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Daniel Weintraub

California Insider

A Weblog by
Sacramento Bee Columnist Daniel Weintraub

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« July 2004 | | September 2004 »
August 31, 2004

'Economic Girlie Men'

Schwarzenegger in New York: Unabashedly pro-American:

"Everything I have -- my career, my success, my family -- I owe to America. In this country, it doesn't make any difference where you were born. It doesn't make any difference who your parents were. It doesn't make any difference if, like me, you couldn't even speak English until you were in your twenties.

"America gave me opportunities, and my immigrant dreams came true. I want other people to get the same chances I did, the same opportunities. And I believe they can. That's why I believe in this country. That's why I believe in this party, and that's why I believe in this President."

And of course he couldn't resist this:

"To those critics who are so pessimistic about our economy, I say: "Don't be economic girlie men!"

The whole thing is here.

Posted by dweintraub at 8:52 PM

Drivers Licenses

The latest rumor racing around the talk radio circuit is that Lt. Gov. Cruz Bustamante, acting governor while Schwarzenegger is in New York, will sign AB 2895, the bill giving drivers licenses to illegal immigrants. It's not going to happen, folks. One version of the tale is that legislative leaders will somehow connive to get the bill to Cruz; the other is that Arnold himself will allow Cruz to sign the bill so that it can be become law without leaving his fingerprints on the matter. Communications Director Rob Stutzman, speaking on KTKZ radio this morning, says his boss fully intends to veto the bill and won't let anyone else get their hands on it before he does so.

Posted by dweintraub at 9:20 AM

August 30, 2004

(Laura) Bush in a landslide

I don't put too much stock in the influence potential First Ladies can have on the election result, but the latest LA Times poll merits at least a "wow." Nationally, voters surveyed by The Times favored Laura Bush over Teresa Heinz Kerry by 56-26 when asked who better represented their idea of what a First Lady should be. Bush's favorable/unfavorable was 72-14. Heinz Kerry: 35-28. Ouch.

Posted by dweintraub at 10:47 PM


Schwarzenegger announced a bunch of mid-level agency appointees today. The two most interesting (to my mind) were

Dana Appling as director of the Consumer Advocacy Division of the Public Utilities Commission. Appling is the former general counsel to the Sacramento Municipal Utility District and most recently served as chief counsel for WebGen Systems, Inc., an energy conservation and demand-side management start-up company.


Matthew Bender as assistant public affairs officer for the Department of General Services. Bender has been a reporter for The Sun newspaper in San Bernardino.

The others can be found here.

Posted by dweintraub at 4:46 PM

Health costs

On Sunday I wrote about Emory University (and Kerry advisor) Ken Thorpe's study of health care costs, which suggests that much of the recent increase is due to demographics, increasing prevalence of disease (or at least treatment) and technology. The paper was published here, in Health Affairs. Another Health Affairs paper, here, published last year compares costs in the US to other developed nations. Conclusion: we pay a lot more, and we don't get more doctor visits or hospital stays, but we pay our providers more and use more technologies and advanced medical procedures.

Posted by dweintraub at 11:18 AM

August 29, 2004

Not enough workers?

I thought the biggest problem in America was a shortage of good jobs. Then my Sunday New York Times arrived with this long story about the real crisis: a looming shortage of workers. The piece looks at the well documented aging of the work force and concludes that within a few years, all sorts of ills await us because companies from McDonald's to Westinghouse are going to be scrambling to fill their open jobs. Certainly we are headed for demographic trouble in Social Security and Medicare, which look as if they won't have enough workers paying taxes to support them at current service levels. But beyond that, why is this a problem? Seems to me that companies that can't easily fill jobs will have to pay workers more and give them better benefits to recruit and retain them. In fact, the article cites examples of this happening already. A classic case of seeing the glass half empty.

Posted by dweintraub at 2:39 PM

August 27, 2004

Schwarzenegger on school standards

Facing increasing criticism like this hinted at broadly in a column by my colleague Peter Schrag, Gov. Schwarzenegger this week held an education summit meeting of sorts to assure his inner circle and, ultimately, the education community and the public that he supports the standards and accountability-based policies he inherited from Govs. Davis and Wilson. Among those present at the meeting were Bonnie Reiss, the governor's senior adviser and a member of the state board of education, Cabinet Secretary Marybel Batjer, Education Secretary Richard Riordan, Legislative Secretary Richard Costigan, state board president Ruth Green, and board members Glee Johnson and Don Fisher.

