And Still We Have No Budget

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I rarely comment in this space about comments to other posts, but given that I am trying to bring together multiple threads into a single article, it actually works quite well.

The anonymous commenter said: “I agree the State Legislature is bad and has been that way for more than a few years. The self serving Nunez and Perata are gone and that helps. I think Arnold has been trying to get everyone to see the light for a couple of years now. But they all have their special agenda’s to follow.” Having covered the state government for over two months now as my “day job,” I have to strongly disagree with the Mr. Anonymous here. The Governor is the problem–he does not lead, he issues fiats and then goes on extravagant trips.

Let us for a few moments throw out politics altogether and forget about whose side we agree with and whose side we disagree with. Let us also throw out the fact that California’s two-thirds requirements are unworkable. On a side note, the Public Policy Institute of California’s poll shows for the first time ever a majority (bare as it is) support for reducing the two-thirds requirement to pass a budget to 55%.

But back to the problem. Everyone talks about how they do not like politicians. Let’s face it, they are unsavory. They are often cold, calculating, and bent on scoring political points over sound public policy. But there comes a time when you just need to get things done. And let’s face it, we are long past that in California.

When there is a budget deal, and there will be at some point, no one is going to like it. The Republicans are going to have to accept the fact that taxes have to go up because you simply cannot make enough cuts to balance the budget without causing more problems than you solve. Democrats are going to have to accept the fact that we are spending too much money and have to cut and that unfortunately they are not going to be able to just cut programs that they don’t like, they are going to have to cut into programs that they do like and from their perspective, do work.

Everyone is going to hate something about this budget.

So back to the Governor. The Governor cannot do this by fiat. The Governor cannot try to do this from afar. If he wants to portray the severity of the problem, then he needs to be traveling around explaining the problem to constituents. He needs to park himself in Sacramento and he needs to roll up his sleeves and work. Until he is willing to do that, this budget problem is not going to be solved.

Moreover, the Governor has one primary responsibility in this process, he must get enough of his own party on board with him to strike a deal. This is a complete and total failure on his part. If Arnold were merely having to work with the Democrats, there would have been a deal a long time ago. The Democrats for the most part have been willing to compromise far more than the Legislative Republicans. I am sorry, but in my book that is Arnold’s failure. All he needs is three votes from the Republican party. He should be able to offer enough inducements to get three members of his party to sign on, but he has not been able to do this so far.

There is a ripple down effect here that is going to be tremendously devastating. First, the governor is trying to balance the budget on the backs of state workers right now. Folks, most of these guys aren’t like the Davis Firefighters making $150K per year in total compensation. These are people who make maybe $30 to $40K. A ten percent cut in their salary means somewhere between $300 to $400 per month in cuts for people who are largely living paycheck to paycheck.

Budget cuts are preferred by many over tax increases. Sales tax may be regressive, but think about it this way, a 1% sales tax increase means, one additional cent per dollar, it means one dollar additional tax per $100, it means ten dollars additional tax per $1000. You are telling me that people who make a $1000 purchase are going to notice $10 additional in sales tax?

On the other hand, budget cuts mean people will get laid off. One proposal for example had Republicans suggesting $10 billion in education cuts. Let us not forget what that would actually do to education, probably the most important thing we spend our money on, that’s probably 20,000 teachers laid off. What would that do to the economy. We’ve had to suspend construction projects to the tune of $660 million per month. For crying out loud, the stimulus plan that Obama is looking at is trying to create construction projects to stimulate the economy. And we are cutting those jobs?

A lot has been made about furloughing state workers. People seem anti-state worker until of course they can’t get their unemployment check or go to the DMV, because it’s closed on a Friday when they should be open to collected revenue for the state. Then suddenly they realize that they need state employees to run our state. They provide a service. They are “public servants.” We actually need them. Of course you say, private sector is laying off their workers, local government is also furloughing their workers. But wait, there is one big difference, let’s start at Yolo County by way of example.

