Schwarzenegger sets the bar high for his last year in office

Sacramento Bee-1/4/10

By Kevin Yamamura

Gov. Arnold Schwarzenegger made it sound easy to fix California when he first ran for governor, but his last six years have proved otherwise.

He took office in 2003 on a promise to "end the crazy deficit spending" and change state government as we knew it.

As Schwarzenegger enters his final year in office, however, California faces massive fiscal problems, while advocates of government reform say a constitutional convention, not an ambitious chief executive, is the best cure for the state's woes.

"Schwarzenegger swept in on this wave of 'I'm going to clean office and be the reformer governor' rhetoric we haven't heard since Hiram Johnson," said Jessica Levinson, director of political reform at the Center for Governmental Studies in Los Angeles. "In many ways, I think he has failed to deliver."

The Republican governor still believes he can finish the job he promised in his final year. He wants long-term changes to the state's tax structure to end wild budget swings. He hopes to create a stronger rainy-day reserve. He will advocate for a "top-two" primary ballot measure that theoretically would lead to elected officials more open to compromise.

Schwarzenegger will ask voters to pass an $11 billion water bond. And he is considering ways to reduce California pension benefits for new public employees, hoping to reduce the state's long-term obligations.

None of it will be easy.

Schwarzenegger will have to move his agenda through a divided Capitol focused on bridging a deficit topping $20 billion.

He'll have to galvanize voters while gubernatorial candidates spend millions of dollars describing California as a failed state with a leadership void. He'll have to win support from lawmakers who can wait out the governor and hope someone more amenable to their ideas will replace him in 2011.

And he'll have to do it all with his voter approval ratings at a personal low.

Schwarzenegger is expected to say Wednesday in his State of the State address that he can reform California no matter the obstacles.

Lame-duck governors have delivered similar messages in their final year – Gov. Pete Wilson said in 1998 that he had "absolutely no intention of going gently into that good night," paraphrasing Welsh poet Dylan Thomas.

One main message from Schwarzenegger's camp is that he has assets that his predecessors lacked: his celebrity status and ability to maneuver between political parties.

"Governor Schwarzenegger never thinks or acts small," said Adam Mendelsohn, the governor's political adviser. "The rules that define elected officials in their final year don't apply to Arnold Schwarzenegger. He has throughout his time as governor defied all the typical laws that apply to politicians."

Schwarzenegger's final agenda in 2010 will incorporate ideas from his last six years in office.

In various forms, the governor has sought changes to the state's pension system but hasn't persuaded lawmakers or voters to approve them. California is projected to have unfunded pension liabilities of more than $100 billion through 2014-15, according to the Legislative Analyst's Office. Schwarzenegger economic aide David Crane said in December that the state needs to reduce retirement benefits for new workers and contribute more toward pension investments.

The governor met recently with backers of a proposed 2010 initiative that would lower benefits for state and local government employees who begin jobs in July 2011 or later. Schwarzenegger has not pledged support yet but is considering the idea, said Marcia Fritz, a Citrus Heights accountant who heads the California Foundation for Fiscal Responsibility, which is sponsoring the initiative.

"The people of California clearly know we have to get a handle on our labor costs in the public sector," Fritz said. "It would be a wonderful thing for him to leave office setting the tide the other way."

Unions warn that if the governor pursues a pension overhaul, he could face a repeat of 2005, when Schwarzenegger spent the year fighting with Democrats and labor. While Fritz said her plan still would offer pension plans better than those available in the private sector, Dave Low, chair of the union-backed Californians for Health Care and Retirement Security, said the change would cut benefits in half and make it difficult for state workers to retire.

"If he decides to go the ballot route, he will basically be declaring nuclear warfare," Low said. "Every public employee association will put everything they have in defeating it."

The governor and his lieutenant governor appointee, Sen. Abel Maldonado, R-Santa Maria, plan to push a statewide primary measure allowing the top two finishers, regardless of party, to face off in a general election. Combined with a 2008 voter-approved change to have a citizens panel draw legislative district boundaries, the governor believes the new primary system would create more competitive legislative races – and in turn, better legislators.

"I think this is going to transform the state and change the behavior of the Legislature in the future," said Maldonado, who lost his own Republican primary race for state controller in 2006.

California Democratic Party Chairman John Burton, who led the Senate when Schwarzenegger took office, said he opposes the primary plan. But he said he doesn't see the party mounting a significant opposition campaign. Business leaders have formed an organization to back the measure.