According to Green, Schwarzenegger at the meeting laid out the following principles as the core of his K-12 education policy:

1) Safeguard the State Board of Education adopted academic content standards as the foundation of California’s K-12 educational system; the same standards for all children.

2) Insure that curriculum is rigorous, standards-aligned and research-based utilizing State Board adopted materials or standards-aligned textbooks in grades 9 to 12, to prepare children for college or the workforce.

3) Insure the availability of State Board of Education adopted instructional materials for Kindergarten and grades 1 to 8 and locally adopted standards aligned instructional materials in grades 9 to 12.

4) Support professional development for teachers on the adopted instructional materials that are used in the classroom.

5) Maintain the assessment and accountability system (including STAR, EAP, CAHSEE, and CELDT).

6) Insure that the California Commission on Teacher Credentialing (CTC) and all teacher training institutes use State Board adopted standards as the basis for determining the subject matter competency of teacher candidates.

7) Strengthen coordination between K-12 and higher education.

Posted by dweintraub at 5:15 PM

Warning shot

In a little-noticed action, the state's Infrastructure Bank took the first step Tuesday toward selling a $1 billion-plus bond to be repaid by earnings from Indian gambling. But a representative of Treasurer Phil Angelides abstained from the vote, and read a statement from the treasurer explaining his position. Bottom line: Angelides says the compacts Schwarzenegger signed with the tribes don't give the treasurer's office sufficient information about the source of the money and without that information, he won't be able to sell the bonds.

"My office needs to have access to all the financial information that will be disclosed to rating agencies, underwriters, and credit providers," Angelides said in the statement. "Without such access, this securitization cannot take place. Without such access, I cannot carry out my fiduciary responsibility to the people of the State of California."

Posted by dweintraub at 11:05 AM

Prevailing wages

One reason the governor's solar power initiative is now having trouble in the Legislature is that Democrats amended it to require that any work associated with the program be done at prevailing (usually union scale) wages. Now the Building Industry Association, which had co-sponsored the plan with Schwarzenegger, is asking lawmakers to vote against it. The measure is SB 118.

Posted by dweintraub at 9:56 AM

Learning to lose

In what might have been the single worst day of his young administration, Gov. Schwarzenegger suffered setbacks on multiple fronts Thursday. The Assembly passed an electricity plan he opposes and rejected his proposal for expanding solar power. He was forced to abandon plans for this year for a big new urban casino in the Bay Area. And faced with strong opposition in the Legislature, the governor softened his opposition to having all Californians contribute to cost overruns on the San Francisco-Oakland Bay Bridge.

Posted by dweintraub at 7:24 AM

August 26, 2004

Drivers Licenses

A spokesman for Sen. Gil Cedillo says last-minute talks with Gov. Schwarzenegger in search of a compromise on drivers licenses for illegal immigrants have failed. Cedillo will now push to send the governor a bill to grant the licenses without any marker indicating immigration status. Schwarzenegger's aides have already indicated that he would veto such a measure.

Posted by dweintraub at 1:15 PM

Income, poverty, health insurance

The US Census Bureau has just released its annual estimates of income, poverty and health insurance coverage. The bureau finds that median income was unchanged in 2003 (after declining for the two prior years), the percentage of people without insurance climbed a bit (while the number of both the insured and uninsured climbed) and the poverty rate increased. Links to the full report are here.

Posted by dweintraub at 7:32 AM

The artful communicator

The LA Times dissects Schwarzenegger's creative communications habits here.

Posted by dweintraub at 6:44 AM

August 25, 2004

Arnold and the tabs

Mickey Kaus links to this LA Magazine expose on Arnold's alleged deal with the tabloids last year, then wonders if it's possible Schwarzenegger was secretly behind the recall all along.

Posted by dweintraub at 3:36 PM

Offshore outsourcing

The Public Policy Institute study on offshore outsourcing that was being held under wraps by the Legislature has suddenly materialized here. And Daniel Drezner chimes in here.

Posted by dweintraub at 2:24 PM

Maria Shriver

Schwarzenegger has renamed the state's volunteer recruiting effort the California Service Corps and named Maria Shriver as its honorary chairwoman.

