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Executive Order From Arnold Will Reduce Pay (Temporarily) of 200,000 State Employees

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 4:56 pm

Looks like the Governor is going to issue an Executive Order on Monday to reduce the pay of 200,000 state employees temporary down to the federal minimum wage.  Once a state budget is approved, these folks will be issued back-pay for the difference.  It's all about preserving cash flow says this breaking story at the SacBee website.

This will jack up the anxiety of public employee unions who should think about this -- they have very little cache with legislative Republicans since, for the most part, they work to defeat every Republican that they can.  So the question is what kind of pressure can these unions bring to bear on legislative Democrats?  Perhaps it's time for the unions to roll up their sleeves and figure out how to give state government a healthy haircut -- which will then allow for a budget to pass, and their members can once again get their full pay.

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PPIC's Peripheral Canal Study Worth A Read

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 4:45 pm

Last week, the Public Policy Institute of California released a study which piqued my curiousity because it talked about the decades-old political football -- the peripheral canal.  I asked the fine folks at PPIC if they would produce a blog-length intro to their study, which is below.  At the bottom, there is a link to much more comprehensive information...

Peripheral canal can save ailing Delta, ensure reliable water supply
Public Policy Institute of California

Building a peripheral canal to carry water around the Sacramento-San Joaquin Delta is the most promising strategy to balance two critical goals:  reviving a threatened ecosystem and ensuring a high-quality water supply for California’s residents.  That is the key conclusion of a report released this week by the Public Policy Institute of California (PPIC).

Under current policy, water is drawn from the Sacramento River and sent south through the Delta to enormous pumps that deliver it to millions of households in the Bay Area and Southern California and millions of acres of Central Valley farmland.  This approach, which disrupts the natural water flow, has threatened native fish and made the Delta attractive to invasive species. 
Furthermore, it is unsustainable.  Projected sea level rise, crumbling ancient levees, larger floods, and high earthquake potential will inevitably result in a dramatically different Delta environment – one with saltier water that is much more costly to treat for drinking and ultimately unusable for irrigation.

Although it would be best for the fish if California stopped using the Delta as a water source, this would be extremely costly.

A peripheral canal is not only more promising than the temporary and ultimately unsustainable “dual conveyance” option – which combines the current approach with a canal – but it is also the best available strategy to balance two equally important objectives.

“Coupling a peripheral canal – the least expensive option – with investment in the Delta ecosystem can promote both environmental sustainability and a reliable water supply,” says Ellen Hanak, PPIC associate director and senior fellow, who co-authored the study with a multidisciplinary research team from the University of California, Davis

Among the report’s recommendations:

  • Plan to allow some Delta islands to flood permanently.  The state should invest in levees that protect high-value land, ecosystem goals, and critical infrastructure – and allow lower-value islands to return to aquatic habitat. 
  • Begin the transition from the current Delta management system.  Over time, the current system will hurt the state’s economy.  Planning for change now will make Californians less vulnerable to the potentially greater cost of earthquake, floods, or levee failures.
  • Develop a new framework for governing and regulating the Delta.  With the proper safeguards, a peripheral canal can be economically and environmentally beneficial. 
“Choosing a water strategy is just the first step,” says Jay Lund, a professor of environmental engineering and one of six UC Davis co-authors of the report.  “The technical, financial, and regulatory decisions necessary to plan for a new Delta are enormous.  The governor and legislature need to be involved in setting up a new framework to manage the challenge.”

Here is the research brief of the report, Comparing Futures for the Sacramento-San Joaquin Delta.

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Let the Budget Kabuki Dance Begin

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 4:25 pm

Wikopedia defines Kabuki is a form of traditional Japanese theatrical dance.. Kabuki theatre is known for the stylization of its drama and for the elaborate make up worn by some of its performers.

I am reminded of these Kabuki dancers when we see acts like the one by State Senate President Don Perata -- who has called for a budget vote next Tuesday in the Senate (h/t to CapWeekly).  The thing is, there has been no successful negotiation to resolve the significant policy issues that divide liberals and conservatives in approach the huge financial hole in which the state find's itself.

So this budget vote next week is Kabuki -- political theatrical dance. 

