Arnold Revs Up The People’s Machine

photographs by Paul Wellman

Gregarious and solidly built, Joe Mathews — a reporter for the
Los Angeles Times — has spent the past three-and-a-half
years as a fly on Governor Arnold Schwarzenegger’s wall. With
California’s gubernatorial election just seven weeks away,
Mathews’s book — The People’s Machine: Arnold Schwarzenegger
and the Rise of Blockbuster Democracy — is just now hitting
bookstores. Mathews gives readers an enormously engaging
blow-by-blow account of the recall campaign that propelled
Schwarzenegger to political power and what he’s done with it in the
years since. Those looking for a zesty diatribe demonizing the
action-hero-turned-governor will no doubt be disappointed by
Mathews’s scrupulous sense of balance. But it is Mathews’s portrait
of the current California political system that leaves the reader
chilled to the bone. Schwarzenegger rode the recall from Hollywood
to the Statehouse and since being there, he’s used the
initiative — or the threat of one — to rule.

The recall and the initiative, as
everyone who attended California elementary schools knows, are
supposed to be the people’s tools to counter the power of special
interests in Sacramento. The problem, as Mathews demonstrates, is
that initiatives cost millions to qualify for the ballot and many
millions more to win. Only the special interests have the kind of
cash available to wage such campaigns. While initiatives may make
for good politics, they rarely make for good government. But as
Mathews argues, anyone who hopes to govern must be willing, at
least, to threaten to launch an initiative or two at a moment’s
notice.

Last year, Governor Schwarzenegger — bankrolled by California’s
powerful business interests — took the initiative to new extremes.
He put a package of four propositions before state voters in a
costly special election. Schwarzenegger’s foes — led by the
politically powerful teachers’ union — denounced the governor’s
initiatives as an overreaching power grab by a power-hungry
executive. Enough voters agreed that the measures Schwarzenegger
backed were resoundingly defeated.

For mere mortals, such an overwhelming repudiation would have
proven fatal. But Schwarzenegger managed not merely to bounce back,
but to enjoy one of his most collaborative legislative sessions
this past year. In fact, his relations with many of the same
Democratic leaders — including Assembly leader Fabian Núñez — who
last year were calling for his blood, have never been better.
Mathews attributes this amazing rebound, in part, to
Schwarzenegger’s personality and celebrity. But mostly he suggests
that the governor and Núñez are committed to reforming some of the
key structural problems thwarting the good governing of California.
Mathews was in town Sunday signing books at Chaucer’s Bookstore.
What follows is a highly abridged version of the conversation I had
with Mathews on his way to the book-signing.

When Arnold’s not governing
directly through initiative, he’s using the initiative as a club.
You describe in your book how he got the Legislature to approve a
workers compensation package using the threat of an initiative. At
the end of the day the Legislature voted to approve something that
they hadn’t even read. How can this be good government? Or
democratic government? That’s a great question. We have a
Legislature that essentially is an auction house. It’s a place of
buying and selling. It’s run by interest groups because the
legislators are chosen by interest groups of the left and right.
Have you been to a legislative hearing in California lately? It’s
not full of probing questions about the issues. When was the last
time you heard of a great legislative hearing? It doesn’t happen.
Everything is transactional. Everything is controlled by leadership
and by interest groups. If you want to do something, if you want to
advance the ball in a way that isn’t merely negotiating terms with
interest groups, with them paying whatever their ransom is, then
you’re going to have to go to the ballot. It’s hard to get action
if you don’t go on the ballot. I think a lot of the reason people
put stuff on the ballot is so people know you’re serious.

Is this the way California will be run from now on or is
this unique to the Arnold Show? Governors will behave like
Schwarzenegger from now on. I’m not sure there’ll be a smoking
tent, but on this tactic, they have to. Angelides, the anti-Arnold,
has nevertheless said he was going to use the Arnold tactic when it
comes to his priorities. He wants to raise taxes to make important
investments in education and healthcare. If the Legislature won’t
do it — and they probably won’t because it takes a two-thirds
majority to raise taxes and the Republicans will defeat any such
bill — then Angelides says he’ll take it to the people. Until you
see a big bargain that changes the two-thirds majority requirement,
then there is not going to be an Angelides tax increase without the
threat of an initiative.

Excerpt from The People’s Machine

Arnold Schwarzenegger and the Rise of Blockbuster
Democracy by Joe Mathews
Epilogue “The Reality of It” On
a chilly Sacramento evening in March 2006, four months after the
special election debacle, Governor Schwarzenegger took a seat by an
outdoor fireplace in a dark hotel patio. Before starting our
interview, he lit a cigar, the flash of light illuminating new
lines in his face and hands. His hair looked more natural and far
less orange than when he’d been running for the office. A few gray
hairs were visible.

