Posted on 09/29/2005 1:47:47 PM PDT by calcowgirl
Listening to Gov. Arnold Schwarzenegger speak last week, in an early evening interview session at his celebrated courtyard cigar tent, he sounded at times like the fellow who ran for governor two years ago:
Lots of optimism, big dreams, a sense of possibility.
He talked of a vision to "create this huge boon and have cranes everywhere."
He said he is growing impatient with the slow pace of government, relating with mock astonishment a recent conversation with House Speaker Dennis Hastert.
Schwarzenegger had asked Hastert how long it had taken to pass a recent bill that got through Congress.
"He said, 'six years,' " Schwarzenegger recalled. "Six years, and he was a happy camper!"
Schwarzenegger said he wants to move more quickly, and has determined that the only way to start is to first reform the current system.
He said he has taken a staged approach to running the state. The first year was about recovery; the second year about reform; after that will come the part he's looking forward to. Rebuild.
"It's very urgent to create the reforms so we stop spending money we don't have," he said.
Because the state suffers from a chronic structural deficit, he said, "We never have a chance to put a program together where we can say, 'OK, let's go build $100 billion worth of infrastructure to improve our transportation. Or let's redo our hospitals because they're not earthquake-proof. Or let's go work on our electricity, our energy.
"All those things need to be done, but we don't have the money. We can't do it. That's why we need the budget reform very badly."
It's an appealing vision.
The problem is, there's an apparent disconnect between what he says and what the reform he is asking voters to approve would accomplish.
Schwarzenegger wants to spend money -- not just on roads and hospitals and power lines, but also, he said, on education and healthcare.
But Proposition 76, the budget reform on the ballot, is designed to curb state spending, not accelerate it.
The measure would place a cap on annual spending, limiting its annual increase to no more than the average annual revenue growth over the previous three years.
The effect, concludes the nonpartisan Legislative Analyst's Office, would be to "likely reduce state spending over time relative to current law."
In other words, Schwarzenegger wants to stop spending so he can start spending.
How is this vision -- more spending with less money -- going to work?
I put that question to Finance Director Tom Campbell this week.
His answer was direct: The money will come from borrowing -- not just money for bridges and roads, but also money for school programs and other services.
It's no secret, Campbell said, that an infrastructure bond will soon be in the offing and it will not be modest.
Schwarzenegger, he said, has told his advisers that they shouldn't blink at talk of a $9 billion or $10 billion bond when "we should be talking about $60 billion or $70 billion."
All that's needed to launch California into a bold new era of borrow and build, Campbell said, is to first get the annual operating budget under control.
Schwarzenegger and Campbell believe that by putting a cap on state spending and giving the administration the ability to make midyear budget cuts -- as Proposition 76 would do -- California could eliminate its annual budgeting chaos, please Wall Street, and up the limit on the state's credit card.
"A bond program of substantial size has to have a sound financial base," Campbell said. "When you have a solid base for economic growth, you can accelerate that."
Even with the $15 billion in debt-repayment bonds voters approved last year, Campbell believes California still has more room to borrow. Debt service, now at just under 5 percent of the budget, could safely go to 6 percent, he believes.
Schwarzenegger and Campbell are clear on one point: Additional taxes are not part of the plan.
In short, here's the Schwarzenegger vision: Rein in annual government spending, which chiefly pays for education and healthcare. Don't raise taxes. Then start massive new spending on big projects with borrowed money.
If that plan sounds familiar, it should. It's the Bush administration approach for paying for the war in Iraq and to rebuild New Orleans after Hurricane Katrina.
The difference is, in California, people will get to vote on the wisdom of that idea.
-- Timm Herdt is chief of The Star's state bureau. His political web log is at http://www.TimmHerdt.com.
I'm going to shock you! He terminated enemies of Auburn Reservoir and Flood Control dam with this move and I support what he did on this! (shhhhhh! Don't tell anybody!)
Okay--well that is a good thing. But it still sounded pretty stinky.
Yea!!!
I'll assume 17 was directed at me. Why the hyperbole? I never said you were out of your mind. Dial it down a notch. "Maniac?" Again, overblown rhetoric. Can't points be made without resorting to extreme arguments.
I get that you're not pro-Republican. At this point I, as a former Democrat, am an almost solid Republican vote. I write letters to my local paper criticizing liberal nuttiness, which was a full-time job in Davis. You should be happy to have me.
I don't understand why when I say something pro-Arnold I'm swarmed on by, well, Wasps. Fresh meat? I'm sure we agree on far more than we disagree.
You watch... Now they will throw Tom Delay over the side. The won't fight for him like the Dems did Clinton who actually did something demonstrably wrong!!!
"You watch... Now they will throw Tom Delay over the side. The won't fight for him like the Dems did Clinton who actually did something demonstrably wrong!!!"
See, here we agree. I hope that the Republicans will support Delay, as opposed to what they did for Lott. We'll see.
I have my standards, ya know.
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