I guess it won't be a complete waste of time.  We can see if Senator Lou Correa and a few other "so-called" more centrist Democrats vote for the extreme tax increases contained in the budget Perata will put before the Senate.

I bet they do -- as we know, a real Democrat has never met a tax increase that he or she didn't want to support!

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Jessica’s Law used to convict local molester in Yolo court

by Senator George Runner - State Capitol (bio) (email)(print)

 
7-23-2008 3:26 pm

Congratulations to the Woodland Daily Democrat for having the courage to print positive news about California’s Jessica’s Law (positive from the standpoint that a dangerous sex offender is going away for a long time instead of getting a slap on the wrist for committing heinous crimes).

But what happened in Yolo County Court is not rare since the passage of Jessica’s Law. Now district attorneys from all over California are successfully using the tools provided by Jessica’s Law – including the provision that makes luring a minor punishable as a felony.

What the story did not mention is that the child rapist will be subject to mental evaluation by the California Department of Health Services before release from prison to determine if he fits the criteria of a sexually violent predator.

If he is deemed to be a SVP, he will spend more time in civil confinement at a state mental hospital receiving treatment until he is OK’d for conditional release (conditional release means he will wear GPS for life; live outside of 2,000 feet of schools and parks; receive weekly counseling; submit to random drug tests, etc.).

To read more about the story, visit:  http://www.dailydemocrat.com/news/ci_9970637

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Rep. Royce: Socializing Risk While Funding The Left

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 1:43 pm

Today the Congress is preparing to vote on a massive mega-billion dollar "bail out" of Freddie Mac and Fannie Mae" - along with billions of other "gifts" to those impacted negatively by the mortgage crisis ("gift" - paid for with our tax dollars). Congressman Ed Royce (R-Orange County) just sent over this well written piece on this ill-advised legislation:

Socializing Risk While Funding the Left
By U.S. Represenative Ed Royce
 
Today the House of Representatives passed one of the largest taxpayer bailouts in decades.  After advocating for strong GSE reforms for the better part of a decade, I am appalled to see this effort dedicated to taxpayer funded giveaways to radical organizations like ACORN and improperly funded liabilities that will cost the taxpayers billions of dollars.  Because I believe good governance and protecting the American taxpayer must trump rewarding radical organizations and imprudent lenders and speculators I opposed this legislation.

For far too long, Fannie Mae and Freddie Mac (the largest Government Sponsored Enterprises) have reaped the rewards of the private sector while enjoying the type of security known only to branches of the federal government.  Their quasi-governmental status has created a level of moral hazard unseen anywhere else in our capital markets.  Insulated from the market forces necessary to quell excessive risk taking, over the years these companies ballooned into the financial goliaths they are today with more than $5 trillion worth of exposure to the mortgage market.  

In an effort to create a regulator with enough authority to restrain these institutions, in 2003 I introduced the first legislation which sought to put Fannie, Freddie and the Federal Home Loan Bank System under one strong regulator within the federal government.  Additionally, in 2005, I offered an amendment on the floor of the House of Representatives to give the new regulator the authority to review and adjust the GSEs' portfolios to mitigate against a potential systemic shock. The same organizations which stand to benefit from today's legislation lobbied against and helped defeat that amendment.

As the systemic risk posed by the GSEs grew, the need for a strong regulator able to control their risk exposure and ensure they were adequately capitalized became even more critical, especially as the mortgage industry began to deteriorate over the past 18 months.  The failure of Congress to pass such critical legislation over the years could end up being one of Washington's greatest oversights in recent history.  Worse yet, today Congress asked (as we so often do) the American taxpayer to pay for past failures.

This legislation has been loaded with handouts and improperly funded liabilities; the most obvious of which bails out speculators and investors that incorrectly gambled on the housing industry and the institutions that provided their loans.  The misguided plan allows banks to dump up to $300 billion worth of their riskiest mortgages onto the back of a New Deal inspired agency - the Federal Housing Administration.  By taking on these mortgages, we are shifting that default risk currently held by institutions and investors around the world onto the backs of the American taxpayers.  A recent projection issued by the Congressional Budget Office estimated that a stunning 35 percent of all of the loans refinanced through mortgage bailout may eventually default on the federal government, which could mean tens of billions in unaccounted for losses.