Posted by dweintraub at 1:21 PM

Offshore this

Every time I write about outsourcing or offshoring, I get flooded with angry e-mails from laid off computer programmers upset that some of their industry's jobs have been shifted to India. Does that strike anyone else as ironic? I mean, aren't software writers themselves in the business of making companies more efficient, and, by extension, reducing the need for human capital? If you believe in a static economy, surely computer programmers have resulted in the "destruction" of more jobs than offshoring ever will. I happen to believe that the economy is more dynamic than that, and that outsourcing and new technology, while at times disruptive, ultimately result in a bigger economy, and more jobs for everybody.

Posted by dweintraub at 9:55 AM

New CHP contract

Weeks after taking lumps for a wimpy re-write of the state contract with prison guards (also known as correctional officers) Schwarzenegger is quietly pushing through a more modest re-do of the labor deal with the California Highway Patrol. Most of the deal is relatively benign. It extends for six months, for example, an arrangement by which CHP officers are deferring a 5 percent pay raise in exchange for a like amount of paid time off.

But one provision in the new contract is especially curious. And the trail once again leads back to the final days of the Davis Administration.

It seems that on Oct. 5, 2003, two days before the recall, a top Davis official signed off on a deal with the CHP union that gave the officers overtime pay for the half-hour each day they were supposed to be eating lunch. The move was made without public notice or legislative approval, even though it was the equivalent of a 3 percent pay raise for every member of the force. (An earlier change had given the officers straight-time pay for the that half-hour, a 6 percent pay bump, even though most state employees eat lunch on their own time).

Now comes the Schwarzenegger deal, and for whatever reason, the union has decided to give back the overtime they won from Davis. But not for nothing. That perk has been traded for a bunch of new holiday and leave pay.

Officers now stand to get 52 hours of additional holiday leave hours (for a total of 164) and 12 more hours of vacation time each year – or an additional 64 hours of paid leave.

The net effect of all that time off, of course, is to increase the need to hire more officers or, if not, to pay more overtime to cover shifts.

UPDATE: A CHP officer notes that there is one other possible outcome, one he insists is the most likely result: that the CHP force will simply be spread thinner throughout the state to compensate for the increased time off, because the shifts of officers who are sick or on vacation are routinely not covered by others.

Posted by dweintraub at 9:48 AM

August 24, 2004

Don Perata

Senate Democrats have voted to nominate Don Perata of Oakland to succeed John Burton as Senate leader, rejecting a latina -- Martha Escutia -- who would have been the first woman and minority to lead the Legislature's upper house.

Posted by dweintraub at 6:35 PM

San Pablo Casino

It's been widely reported that the amended gaming compact the governor signed Monday with the Lytton band for a San Pablo casino limits the number of slots to 2,500. But that limit only applies until 2008, when the parties are free to negotiate "in good faith" on a new limit, after reviewing market conditions and the effect of the casino on surrounding areas. You can see that and other details in the full agreement here.

Posted by dweintraub at 9:14 AM

Local pension fallout

With Orange County on the verge of giving its employees a big new pension benefit, the Orange County Register has hired an actuary to doublecheck the county's projections, and produced findings questioning the government's figures. The private actuary says the county is using old life-expectancy tables and has failed to acknowledge that the new benefits will prompt more workers to retire early. Combined, the two faulty assumptions could mean the benefit will cost far more than the county has projected.

Posted by dweintraub at 7:59 AM

Kevin Shelley

A former aide accuses Secretary of State Kevin Shelley of making crude gestures and sexually explicit comments, the Bee reports.

Posted by dweintraub at 7:58 AM

August 23, 2004

Casino deals

Schwarzenegger has signed the five Indian gaming compacts he disclosed last week, including a newly modified deal for the San Pablo casino, now limited to 2,500 slots rather than 5,000 the governor agreed to last week.

Posted by dweintraub at 5:00 PM

Steve Thompson

Among those mourning lobbyist Steve Thompson Saturday at the Trinity Cathedral were Rep. Robert Matsui, former Mayor and Assemblyman Phil Isenberg, Treasurer Phil Angelides and former Assembly Speaker and San Francisco Mayor Willie Brown. All were in fine form, cheering the standing-room-only audience with touching and humorous tales of Thompson's imfamous antics.

Matsui, who'd known Thompson since junior high school, said he arrived at California Junior High in Land Park, about two miles south of the Capitol building, after attending elementary school in downtown Sacramento. He knew hardly anyone at his new school. But Thompson, Matsui said, reached out to him and brought him into his circle of friends. Nearly 20 years later, he managed Matsui's first campaign for the City Council.

