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Why Arnold's May 19 Bailout Is Failing

Pissed off voters primed to torpedo Schwarzenegger's ballot measures

If the polls are right, Governor Arnold Schwarzenegger is about to lay the biggest ballot-box egg of his political career, even more disastrous than his 2005 Year of Reform, when he tried but failed to curtail government growth and mend the polarized Legislature by enacting new spending and election laws.

Propositions 1A, 1B, 1C, 1D and 1E could all fail Tuesday. Only the mild-mannered Proposition 1F, which would freeze salaries of future legislators if the state was running a deficit, is expected to pass resoundingly.

Mark Baldassare, president of the Public Policy Institute of California, says the bipartisan measures are “a very complicated package,” and voters “have low regard for the governor and Legislature” that dreamed them up. Californians are disgusted by how much time Schwarzenegger and Democratic leaders, Assembly Speaker Karen Bass and Senate President Pro Tem Darrell Steinberg, wasted before adopting the state budget — months past the legal deadline.

It’s hard to imagine a worse time for the package. California has high unemployment and foreclosure rates, just as lawmakers are seeking tax hikes and service cuts. Recently, Speaker Bass, a political neophyte who has stumbled repeatedly during the fiscal meltdown, backed a pay raise for 120-plus employees who work for her and other politicians in the state Assembly. A wide outcry has forced her to rescind the raises.

Then Schwarzenegger, meeting in Culver City with local politicians May 11, warned that, if voters reject the new taxes, the borrowing against lottery income, and the raiding of special funds for children and the mentally ill, California will face a $21 billion real-time deficit — but that even passage of the measures will mean an instant $15 billion deficit.

Ben Tulchin of Tulchin Research, polling on behalf of No on 1D and No on 1E, which would raid money set aside for preschoolers and the mentally ill and use it to reduce the fiscal crisis, says that in focus groups and statewide polling, “Once voters realize what D and E are really about — which is robbing Peter to pay Paul — they get really pissed.”

That’s been verified by the nonpartisan Field Poll. In early March, Bass, Steinberg and Schwarzenegger had a decent chance on some of the measures. A newer Field Poll shows that earlier hope foundering. “Voters want to ... be for something,” Tulchin says. The fact that they can’t get behind virtually anything except the modest pay-cut idea is telling.

Paul Goodwin, of Goodwin Simon Victoria Research, says Angelenos are in step with statewide sentiment, harboring three distinct feelings: confusion, frustration and pessimism. Goodwin even has a new catch phrase for what awaits voters May 19: “It’s paralyzing-confusing.”

Conservatives are generally against all but the legislative pay cut, while, “As a liberal or progressive or moderate, it’s not clear what to do.”

The measures are creating unusual friends and foes. Former Los Angeles Mayor Richard Riordan is urging a no vote on the $16 billion Prop. 1A tax hike, speaking for Californians Against New Taxes, while Riordan’s friend Joel Fox, president of the Small Business Action Committee, is for Prop. 1A. Many chambers of commerce support 1A through 1F, but the Republican Party leadership opposes all of them — including 1D, 1E and 1F, originally proposed by Sacramento Republicans.

On the liberal side, California Democratic Party delegates couldn’t drum up enough votes to endorse the core measure, the two-year tax hike and rainy-day fund of Prop. 1A. Meanwhile, progressive groups such as the Courage Campaign are opposing not only Prop. 1A, but also Props. 1C, 1D, 1E and 1F.

Sitting in the wings watching all this is an old hand at voter-outrage movements, Ted Costa, who led the signature drive to recall Gov. Gray Davis. Costa is working on a radical 2010 initiative to “dissolve” the Legislature if it again fails to pass a balanced budget by its legal deadline, which is June 30. The previous year’s budget would guide spending while the Legislature is “reconstituted” by a new election in which incumbents would be banned.

“These ballot measures do nothing but kick the can down the street,” Costa told L.A. Weekly. He’s not convinced the measures will fail, because “we don’t know who comes out to vote.” But he sees either outcome as untenable. “We tried changing the governor, and things are even worse now. We think if we can dissolve the Legislature — basically conduct a mass recall — we can get back control of the government.”