Perhaps less obvious than the $300 billion bailout, but in many respects more egregious, is an affordable housing fund which would funnel as much as $600 million every year to activist organizations under the guise of promoting affordable housing.  This plan takes a percentage the GSEs' total new business and redistributes it to groups like ACORN and La Raza with lengthy histories of both voter fraud and anti-free market advocacy at the local, state, and national levels.  So while the chance of a government bailout of these two struggling institutions remains a real threat, we will begin levying a tax dedicated to fund these groups.  And what would be the penalty should one of these organizations be found to have misused the taxpayer funds? Today's legislation would simply require repayment of the misused funds and anything left from the initial grant.  Additionally, there is nothing to prevent these groups from going back the very next year to receive additional money from this slush fund.  Regardless of where the taxpayer money actually goes, because it is fungible, the government is subsidizing all of these groups' activities whether we intend to or not.  

Another ill-effect of this legislation is the damage it will have on the progress currently being made through the Hope Now Alliance.  Industry leaders, representing almost two-thirds of the mortgage sector, are stepping forward to address the mortgages most likely headed toward foreclosure.   Because of the significant costs associated with a foreclosed property, a great number of servicers, lenders and borrowers have an incentive to restructure these troubled mortgages which have been weighing on our capital markets and the broader economy.  The rate of workouts through the Alliance has now increased to about 2 million per year. These workouts allow the borrowers to stay in the home and help ease the burden these pending foreclosures have had on our capital markets.  When the lending institutions and borrowers see what the $300 billion bailout would do for them, they will surely step away from the negotiating table in order to receive a much sweeter deal provided at the taxpayers' expense.   

Earlier today I encouraged my colleagues in Congress to join me in opposing this legislation because of the unprecedented amount of taxpayer liabilities included in this package.  This legislation is an affront to good governance and it should be avoided at all costs.

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Governor Holding The Line On Budget Reform

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 9:59 am

The Governor continues to stand firm on his demand that any budget must include real spending reform.  That is outstanding.

While these days we need to take the Governor's resolve on a day by day basis, it is heartening to see him continuing to advocate this needed reform of state government, to prevent future overspending.

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Newport Beach Council votes to rescind "hit piece" crime

by James Lacy - Political Law (bio) (email)(print)

 
7-23-2008 9:58 am

     The Newport Beach City Council voted 5-0-2 last night to rescind their campaign ordinance that makes failure to register a campaign mailer with the city in the last 14 days of the election a crime.  We have called the ordinance a violation of free speech rights.  Good for them.  The two absentions came from members of the city council running for reelection in November, Councilmembers Curry and Rosansky, who said they did not want to vote on the matter because of the their pending election campaigns.  The Council will need to take some subsequent actions, but the ordinance appears on its way to oblivion. 

    

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Bob Huff Explains His Vote For The Container Fee/Tax Bill

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 8:36 am

There was quite a bit of chatter going on in the State Capitol when conservative Assemblyman Bob Huff put up the lone GOP vote for SB 974.  This legislation would require those shipping goods into California's ports in Los Angeles, Long Beach and Oakland to pay an estimated $400 million a year into government coffers to pay for infrastructure investment around those ports.

Since this vote was controversial, we reached out to Assemblyman Huff to ask him why he voted for this bill, that was rejected by his Republican colleagues.  In response to our inquiry, Assemblyman Huff penned this piece to explain his position, and his vote...

We're placing a link to Huff's piece here on the FR blog in case those reading it would like to publicly comment.

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Roll Call: The Farm Team: Dominoes Fall When Schwarzenegger, DiFi Leave

by Jon Fleischman - Publisher (bio) (email)(print)

 
7-23-2008 8:07 am

The following article appeared in Roll Call ($$) yesterday.  Since I had a quote in the piece, I've highlighted it below.

The Farm Team: Dominoes Fall When Schwarzenegger, DiFi Leave
By David M. Drucker Roll Call Staff

First in a three-part series

Conservative Republicans need not apply.

