Posted on 12/02/2008 9:39:21 AM PST by NormsRevenge
SACRAMENTO – A day after declaring a fiscal crisis in California, Gov. Arnold Schwarzenegger will be in Philadelphia today to deliver a face-to-face plea to President-elect Barack Obama for more public-works money to help break the recession's grip on states.
California has $26 billion in projects – from airports to roads – that are stalled until additional federal funding comes through.
“So this is why I'm going back there, to talk about projects we have ready to go,” Schwarzenegger said yesterday in Los Angeles. “We can put a shovel in the ground literally the day after he becomes president.”
While he plans to encourage Obama to release dollars for long-term economic recovery projects, Schwarzenegger also made it clear that he will not be seeking a direct federal bailout to rescue California from its immediate cash crunch.
“I would never ask the federal government to help us before we have straightened out our own fiscal mess,” said Schwarzenegger, who will make a presentation to Obama on behalf of dozens of governors attending the session.
With the state grappling with an $11.2 billion budget gap in the current fiscal year, Schwarzenegger yesterday for the first time invoked powers granted by Proposition 58 to call a special session that requires lawmakers to act within 45 days, by Jan. 15. Other types of special sessions do not allow the governor to set a deadline or establish constraints if lawmakers fail to act.
Schwarzenegger endorsed Proposition 58 as a counterbalance to a $15 billion bond measure that represented a long-term loan to cover a budget shortfall he inherited when he took office in November 2003. “California faces unprecedented budget deficits,” Schwarzenegger and other supporters said in ballot arguments for the 2004 measure. “This proposition is a safeguard against this ever happening again.”
But it has, primarily as a result of the sour economy.
“Without immediate action, our state is headed for a fiscal disaster where everyone will be hurt,” the Republican governor said yesterday, warning that the state could run out of money as early as February.
California's Constitution requires the governor to introduce a balanced budget, but Proposition 58 for the first time requires the state to adopt a balanced budget. In September, the Democratic-controlled Legislature passed a budget balanced with what critics said were accounting maneuvers and gimmicks. Then tax receipts plummeted.
If lawmakers fail to act within 45 days, the special session would continue and they would be barred from considering any other legislation or taking a recess. But that doesn't figure to generate much pressure on legislators who don't take up many bills before March or April.
Tony Quinn, a veteran Republican political analyst who worked in the Legislature, was skeptical that lawmakers will sense any greater urgency than they did in an unproductive lame-duck special session last month.
“I don't believe this is anything but a continuation of things that haven't worked,” Quinn said. “There was no sign that the outgoing legislators took this seriously and there is no sign that any of the incoming people take it seriously.”
How lawmakers will respond is in doubt, particularly after a last-ditch effort last week failed to reach a compromise before the two-year legislative session closed and termed-out legislators left town. In a rebuke, Schwarzenegger said, “It's like kindergarten up there.”
But now there's a new class of lawmakers, sworn in yesterday and immediately confronted with the challenge of closing a deficit estimated to be $28 billion over the next 18 months.
Legislative leaders immediately pledged to pursue compromise, but Democrats and Republicans remain far apart over taxes and spending cuts. A two-thirds vote is required to raise taxes.
The same supermajority of both houses is also needed to order a March special election, deemed imperative to obtaining voter approval for other reforms and potential solutions, such as a spending cap and borrowing against future state lottery revenues.
Assembly Minority Leader Mike Villines, R-Clovis, said GOP lawmakers will hold out for more cuts, a spending cap and concessions to help the economy.
For example, Republicans want to change laws that require union wages for public-works projects; ease environmental restrictions; and provide business owners with more flexibility in setting employee work schedules.
“What we have said is these are things that will help move negotiations forward,” Villines said.
Democrats are balking at those proposals.
“I have major problems with dismantling labor laws and environmental laws,” said Assembly Speaker Karen Bass, D-Los Angeles.
Bass and Senate President Pro Tempore Darrell Steinberg, D-Sacramento, said Republicans need to provide a detailed list of cuts they would make, plus specific revenues they could support.
“Tell me what it takes to get a budget deal, and then we'll tell you what we think it takes to get a budget deal and then you start a real conversation,” Steinberg said.
