Thread: The system is the problem with California's budget

Friday, June 5, 2009

The system is the problem with California's budget

Built-in forces in Sacramento make it difficult for governor, Legislature to solve fiscal crisis.

By BRIAN JOSEPH
The Orange County Register

SACRAMENTO When Arnold Schwarzenegger seized the governor's office in 2003, he replaced an unpopular leader who presided over a multibillion-dollar budget deficit.

Six years later, Schwarzenegger's approval ratings are in the toilet and the state is facing a $24.3 billion shortfall.

What happened?

"Basically, the systemic problems that confronted Gray Davis confronted this governor," said Barbara O'Connor, director of the Institute for the Study of Politics and Media at Cal State Sacramento. "He underestimated (how bad) the system was."

Indeed, experts say no one man is to blame for the state's economic problems. Rather, California's perpetual budget crisis appears to be the product of a unique set of circumstances found nowhere else in the U.S.

Individual politicians, to be sure, have made some lousy decisions over the years – there's no escaping that. But the forces at work in Sacramento – the political culture, the legislative rules, the special interest money – might explain why personalities change but the deficit remains.

What follows is a look at the parties who have authority over the budget, and the pressures that shape their actions. The system doesn't make it easy for anyone to act in the long-term interest of the state.

The Governor

Davis lost the governor's office largely because of budget problems and today Schwarzenegger is blamed for the state's deficit. But while the state's top leader undoubtedly can influence the direction of the budget, his direct powers are somewhat limited.

Under state law, the Legislature writes the budget. The governor recommends what the budget should look like, but lawmakers can ignore any and all of his suggestions.

Now, it's probably not wise to entirely ignore the governor. That's because once the Legislature approves the budget it goes to the governor's desk, where he has the option of approving the whole thing, vetoing the whole thing, or approving part and vetoing part, a power known as the line-item veto.

Traditionally, the threat of a veto has given the governor leverage to negotiate on the budget, but that's only a negotiating tool. If the governor is bluffing and the Legislature knows it, the governor can't influence what the budget looks like.

Schwarzenegger, for his part, has a decent reputation as negotiator. Some say he could have done more to restrain spending, but overall he gets good marks.

"He's done the best he could with a bad hand," said Jack Pitney, government professor at Claremont McKenna College. "He's been fairly effective, given the severe limitations he's been operating under."

The Voters

Voters aren't often blamed for the state's budget problems, but they've contributed to the situation – through the initiative process. Californians vote on a lot of initiatives and many successful ballot measures have had a tremendous impact on the budget.

For example, voters in 1988 passed Proposition 98, which guarantees that schools receive a minimum level of funding each year and that the minimum level will increase as the economy and population grows.

Prop. 98 sounds like a good idea. Who doesn't want schools to be funded? But in practice, Prop. 98 has been a disaster for the budget. Today, Prop. 98 mandates that 30 to 35 percent of the General Fund must be spent on education.

That means that roughly one-third of the budget is accounted for even before the governor or Legislature have made any spending decisions.

"It limits options," said Jean Ross, executive director of the California Budget Project, a non-profit that examines the state budget.

And Prop. 98 is just one example. Over the years, California voters have passed a series of measures with grave impacts on the budget. Three Strikes has necessitated more money for the prison system. Proposition 13 cut property tax revenue sharply.

Thanks to this so-called Ballot Box Budgeting, some estimate that as much as 90 percent of the budget – or even more – is set in stone before the Legislature and governor even start negotiating.

"The initiative system is a good explanation for why we seem to be stuck – why there's no good options," said Joe Matthews, Irvine Senior Fellow at the New America Foundation think tank.

Twenty four U.S. states allow initiatives, but California's system is uniquely inflexible. In other states, ballot measures expire after a number of years or their legislatures have the power to override voter-approved initiatives.

Not in California.

Once an initiative is passed in the Golden State, it can only be changed by another vote of the people.

In other words, once a spending restriction like Prop. 98 goes into place, it's there forever, unless voters remove it themselves.

"The public is not only powerful," Matthews said, "it's oblivious to what it's doing."

The Legislature

California is one of three states to require a two-thirds vote of the Legislature to pass the budget. California also is one of 13 states to require a two-thirds vote to raise taxes. California, however, is the only state to require a two-thirds vote for both.

This unique vote requirement, found nowhere else in the nation, forces members of the California Legislature to compromise in ways that lawmakers in other states don't have to.

At the same time, other powerful forces actually discourage lawmakers from cooperating.

Up until last year, state law allowed California legislators to draw their own legislative districts. Lawmakers historically used this power in their own self interest by drawing "safe districts," so called because the voters there are either overwhelmingly Republican or Democrat.

This is known as gerrymandering and it ensures that one party or the other will remain in control of a given district.

Gerrymandering raises all kinds of ethical and legal questions, but one of its biggest effects is on the kind of officials elected to represent these districts. In a district dominated by Republicans, the most hardcore Republican is likely to win the seat.

Meanwhile, the most hardcore Democrats are winning the Democratic seats. Then, when all the hardcore Democrats and all the hardcore Republicans get to Sacramento, nobody wants to compromise. In fact, some argue that if you're elected by a district dominated by one party, it's your responsibility not to compromise.

"The people on the far Left and the far Right expect ideological purity," said Bob Stern, president of the Center for Governmental Studies in Los Angeles.

Last year, California voters approved an initiative that took lawmakers' power to draw their own districts and gave it to an independent commission. It's hoped that the initiative, Proposition 11, will spell the end of gerrymandering and lead to more moderate candidates who are more inclined to compromise, but that remains to be seen.

Term Limits

But even if Prop. 11 blunts the partisan bickering in Sacramento there still remains another problem in the Legislature: term limits. Voters love term limits because they think lawmakers get lazy and out of touch when they remain in office year after year after year. Term limits, however, have had the unintended consequence of giving more power to special interest groups.

For one, new lawmakers cycle through the Legislature every few years but the same lobbyists can remain for decades. That's a pain for lobbyists because they have to build relationships with new lawmakers every couple of years. On the other hand, it's also an advantage because neophyte lawmakers sometimes defer to the experience and knowledge of the lobbyists.

In addition, a lawmaker who is only in office for six or eight years doesn't have a lot of time build up his own power base of donors loyal to him. Instead, the lawmaker relies on an easy source of campaign cash and volunteers: special interest groups.

Lawmakers need volunteers and cash to get re-elected and they know if they vote against a large or deep-pocketed special interest group a major source of money or manpower could dry up. These groups include state employee unions, teachers, businesses and industries.

"It's certainly destroying our state," said Doug Heller, executive director of Consumer Watchdog, which examines the intersection of money and politics. "When politicians say they have to play this game, they don't have to, but it's easier. … The ones protected from the budget pain pay into the political game."

Contact the writer: 916-449-6046 or bjoseph@ocregister.com

http://www.ocregister.com/articles/budg ... -lawmakers

Wow! I had no idea behind the intricacies of California's laws and I think most of us not intimate with CA's politics didn't either. What the rest of the country sees is the surface skim of California's huge budget deficit and what the state is trying to do about it.
Lobbyists for special interests are a disease in this country, but legislators redrawing their own districts had me stunned. A two-thirds vote stymies a load of stuff that could be accomplished and term limits bring out the laziness of legislators to think for themselves, rather than relying on advice of lobbyists.

Built-in forces in Sacramento make it difficult for governor, Legislature to solve fiscal crisis.

This need to be changed to:

Built-in forces in Sacramento make it difficult for the governor, Legislature or the VOTERS to solve fiscal crisis.