Remember as I said earlier, Arnold likes to govern by fiat. There is a process by which furloughs should be considered. It is the collective bargaining process. If the County cuts employee work days and salaries it occurs in negotiation. If the school district cuts employee work days and salaries it occurs in negotiation. If the city of Davis cuts employee work days and salaries it will occur by negotiation. That is how the rights of workers are protected. Almost every agency has been willing to sacrifice so that employees are not laid off. For all the perception out there, that is an amazing thing.

However, Arnold wouldn’t and won’t do that. This despite public employees groups publicly suggesting that they would be willing to work with the state to make things work to avoid layoffs. This despite what Speaker Bass said on New Year’s Eve that the Democrats would be fine with holidays and furloughs as long as it was part of the collective bargaining process.

Yolo County is in many ways in deep trouble. They will be $18 million in deficit. That is one-third of their operating budget. There was a good story Friday in the Sacramento Bee on the relative success of Yolo County in instituting voluntary furloughs since May. That’s right, voluntary furloughs. That is how job losses have been avoided. But this occurred with the help and consent of the bargaining units as opposed to forcing furloughs upon them.

That, at least, has been the experience of Yolo County government workers – for whom unpaid time off has become the norm over the last seven months.

Beginning last spring, when county officials realized they had to cut costs, Yolo County employees either volunteered to take time off or eventually faced mandatory furloughs.

Many say their experience has been surprisingly positive, despite the pay cut.

The Governor does not operate that way. He issues demands and fiats and expects people to comply. What he discovered is that that type of approach produces resistance rather than cooperation.

Let us not kid ourselves, the situation would be dire no matter what given the nature of the economic crisis before us, but had Arnold agreed to a budget in December, California would be in far better shape.

For one thing, we would be working with real budget numbers rather than assumptions. People’s lives have been torn apart based on these assumptions.

Look no further than the school district. They are going to have to put people on pink slip notice once again because they cannot assume budget flexibility. If we had a budget, they might not have to do this. They are going to have to ask teachers to take a 2.5% pay cut. This will be negotiated. It is not preferred, but it will be done if need be in order to prevent job losses right now.

I actually think Sheila Allen summed it up the best:

“It’s just so frustrating that we have deadlines that we have to meet and other elected officials are not. So we’re working with ‘fiction’ and we’re messing with real people’s lives when it’s based on fiction, it’s very frustrating.”

I agree. I’m sorry anonymous, but from my standpoint, Arnold doesn’t know how to negotiate. He doesn’t know how to lead. The departed President found himself in a similar situation. Oh he had conviction to the point of stubbornness, but like George Bush, Arnold never learned the most valuable lesson of all, you aren’t a leader if no one is following you. Until Arnold learns that lesson, these budgets will only get more difficult and more and more people’s lives will be torn apart.

Come on Mr. Governor, it’s time to step up and solve the budget crisis not by will, not by fiat, but by cooperation and in true spirit of negotiation.

—David M. Greenwald reporting

About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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28 Comments

  1. Lexicon Artist

    This column is brought to you by Fiat?…He issues fiats and then goes on extravagant trips. … The Governor cannot do this by fiat. … Remember as I said earlier, Arnold likes to govern by fiat. … He issues demands and fiats and expects people to comply. … Come on Mr. Governor, time to step up and solve this thing not by will, not by fiat, but by cooperation and the true spirit of negotiation….If you read Genesis 1:3, you'll find the origin for fiat (…a decree…):…And God said, Let there be light: and there was light….In Latin, …Let there be light… is …Fiat lux…. In the late 14th Century, English speakers borrowed fiat from that common phrase to mean …let it be done… and soon enough a king's arbitrary pronouncement was a fiat.–Rich

  2. Mike

    You can't have it both ways, you can't have a moderate Governor and expect him to lead …his… party. The Governor has little to no connection to the Republican party and can't deliver their votes.We are blessed with a moderate Governor. We are cursed with a pair of parties that embrace the extremes. Simplistic, two-dimensional politicians that loathe to cut spending or raise taxes are silly. We have a Governor that looks past these silly limitations. Sadly, we are stuck with party leadership (on both sides) that embrace only their simplistic slogans.He is doing the right thing. He should lay out where the bozos need to move to, and take a long vacation until the pain is felt and they finally move. This isn't a time for him to try and work with the clowns, he needs them to toe the line.

