Finally, It’s About Time We Regulate Investments that Nobody Understands

David S. White
Principal of the Law Firm of David S. White & Associates, West Los Angeles, specializing in litigation, arbitration and mediation of real-estate-related disputes and litigation since 1977; www.dswlawyers.com

Imagine a betting window at the racetrack where you can bet any amount that a horse will not win, as opposed to the usual bet on a horse to win. You can make these bets at 30 to 1 odds every time – and you can get all your friends to join in so that your bets go up into astronomical amounts of money.

And, you can make as many bets as you want – with 7 or 8 horse in the race, it is way easier to pick the loser than to pick the one and only winner – so this helps you sell and re-sell these bets, on which, I almost forgot to mention, you are making huge profits and you are telling everybody who will listen that these are virtually risk-free bets. You can bet more money than you have in your bank account and even more money than all of us have in all of our bank accounts, combined.

And then you can keep selling and re-selling those bets on horses to lose, not win, mind you, all over the world – give them fancy French names like “tranches,” or formidable sounding names like “collateralized debt obligations,” (we’ll call them “CDO’s, for short here), including “credit default swaps.”

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Why Meg Is Right to Lay Low

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)

Several times a week, I read about how terrible, just terrible it is that Meg Whitman is declining interviews from California reporters, skipping debates, and not behaving like a serious candidate for governor.

Steve Poizner’s campaign has made this almost a daily drumbeat; “If Meg Whitman can’t stand up to questions, how can she stand up for California?” read part of a state from Poizner senior advisor Kevin Spillane last week. And over at Calbuzz, Phil Trounstine and Jerry Roberts are “fuming” about Meg’s “ducking serious questions from California political writers for months.”

Expect more of the same today, when her GOP rivals — Poizner and Tom Campbell–are scheduled to debate the measures on tomorrow’s special election ballot.

I have a bit of advice for the Meg bashers: Take a deep breath. And get a life.

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Speaker Pelosi Needs a Lifeline

Matt Klink
President, Klink Campaigns

While tomorrow’s California general elections are understandably receiving the vast majority of coverage throughout California, House Speaker Nancy Pelosi has garnered more than her fair share of the national spotlight in recent weeks. Any time that the highest ranking Member of Congress – and third in the line to be president of the United States – says that the CIA misled her and others in Congress (Washington-speak for lied)…that’s not only newsworthy but will also inspire the news media to dig deeper.

What is known is that Nancy Pelosi, as a member of the House Intelligence Committee and before she became Speaker, received briefings from CIA professional staff, not Bush Administration appointees, as she would lead us to believe, in the 2002-2005 timeframe. At these briefings, according to CIA notes (some of which are public and others which will likely soon become public), Pelosi was updated on “enhanced interrogation techniques” used against terrorists captured by the United States military.

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Proposition 1E – The Silent Killer

President of Citizens for California Reform

The Mental Health Services Act (MHSA), or Proposition 63 (also called “the Millionaire’s Tax”) was
overwhelmingly passed, in 2004, by California voters who recognized the urgent need to address decades
of inadequate state funding for mental health services. The initiative generated new revenues to expand the
state’s mental health services and reach the estimated 60% of Californians living with untreated disabling
mental illness under the then-existing system.

Self-proclaimed “champion” of mental health care reform and current Senate Leader Darryl Steinberg coauthored
the MHSA. Senator Steinberg now “champions” California voters to overturn portions of the
MHSA by approving Proposition 1-E. Proposition 1-E allows the state legislature to raid mental health
services funds, diverting $460 Million dollars away from the mentally disabled to help close the budget
deficit, which has ballooned under his tenure. This would essentially prevent any meaningful reforms in
mental health services– improvements this self-proclaimed mental health care reformer once championed
– another classic case of Sacramento politicians robbing Peter to pay Paul.

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Helping Homeowners Prepare for the Next Fire

Jeff Miller
California State Assemblyman representing the 71st Assembly District

Any student of history will tell you that there’s a recurring theme dating back hundreds, if not thousands of years: The temptations of preparing to win the last battle, instead of succeeding in the next battle.

This is a challenge California faces today, but not in a traditional war. Rather, we must prepare to battle the devastating brushfires and wildfires that can seemingly strike anywhere in our state, and attack regions in Southern California especially hard like Orange and Riverside Counties.

And when it comes to preparing for future fire hazard conditions, I fear California is very much looking backwards. Given the widespread damage caused by wildfires in California every year, the cost of inaction will be devastating.

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The One Endorsement That Could Turn the Entire Special Election Around

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)

All sorts of people and organizations are endorsing measures on next Tuesday’s special election ballot. While Props 1A through 1E appear headed for defeat, the measures seem to be winning the endorsement war, picking up support from most newspapers and elected officials. Both of California’s U.S. senators endorsed Props 1A and 1B this week.

But none of these endorsements seem to be making any difference in the polls. The public isn’t paying particularly close attention to the measures, and no one seems to much care what political leaders think about the measures.

In fact, there’s only one person in the entire whose opinion on ballot measures seems to matter to the public anymore. Who’s that, you ask?

Miss California Carrie Prejean.

