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Why California’s Government Doesn’t Work

Plus All-Around Rancor for Arnold’s Budget Plan


Governor Arnold Schwarzenegger’s new budget plan was pronounced “dead on arrival” by lawmakers of his own party, denounced as “shameful” by rival Democrats and cited by the capital’s leading columnist as evidence that the Terminator was a wimp.

He must be doing something right.

To be sure, the $144 billion spending scheme Schwarzenegger released last week contains something for everyone: to hate. Targeting a $17 billion deficit, it wagers heavily on a fiscal Hail Mary play to raise $15 billion by selling bonds, secured by future earnings of the state lottery. Should the lottery revenue not materialize, the plan would raise state sales taxes 1 percent, with first dibs on the money to bond-buying investors.

Even at that, his budget takes a major whack out of health and welfare programs for the poor. Although it increases money to public schools slightly - about $3 per pupil - K-12 education funding falls far short of matching inflation and enrollment growth.

Still, the predictable pile-on of unctuous outrage that greeted the budget in Sacramento seemed as surprising and spontaneous as pro wrestling.

Democrat Don Perata, the state senate leader, struck an emotional pose of wounded sanctimony, calling it “a budget beneath a governor of this great state.” GOP senate minority leader Dave Cogdill declared it DOA and thundered mightily against even the hint of a tax increase. Dan Walters, the Sacramento Bee‘s alpha columnist, all but challenged Arnold to swords at sunrise, for having “wimped out” on his “macho words.”

(Interlude of Sacramento humor: Seeking a cinematic metaphor for the universal nay-saying, capital wags circulated a YouTube clip of the 1932 Marx Brothers classic Horsefeathers, featuring Groucho famously singing, “Whatever It Is, I’m Against It!” (“Your proposition may be good / but Let’s have one thing understood / Whatever it is, I’m against it! / And even when you’ve changed it or condensed it / I’m against it!”)

Admittedly, schadenfreude self-indulgence at Schwarzenegger’s expense is tough to resist. The super-hero who stormed the Capitol four years ago, vowing to clean up the town and calling out legislators as “girlie men,” is now humbled by the kryptonite of chronic deficits, which he used to hound the hapless Gray Davis from office in 2003.

But the mindless mantras of partisan cant mouthed in Sacramento won’t make a dent in state government’s fundamental problems. The failure of governance symbolized by the capital’s annual budget pie fight is shaped by more powerful political dynamics:

Politicians can’t be trusted to draw their own turf: On critical issues of public finance, California’s Legislature is crippled by political polarization. This is also largely because of the power of reapportionment, the eye-glazing but crucial once-a-decade process of redrawing maps of legislative and congressional districts, rests with lawmakers themselves. This conflict of interest for decades has made reapportionment an exercise in incumbency protection, as legislative leaders accommodate one party or the other, rather than crafting districts that are bipartisan, competitive and hospitable to moderate, pragmatic candidates. The results: heavily Republican districts favor conservative candidates over moderates while liberals trump centrists for Democratic seats. And hardline partisan warfare rules in Sacramento.

Voters love services but don’t like paying for them: Ronald Reagan showed voters that government could boost spending while lowering their taxes and taught politicians to shrug at huge deficits. A recent survey by the non-partisan Public Policy Institute of California offers a case study of this something-for-nothing attitude: Eight in 10 Californians, across party lines, say the quality of public schools is a problem, and six in 10 that the system needs big changes. But less than half 48 percent are willing to pay more taxes to avoid proposed cuts for schools. As Mark Baldassare, CEO of the group put it: “There is consensus on the problem and the need for resources. But there’s no commitment to action.”

California’s tax system needs fixing: Much of California’s tax structure was designed and enacted for a 20th century, industrial economy. The state taxes sales of goods but not many of the services which sustain the information age economy; also, California is heavily dependent on income tax payments from the wealthy, which fluctuate wildly with booms and busts of the economy. And the 1978 Proposition 13 property tax cut set in stone a two-tier system, which allows long-time homeowners to coast, effectively subsidized by higher tax bills of more recently arrived neighbors; it also treats commercial real estate the same as residential, and requires a very difficult to attain two-thirds vote for tax increases.

As a practical matter, politicians are not lining up to tackle these intractable issues. However, a few brave souls in Sacramento have begun to address them. Newly elected Assembly Speaker Karen Bass has announced plans to convene a task force to recommend a restructuring plan for the tax system. Schwarzenegger has formed an alliance with the good government group Common Cause on a November ballot initiative, to put reapportionment in the hands of an independent commission. Should the governor prevail, another YouTube video might make the rounds, this one with his best line from Conan the Barbarian, the film that made him a star: To the question “What is best in life?” Conan responds “To crush your enemies!”

The views expressed in this article are solely that of the author and not of his employer, UCSB.

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