  3. Anonymous

    Thank you Rifkin, for you off-topic post designed to show your superior language skills. Can you please give us the definition of 'talentless a**-clown?… Oh, wait, you just did.

  4. Mike

    …Can you please give us the definition of 'talentless a**-clown?'…Anonymous 9:21, don't be so hard on yourself. You're good enough. Sure, you no one likes you and you have no discernible talent. But if you try harder, you might garner the sympathy of your mother… some day.

  5. Don Shor

    The …big five… have been meeting recently and are probably close to a deal. There is no point in the governor staying in town while the respective party leaders take their budget discussions back to their parties to see what will fly. I don't agree with your position that this is somehow the governor's fault any more than it is the fault of each party's leadership.

  6. wdf

    Maybe things will reach resolution in Sacto soon enough. But my impression is that Schwarzenegger isn't quite connecting with legislative culture. Mike portrays the Governor as saying what he wants, and damn the rest, as if he is above the fray and blame it on partisanship if agreement isn't reached.One problem with that stance is that budgets have been dragging longer and longer, posibly costing us even more money in the delay.I would expect that he could be hands on and deal in such a way so as to bring some bipartisanship.There is sometimes something to be said for having a legislative insider be the chief executive. President Johnson, for all the criticism that could be thrown at him, exercised this trait to a excellent degree in getting civil rights legislation passed. He knew the vulnerabilities, sensitivities, and preferences of enough congressional representatives to know how to deal.The Governor seems to promote his agenda the way he might promote one of his blockbuster movies. Plenty of headlines and mentions for a few days, and then it all fades.I am not getting the impression of a …results… Governor out of Schwarzenegger. If there is something missing on this that I should reconsider or admire in him, please enlighten.

  7. Anonymous

    Lexicon Artist: Thanks for the etymological ramble. It was informative and I learned something useful. Like me, who once drove a Fiat that always broke down when I was a freshman in college, the Governator also can be identified by association with a broken-down foreign car. PS: as for your detractors, they are obviously illiterate, so simply consider the source.Blogger Lexicon Artist said… This column is brought to you by Fiat? …He issues fiats and then goes on extravagant trips. … The Governor cannot do this by fiat. … Remember as I said earlier, Arnold likes to govern by fiat. … He issues demands and fiats and expects people to comply. … Come on Mr. Governor, time to step up and solve this thing not by will, not by fiat, but by cooperation and the true spirit of negotiation…. If you read Genesis 1:3, you'll find the origin for fiat (…a decree…): …And God said, Let there be light: and there was light…. In Latin, …Let there be light… is …Fiat lux…. In the late 14th Century, English speakers borrowed fiat from that common phrase to mean …let it be done… and soon enough a king's arbitrary pronouncement was a fiat. –Rich 2/8/09 7:59 AM

  8. My View

    I suspect there is blame to go around everywhere. The governor is clueless, but each side is intractable. All sides are culpable here. The real problem is legislative salaries are not tied to the budget. If they were, trust me, we would get a budget on time, every time!!!

  9. David M. Greenwald

    Gimmicks are not going to solve this problem. The stakes are too high and most legislators are independently wealthy enough that it won't be a serious impediment and for those who aren't there is leadership that will keep them in tow.My solutions involve reform.First, two-thirds vote doesn't work. If people are angry that they have to pay more taxes, vote out the people that raise your taxes. In a partisan era, the two-thirds vote creates the worst of both worlds.Second, get rid of term limits. It doesn't work. It creates a bunch of novices particularly in the Assembly. It doesn't change the political dynamics that much. And it invests gatekeeping power in the unelected.I'm not huge into the redistricting reform and campaign finance reform, but I would be willing to trade those for the above two.Republicans somehow still believe that redistricting can make them competitive in California. It can't. They mustered 37% against Obama. They mustered about the same percentage of legislative votes across the state. Since 1996, only a few Republicans have won statewide, most notably Arnold. I just don't see redistricting playing that big a role.Democrats are convinced that you can legislate big money out of the system. I just don't see it. I'd rather focus on full disclosure and take the handcuffs off.I know Rich Rifkin likes public financing, I just don't see anyone buying into it.For me, the Netroots movement is probably the best way to democratize the electorate and to pass information quickly without the corruption of big money.