 
  • Note Man 05/19/2009 6:16:00 AM

    Who "propelled" Arnold into the governor's race initially? And which voters "installed him" into his seat of power? Ol' "Kenny boy" Lay is still playing Californians for the complete, utter, and ignorant fools they have demonstrated themselves to be -- even from the grave.....! Decades will not wipe out this catastrophe., May 6, 2005 By Miles D. Moore (documentary review - excerpts) Alex Gibney's "Enron: The Smartest Guys in the Room," based on the book by Bethany McLean and Peter Elkind, is a riveting, masterful documentary about the most appalling catastrophe in American corporate history: the collapse of Enron, brought about by the ruthlessness, greed and treachery of its top executives. I give one example: of course everyone knows that the California energy crisis brought about largely by the rapacity of Enron energy traders was the main reason for the successful recall effort against California Governor Gray Davis. And most people probably realize, though they don't think about it much, that the Federal Energy Regulatory Commission chief who refused to help Davis was appointed by George W. Bush on the express recommendation of Ken Lay. But what people almost certainly DON'T know--unless they've seen this movie--is that during the crisis Ken Lay called a meeting in Los Angeles of Enron's Caifornia supporters. No minutes from this meeting have ever come to light, but one of the attendees was Arnold Schwarzenegger. You do the math.

  • Ron Jacobs 05/18/2009 8:49:00 PM

    Who can trust the incompetent fools in Sacramento? We've been down this road before with promises of change if only we pass this or that ballot initiative. It should not be the job of the public to make a budget work, this is why we elected the officials in the first place. But obviously, their only interest is in lining their own pockets and that of the special interest groups and corrupt unions who help the win elections. We should all vote no on everyone of the initiatives and let state go into bankruptcy, then we could get a handle on all the contracts that the beholden legislators approved and get our state back on track.

  • Robert 05/18/2009 1:35:00 PM

    If 1A passes the Governor and State Legislature will believe the voters approve of extending the new taxes and fees beyond the two years in 1A. It is very likely the new taxes and fees will be extended even longer, the Global Economic Crisis continues. There is no sight of ending this budget deficit, it is always growing by the month. The new taxes and fees will be around for a long time. The pro 1A supporters say the new taxes and fees will end after the two years. ?????? Have anyone read all the fine print in the 1A. All of the changes 1A will bring to the state laws. Are there loopholes to extend the new taxes and fees???? The Governor and State Legislature will find ways to extend the new taxes and fees with 1A.

  • Robert 05/18/2009 1:13:00 PM

    If 1A passes the new taxes and fees will be extended beyong the two years stated in 1A. The Governor and State Legislature will believe that the voters are willing to extend the new taxes and fees more than two years. This will happen because the budget deficit will still be very high in the next few years. They can extend the new taxes and fees at anytime.

  • Robert 05/18/2009 1:02:00 PM

    The lastest Budget Deficit is now $$$$15.4 Billion $$$ Dollars if 1A, 1C, 1D, and 1E pass. The Budget Deflicit if 1A, 1C, 1D, and 1E fail will be $$$$21.3 Billion $$$ Dollars. In March just weeks after the budget was passed and signed the Budget Deficit was $$$$8 Billion $$$ Dollars if 1A, 1C, 1D, and 1E passed. In June, What will our Budget Deficit be if these 1A, 1C, 1D, 1E pass, $$$$20, $$$$25, $$$$30 Billion $$$Dollars????? And what about July and August????

  • Robert 05/18/2009 1:01:00 PM

    The lastest Budget Deficit is now $$$$15.4 Billion $$$ Dollars if 1A, 1C, 1D, and 1E pass. The Budget Deflicit if 1A, 1C, 1D, and 1E fail will be $$$$21.3 Billion $$$ Dollars. In March just weeks after the budget was passed and signed the Budget Deficit was $$$$8 Billion $$$ Dollars if 1A, 1C, 1D, and 1E passed. In June, What will our Budget Deficit be if these 1A, 1C, 1D, 1E pass, $$$$20, $$$$25, $$$$30 Billion $$$Dollars????? And what about July and August????

  • Robert W. 05/18/2009 9:54:00 AM

    Remember State Ballot Measure 57 in March 2004 - The Economic Recovery Bond Act for $$$15 Billion $$$$ Dollars & State Ballot Measure 58 in March 2004 - The Balanced Budget Act????? Governor Arnold promised the end to Credit Card spending forever and the Budget Deficit would be erased for good.

  • Robert W. 05/18/2009 9:45:00 AM

    Two reasons why Arnold " The Total Action Movie Star " won the Recall Election in 2003 and the Governor Election in 2006. Reason One - Arnold is a World Famous Movie Star. Reason Two the Democrats put bad candidates againist him.

  • Robert W 05/18/2009 9:38:00 AM

    Karen from Los Angeles stated perfectly about Governor Arnold. Jill Stewart states it perfectly about Jim Evan's statement. The State Legislature passed the first 2008-2009 budget on September 17 TH 2009. Governor Arnold vetoed it calling it a "Go Home Budget!!!!" The State Legislature passed the second 2008 - 2009 budget on September 19 TH. 2009. Governor Arnold signed it on September 23 RD. 2009. Due to the Global Econimic Crisis, On November 6 TH. 2009, Governor Arnold called a Special Budget Session for a new 2008 - 2009 budget and requested the 2009 - 2010 budget. A month later Arnold put clock and deficit clock to track the number of days it took to pass the revised budget and the ever climbing deficit because of the delayed budget. It took the State Legislature 106 days after the Governor Arnold's November 6 TH. 2009 request of the Special Budget Session. The State Legislature passed the revised 2008 -2009 buget and the 2009 - 2010 budget on February 20 TH 2009. The Democrats and Republicans ignored Governor Arnold.