"I'm against it, but there's no money to go against it," Burton said. "There's a whole lot of other issues people are concerned about. … Is the laurel for Arnold going to be that 'I gave you a Louisiana-style primary while students are sitting in on campus because they can't afford the fees?' "

Democrats likely will spend the year trying to block spending cuts to education, social services and public employees. Republicans will stand firm against tax increases and seek to ease regulations for businesses in a down economy.

Voters last year rejected a plan to set limits on future spending and build a stronger reserve fund for use in economic busts. A bipartisan commission that reviewed the state's tax system last summer revived the idea.

Jean Ross of the California Budget Project, which represents low-income residents, warned that another run at a stronger rainy-day reserve could detract from the governor's most crucial problem – solving the immediate state budget.

"A lot of the ballot wars have been divisive and taken attention away from making real progress to balance the budget," Ross said. "Time and attention are limited commodities, and what we really need is to buckle down and figure out how to address what is going to be an extremely tough budget year."

If Schwarzenegger can't solve the budget quickly, it could infringe upon another major priority – campaigning for an $11 billion water bond to pay for storage and a Sacramento-San Joaquin Delta fix. The longer voters hear that the state can't afford billions of dollars in regular programs, the less likely they may be to pass another bond measure.

Mendelsohn said the governor hopes to convince voters that the budget cuts are tied to a struggling California economy that will improve with water investment.

"The state cannot recover financially the way it needs to recover without a massive investment in its water infrastructure," he said.

Burton and Schwarzenegger were fast friends when the governor took office in 2003, even if they sparred over the budget and policy matters. Burton has offered advice, solicited or not, over the years.

"This ain't the year he can hope to do something big to go out on," Burton said. "I feel sorry for him, for the Legislature and for the people of California. I have no idea how they're going to make up this deficit, because the social safety net has already been shredded."#

http://topics.sacbee.com/Arnold%20Schwarzenegger/

Lame-duck role may not suit Schwarzenegger

L.A. Times-1/4/10

By Michael Rothfeld

No self-respecting politician wants to be one. The phrase itself is utterly demeaning. But with a year left in office, there are signs that Gov. Arnold Schwarzenegger has begun his transformation into a lame duck.

This status, defined by the weakness of a politician whose term will soon expire, may be difficult to swallow for a former Mr. Universe known to legions of moviegoers for vanquishing opponents as Hercules, Conan and the Terminator. Even as a pregnant man in "Junior," Schwarzenegger reflected a particular kind of strength.

But legislators have already begun sensing that as a lame duck he is easy prey and openly disregard some of his wishes. Members of his staff have steadily been quitting, and replacements are hard to come by.

Schwarzenegger himself has stopped curtailing his famous mischievous streak. More of all this seems inevitable in the year ahead.

The question for Schwarzenegger is whether he will focus his energy on resolving the state's renewed budget crisis or take a more passive approach and spend his time on a publicity tour around the state or the globe to burnish his legacy, said Bill Whalen, a former speechwriter for Gov. Pete Wilson.

"He is by definition a lame duck, but being a lame duck does not mean that you have to sit back and let the situation overwhelm you," Whalen said.

Schwarzenegger took a jaunt through the Middle East and Europe in November and flew to a climate conference in Copenhagen last month while aides were dealing with a $20-billion deficit. If that pattern continues, Schwarzenegger will have to fit it into a busy schedule.

Besides the budget, he is expected to campaign for a system of open political primaries on the ballot in June and an $11-billion water bond measure slated for November.

"Gov. Schwarzenegger is going to approach this year no different than any other, with an aggressive agenda to fix what's broken in the state," said his spokesman, Matt David. "He's proven time and again that he can get stuff done even during difficult times."

That Schwarzenegger's power is waning was evident last month, however, in the decision by state Senate President Pro Tem Darrell Steinberg (D-Sacramento) to kill the governor's reappointment of Rachelle Chong to a six-year term on the Public Utilities Commission without a confirmation hearing.

Steinberg cited Chong's record as the problem but also indicated that he is likely to reject more of Schwarzenegger's appointees whose terms would last well into the next governor's tenure.

"There have been pro tems who have made the decision to simply not confirm any long-term nominee in the last year of an administration," Steinberg said. He said he would consider other appointees on "a case-by-case basis."