  10. David M. Greenwald

    That's what you have elections for. If you don't like the policies then you vote them out. You have still a governor who can veto budgets. There's no money right now to increase spending anyway.

  11. Lexicon Artist

    …My solutions involve reform….I agree with you on getting rid of supermajorities. However, when you have a Democratic majority in the legislature (both chambers) and a Republican governor (even if he's largely out of step with his party), you would face the 2/3rds hurdle on a veto override, anyhow.I also think our current term-limits law is wrong-headed. I know you don't like limits at all. But I think a fair compromise — which happens to be my position on this — would be a 16-year maximum in each chamber. A very popular pol could then serve 32 years. Because incumbents have such a big advantage and because we have such uncompetitive partisan elections, I think without any term limits, at least 110 of the 120 seats in our legislature (both houses) would never turn-over, short of death or graduation to higher office. Some turnover is good for the body politic — it brings in youth, vigor and fresh ideas.While getting rid of ballot propositions would not solve anything in the short run, I favor that as a reform measure. One of the great challenges for our elected officials in budgeting is having to work around the strictures put upon them by the voters — Props 13 and 98 being the most binding. There are now and then propositions on the ballot that I not only favor, but think are appropriate for the public to weigh in on collectively. However, losing those in exchange for getting rid of the entire initiative process — which is hardly progressive, as the Progressives intended — is a good bargain in my opinion.

  12. Lexicon Artist

    By the way, I just noticed that post by the person who calls me …a talentless clown…. Sorry to have offended you, sir. I enjoyed reading David's column, noticed he used the word …fiat… a number of times, and (although I knew it meant decree) looked its etymology up to see learn its origin. I thought that was interesting and figured I'd post it, as others might like that, too. I guess I was wrong. I'll have to get back to my classes at clown school to please you.

  13. Anonymous

    …I think a more effective governor could have brought along the Republicans to some degree…. Long ago I stopped expecting my friends on the left to satisfy my need for objective debate. I'm sorry, but this statement drips with the idea-elitism that causes conservatives to understand the futility of compromise. It says:

  14. The sauras

    Arnold could have signed the plan Steinberg and the dems put forward but vetoed it instead so blaming the 2/3 requirement, which does need to be removed, misses the point. Arnold got rid of the 2%VLF creating the structural deficit and the Repugs have failed to allow it to be fixed for years. Now with the downturn the no new taxes Norquist right wing is killing the state altogther. So both the gov and the republican minority are responsible. All this nonsense about the dems taxing us to death is absurd. The dems haven't raised taxes since Davis restored the car tax and before that since Pete Wilson was Gov. Trying to extract concessions on unrelated things like workplace rules and CEQA is fiddling while California burns.As for Rifkin, he once again wrote an absurd column in the Enterprise proposing the most stupid solution for the current economic mess I have seen anywhere. Giving people property tax money while they are losing their homes and trying to lure investment with long term capital gains relief at some future date when prices may be even lower than today is so stupid it could only come from someplace like the brain of Rifkin or Dumb and Dumber.

  15. Michael

    …Giving people property tax money while they are losing their homes and trying to lure investment with long term capital gains relief at some future date when prices may be even lower than today is so stupid it could only come from someplace like the brain of Rifkin or Dumb and Dumber….I think it's funny the way people who have nothing smart to say label people who are much much, smarter than they are …dumb…. I don't know Rifkin–but his writing is anything but …dumb…. Most UCD profs I had couldn't hold a candle to his ideas. I notice comments such as …sauras… are not deleted, even though others are and it says …slanderous attacks will be subject to deletion….

  16. Anonymous

    …Now with the downturn the no new taxes Norquist right wing is killing the state altogther. So both the gov and the republican minority are responsible…. …All this nonsense about the dems taxing us to death is absurd. The dems haven't raised taxes since Davis restored the car tax and before that since Pete Wilson was Gov…. It is an idiot

  17. David M. Greenwald

    …I notice comments such as …sauras… are not deleted, even though others are and it says …slanderous attacks will be subject to deletion…. …Is that you volunteering to be a moderator on this blog, because if you are not, I'm not really interested in your critique. If you are, drop me a line and we can talk.