In junior high, Matsui said, Thompson once hatched a plan for a group of friends to travel by bus to San Francisco to see "Guys and Dolls," which was not yet playing in Sacramento. Thompson informed the group of 13-year-olds that they would all have to wear suits. Then, the night before the trip, he called each of them and told them to snatch some of their dads' cigars, if they could. The next day they took the Greyhound to the The City, saw the movie and smoked their stogies. They all felt like big shots.

On the way home, Matsui said, they all got sick.

"I had a hard time explaining to my mother," the congressman said, "why my suit smelled like cigars, and how I got barf all over my pants."

Posted by dweintraub at 10:09 AM

San Pablo Casino

Backers of the San Pablo casino have already agreed to reduce the number of slots from 5,000 to 2,500. This suggests to me that they knew all along that the higher number would draw protests, and they built in wiggle room. Had they proposed 2,500 to begin with, that number, too would have been controversial. I wonder if the final deal will include a provision to allow them to expand later, perhaps with the approval of the city.

Posted by dweintraub at 9:59 AM

Hetch Hetchy

The Bee on Sunday began a series of editorials calling for the restoration of the Hetch Hetchy Valley, the twin of Yosemite that was dammed nearly 100 years ago to supply water to the city of San Francisco. The idea of taking down the dam isn't as far-fetched as you might think. The first installment in the series is here.

Posted by dweintraub at 9:55 AM

August 20, 2004

Minimum wage

The Senate has passed, and the Assembly will soon, legislation to raise California's minimum wage by a dollar, to $7.75 an hour, over the next two years. Schwarzenegger's office hasn't said where he stands on the bill, but he seems likely to veto it.

Posted by dweintraub at 9:26 AM

August 19, 2004

San Pablo Casino

The governor’s office, in a briefing for reporters, has released more details on its deal for a massive new Indian casino in San Pablo in the Bay Area, saying the governor remains an opponent of urban gambling. He approved the San Pablo deal, they said, because federal legislation granting the Lytton tribe rights to gambling on that location forced his hand. He agreed to a mega-casino, with up to 5,000 slot machines, in the hope that the revenue that would flow from the operation would mitigate all the ill effects from the casino.

“We believe,” said lawyer Daniel Kolkey, “that he had a lemon and made it into lemonade.”

Among the provisions:

--The tribe will have to conduct an environmental impact report and then get the sign-off of the city of San Pablo, Contra Costa County and CalTrans before going forward. The deal might eventually include a new freeway offramp into San Pablo from Interestate-80.

--The governor’s office expects the state’s take to be at least $150 million a year, which would be 25 percent of the casino’s earnings from not just slots but card games as well. Payments to the city, county and CalTrans would be deducted from that amount. The remainder would go to the general fund.

--Kolkey said the 35-mile exclusion on competing casinos is evidence that the governor opposes urban gaming. Peter Siggins, the governor’s legal secretary, said it would take another “act of Congress” for Schwarzenegger to approve another urban casino.

--The casino will participate in the state’s workers compensation program for injured workers, abide by Cal-Osha worker safety regulations, and allow employees to organize in union via a secret ballot if they wish. State and local law enforcement will have their run of the place, and the state will have considerably more leeway in regulating the operation than it has with other Indian casinos.

--The casino will abide by extensive requirements concerning pathological gambling in its advertising and promotion and will have to prominently display warnings about compulsive gambling and hotlines for people to be treated. It will allow people to black-list themselves from the joint and will have the right to deny entrance to people it suspects of being problem gamblers.

It sounds as if the bottom line is that this is a Las Vegas-style casino, and the governor’s office believes its deal treats the casino more like a Vegas operation than the arms’ length relationship the state maintains with other tribal gaming palaces protected by their sovereign rights under federal law.

Posted by dweintraub at 2:35 PM

Drivers licenses

Talks over drivers licenses for illegal immigrants have broken down, and a veto from Gov. Schwarzenegger seems likely. Now more accusations are flying about who said what to whom, and Democrats once again are saying they were misled by soothing words from Schwarzenegger.

Posted by dweintraub at 7:20 AM

August 18, 2004

How to beat Arnold

This Schwarzenegger assessment from The New Republic online nails the bottom line: Arnold's not nearly as all-powerful in Sacramento as his national image would suggest. But I'd quibble with some of the details, including the author's conclusion that the "girlie man" comment was a political mistake that hurt Schwarzenegger with the voters.