He appeared to be a different governor. After the defeat of his
four ballot initiatives, Schwarzenegger spent weeks privately
seeking advice from friends and critics, Democrats and Republicans,
on where he’d gone wrong. This self-examination spurred
Schwarzenegger, usually reluctant to let employees go, to replace
much of his divided staff. The governor had a new communications
director, a new cabinet secretary, a new finance director, and new
consultants for a re-election campaign that appeared far more
daunting than it did a year before. [His wife, Maria] Shriver, who
had privately opposed the special election, helped with the
reshuffling. The new chief of staff, Susan Kennedy (no relation to
the First Lady’s extended family), was a Democrat who had been
cabinet secretary in the administration of Gray Davis. Shriver’s
own new chief of staff was a former Davis policy advisor and close
friend of Kennedy’s. Their appointments made it official: The
recall was finally over.

When Republicans protested Schwarzenegger’s decision to hire
Kennedy, the governor didn’t budge. In a meeting to soothe leading
Republicans, he suggested conservatives didn’t like Kennedy because
she is gay.

Schwarzenegger was more concerned with satisfying his larger
audience, the voters. He interpreted the special election results
as a message from the public to cool the rhetoric. He knew better
than anyone how his own persona had been used against him, and he
began using public appearances to present himself as a slightly
more conventional governor. Instead of mall rallies and junkyard
stunts, he gave policy speeches in and around public buildings.
Rather than challenge the establishment again, Schwarzenegger
sought accommodations as he fought for political survival. In
public, Schwarzenegger talked less of ballot initiatives and more
of compromise. He would move more slowly, more deliberately. He
would not repeat the mistakes of 2005.

“At the end when the dust is settled and done, the only one that
I blame for this is myself,” he told me. … “The reality of it was
that you can’t go and say, ‘This year, this has to be done,’ when
in fact, it might take two or three years to do it. Reform was a
huge undertaking. And I feel responsible for the whole thing.”

That sounded like a sober concession to the power of the status
quo. But when he talked about old friends from Austria … and his
years of unorthodox preparation for his current job, his old
bonhomie returned. … And even in the shadow of popular rejection of
his proposals, he couldn’t stop talking about the people. He wanted
to go to the people again, this time in pursuit of a giant,
history-making … project to rebuild the state. His plan called for
1,200 miles of new highways, 600 miles of mass transit, more than
2,000 new schools, two new prisons, a new crime lab, 40,000 new
classrooms, 101 new courts, and new levees to protect the Central
Valley from floods. He envisioned voters approving $70 billion in
infrastructure bonds over five election cycles to leverage $222
billion in projects. …

For all his talk about learning the lesson of patience,
Schwarzenegger was in a hurry again. … “I made mistakes,” he said
of 2005, “but there was no mistake on policy, because we were right
on the money with the policy. We have to take more time, do it a
different way.”

His political standing was different.

His advisors were different. He was the same governor.

Published by PublicAffairs.

That was kind of my disappointment with Arnold. I was
hoping to see him take that on more directly — this two-thirds
requirement. There are really two big things that govern
our direct democracy and voters will have to ultimately make these
changes; they’ll have to undo these things. The two big things out
there are Prop 13 [the property tax cap approved in 1978] and the
two-thirds requirement. There are these two things that keep
revenues down. The people on the right are not willing to give up
Prop 13 and would fight tooth and nail and probably would win that
fight. But people on the left would also have to give up things
like Prop 98, the education funding formula. I don’t think either
side is willing to trade away these two things.

I was against the recall and I was against Arnold when
it happened. But at the same time, the state was so screwed up that
I wondered if maybe we needed someone like Arnold — a weird
independent outsider — to fix things. He’s deeply weird,
but politically, he’s a pretty cautious centrist, which is why I
think he has some problems on the political right. I think the best
argument for him is that by getting into government he has brought
way more attention to state politics. People still don’t know a lot
about state politics and government but they know a lot more than
they did, and it’s largely because of him.

And you think that’s sustained. We’ll see how
long the public’s interest in [state government] will last. No one
wants it the way it is. The polls show that 80 percent of the
people know that it’s bad. But what we don’t have is successful
consensus-building. Can he, or can Angelides, or can any political
leadership in the state build consensus? I think there’s probably
still a good argument to be made that Schwarzenegger is the best
person to build that consensus, not just because of the position he
holds but because of the type of person he really is and the way he
manages, which I think is underappreciated. People don’t understand
how he manages because they think someone’s running him.