The politics are straightforward. The power to give a governor anything he might want is a bargaining chit for lawmakers. But these chits may hold more value with a governor who will have up to eight years to serve. Schwarzenegger, by contrast, has fewer chances to punish lawmakers who defy him and fewer issues he can use as leverage to negotiate.

With a deal on the state's water system completed with lawmakers in November, the only main issue around that he can still negotiate is the ongoing state budget crisis. Lawmakers cannot wait for another governor to resolve the problem.

Schwarzenegger may try during those talks to obtain changes to the state's costly pension system, which he has been seeking for several years, as a last major accomplishment.

Schwarzenegger will lay out his agenda for the year during his State of the State address Wednesday.

The governor's initial strategy for the budget appears to be an attempt to pressure the federal government for more funding that he says California needs to comply with federal laws.

Schwarzenegger is expected in his budget proposal, due to come out on Friday, to demand that the state get back more of the taxes it sends to Washington and to threaten large new cuts to social services, mass transit and other programs if U.S. officials do not provide extra money

Other proof that his administration is on a downward trajectory comes from his own high-ranking aides, who have been streaming out the door.

In 2009, Schwarzenegger lost his legislative affairs secretary, the directors of the Departments of Finance, Transportation, General Services, Employment Development, Forestry and Fire Protection, and the head of the California National Guard. Another cluster of top advisors departed at the end of 2008.

Most of those positions have been filled internally with lower-level managers, given the near impossibility of attracting outside talent to jobs they would be probably lose when the next governor takes the helm. (Schwarzenegger had trouble finding a finance director willing to replace the outgoing Mike Genest in a tough budget year, eventually pressing a deputy, Ana Matosantos, into service.)

For months, some departments have had "acting" directors or vacancies at the top; the California Housing Finance Agency, for instance, has been without an executive director for a year.

Other jobs have become revolving doors. The governor has had three Cabinet secretaries in a year. He brought back Fred Aguiar, a trusted aide from the beginning of his administration, as secretary of the State and Consumer Services Agency after the agency's previous leader resigned under fire in March.

In early November, he moved Aguiar into the governor's office, leaving the consumer agency's Cabinet-level post empty.

Some politicians find new freedom in being a lame duck, feeling unconstrained in their words and actions without an election on the horizon. Schwarzenegger for a time held his tendency for politically incorrect comments in check.

But he recently scolded his wife publicly for driving and talking on a cellphone without a hands-free device, sent a legislator an obscene coded message in a veto letter and wielded a knife in a video while endorsing cuts in social services and education in the budget.

Before he leaves, the governor is also sure to look to take care of those who have taken care of him, with judgeships or other perks.

Matthew Cate, a former prosecutor and the governor's corrections chief, said he has discussed with friends, including Schwarzenegger's top legal aide, whether a judgeship might be possible.

But he has also thought about continuing to try to turn around the state's troubled prison system under another governor.

"If the situation were right and the circumstances were right on both sides, I'd actually be interested to stay," Cate said. "I haven't talked to anybody about that, but there's so much going on, I'd love to be a part of it."#

http://www.latimes.com/news/local/la-me-arnold4-2010jan04,0,537997.story

Our View: 2010: Let’s get back to basics on money, water, jobs

Auburn Journal-1/3/10

Editorial

If 2009 was the year of the great recession, is 2010 the year of the great recovery?

While few economists see the new year bringing robust growth, there are enough positive signs in housing, retail sales and corporate investment to believe the worst might be over. If employment improves, especially in the first quarter, we all could be breathing a little easier at this time next year.

But even a hearty economic recovery won’t fix all of Auburn’s and Placer County’s money woes. That issue — government operations and funding — likely will lead the list of critical issues facing the region in 2010.

With strong leadership and strategic action, the Auburn Journal editorial board sees the following agenda as a blueprint for community success over the next 12 months.

Auburn and Placer County face ongoing contractual issues with employees and law enforcement. It will take a deft hand in negotiations to balance public safety, efficient operations and long-term staff morale. Both sides must be willing to sacrifice, realizing taxpayers expect transparency and accountability at the local level, now more than ever.

At the ballot box, voters will decide the fate of three Auburn City Council positions currently held by Mayor Bridget Powers, Kevin Hanley and Mike Holmes, while county supervisor seats held by Rocky Rockholm and Robert Weygandt will be up for grabs. It would serve this region to have spirited, vigorous, competitive races that result in the best decision-makers possible. Will candidates step up to the challenge?