If ever someone was going to write a help-wanted ad seeking Republicans with a realistic chance of winning a Senate race in California, that sentence would most certainly deserve top billing.

California is a political behemoth. Its state Legislature often foreshadows what is to come in Congress, and its 55 electoral votes are the biggest prize in the quadrennial presidential election, equaling 20 percent of the total haul of 270 electoral votes it takes to win the White House.

But competitive between the two major political parties, it generally is not.

On the presidential front, Democrats have had a lock on the Golden State since Bill Clinton won in 1992. Democrats control large majorities in both chambers of the Legislature, hold all statewide constitutional offices except for two and are threatening this cycle to expand their Congressional-delegation lead.

Allan Hoffenblum, a Los Angeles-based Republican political consultant who tracks state legislative and Congressional candidates, said independents are the key voting bloc in California — and they prefer moderates.

And because California’s Republican base is significantly smaller than its Democratic base, the GOP has a much tougher time succeeding in statewide races.

However, Hoffenblum was quick to point out that moderate Republicans usually fare better than left-wing Democrats, which is what happened in 2006, when Gov. Arnold Schwarzenegger (R) won re-election over then-state Treasurer Phil Angelides (D).

“Neither the Democratic nor Republican base vote by itself can elect a [statewide candidate] — particularly the Republican base vote,” Hoffenblum said Monday. “Therefore, independent voters are critical. Look at the past several elections. Those independent voters prefer moderates.”

Not surprisingly, those Republicans talked about as potential challengers to Sen. Barbara Boxer (D) in 2010 are viewed as moderates. Sen. Dianne Feinstein (D), arguably the most popular statewide elected official in California, is seen as too formidable to challenge in 2012.

But if Feinstein, who will be 79 in November 2012, decided to retire, crowded primaries on both sides of the aisle would likely ensue. The field of

Senate candidates in both 2010 and 2012 will be determined in large part on who runs for governor in 2010, when term limits will force Schwarzenegger to retire.

Most of the moderate Republicans who are mentioned as potential Senate candidates are actually eying the 2010 gubernatorial race. Schwarzenegger has declined to completely kill rumors that he might run for Senate against Boxer in 2010.

Among those moderate Republicans eying the 2010 gubernatorial race — but who might be persuaded to run for Senate instead to break up a logjam of moderates in the primary that would allow a conservative to sneak through — are state Insurance Commissioner Steve Poizner and former eBay Chief Executive Officer Meg Whitman.

Former Hewlett Packard CEO Carly Fiorina, who has taken a high profile position in Sen. John McCain’s (R-Ariz.) presidential campaign, is also mentioned as a potential Republican Senate candidate by both Democratic and Republican insiders.

Some political strategists have also mentioned Gerry Parsky, a wealthy lawyer and for a long time President Bush’s point man in California on political and judicial issues. Former Rep. Tom Campbell (R), who has started an exploratory fundraising committee for the 2010 gubernatorial race, challenged Feinstein in 2000 and would be tough to persuade to run for Senate again.

With the exception of Campbell, everyone on that list of potential candidates — Fiorina, Parsky, Poizner, Schwarzenegger and Whitman — is a multimillionaire capable of self-funding a campaign, and Boxer is planning accordingly.

The two-term Senator closed the second quarter of this year with more than $3.5 million on hand, and her advisers are preparing to wage what they believe could be the most expensive Senate race in California history. Boxer’s team is also hedging on Schwarzenegger, believing the chances of him running for Senate are better than he has indicated.

“Sen. Boxer has great base of support in California, and handily won her last race,” said Rose Kapolczynski, a Boxer political consultant. “But she can’t take anything for granted in a state of this size where it is so expensive to run a campaign.”

Other Republicans who are mentioned as potential Senate candidates, either to challenge Boxer but more likely to run for an open seat in 2012 should Feinstein retire, include Rep. David Dreier; Rep. Dan Lungren, a former state attorney general who lost a 1998 gubernatorial bid; Rep. Darrell Issa, who has previously flirted with running for statewide office; former California Secretary of State Bruce McPherson; 2002 gubernatorial nominee Bill Simon; and Anaheim Mayor Curt Pringle.