As part of his budget-balancing proposal, Schwarzenegger sought a temporary increase in the state sales tax, in addition to extending the tax to many professional services and sporting events.
“I know this is a terrible time to raise taxes, but it is also a terrible time to make cuts in very important programs,” Schwarzenegger said in defending his budget package yesterday.
Democrats have countered with an increase in the vehicle license fee, saying a sales tax increase would hit the poorest Californians the hardest.
Republicans oppose both proposals. “They only want taxes,” Villines said. “It's a broken record. We're not going to give in to that.”
Democrats proposed more than $8 billion in cuts.
Meanwhile, Schwarzenegger's trip to the National Governors Association meeting in Philadelphia underscores the crises confronting dozens of states. A coalition of state governors organized the meeting with Obama.
Schwarzenegger's role is to make a case for more federal funding for infrastructure projects, which state officials say would create desperately needed jobs.
The governor cited the example of President Franklin D. Roosevelt, whose New Deal spending and emphasis of shared responsibility was credited with helping bring the country out of the Great Depression.
“He saw the big crisis and he used that opportunity to start building America,” Schwarzenegger said. “We need that same spirit again right now.”
"Just Say No."
Too bad Bush , Paulson, Schwarzenegger and now, Obama never adopted it as a precept they governed by when it came to your money.
The Gubamint has become a behemoth, a monster, and soon your landlord and mortgage holder ... and both parties and their leaders are complicit in it being so.
Arnold should at least realize he dose not have to don his Governor knee pads until January 20th
Seems to me that he ought to be able to cherry-pick that $26B from the over-abundance of social programs and government waste.
All he has to do after January 20th is to remind Obama, Pelosi and Reed that his wife is a Kennedy. That should be good enough for the first trillion dollars...
Obama doesn’t have kind feelings toward Arnold. Remember that video from Ohio during the campaign where Arnold insulted Obama’s anorexic looking physique, his legs, his torso? ;)
That video was on Drudge for two days and got a million hits. Obama and his cronies were probably insulted. They won’t be in any hurry to give Arnold what he wants.
The girlie-man should stay in California and do the manly job of reigning in his own state government.
He suggests that state layoffs may be next.
He’s probably right, and if so the place he needs to start is in the staffs of major state agencies, the executives offices, and the staff of the state legislature, before he hits state-run health care facilities and the like.
He could also demand the state university and college systems pare down all non-teaching staff, education “consultants” and non-teaching activities and terminate, or defer any sabbaticals for any state educator, defer any state salary increases, for anyone, and defer any early retirements (limiting new hires and temporary hires to fill the gaps).
After that, he can make an assessment of all state infrastructure projects and terminate or defer any that are not critical fixes or completely essential that they proceed now, this year.
Just for starters.
It doesnt hurt to get a little head start on the crowd.
“We can put a shovel in the ground literally the day after he becomes president.”
At least he didn’t use the other word for shovel.
The “Girly-Man” of California Politics strikes again!
Sounds like Arnold S. wants a bailout.
Now that we have set a precedent for the federal gov’t to bail out key business or industries that are “too big to fail”, is the next step for the federal gov’t to bail out states which are broke??????
The bailout mentality is spreading.
What a DumbAZZ, Arnold obviously is economically illiterate claiming FDR as the hero of the GD.
Early?
No.
Obama is already acting as President. The markets and media are glued to his every word and action.
Bush is roadkill in the rear view mirror.
“At least he didn’t use the other word for shovel.”
Some southern Governors would have. George Wallace comes to mind.
Perhaps he is actually in training for the day he begins his run for President.
Hussein has set the precedent for a run by the Governator. Citizenship is no longer an issue.
not according to the Constitution.. Arnold can NOT be president until they amend it
Rick Perry (and someone else) had an oped in the Wall Street Journal today, representing states that DO NOT BELIEVE adding to the federal debt to relieve debt-burdened states will be helpful to anyone in the long run.
[Full disclosure: supporting Rick’s view on this does not make me a supporter of his on all things, in Texas or nationally.]
I would go further and argue it will only hurt everyone, the state governments as well, in the long run.
It's his own fault.
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