Posted by dweintraub at 11:17 AM

Five more tribes

Gov. Schwarzenegger is about to firmly put his stamp on state gambling policy by signing five more compacts with casino tribes. The deals will bring more money to the treasury, and will require the tribes to participate in the state's workers compensation program for injured workers and follow state workers safety regulations. Here is a story in the Bee.

Posted by dweintraub at 6:19 AM

August 17, 2004

Steve Thompson

Steve Thompson -- lobbyist, good guy, husband, father and veteran of 40 years around the Capitol -- is dead at 62. Damn.

Posted by dweintraub at 4:17 PM

More barriers for Wal-Mart?

The California Assembly has passed legislation that would prohibit local governments from approving new Wal-Mart superstores without first conducting an economic impact study that critics of the bill say would be stacked against the successful discount retailer. Here is a story on the legislation in the Bee.

Posted by dweintraub at 7:18 AM

Kerry's lead grows in Cali

Highlights from the latest California poll by the Public Policy Institute of California:

--64% of likely voters say they are more interested in politics now than they were during the 2000 presidential election.

--The Democratic ticket of Senators John Kerry and John Edwards holds a 16-point lead over the ticket of Republican President George W. Bush and Vice President Dick Cheney (54% to 38%). Only 6% of likely voters say they have not yet chosen a candidate.

--63% of Californians disapprove of Bush’s handling of the Iraq situation, up 18 points from one year ago; 61% of state residents say it was not worth going to war in Iraq.

--65% of state residents approve of the way Arnold Schwarzenegger is handling his job as governor.

--Among likely voters, Senator Barbara Boxer has a 17-point lead over Republican challenger Bill Jones (53% to 36%).

Posted by dweintraub at 7:15 AM

August 16, 2004

Bay Bridge cost overruns

With the latest estimates showing the cost of retrofitting or rebuilding California toll bridges climbing to $7.4 billion -- or roughly three times the original estimate -- Schwarzenegger today took steps to distance himself, and the state, from the Bay Bridge fiasco, which is becoming a political and public works disaster. The governor said he would commission an independent audit to determine what's gone wrong and how any mistakes made on this bridge can be avoided in the future. He is calling on Bay Area voters to decide whether they want to redirect the extra $1 per crossing toll that took effect July 1 from new projects to the Bay Bridge. And he wants to hand the entire project over to the Metropolitan Transportation Commission along with "all the tools necessary" to fix the problems now and more in the future should they arise. It sounds like he is trying to stop the bleeding before the bridge project takes any more of the state transportation program down with it.

NOTE: An earlier version of this item stated incorrectly that the Bay Bridge alone was now a $7.4 billion project, and implied that Schwarzenegger endorsed the idea of redirecting the new $1 toll from new projects to the bridge rebuild. A spokesman said he supports putting the question to the voters but likely won't take a position.

Posted by dweintraub at 3:36 PM

School test scores wobbly

The state released results today from the 2004 standardized tests in the public schools, and for the first time since testing resumed in the late 1990s, statewide scores were stagnant, and in some cases, declined. Here is the first report from the California Department of Education.

Posted by dweintraub at 12:41 PM

Legislative races: AD 30

Two years ago, Nicole Parra won this Central Valley district by 266 votes. Now the Republican who nearly beat her is back, with the support of his party and the governor. The Fresno Bee's Jim Boren describes the campaign here.

Posted by dweintraub at 6:03 AM

August 13, 2004

17,000 jobs lost, but unemployment dips

The latest payroll survey shows California lost more than 17,000 jobs in July, but the number of unemployed and the unemployment rate both declined. The unemployment rate was 6.1 percent, down from a revised 6.3 percent in June. The number of people on unemployment insurance declined by 39,000 from June to July, and by 118,000 from one year ago.

The numbers reflect the national trend and are likely to fuel further debate about the payroll versus household surveys. Some economists believe the drop in the number of people on unemployment rolls, coupled with an increase in the number of people reported employed in household surveys, suggests more people are self-employed either as contractors or entrepreneurs. Others say the household survey is unreliable and the drop in the number of unemployed is evidence that the jobless are giving up hope of finding work.