What’s he like to work for? He’s good to
people. He’s decent. He’s sort of a jokester and he teases people.
He seems to be pretty good-spirited. He’s kind, but the way he
manages where there are multiple channels, it can be hard and
confusing, and it can create internal tension and competition. In
part because of his insistence on having lots of Democrats and lots
of Republicans, all these people with different backgrounds and
views, because he likes that. He likes disagreement. This isn’t
Bush. He doesn’t want to have his own views reinforced. He wants to
see all the different views. … When people have gone up and gotten
into heated discussions in front of him, he could not be more
delighted.

What about disagreements with him? Oh, he likes
it. I found that the best way to get his attention is to ask him
the most obnoxious, doubting question I can think of and
immediately he’ll call you afterward, because he can’t stomach the
idea that you don’t understand. This is a guy who fundamentally
sees the world as divided between two kinds of people: those who
understand how great and fabulous he is and those who just don’t
yet have enough information to understand that truth. That’s the
view. He’s utterly confident in that way.

A lot of people say, “He’s just a regurgitated Pete
Wilson.” He’s not. He’s in charge. He’s a very
unpredictable governor and that’s partly because he doesn’t come in
with strong ideological beliefs, which is fine. Most Californians
don’t have strong ideological beliefs, but he also doesn’t have a
clear sense of direction. On one hand he wants to be the ultimate
pro-business governor and yet, on the environment, he has some of
his most liberal views.

He certainly is unpredictable. This year after he had his great
defeat at the ballot box, when all four of his initiatives were
defeated, he began acting as a head of state, not the governor of a
state. He met with British Prime Minister Tony Blair in Los
Angeles, took a position in clear defiance of the federal
government — a Republican federal government — and declared global
warming a clear and present danger. Recently he signed a global
warming bill into law. The bill written by state legislator Fran
Pavley [D-L.A./Ventura] calls for green gas emission standards
considerably higher than any federal standards.

How did he finesse that? He just did it. He
also put himself in a corner. He talked so much about global
warming and emissions that I think he sort of had to do it. I think
he wanted to do it; it was just the businesspeople who were upset.
But he’s given business a lot too.

And up until now, mostly his tilt was to the business
community. It’s funny: He’s much more pro-business in
public than he is in some of the conversations I’ve seen. He’s not
a big fan of quarterly-earnings thinking. He’s a very long-term
thinker. When he was thinking of signing Pavley’s bill on global
warming she asked him if he was concerned by what the reaction
would be of some business folks and oil company people and he said,
“Those guys have made enough money already this year.”

In your book you talked about how some businesspeople
were trying to move the Republicans from the far right to the
middle, and they were hoping to use Arnold in some degree to help
do that. Do you think he’s had any success there? It looks like
he’s arguing with the Republicans more than he is with the
Democrats. He’s gotten more control over the party itself.
The activists, the real muscle in the county Republican committees,
like him — and that counts for a lot — but they don’t agree with
him on most things and routinely dismiss him as a liberal. The
Republican legislators are really to the right, and they haven’t
given him many votes. They didn’t vote for his budget. Many of them
were grudging even about workers comp. That was an issue where he
did everything he could to bring them to the table. He did an
end-zone dance on that one, and yet that wasn’t enough for some of
these conservative Republicans. You almost thought that if injured
workers weren’t being thrown into the street, it wouldn’t have been
enough. It’s remarkable. And at the same time, he likes the
Democratic leadership. He spent a lot of time with John Burton, who
was the state Senate Pro Tem during Arnold’s first year in
Sacramento, and also with the Assembly leader Fabian Núñez.
Given last year’s rout — where all of his special election
ballot initiatives got creamed — I’m amazed at the cordial
relationships he has with the Democratic leadership this year. And
it’s been productive, too. First off, he accepted
responsibility immediately. And he went and talked to a lot of
people. He would go around to people, literally, to friends and
foes, and say, “Tell me where I f-ed up. What could I have done
better?” And he talked to Núñez, really sat down with him, and
said, “Help me understand you. What is it you want? If there are
things you want that I agree with or can get part of the way there,
let’s do them.”