McPherson was appointed secretary of state by Schwarzenegger in 2005 to replace Kevin Shelley, who resigned. But McPherson lost his bid for the seat in 2006 to Democrat Debra Bowen.

State Assemblyman Chuck DeVore, an Orange County legislator, has already signaled that he’ll be running for the GOP Senate nomination in 2010.

State Sen. Tom McClintock (R), an unabashed conservative who has won and lost races for different statewide offices at least three times, is also mentioned as a candidate. McClintock is seeking the open 4th district seat this year, and is favored to win.

But because of his political history and strong name identification, some Republicans refuse to count McClintock out of the 2010 or 2012 Senate races. In fact, some Republicans speculate that McClintock might launch a 2010 gubernatorial bid. McClintock has been adamant that his only interest is the 4th district, which is being vacated by retiring Rep. John Doolittle (R).

Not all Republicans subscribe to the philosophy that the GOP needs to nominate a moderate to win statewide.

Consultant Jon Fleischman, a former California Republican Party executive director who publishes the FlashReport blog, said the GOP has failed in California because its nominees have waged poor campaigns that made fatal errors. Fleischman noted that Republicans have nominated moderates over the years who failed to do any better than conservatives.

“For Republicans to win California, it’s not whether we field a conservative or a moderate nominee,” Fleischman said. “It’s that we field a smart nominee who keeps the debate about the issues that matter to the voters.”

With California so friendly to the Democratic Party, there are no shortage of Democrats eying higher office. With the state’s two Senate seats held by Democrats, most of the focus has been on the governor’s office, which will be open in two years. But should Feinstein retire in 2012, expect a scramble among Democrats to replace her.

On the short list could be 2006 gubernatorial candidate and former state Controller Steve Westly; Angelides, the 2006 gubernatorial runner-up; Los Angeles Mayor Antonio Villaraigosa; Lt. Gov. John Garamendi; former state Speaker Fabian N**ez; Los Angeles County District Attorney Steve Cooley; Rep. Jane Harman, who previously ran for governor and is personally wealthy; and Rep. Ellen Tauscher, who also has a fortune she could tap.

Among some Democrats, the real rising star for statewide office is Rep. Loretta Sanchez. The Orange County Democrat has long coveted higher office, and her team has in the past few years polled to see how she would fare in a run for governor.

Should she bypass the 2010 gubernatorial race, look for Sanchez to be an often-mentioned candidate for Senate should Feinstein retire in 2012.

“She has the name ID, the charisma and the ability to raise the kind of money necessary to win a U.S. Senate seat,” said one Democratic operative who follows California politics. “And she’s made no secret of her plans to run statewide in the future."

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Inside the Beltway News - Wednesday

by Jeff Solsby - D.C. "Beltway" (bio) (email)(print)

 
7-23-2008 8:02 am

Yesterday was a crazy day for seven members of the Texas congressional delegation routinely returning from Houston to Washington, D.C. for a vote on--among other things--an aviation safety measure.  Reminds me of my friend Sam Dealey's story in the Weekly Standard in 2002 about a certain member of Congress' run-in with the same airline.  Continental won praise from one Texas rep in response to yesterday's emergency landing.

Politico has an interesting piece examining the use of the "MRA" a reimbursable program that funds members operating and office expenses.  Elsewhere in the paper, Variety's Ted Johnson pens a piece on the positive work of Hollywood pros in support of our troops.  He writes Variety's "Wilshire and Washington" blog, here.  Politico also looks inside a debate pitting journalists against homeland security / national defense interests over a so-called "shield" law.  

The Hill reports that the NRA is applying some heat to conservative Democrats in an election year.

Rep. Kevin McCarthy (R-Bakersfield) is noted in a Hill piece about differences between Sen. McCain's positions on drilling in ANWR and GOP party platform positions.  Elsewhere in the paper, longtime Fox News producer and now Hill columnist Jim Mills writes a nice remembrance of Capitol Police Officers Gibson and Chesnut who were killed 10 years ago tomorrow.

Rep. Brian Bilbray (R-San Diego)'s new communications director is profiled in The Hill, here.



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