Posted by dweintraub at 2:11 PM

Gambling measures take nosedive

Two months ago, a pair of November proposals to expand gambling in California had healthy leads in the Field Poll. Today, they are both trailing badly.

One thing that's changed in the interim is Schwarzenegger's announcement that he opposes both measures and has crafted an agreement with five tribes to expand gambling on terms more favorable to the state and to their neighbors.

The poll asked voters if they were swayed by Schwarzenegger's opposition and three out of four said no. A tribal spokesman, meanwhile, says a change in the wording of the questions was to blame for the shift. Either way, the tribes and the card rooms and racetracks backing the other measure are in a big hole.

Here is the Field Poll.

Posted by dweintraub at 8:56 AM

August 12, 2004

Drivers licenses

There's been a flurry of activity on the illegal immigrant drivers license issue in the past day or so. Sen. Gil Cedillo says the governor has given him a counter-offer to his latest proposal and the two are in serious negotiations. Cedillo says a deal is near. Of course, lots of Democrats have said they were "near" deals with the governor this year that never seemed to materialize. Cedillo plans to brief reporters on the latest developments later today.

Posted by dweintraub at 8:11 AM

Schwarzenegger might stump for Bush

After saying for months that he wouldn't go out of state to campaign for Bush, Schwarzenegger now says he might do just that.

Posted by dweintraub at 8:09 AM

Poll: health mandate has big edge

The latest Field Poll shows voters are inclined to support Proposition 72, the proposal to require employers of 50 or more workers to provide health insurance or else pay into a state fund that will do it for them. This is a referendum on SB 2, passed last year and signed into law by Gov. Gray Davis. But remember, even though it is a referendum, it works the same way as any other ballot measure: A yes vote means you want the law to go into effect, and a no vote means you're against it.

Posted by dweintraub at 7:11 AM

August 11, 2004

Gay marriage ruling expected

The state Supreme Court is expected to rule Thursday on whether San Francisco Mayor Gavin Newsom overstepped his legal authority when he ordered city officials to issue marriage licenses to gay couples earlier this year. Most observers expect the court to rule that Newsom was wrong to determine for himself that a voter-approved ban on gay marriage violated the constitution. But even if the court swats Newsom on the process issue, it won't rule yet on the core question of whether the ban is or is not constitutional. That will come later.

Posted by dweintraub at 2:32 PM

July revenues up slightly

The Department of Finance has released its revenue report for July, and receipts were on target with the amount projected in the governor's revised budget in May. The major revenue sources, the department says, were $108 million above the monthly forecast of $4.2 billion. A full copy of the report can be found here.

Posted by dweintraub at 2:03 PM

"A revolutionary kind of change"

Schwarzenegger opposes a new initiative to limit services to illegal immigrants, is undecided on the stem cell bond and is stilll toying with the idea of a part-time Legislature, even in the face of a new poll showing that the voters don't like the idea.

And he is more than willing to try to take key elements of his performance review to the people if the Legislature won't go along.

"People have a difficult time giving up anything…. It's just a habit. So what we're going to do is take those things directly to the people. But in any case, by the time it's all over there will be revolutionary kind of change and remake of government. And it will be updated, basically. That's the way it should be."

From an interview the governor did with the Bee and the LA Times while in New Mexico for a border governors' conference.

Posted by dweintraub at 9:10 AM

Devil in the details

Californians love the idea of the governor's proposal to overhaul state government, and they like some of the proposals. But others give them pause. Here are the details in the latest Field Poll.

Posted by dweintraub at 9:02 AM

August 10, 2004

Field: 65% approve of gov's performance

Schwarzenegger's approval rating in the latest Field Poll remains high at 65 percent, but his musings about a part-time Legislature are getting the cold shoulder from voters. By a 52-33 margin, voters oppose the idea of cutting back on lawmakers' hours, the poll found. Other results of note:

--Schwarzenegger's approval rating is nearly unanimous among Republicans (90-5), is high among non-partisans (61-23) and pretty good among Democrats (45-36). His performance is approved almost equally by men (66-22) and woman (63-23). And non-hispanic whites approve of his performance by a margin of 70-18 while Latinos back him 56-32 and blacks, Asians and other ethnic groups approve by a margin of 55-33.

--More than half (54 percent) feel the governor is doing a better job than they expected.

--By 56-27, voters think Schwarzenegger makes his decisions on the merits, not based on what special interests want.

--By 49-13, voters rate the governor's performance on the budget as a good or very good job.