Is Schwarzenegger a good deal-maker? He’s not
actually a great negotiator, I would argue. He’s a great
manipulator and a very smart guy. He’s very good at finding where
the audience is, but I don’t think he’s actually a terrific
negotiator. This year, when he’s made deals, the people who’ve been
doing the deals with him have done better than he’s done in a lot
of ways. The Democrats have gotten most of what they wanted. If I
were still writing this book, I’d go back to what the tribes got.
In the first couple of years, he had a really coherent policy
there — he had protections for [casino] workers. But that was too
much for Republicans. This year he’s worried about the big, more
Republican-leaning tribes, the Agua Caliente, the desert L.A.
tribes coming after him with all that money they’ve got. So he
gives them a deal that doesn’t protect the workers. He just
completely, without explanation, went back on his policy.

In your judgment, what was his biggest mistake?
When you look at his list of mistakes — and there are many — for my
list of his top 10 mistakes, breaking his word on education funding
are numbers one to five. If he’d honored his promise on education
funding [to the California Teachers Association] I think he’d maybe
[have gotten] some of those reforms passed in the special election.
The California Teachers Association really has control of the
budget because of Prop 98 [which requires that 40 percent of the
budget be spent on education]. Schwarzenegger tried to pacify the
union, and then he couldn’t live up to his deal. What was
the biggest surprise that you found in getting to know the
governor? I think at first I didn’t get how smart he was.
I got the sense he wasn’t a dummy, but when he’s sitting in that
Capitol, he may be the smartest guy there. I didn’t get that. That
won’t get you far in Sacramento, of course. I think the real issues
with him have to do with ego and his fetish for big things. He
always wants the big reform, the big change. A lot of government is
incremental and small. I think he’s learning that. He understands
that intellectually because he’s smart, but it’s hard for him,
because his life is about being bigger, about making the big turn.
He’s definitely willing to hear criticism, but he wants it to be
constructive. He wants this air of positivity. He constantly talks
like that about people. “What are your dreams?” I think even
hard-bitten reporters who just cover him have been affected by
that. This is a guy who’s always talking about, “You should just go
for it.”

Isn’t that what Schwarzenegger promised — that he would
be the ass-kicking outsider who would knock heads to get big things
to happen? It’s true he didn’t knock any heads. But you
can’t get anything done in Sacramento like that anyway. And he’s
not a knocking-head type. He’s a conciliatory person. He thought
that when he won in the recall election people would want to do the
right thing at such an extraordinary moment. He tried to make
deals; he tried to conciliate. And he didn’t get very far on the
budget stuff that way. Initiatives are really just negotiating
tools to get to a deal on compromise measures, and last year was
his attempt to get that grand compromise — to get these concessions
from both sides. When you consider the negotiations he had through
Bob Hertzberg [the former Democratic Assembly Speaker] with the
current Assembly leader, Núñez, you realize that they were looking
at all this big stuff — at two-thirds, at Prop 98 — but they
couldn’t get to that deal. This year they have a better
relationship — forged through those failed negotiations last
year — but they still have not gotten to a deal on the big
issues.

You have a chapter about the Enchilada Deal. Do you
think Schwarzenegger and the Democratic-controlled Legislature will
be able to tackle the big reforms if the governor gets a second
term? Can they get a deal? That’s the million-dollar
question. I think the answer to that is yes. I think he will try to
make that big deal if there’s a second term. I think one of the
indications of that is how Núñez is behaving this election. While
he’s a co-chairman of Angelides’ campaign, he’s almost talking like
a Schwarzenegger supporter. He’s all but officially endorsed him,
saying great things about him in public, making these deals that
help him look better to independent voters. That strongly suggests
that Núñez, who wants to tackle these big things, and Arnold, who
wants to tackle these big things, have an understanding.

What would this big Enchilada Deal look like? I
think it would have to be the entire political leadership of the
state, both parties, getting into a mega-deal. Two-thirds would
have to be part of it — the part that the right would have to give
on, because now the problem is that a minority can block tax
increases and certain fiscal things. But the left would have to
give on a lot of governance stuff, such as the ability to draw
districts. And on Prop 98. That’s part of a mega-deal. But even
then, some of these reforms must be voter-approved. Ultimately
you’re looking at a slate of ballot measures, maybe in 2008. That
is when the whole political leadership of California would have to
walk to the cliff and jump off, hoping that the public will be
there at the bottom with a big net to catch them. Do you
think Phil Angelides has got a chance in his race against
Schwarzenegger? I do think he has a chance. He has a very
strong chance. He’s a Democrat in a very Democratic state in a
Democratic year. Of course he’s got a chance. But it’s shocking,
particularly in such a bad a year for Republicans, how far ahead
Arnold is.