  • Karen 05/16/2009 11:24:00 AM

    Arnold is incompetent, and he needs to resign. Why did the voters think that an uneducated actor could run the fifth largest economy in the world? He doesn't know what he's doing and he's running our state into the ground!! All he does is cut education and borrow money. He doesn't have an education and that's why he doesn't value it.

  • Robert 05/16/2009 2:19:00 AM

    What a shame those 2005 measures to control govt spending aren't on the ballot now. They'd pass.

  • Stephen 05/15/2009 6:58:00 PM

    This article reflects true journalism; I applaud its' authors. What a great idea to dissolve the legislature!! I'll gladly sign on, and send a sympathy card to state senator Gilbert Cedillo upon him having to turn in his STATE SENATE PROVIDED LEXIS automobile!! Let it begin.

  • Maggie Jones 05/15/2009 5:16:00 AM

    You Think You Know? Truth-It! It's time to unlearn what you've learned. Our future depends on it. Find the truth and more.

  • Maggie Jones 05/15/2009 5:16:00 AM

    You Think You Know? Truth-It! It's time to unlearn what you've learned. Our future depends on it. Find the truth and more.

  • Yikes123 05/15/2009 5:00:00 AM

    Here�s a one shot summary of everything that is 100% verifiably TRUE about First 5 and Prop 1D (from IRS docs, state audited financials and the First 5 databases) For starters: First 5 has $2 BILLION+ ONLY because it took 2 years+ for most of them to do their strategic plan AND they were not allowed to spend the funds coming in until they did. It was NOT due to good planning! They were forced to save it and spend it slowly per their strategic plans. There is NO budget impact because they will use what they have in the bank to fund the 5 years of temporary sharing that they are being asked to do. So, who can a person believe at FIRST 5 ? 1. Not First 5 commissioners, since IMO they �self deal�. For a clear example, check out Riverside First 5, whose Commissioners raked in 75%+ of all program funds in FY 07/08 � at least one resigned � and they had to restructure! See www.pe.com for more info. Julia Glick was the reporter. Check out your local First 5 to see just how true this is! 2. Not the First 5 lobbyist, Sherry Novick. She received over $1 MILLION of First 5 funds - $200K of which went into her pension account - IRS Form 990s say so! If Prop 1D passes, it cuts her off from receiving any new funds. ALSO � audited financials show that First 5 does NOT spend responsibly: 1. First 5 spent over $100 MILLION on private evaluation consultants! They are on track to spend $500 MILLION on evaluation within 15 years And $1 BILLION+ within 25 years! Where�s the beef? Where�s the results? Nada! Even WORSE: First 5 spent $500 MILLION+ on ADULTS in a program called CARES. They gave Master's degree holders up to $5,000 just to stay in their jobs! Not a documented penny went to children 0 to 5! This money went up in smoke?! Can anyone say POOF? Google �lakin ventura Star deception 1d� OR �melissa prop 1d baby killer smokers� for links to data and more in depth discussion.

  • Manuel Besemeculo 05/15/2009 4:41:00 AM

    Way to GO, Jill!

  • Jill Stewart 05/14/2009 11:52:00 PM

    News Editor Jill Stewart responds to Jim Evans, Communications Director for Senate President pro Tem Darrell Steinberg: Spare us the Sacramento spin. The current budget was adopted several months past the June 30, 2008 deadline by which the governor must sign it. The legislature was supposed to approve the current budget by June 15, 2008, but failed -- egregiously many say -- to do so. This failure, for months, by the legislature and governor created a far worse deficit. Without a trimmed budget in place, state agencies continued to spend under the old, fatter formulas. The legislature's February action regarding next fiscal year's budget is quite clearly not the subject of this story. We'll see how you handle things if voters reject the ballot measures next week and the February plan for next fiscal year instantly becomes meaningless.

  • Jim Evans 05/14/2009 11:23:00 AM

    "Californians are disgusted by how much time Schwarzenegger and Democratic leaders, Assembly Speaker Karen Bass and Senate President Pro Tem Darrell Steinberg, wasted before adopting the state budget � months past the legal deadline." This line is incorrect. The deadline for the Legislature is June 15. This year we passed a budget on February 20, roughly four months before the deadline. - Jim Evans, Communications Director, Senate President pro Tem Darrell Steinberg.

 

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