“Think Auburn First” is a catchy slogan that must transition to bona fide movement in 2010. Meanwhile, city officials must get more aggressive with commercial real estate leaders on finding a strong tenant for the vacant Gottschalks store. The space is a key cog in local retail growth, and dozens of jobs would boost the hopes of local job seekers.

Speaking of employment, 2010 would be a great year to see some of the vacant space filled at the Auburn Airport Industrial Park. Work is under way to organize the airport businesses into a business association, a move that would help build momentum and marketing for general aviation and the 285-acre complex.

Tourism, especially with growth in local winery visibility and wine quality, must be fully tapped. And a resurgent Downtown — with Streetscape construction behind it — should make this spring and summer exciting.

The horrific 49 Fire reminded us what can happen when fire, wind and drought conditions mix. As families rebuild from the ashes, a larger and more powerful wildfire menace lies dormant in the American River Canyon.

Stunningly beautiful, the canyon also is a tinderbox at Auburn’s back door. Action is needed this year to remove brush, trees and wood fuel from the canyon that could erupt this summer and destroy not dozens, but hundreds of homes.

Auburn continues to ask for more state and federal resources, but with those funding wells running dry, why not a public-private partnership to get the job done. A Project Auburn of epic scale could assure the safety of thousands of area residents.

Shrinking budgets and declining enrollment will continue to frustrate education leaders in 2010. This should be the year the Placer County Office of Education takes the lead on school consolidation in the greater Auburn area.

Every available dollar should be focused on students, not redundant administrative structures. PCOE must take the lead on this issue, rather than waiting for individual districts to pair up and consolidate on their own.

The Auburn Area Performing Arts Center made giant strides in 2009, and a series of music, dance and film performances in 2010 will only raise the visibility of the work needed to make this the centerpiece of Auburn redevelopment.

Two of Auburn’s largest and most beloved summer events — BBQ & Blues and the Black & White Ball — are not on the calendar for the first time in about 20 years. Both events will be dearly missed, but will their exits open the door for a new signature event?

Last, but certainly not least, is the fluid we all need. As legislators attempt to solve the Delta’s quality and quantity issues by sucking water from the foothills and other parts of the state, the Placer County Water Agency will need local support to maintain the supply that sustains us all. At home, we need to step up conservation efforts to save every drop possible.#

http://auburnjournal.com/detail/138782.html?content_source=&category_id=&search_filter=water&user_id=&event_mode=&event_ts_from=&event_ts_to=&list_type=&order_by=&order_sort=&content_class=1&sub_type=stories&town_id=

Expect water to spur year's biggest fight

Woodland Daily Democrat-1/3/10

By Thomas D. Elias

No one knows for sure, but the water plan and an associated bond issue approved last fall by state lawmakers might determine who will become California's next governor. All major Republican candidates back the plan, while Attorney General Jerry Brown, the lone significant Democrat now running, hasn't said much about it.

No one knows, also, whether Mark Twain really did say back in 1875 that in California, "Whiskey is for drinking. Water is for fighting over."

Whether it was his or not, the remark remains as apt as ever today, almost 135 years after it was supposedly first uttered.

The fighting this year will be over that as-yet-unnumbered water bond proposition, an $11.1 billion tar baby strongly backed by Gov. Arnold Schwarzenegger.

It's vital to pass this, he and other advocates say, if there's to be progress toward assuring adequate water supplies for all parts of the state.

There's money in it for new dams, groundwater basin protection, environmental protection in the vital Delta of the Sacramento and San Joaquin rivers and many, many local projects. Almost every lawmaker put something for his or her district into this package.

Unlike past plans like the putative Peripheral Canal vetoed by voters in 1982, which would have carried water around the Delta in a concrete-lined ditch, this one has backing from some major environmental groups. Both the Natural Resources Defense Council and the Environmental Defense Fund signed onto the water plan before it passed.

But whatever good will that reigned when the water measures passed in October quickly gave way to the discord usually prevalent whenever changes in California's water situation near reality.

Brown, who okayed the Peripheral Canal idea while governor 28 years ago, was badly burned by the public's rebellion against it; maybe that's why he's being cautious now.

But others are not at all reticent. No sooner had Schwarzenegger signed the water package than Delta-area legislators, fishermen and Indian tribes claimed it would lead to utter destruction for the Delta -- this despite creation of a Delta Stewardship Council designed to preserve species and water quality there.

