Posted on 11/14/2004 8:49:09 AM PST by NormsRevenge
SACRAMENTO – One year after taking office, Gov. Arnold Schwarzenegger has cut taxes, avoided a state cash crisis, improved the business climate and is riding high in the polls.
But his bid to become perhaps the biggest reform governor since Hiram Johnson, who nearly a century ago led the drive that allows Californians to vote on laws through the initiative process, has stalled in some cases and not yet begun in others.
When the Legislature returns in January, Schwarzenegger will again face an issue that led to the ouster of his predecessor, Gray Davis, in a historic recall election last fall: a chronic state budget gap.
The governor is expected to unveil sweeping proposals developed during his first year to control costs in Medi-Cal, the state's health care program for the poor, and to overhaul other parts of state government after a "performance review" by a task force of state workers.
He also wants major political changes that would:
Create more competitive legislative districts so they would not be automatically dominated by one party or the other as they are now.
Ban fund-raising during the state budget process.
Provide more public access to legislative records.
Schwarzenegger could take his case directly to voters through the initiative process. First, the Republican governor will try to get cooperation from the large Democratic legislative majority, which remains unchanged after his failed campaign to add more Republicans.
But that might not be easy because the governor's tactic of simultaneously charming and berating the Legislature has left some lawmakers wary. Looking back on his first year, the governor has acknowledged the need to improve relations with the Legislature.
During a recent interview on CBS' "60 Minutes," Schwarzenegger was asked to rate his performance since being inaugurated a year ago this week. "Ten being the highest, I would give myself an eight," he said. "I think that I fell short on some of the things, probably the communications with the Legislature."
Schwarzenegger said during a news conference after the Nov. 2 election that he thought he was successful in working with the Legislature 20 percent of the time during his first year.
"I think this year we should shoot for 30 percent, and slowly increase the amount of things that we can agree on and work together on, rather than fighting," he said. "Because with fighting, that's not what people want. I mean, they are sick and tired of politics as usual."
But throughout the year, and just recently, the governor let fly stinging verbal jabs at Democratic legislators.
"Why would I listen to losers?" Schwarzenegger said after the election when asked if he would listen to proposals from Democrats such as incoming Senate President Pro Tempore Don Perata, D-Oakland, for tax increases to avoid big spending cuts.
The governor went on to explain that he was referring to voters' rejection this month of well-publicized local tax increases in Los Angeles and the San Francisco Bay Area.
In the "60 Minutes" interview, Schwarzenegger used a vulgar term for part of the male anatomy that denotes courage while talking about having called some legislators "girlie men" during a budget deadlock last summer.
The remark was noticed by Assembly Speaker Fabian Núñez, D-Los Angeles, who said in his postelection comments that Democrats would continue to work with the governor but not capitulate to him.
"I know that he made some comments on TV the other night – I saw him on '60 Minutes' – and (he) made some references to certain things that some members of the Legislature didn't have or lack," Núñez said.
The election was a mixed bag for Schwarzenegger. His impact on legislative races largely was limited to aiding Republican incumbents targeted by Democrats, such as Assemblywoman Shirley Horton, R-Bonita. But he was a winner on ballot measures.
The governor led campaigns that defeated two well-financed gambling measures and, most spectacularly, a last-minute drive that defeated a proposal to soften the "three strikes" sentencing law that once had a big lead in polls.
Schwarzenegger has popularity – a 65 percent approval rating in a late September Field Poll – and retains the aura of the international movie star that he was, judging by the wild reception he received on a trade mission to Japan last week.
But the man who once said he is wealthy enough not to need special interest money has another strength: political fund raising.
A group in Santa Monica that tracks Schwarzenegger's fund raising on a Web site, arnoldwatch.org, calculates that he has raised $38 million since last August and spent an additional $12 million of his own money.
"Gov. Schwarzenegger blows every other politician out of the water in terms of fund raising," said Doug Heller, executive director of the Foundation for Consumer and Taxpayer Rights. "Nobody in California has ever raised money at this rate."
Despite the governor's obvious political assets, Senate President Pro Tempore John Burton, D-San Francisco, sounded a cautionary note for the man he befriended
"The governor's still got his pizazz," said Burton, who was barred from running for re-election by term limits. "He is always going to have his pizazz. But sooner or later, the budget is the one that causes a problem."
