Saturday, May 23, 2009

California's Crisis

Everyone is expecting the California Bloodbath to commence on July 1. State government is, in effect, going to grind to a halt, out of money, and to survive as an entity, the State Powers That Be will slash and burn the budget in wild abandon, putting almost the entire burden of California's economic collapse -- which has led to the government collapse -- on the poorest, the weakest, the sickest, the oldest, and the least able.

The propositions failed. Well, all but the one that forbade increasing legislative and state officer salaries when there is a "deficit." Since the state government can't theoretically operate at a "deficit", this measure is really nothing but a slap in the face of the Governor and the Legislature for their pissery over the last many years that has brought us to this point.

In their defense, there's not a lot they can do. To pass a budget or to raise taxes, they have to have a 2/3rds majority in both houses of the legislature. The remnant Republicans have one-third of the votes in both houses and they are rigidly united against any increase in taxes (although sales taxes and VLFs -- "car taxes" -- were raised, strangely enough, while billions of dollars in tax breaks for corporations "balanced" the revenue increase so it wasn't a net increase in taxes. Such is hypocrisy in the California legislature.)

The Orange Waxy Man, the man who invented John Bohner Tan, the Governator, swept in to office by throwing out the pencil-necked Gray Davis (who had quite a small budget pickle compared to Schwarzenegger's) and promptly cutting taxes, throwing the state into several years of tumult while adjustments were made for the lost revenue.

Only adjustments never were made, and things just got worse and worse and worse.

And with the collapse of the economy, there is nothing to be done about it. There is no more revenue "reasonably" to be had. ("Reasonably" because you can't tax the rich or they'll flee the state; the burden on everyone else is close to the maximum right now; the faltering economy isn't stable.) That means $85 billion in revenue this fiscal year (maybe), which is about the same as the revenue projection for 1999. And the budget is $110 billion. Oops.

The budget has increased essentially no more than inflation since 1999; revenues have obviously declined. They decline because, in part, the rich have the rump Republicans in the legislature to protect them from the ravening hordes. And the state constitution is set up to ensure that protection.

The governor -- no matter who it is -- flaps his gums and flails around; the legislature throws pies and plays with blocks; the prophets of Doom pontificate; and everything goes to hell in a handbasket, year in and year out, guaranteed.

And when the People, in frustration and anger, bestir themselves to do something about it through the Initiative process (ie: Proposition 13, Proposition 209; Proposition 8) their betters in the Governor's Office and the Legislature and the various branches of the bureaucracy do their level best to slap the People silly -- and make as many painful, horrendous, gawdawful cuts and administrative decisions as they possibly can.

It is ever thus.

The War between the People of California and their Government is ongoing, neverending, debilitating, cruel, and often deadly.

The fact that the Government decided to use the ballot process to paper over the budget mess in the Capitol for the time being led to the People soundly rejecting this nonsense. The legislature and the governor had been dithering for months -- some would say years -- over the looming budget problem. No sensible solutions were possible because of the complete recalcitrance of the rump Republican caucus that would not provide the votes necessary to pass a flawed but feasible budget. So they came up with a Rube Goldberg scheme that made no sense to anybody and foisted it off on the People, who they knew weren't going to vote for it, or they should have known, and now, of course, they blame the People.

It's what they do.

This is actually a Reagan/Jarvis legacy but we won't get into that.

Always the People of California are blamed for their own folly. This mess is of their own making, and they deserve to suffer, severely if necessary, in order to "teach them a lesson."


It's not the Nanny State, it's the Daddy State.

This has been going on in one form or another for decades, since Reagan was governor really, and it is time to call a halt to the madness.

The problems California's government continually faces are structural, built in to the loopy taxation and expense system that itself is built in to the State Constitution.

Time to change the Constitution. Which state governments can do with much more ease than the Federal government.

Progressives, supposedly, are preparing a package of initiatives for the 2010 ballot that are supposed to address some of the structural issues that have long plagued the state and its budgeting, but I will say right now they are going to fail -- if they can even manage to get any on the ballot.

Why not go for broke and re-write the Constitution?

Well connected political and financial interests in California are headed in that direction as this Dan Walters column from the Sacramento Bee makes clear:

Dan Walters: Two strategies to change California government

By Dan Walters
Published: Tuesday, Apr. 21, 2009 - 12:00 am | Page 3A

California's never-ending budget crisis has, if nothing else, solidified broader acceptance of what until recently had seemed to be a radical notion – that the state's governance is deeply flawed and needs fundamental overhaul.

Two centrist, bipartisan civic groups – California Forward and the Bay Area Council – are pushing two different and somewhat competitive reform strategies, both aimed at asking voters next year to take action of some kind, and both appear to be picking up steam.

California Forward, an organization financed with millions of dollars from the state's top foundations, had been pursuing an incremental approach to reform. It endorsed shifting legislative redistricting to an independent commission, which voters approved last year. It is also endorsing the six budget-related measures on the May 19 special election ballot and has been poised to support a form of open primary elections on next year's ballot, aimed at reducing partisanship.

The Bay Area Council, a collection of corporate CEOs, has had a more aggressive approach, working on two ballot measures for 2010, one that would allow voters to call a constitutional convention without going through the Legislature, another that would call such a convention to overhaul state and perhaps local government.

Both have implicit, and sometimes explicit, support from Gov. Arnold Schwarzenegger. "I think that eventually the state of California has to look at a constitutional convention, to really look at the whole thing, the way government works in California," Schwarzenegger said during a presentation to the Commonwealth Club last month, "because there are many aspects of government in California that are dysfunctional."

That was a boost for the Bay Area Council, but California Forward is dominated by the governor's allies and advisers. They include Robert Hertzberg, the former Democratic speaker of the state Assembly who has assumed the group's co-chairmanship. He succeeded Leon Panetta, now director of the Central Intelligence Agency.

On Monday, Hertzberg laid out a more aggressive agenda, calling for sweeping changes in fiscal procedures, including two-year state budgets and eliminating the two-thirds vote requirement for budgets (while retaining it for new taxes), tax reform, modifying legislative term limits, and strengthening local governments.

"The public doesn't trust Sacramento," Hertzberg told the Sacramento Press Club, adding, "People are mad as hell … it's real."

His reform list is similar to the Bay Area Council's, but Hertzberg says he wants to give the Legislature a chance to fashion a reform package through a constitutional revision commission, rather than jumping to a constitutional convention. "We are going to light this thing up," he said.

The two groups, which have been conducting talks together, appear to have agreed on a two-pronged strategy. They'll try the legislative route first. If that fails, they'll pursue a constitutional convention proposal for the 2010 ballot.

Where are the Progressives?

The answer is nowhere. Well, nowhere that is going to stop the corporate steamroller that's getting under way.

The whole idea of getting out in front of pernicious actions like those outlined in Walters' piece is anathema to progressives, especially of the internet variety. They are culturally attuned to reaction, not action, and so various interests such as the corporate/foundation cabal mentioned above run rings around the progressives in California and throughout the land.

Progressives need to recognize the power they have -- at least in theory -- to precipitate change, radical change if need be, and stop reacting to the radicalism of others.

But we're not there yet.

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