They seized on Schwarzenegger's almost immediate announcement that he intends to pursue something like a Peripheral Canal, charging that because the governor will appoint four of the seven Stewardship Council members, "you can be sure ... the canal's construction (will be) a priority for the council members ..."

This, of course, ignores the fact that Schwarzenegger will be governor for less than one year from now, while it will be many years -- perhaps decades -- before dirt is turned on the projects now contemplated.

Realities like that don't stop the emotional responses water always spurs, emotions likely to split the state on a north-south basis when the bond battle heats up next fall. Cries that vast quantities of Northern California river water are wasted washing cars and watering lawns in Central and Southern California were heard less than a day after the package passed.

There will also be financial issues with the bond package, which would cost about half a billion dollars yearly to repay and contains an estimated $2 billion worth of pure "pork."

And some in the Delta area call for revival of the long-dormant Auburn Dam as an alternate to the Peripheral Canal or for a system of gates and locks within the Delta itself.#

http://www.dailydemocrat.com/ci_14114460?IADID=Search-www.dailydemocrat.com-www.dailydemocrat.com

Water Bond Proposal Enables Water Privatization

California Progress Report-1/3/10

By Robert Cruickshank

Opinion

Two and a half years ago, the city of Stockton voted to abandon privatization of city water after four years of poor service, contamination, and soaring rates. It's a textbook case of why public services should never be privatized - investors merely want to generate profits and don't care about the quality of service, so they'll cut corners and jack up rates.

One might have thought that this experience would have led the state legislature to stay as far away from water privatization as possible. And you'd be wrong, as the San Francisco Chronicle reported:

Private companies could own, operate and profit from reservoirs and other water-storage projects built with billions in taxpayer dollars under a little-noticed provision of the $11.1 billion water bond that was approved by the Legislature and goes before California voters next year.

Lawmakers barely discussed the provision while considering the bond, and water experts who were asked about it by The Chronicle said they knew little about it or why it was a necessary part of the plan to overhaul the state's water system....

The bond provides for the formation of what are known as joint powers authorities - usually a coalition of public entities that pool resources for projects they probably couldn't do, or couldn't afford to do, on their own. The water bond, though, specifically allows for the creation of joint powers authorities that "may include in their membership governmental and nongovernmental partners that are not located within their respective hydrologic regions in financing the surface storage projects."

This came at the request of the Glenn-Colusa Irrigation District in the Sacramento Valley, where the $3.5 billion Sites Reservoir is going to be built, partly with funding from this bond. Instead of water fees going to pay off the costs of construction and operation, some would go into the pockets of an investor. In short, users would have to pay an investor to take a shower, wash their clothes, or cook their dinner.

As the Chronicle article shows, water privatization tends to benefit a few wealthy individuals (Stewart Resnick) and distorts the usage of water:

In a controversial agreement, the state officials turned control of the bank over to the Kern County Water Agency in 1995 in exchange for water rights to 45,000 acre-feet of water, or enough to meet the annual needs of about 90,000 households. Later that year, the Kern Water Bank Authority formed as a joint powers authority that includes the Kern County Water Agency, four other water districts and one private company, the Westside Mutual Water Co.

Westside now owns 48 percent of the shares of the water bank. The company is owned by Los Angeles billionaire Stewart Resnick and his Paramount Farms company...

Paramount Farms is in the midst of a significant expansion, according to the company. Most Kern County farmers have suffered through years of drought, and the water agency there declared a state of emergency this year due to a lack of water.

Arnold Schwarzenegger sells these kind of private funding deals to the voters as a way to save money - but they'll spend more for the water fees than they would if we paid for this out of tax revenue.

Privatization of water resources - in any form - is a line that should never be crossed. Some places in California do get their water through private companies, such as we who live on the Monterey Peninsula.

It's a totally unnecessary situation, and should be avoided when possible. This news will only further damage the bond's already doubtful prospects for passage. Which would be just fine by me given the numerous flaws in the proposal.#

Robert Cruickshank is a historian, activist, and teacher living in Monterey. He is a contributing editor at Calitics.com and works for the Courage Campaign, in addition to teaching political science at Monterey Peninsula College. Currently he is completing his Ph.D. dissertation in US history, on progressive politics in San Francisco in the 1960s and 1970s.

http://www.californiaprogressreport.com/site/?q=node/7285

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