Schwarzenegger, inheriting a large state deficit, immediately dug a deeper hole by repealing a $4 billion vehicle license fee increase, contending that former Gov. Davis had raised the tax illegally through a dubious administrative procedure.
Schwarzenegger took over a budget that was based on a $10.7 billion bond to pay down the deficit. But a lawsuit was filed to block the bond because it was not approved by the voters. If the courts had ruled the bond illegal, a serious cash crisis would have resulted.
So Schwarzenegger persuaded voters in March to approve a $15 billion deficit bond, avoiding a cash crisis. But then he signed a new budget in July that relied heavily on borrowing, did not raise taxes and made few spending cuts.
Now a large budget gap is expected to reopen next year. Nonpartisan Legislative Analyst Liz Hill is scheduled to issue a report Wednesday – the governor's one-year anniversary in office – that updates her previous estimate of a $6 billion budget gap next year.
Schwarzenegger, again vowing to avoid a tax increase, said after the election that he has seen estimates of the budget gap ranging from $5 billion to $8 billion.
Tax revenue from an improving economy is exceeding projections, he said, but spending required by formulas based on inflation, caseload growth and other factors is growing at a greater rate.
"I will not spend an extra dollar (more) than we make on revenues," the governor said. "That's for sure, even if that means we have to make certain cuts. But we have to be disciplined. That's the bottom line."
A potential cushion is that $3.7 billion of the $15 billion deficit bond was not used in the current budget and could be available next year.
The budget that Schwarzenegger proposes in January for the new fiscal year beginning in July might also project savings from proposals aimed at making state government more efficient.
A Health and Human Services spokeswoman said the budget will propose changes for Medi-Cal, a health program for the needy jointly funded by the state and federal governments, but declined to reveal details of the proposed changes. The state general fund is expected to spend $11.9 billion on Medi-Cal this fiscal year.
"Our greatest concern is that they will trade off short-term savings for potential long-term costs," said Jean Ross of the California Budget Project, a liberal-leaning analysis group.
Reforms called for in a 2,500-page proposal for overhauling state government issued in August by the governor's performance review task force could save the state general fund $1.5 billion a year, the Legislative Analyst estimates. However, some of the major savings, such as delaying kindergarten for children younger than 5, could be controversial.
Schwarzenegger has not decided which proposals he will try to get enacted.
In his political reform agenda, Schwarzenegger is talking about no longer allowing the Legislature to draw its own districts, but instead giving the task to a panel of retired judges.
The governor said about 90 percent of the current seats are uncompetitive, packed with Democratic or Republican voters to make them safe for one party or the other. He said the winner is determined in the party primary.
Schwarzenegger backed four reform bills dealing with legislative open records, a ban on campaign contributions during the budget period, and some minor lobbying and conflict-of-interest issues. None passed.
"He remains committed to the principles in those bills," said Ashley Snee, a Schwarzenegger spokeswoman. "They will be Year Two agenda items."
aRnie likes marketing... PT Barnum-style apparently.
Maybe someone from California can help clarify the record of GovRino.
When did Arnold cut income taxes? He raised fees and juggled some revenue, but what taxes has he cut? It's a fact that GovRino added more debt by borrowing an additonal $15 billion. Does that count as being fiscally responsible? Exactly how has Arnold improved the business climate? Arnold maybe riding high in the polls, but doesn't that have more to do with appealing to the political status quo in California? A status quo that slants left and approves of continuing liberal Democrat polices? What has Arnold done to advance fiscal conservatism in California?
Here is my current list (additions are appreciated):
NO income tax cuts. NO tax cuts whatsoever. So far, Arnold falls far short of advancing a policy agenda aimed at fiscal conservatism. Arnold maybe not be "Boy" Davis, but to this outsider, I don't see much of a difference between Governor Davis and Governor Schwarzenegger. Arnold's leadership is driven from his social liberal politics.
Just to be fair and balanced, Arnie single handedly repealed the car tax (~$4 billion). That was already being charged so it is a tax cut. He also got the legislature to repeal granting driver's licenses to illegals.
Reversing the effects of the Davis car tax was a foregone conclusion. To be fair, Tom McClintock had been leading the effort to abolish the car tax since 1998. And if GovRino has his way, the issue of driver licenses for illegals will be coming home to roost once again.
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