The whole poll is here.

Posted by dweintraub at 7:13 AM

August 9, 2004

State bonds off the watch list

Fitch Ratings has taken the state's bonds off its "watch negative" status thanks to the recent budget agreement. Says the rating agency: "Further financial deterioration is not now expected."

Posted by dweintraub at 1:09 PM

August 8, 2004

Assembly elections: 61st AD

Republicans have targeted Assemblywoman Gloria Negrete McCleod, hoping to make her the first Democrat incumbent to lose since 1994. Here is a good overview of the race from the Ontario Daily Bulletin.

Posted by dweintraub at 10:22 AM

August 7, 2004

Local pension fallout

Interesting inter-generational debate among Orange County public employees over how to finance a generous new pension plan. The older workers love it, because they get a big benefit boost and don't have to pay much more before retiring. The younger workers stuck with the tab aren't so thrilled. The story is in the LA Times.

Posted by dweintraub at 8:50 AM

Vegas ventures

Last week Gov. Schwarzenegger made a big show of unveiling a billboard in Las Vegas designed to promote California as a place to do business. But the Las Vegas Business Press has a piece suggesting the gambling mecca's leaders aren't exactly in a panic.


Of the 60 new companies that relocated to Clark County bringing 1,877 jobs paying an average wage of $22.80 per hour during the Nevada Development Authority's (NDA) last fiscal year, 32 came from California, a 68.4 percent increase over the 19 that came from California the year before.

Gov. Schwarzenegger was diplomatic, though, complimenting Gov. Kenny Guinn's administration and glossing over the rivalry between the two states.

"This is not about taking jobs away from Nevada," he says. "It is all about bringing jobs to California."

Still, the timing illustrates the difficulty of California's predicament. The day before the launch of the ad campaign, construction materials manufacturer Quickflash Weatherproofing from Huntington Beach announced that it would be relocating to Las Vegas and the city of Henderson passed zoning changes to accommodate the relocation of intermodal distribution company Pacer Stacktrain's corporate headquarters from the Oakland area, bringing 350 job with it.

In addition, three California companies had contacted the NDA to inquire about relocating to Nevada the same day Schwarzenegger launched the campaign.

Hat tip: Prestopundit.

Posted by dweintraub at 8:29 AM

August 6, 2004

Arduin: $5 billion gap next year

Gov. Arnold Schwarzenegger will probably face a new budget shortfall of about $5 billion later this year when he begins to put together his proposed spending plan for the 2005-06 fiscal year, the governor’s finance director, Donna Arduin, said in an interview today.

Arduin said she believes the budget Schwarzenegger signed a week ago effectively erased about $11 billion of the state’s $15 billion structural budget gap. That leaves about a $4 billion gap between the general fund’s ongoing revenues and its expenditures, she said, with another $1 billion or so of “inherited debt” coming due next year.

Arduin said that as of today, she projects general fund revenues of about $83 billion in 05-06, with expenditures, based on current law, rising to $88 billion. Some combination of cuts and revenues bridging that gap will have to be part of Schwarzenegger’s budget proposal next year to bring the two sides of the ledger back into balance.

“You have to keep working at it,” she said.

The state has $3.7 billion of borrowed money remaining from the $15 billion bond voters approved in March, and some or all of that cash could be used to help close the gap for one year.

Arduin’s estimate of the remaining structural shortfall appears to be significantly smaller than others have guessed it might be. As the budget was nearing final passage, several legislators said they thought this spending plan would leave a gap as large as $7 billion or $8 billion next year, growing to $10 billion the year after that if nothing was done in the meantime.

But even if Arduin is correct, the task ahead is difficult. Schwarzenegger has already placed off the table for next year K-12 education, higher education, and the judiciary, and has promised not to raid local government coffers again. That leaves him with few options other than deep cuts in health and welfare and prison programs.

The non-partisan legislative analyst will probably weigh in with a preliminary estimate of the remaining gap sometime in the next week or so.

Posted by dweintraub at 3:09 PM

Westly says July revenues up $400 million

Controller Steve Westly reports that July revenues were 13 percent ahead of the Department of Finance forecast, netting $400 million more for the treasury than projections made last May. Remember, though, that the controller and the department always seem to be on different pages when it comes to projecting and counting state revenues. For June, Westly reported revenues were up $700 million, while the Finance Department said receipts exceeded projections by about half that.

