Gov. Jerry Brown's Plan A to end the state budget crisis collapsed — and there's no Plan B.

There's blame to go around

Gov. Jerry Brown's Plan A to end the state budget crisis collapsed — and there's no Plan B.

George Skelton
Capitol Journal
March 31, 2011
From Sacramento

It's another sorry saga in Sacramento: Gov. Jerry Brown and the Legislature botching the governor's Plan A for healing the bleeding budget. Who's to blame? And what now?

The first question is easy to answer: Blame everyone and everything.

Blame the Democratic governor and, to a lesser extent, Democratic legislators. Blame short-sighted Republican lawmakers.

Blame the labor unions that intimidate Democrats. Blame the hate-mongering radio entertainers and a Washington-based anti-tax demagogue (Grover Norquist) who petrify Republicans.

Blame a governing system that invariably produces gridlock. And blame the voters for creating the ungovernable system.

What now? Nobody knows. "Exploring all our options," Brown and Democratic leaders are saying. But there is no Plan B. More on that later.

Brown's at fault because of his foolish campaign promise last year to give voters the final say on any tax increase. To do that, he needed a special election. And he needed a two-thirds majority — meaning at least two Republicans in each house — to authorize the election.

Because labor unions were needed to bankroll an election campaign, they had huge sway over any deal the governor might cook up with the GOP. Big problem. Brown couldn't deal directly with Republicans. He had to run stuff by union leaders.

But I repeat myself from previous columns.

As it turned out, Brown and a handful of Republicans came close to cutting a deal that would have allowed a June election. Both sides agree they were inches from a pact on two "reforms" that the GOP demanded: on public employee pensions and business regulations.

"We were very close on those two items," says Sen. Bill Emmerson (R-Hemet), one of the GOP Five who had been bargaining with Brown for weeks. "I'm very disappointed that it blew up."

The blowup came over a proposed state spending cap, Emmerson says.

Republicans demanded a tight spending cap tied to population and inflation growth. And they accepted the Democrats' formula for measuring inflation: per-capita income growth. But they wanted any surplus revenue to go toward retiring certain debt and building infrastructure. And they said the cap should stay in effect until the debt was paid off. They figured that would be 2017.

Then after the debt was retired, Republicans insisted, a looser spending cap should take effect, one that the Legislature already has passed and is scheduled to be on next year's ballot as a proposed constitutional amendment.

Brown and labor balked at all this, especially placing the second cap in the state Constitution.

Crazy! Here they are that close to a deal that potentially could have righted the sinking ship of state and they get distracted by the color of life preservers.

There's no money. A tight spending cap for a few years seems moot. It could even be a good thing. Compromise and end it when Brown's higher taxes expired. Brown asked for five years of higher taxes. Republicans had offered three. Can anyone say four?

There also were other disagreements, but none that couldn't have been resolved. You'd think.

Republicans, of course, blew yet another chance to be relevant in this blue state by not capitalizing on their clout over a two-thirds vote. A little give here and there and they could have had pension rollbacks, business regulatory relief and even a spending cap. All for just putting a tax question on the ballot.

Democratic legislators essentially did their job. They basically cut in half a $26-billion deficit, mostly with spending cuts principally aimed at the poor, the disabled, the aged and the tuition-paying university students. Republicans wouldn't even vote for all that whacking.

But Democrats can be faulted for fantasizing that they're more powerful than they really are. Senate leader Darrell Steinberg (D-Sacramento) lectured lawmakers during a budget floor debate that "elections matter." Because voters had elected a Democratic governor and huge Democratic majorities in the Legislature, Republicans "shouldn't overreach," he cautioned.

Elections don't matter as much as they should, however, when a governor discounts the value of his office by abdicating some of its power to the voters. And they don't matter as much when a two-thirds legislative vote is required for tax increases.

The system is especially at fault.

California is one of roughly a dozen states that require a two-thirds vote for taxes. Back when Sacramento actually governed, taxes could be hiked on a majority vote. That changed with Proposition 13 in 1978. The property tax-cutting measure also led, unfortunately, to more Sacramento control and funding of local government and schools.

Also blame the voters' failed experiment with term limits. Inexperienced lawmakers just don't seem to have the know-how or courage to make a deal that might upset someone, such as a labor boss or radio shock jock.

That malady is compounded by uncompetitive legislative races, which should change next year when independent redistricting and an open primary system kick in.

But what now? No lawmaker wants to solve the deficit entirely with cuts.

Democrats, however, should forget any notion of slipping a tax measure through the Legislature on a majority vote. It would be challenged in court. And they'd look like jerks.

There's talk of a November election to vote on some labor-sponsored tax initiatives. Sounds like a certified loser without bipartisan business support. And don't count on that.

My Plan B: Forget an election. Democratic leaders should buy off enough Republican votes — yes, it's possible — and send a tax extension down to Brown's desk. Dare him to veto it. He wouldn't. But if he did, override the veto.