requirement is urgently needed. Whether you’re on the left or the right, whether you think taxes are too high or too low, it’s undeniable that the super-majority requirement makes it very, very hard to govern our state. Getting two-thirds of legislators to agree on anything is just about impossible. So California lawmakers are unable to respond in any sort of coherent or timely way, even in the midst of an economic and fiscal crisis.

California to Feds: Drop Dead

This article originally appeared in Sunday’s Washington Post

Sure, California’s economy has seen better days, our budget is a mess, and we’ve been wondering whether the federal government might help us out with our cash flow. But the barbs sent our way by politicians and commentators in Washington are getting to be a bit much.

Democrats suggest that we’re all selfish folks who refuse to tax ourselves enough to support our spending. (They should talk.) Republicans say the entire state is addicted to over-spending. (They should talk, too — see the rising deficits of the Bush era.) Such commentary has been offered with heaping plates of schadenfreude, as if our devotion to surf, sunshine, personal fitness and Kobe Bryant meant that we deserve damnation. Writers at the Atlantic have admitted to enjoying California’s troubles and urged us to declare bankruptcy even though, as a legal matter, states can’t seek bankruptcy protection.

A Last Resort The Feds Will Be Checking Into

This Washington Post story, headlined “California Aid Request Spurned by U.S.,” is one of those stories that means exactly the opposite of what it’s first paragraph says.

After reporting that California’s pleas for federal assitance have been turned down, the story reports the following.

“After a series of meetings, Treasury Secretary Timothy F. Geithner, top White House economists Lawrence Summers and Christina Romer, and other senior officials have decided that California could hold on a little longer and should get its budget in order rather than rely on a federal bailout.

These policymakers continue to watch the situation closely and do not rule out helping the state if its condition significantly deteriorates, a senior administration official said. But in that case, federal help would carry conditions to protect taxpayers and make similar requests for aid unattractive to other states, the official said. The official did not detail those conditions.” (Italics are mine)

The Tax Commission Thinks Big

The meeting had ended a half hour earlier, but members of the state’s Commission on the 21st Century Economy – the tax reform body put together by the governor and assembly speaker – were eagerly talking and joking in a UCLA hall late Tuesday afternoon.

“You have to admit,” said commissioner member Fred Keeley, the Santa Cruz County treasurer and former assemblyman, “that the package is a game-changer.”

It is, as the rest of the state will discover next month when the commission is scheduled to approve recommendations to the governor and legislature.

In the post-meeting conversation, the commission’s chair, Gerald Parsky, wondered aloud if the legislature was ready for what was coming. Parsky told members that he thought lawmakers were expecting the group to recommend some reductions in income tax and extension of the state sales tax to services. In fact, there was surprising consensus for more extensive changes.

Why the Best Laid Plans for 2010 Will Be Lost in A Cloud of Smoke

What will be the big political issue of 2010 in California? Reformers think the constitutional convention will seize public attention. Labor unions are hoping it will be their effort to eliminate the two-thirds vote for the budget (and perhaps taxes too). Gay couples hope the fight for marriage equality will take center stage. And then are the contenders for governor, who will raise and spend hundreds of millions of dollars in hopes that the political year will be all about them.

It says here that they’re all wrong. The issue of 2010 won’t be reform or marriage or even the gubernatorial election.

You won’t be able to see any of those issues through a thick haze of marijuana smoke.

It’s a good bet that an initiative to legalize and tax marijuana is headed to the November 2010 ballot. TaxCannabis2010.org already has begun planning. The measure should be cheap to qualify; signature gatherers, standing outside of grocery stores, will have little problem convincing people to sign that petition (unless, of course, the munchies are so extreme that signers won’t stop on their way in).

How About a Governor Campbell Right Now?

Most candidates aren’t answering detailed questions about their plans for the state. So it’s still way too early to tell who would be the best candidate to take over as California governor in 2011.

But there’s a case to be made that Tom Campbell might be the best governor the state could have right now.

Whatever his other faults and virtues, Campbell’s credible budget proposal comes closer than anything else I’ve seen to resolving the problem.

Consider, for purposes of comparison, Gov. Schwarzenegger’s approach on the budget. He’s essentially offering a package of super-scary cuts that, by evidence of his previous public statements in favor of the targeted programs, he himself doesn’t support. The governor said before the special election that the laws of mathematics made it impossible to balance the budget without tax increases.

Would a Constitutional Convention Be Open to the Public?

The answer, as far as the Bay Area Council-backed convention is concerned, is almost certain to be yes. While a measure to call a convention has not been filed, my sources tell me that the convention would be a public meeting. The sessions might even be broadcast.

That’s wise. Permitting the convention to operate in secret would create an enormous political vulnerability for the effort. It’d be easy for opponents to defeat the idea of calling a convention – or defeat the convention’s recommendations — if they could argue that such a meeting would take place in secret.

But I do wonder if a secret convention might produce a better constitution. The difficult steps that would be required to make dramatic changes in the constitution would be easier to achieve without public and interest group pressure.

After all, the constitutional convention that produced the U.S. constitution met under a rule that the deliberations would be kept secret. No reporters or members of the public were permitted to attend. The rationale for this? They wanted a free, frank exchange of ideas.