Unless you’ve been living under a rock, you know that Miss Prejean, by opposing same-sex marriage (and thus endorsing Prop 8) during the Miss USA pageant, has created a major cultural storm. She nearly lost her the prestigious Miss California title (What does it say about the state of the state that we can’t even pick a Miss California without it devolving into a political mess?), keeping her position only after a mediation by Donald Trump (hey, can he handle the next round of budget negotiations?) and in the process became a household name. Entertainment magazines and TV programs are now devoted to her every pronouncement.

Now she has the opportunity to use her political capital to save the state approximately $6 billion. I’m quite convinced that with a few words (for example, “these propositions are so clear and uncomplicated that even I understand them”), Prejean could swing at least a few of the ballot measures from no to yes. (No one can save 1C). And before you snicker, why shouldn’t she be taken seriously? The nearly nude photos? Heck, in this era, being photographed in your birthday suit can help you get elected governor. (But please don’t get any ideas, Mr. Poizner).

One would think that the yes and no campaigns on each measure would be falling all over themselves to secure her endorsement. But in checking with my sources, it appears no one has bothered. This is consultant malpractice, particularly on the part of the Yes side. Gov. Schwarzenegger, you have 96 hours to make this sale.

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National Tourism Week and Swine Flu remind us we can’t take Tourism for granted

Caroline Beteta
President and CEO of Visit California

These days, we are getting constant reminders about how important tourism is to the state’s economy – as well as how vulnerable it is. With many consumers cutting back on travel due to the recession and ongoing issues like the swine flu “infodemic,” it is a constant battle to remind consumers about why they should still travel.

In honor of National Travel and Tourism Week, which runs through May 17, I’d like to remind everyone how tourism impacts our lives, and why we cannot take it for granted. We are lucky to have a governor who gets it and supports our efforts to keep this industry strong, which is not an easy task these days, and I urge legislators at the state and local level to do the same.

Governor Schwarzenegger supported this vital industry once again this week with a proclamation declaring this Travel & Tourism Week in California, to coincide with the national holiday. Why should you care? Travel and tourism expenditures total $97.6 billion annually in California, supporting jobs for 924,000 Californians and generating $5.8 billion in state and local tax revenues. These revenues help relieve our tax burdens and keep unemployment down. Also, some of these revenues benefit the state’s cultural and heritage assets, which attract more visitors and enhance our lifestyle in California.

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California Demographic Breakdown: Minorities Becoming More Important To Republicans Every Year

Partner, Public Opinion Strategies

(This article was co-authored by Matthew Jason.)

We all know The Golden State was not friendly to the Republican Party in November of 2008 when President Obama (61%) received more than 3.2 million more votes in the state than John McCain (37%). Voter ethnicity played a large role in this colossal Democratic landslide in California. According to CNN Exit Polls, ninety-four percent (94%) of African American Voters, seventy-four percent (74%) of Hispanic/Latino Voters, and sixty-four percent (64%) of Asian Voters in California cast a vote for Barack Obama.

Further, all indications are that minority voter turnout reached unprecedented levels in California in 2008. Since the Secretary of State does not track ethnicity on the voter file or release any participation statistics by ethnicity, the ability to measure voter turnout in California along ethnic lines is not an exact science. That being said, we have studied the exit polls and carefully analyzed some other key data from the voter file in order to confirm the high minority voter turnout numbers, and they definitely appear legitimate.

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Cuts Are Coming

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

The governor issues two budget proposals today, one suggesting how he plans to fill the budget hole if the special election ballot measures pass, the other showing how he’ll fill the bigger hole if they fail.

Either way, whether the budget is 15 billion dollars out-of-whack or 21 billion, cuts will happen.

Arguing that many of the suggested cuts are scare tactics, some have referred to similar tactics employed in the past, especially during the famous California tax revolt of 1978. Few of the threatened cuts at that time came to pass. One big difference from then to now is that in 1978 the state was sitting on a 40% state budget surplus. Now there is a about a 40% state budget deficit.

So there will be cuts. The focus now is how they will be employed. Many cuts should be made and have been needed for a long time. Agency consolidation, unnecessary commissions and sale of excess property have been argued over for years and will be the first on the agenda. But that will not be enough, and cuts will come to local governments and schools and other mainline services.

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Main Street Menace of the Week: Proposition 1A – Small Businesses Say No Way

John Kabateck
NFIB State Director in California

While the legislature is in session, the National Federation of Independent Business/California will be profiling anti-small business bills and the adverse effect they would have on California’s job creators. This is the fifth column of that series.

In a less than a week, California voters will go to the polls once again. This time, they are being asked to consider several propositions that were put on the ballot as part of the budget deal that was struck earlier this year. Late last month, NFIB/CA formally opposed Proposition 1A after balloting our more than 21,000 members. Once again, the voice of small business was loud and clear – no more new taxes!

There is no doubt that the state is facing unprecedented troubling times. That is why it is especially concerning that the budget deal included new and unanticipated costs that struggling small businesses simply can’t afford to absorb, including an increase in income taxes, sales taxes and a near doubling of the car tax. During tough economic times such as these, heaping new costs upon California’s leading job creators should not be even a remote option when trying to balance the state’s budget.

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