Groundhog Day for Moonbeam
Jerry Brown Faces a Tangle of Fiscal Problems Created by His Younger Self
Thursday, June 5, 2014
First-term Governor Jerry Brown was 40 years old on a warm June morning nearly 40 years ago, as he sat in the Assembly chamber, listening to comic Bob Hope crack wise about California’s financial mess.
“I want to tell you how great it is to return to Sacramento, the home of my money,” the late, legendary comedian told his audience of top state officials. “This is where they make the laws, and it’s only rarely that a victim gets to return to the scene of the crime.”
Hope was in Sacramento for a long-planned ceremony honoring his 75th birthday, an event the Legislature hailed with slightly more pomp than if he’d been president of China. By coincidence, the event came days after state voters shook up Sacramento by voting overwhelmingly for the sweeping tax cut known as Proposition 13, which the guest of honor called “the kind of thing you used to hear from a girl in a bar.”
The big star also claimed an alleged surprise sighting of the ballot initiative’s author: “I knocked on the door of the governor’s mansion, and Howard Jarvis answered,” he said.
The real governor was not amused.
Hope’s long-ago, one-liner shtick came to mind this week, as 76-year-old Governor Brown pounded his opposition in Tuesday’s election, positioning himself to win an unprecedented fourth term in November.
As a political matter, Brown’s challenge this year is considerably easier than his bid for a second term was back in the turbulent Prop. 13 year of 1978; as a policy matter, however, many of the dilemmas he’s facing were forged by the events of that steaming-hot summer in Sacramento, as Brown and lawmakers scrambled under intense public pressure to enact legislation implementing the radical tax cut.
The result of their labors was a complete overhaul of governance in California, as power became centralized in Sacramento, which took over control of doling out money to school boards, counties, and cities for education and many social-service and criminal-justice programs.
“The shift started within days of Prop. 13’s triumph,” journalists Joe Mathews and Mark Paul wrote in California Crackup, a detailed deconstruction of the state’s structural and complex political problems.
“Using the new power given to it by Prop. 13, the legislature divvied up the remaining property tax ….Where once there had been largely separate and relatively well defined pots of revenue — one labeled ‘local,’ the other ‘state’ — there was now a single hydraulic money system, as vast as the state’s water’s works, with the legislature controlling the sluices and valves.”
It’s a great historic and political irony that Brown’s current, successful-to-date effort to stabilize state finances, an Augean task that remains unfinished, in many ways involves undoing policies and changing public attitudes on issues with which he struggled in his first incarnation as governor.
A few examples:
Brown, widely mocked as “Jerry Jarvis,” flip-flopped on his fierce opposition after Prop. 13 passed, declared himself a “born-again tax-cutter,” and spent years opposing any hint of a tax increase; returning as governor in 2011, he realized the state’s fiscal morass simply could not be fixed without raising taxes and won voter approval for a ballot measure that got it done.
The governor has spent considerable political capital in recent years on “realignment,” his work-in-progress reorganization of funding and responsibilities for incarceration, rehabilitation, and other programs; the tangle of jurisdictions he seeks to unsnarl was in part shaped by passage of Prop. 13, when he and the Legislature began to consolidate political authority.
Brown recently has battled longtime labor allies, both over details of a proposed state budget reserve fund, which will be on the November ballot, and over his efforts to curtail some benefits for retired public employees; it was first-term governor Brown, however, who took the first crucial step in giving unions their enormous power in Sacramento and city halls when he signed little-noticed but sweeping legislation that gave state workers collective bargaining rights.
More directly, Brown in coming months will likely face a decision of whether to sign a key Prop. 13 reform measure, passed by the Assembly and awaiting action in the state Senate, to close a loophole that long has allowed corporate interests to avoid some property tax increases when commercial property is sold, yet another unintended consequence of Brown’s long-ago implementation of Proposition 13.
“Jerry could be fairly faulted, not for changing his stand on Proposition 13, but how he did it,” wrote Brown biographer Roger Rapoport. “The proposition, while responding to real need, was loaded with fiscal time bombs sure to detonate in the years ahead.”