  18. The sauras

    David, the market will clear when the prices become affordable using traditional mortgage requirements of payments less then 28% of income and income that is more than 36% of debt. All this fantasy nonsense of what the government should do is pay speculators taxes and give them capital gains breaks is similar to the kind of Greenspan low interest rate intervention that inflated the real estate bubble in the first place. Surely a free market type supply and demand person like yourself can understand that. I'll repeat the worst problem with Rifkin's inane argument is the notion that property values will be higher in five years. If people knew that with certainty the market would clear on its own. On what basis does he make that claim? Further the notion that the financial calamity that besets the country is going to be fixed by fixing the housing market is so naive. The financial crisis may have started with Subprime mortgages but the credit bubble that is deleveraging has spread to Alt A, Option Arms, prime mortgages, credit card debt, commercial real estate, credit default swaps, mortgage insurance, insolvent banks needing billions to recapitalize their balance sheets, contracting GDP, rising unemployment, zero bound monetary policy, the Federal Reserve increasing its balance sheet to the tune of 2 trillion dollars and a world wide recession. For a posttdoc like you to think it could all be fixed if only they adopted Rifkin's ideas proves what the Wizard told the Scarecrow … I know plenty of people that have no more brains than you do but they have one thing you haven't got, a diploma….

  19. Anonymous

    …I think the greedy rich that you defend have to be held accountable. You may not like it claiming that it's 'un-American,' but ignorance is un-American now that Bush is out of the White House….Nice post loving liberal. You might be one of the few on the left that I could have a healthy debate with.I agree with the anger against Wall Street. However, the topic you broach is a much deeper problem than just Wall Street and just

  20. Anonymous

    The …bonuses… for Wall Street are a little misleading with how they are reported. I was under the impression that Wall Street bankers make their income AS bonuses, in other words, their income is based on performance. It is like when a baseball player makes a minimum salary plus a bonus if he hits more than 40 homeruns. So to paint Wall Street bankers as fatcats is a bit misleading because the ones getting bonuses are the ones doing their jobs well. I agree we shouldn't have bailed any banks out but that is a separate issue than bonuses.

  21. Anonymous

    David, Good luck in controlling this particular debate on your blog. You're gonna need it. And by the way you sound a little like Dan Walters of the SacBee. He blames Arnold for everything that goes wrong in California. I…m waiting for Mr. Walters to blame the Gov. for obesity, old age and homeliness, all of which afflict Mr. Walters. The problem started a very long time ago with crooked politicians setting up a mess for the future. The latest and greatest was that moron Gray Davis who was bought and paid for by Public employee unions. Unions steal their money from the State Employeee and indirectly the taxpayers. A real merry go-round.Whose to blame??? All of the above.

  22. David M. Greenwald

    Mike:I’m not sure your point about I can’t have it both ways. I guess I disagree, I think a more effective governor could have brought along the Republicans to some degree. The governor’s problem is that while he may be moderate on some issues politically, in approach and tone he’s more of a dictator.I’m sorry but he’s the problem more than the legislative Republicans because he has no idea how to broker a deal and apparently lacks the attention span for the fine details. You don’t demand a budget one day and then head off to go skiing. If you want a budget, you stay in Sac and work with people and find common ground and also tradeoffs. I don’t see any of those qualities in Arnold and that’s why he has failed so much worse than even other recent governors.

  23. FastFwed

    Having a budget AND having a budget with plenty of new and increased taxes on it WILL be the norm. Count on it. If you don't agree with me on this very specific statement..tell us why. Do you honestly trust Steinberg&Bass to hold down spending?? Get real….Once the 2/3 is gone-its gone forever-and your children will have you to thank. That shoud make you feel good?? Yes on 13 and Yes on 218–you will be sorry if we divert from these. S'berg&Bass live for burying these so they can take over your entire future.

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