UPDATE: Westly's office now says it's discovered that sales tax projections it was comparing to actuals were artificially low because of an accounting issue, so the revenue numbers are not as rosy as first believed. The controller, though, adds this detail: all three major tax sources were significantly higher than the same month a year ago. Sales and use taxes were 9.5 percent higher; personal income taxes were 7.6 percent higher; and corporation taxes were 30.9 percent higher.

Posted by dweintraub at 2:15 PM

Field: Kerry 51, Bush 40 in California

Today's Field Poll has Kerry maintaining his double-digit lead over Bush in California, 51% to 40%. That's about the same margin by which Gore beat Bush here four years ago.

The race continues to be all about Bush, with 58% of Kerry supporters saying they will vote for the Democrat not because they like him but because they can't stand the president. Seventy-nine percent of Bush voters, meanwhile, say they will vote for the incumbent because they like him, with just 17 percent saying they will vote for Bush because they don't like Kerry.

Among voters who support their candidate strongly, Kerry leads by just 34 percent to 33 percent. The leaners -- those who say they support their candidate "somewhat" -- break 17 to 7 for Kerry.

The whole poll report is here.

Posted by dweintraub at 10:12 AM

21st Assembly District

By traditional measures, Republicans have no business even playing in the Bay Area's 21st Assembly District. Democrats hold a commanding 45-31 registration edge. But the GOP candidate, Steve Poizner, a former tech executive who sold his start-up for $1 billion, is funding his own campaign while refusing contributions from unions, corporations PACs and political parties. The Democrat, Redwood City councilman Ira Ruskin, is running a traditional campaign with a lot of help from the unions. Keep your eye on this one. Here is the latest from the Mercury-News.

Posted by dweintraub at 7:11 AM

August 5, 2004

Costa: 90 days every 2 years

Ted Costa, the recall sponsor who announced Wednesday that he'll be pushing an initiative to make the Legislature part-time, just told me he plans a major change in the measure before he starts collecting signatures. The original would have allowed lawmakers to meet for 90 days a year, which would not have meant a huge change in the way the place operates. They would have been in town off and on for six months instead of eight months. Now Costa says that the initiative will limit their sessions to 90 days every two years. That's a true, part-time Legislature that would fundamentally change the culture in the Capitol, which would probably lead to a pay cut and a different breed of politician running for these offices. Costa says he plans to file the change Friday with the attorney general's office. Stay tuned.

Posted by dweintraub at 3:58 PM

Study: new electricity crisis coming

The Bay Area Economic Forum warns in a new study released today that California might face a new electricity crisis as soon as next summer. Demand is climbing fast with the economic recovery, and new plants proposed since 2001 aren't being built, in part because of the state's muddled regulatory climate. The report urges policymakers to expedite the construction of new plants, encourage utilities to contract with private electricity providers, and create more incentives for users to reduce demand during peak hours.

Posted by dweintraub at 3:35 PM

One year ago

Friday is the one-year anniversary of Schwarzenegger's announcement that he would run for governor in the 2003 recall election. He's celebrating with a dinner tonight with his senior staff and cabinet in Sacramento and an appearance Friday night on the Tonight Show with Jay Leno, where he originally announced that he would run.

Posted by dweintraub at 1:52 PM

GOP campaign plan

California Republican leaders, in advance of their mini-convention San Diego this weekend, had a conference call with political reporters this morning in which they predicted that their candidates will surprise some people in legislative races this fall. With more money than they have had in years, and Gov. Schwarzenegger getting more serious about the effort, they said they hope to pick up at least two seats in the state Senate and four or more in the Assembly.

Given the lay-out of district lines designed to protect incumbents and incumbent parties, that seems like a reach. But remember that Schwarzenegger and fellow Republican Tom McClintock won a plurality in 65 of the 80 Assembly Districts. The party strategists are dreaming about winning maybe 36 of those 65 seats, and they hope to do it by rekindling the spirit of the recall and making the performance of the Legislature an issue throughout the state.

Despite all the help Republicans have had from Schwarzenegger, the Democrats have more cash on hand in their state party fund than Republicans at this point ($12.9 million to $7.8 million). But Republicans have raised more during the current election cycle, and they have a slight edge in money on hand that was raised under the new federal campaign finance rules ($2.8 million to $2 million), which they say is easier to spend on voter outreach in the weeks before the election. Their candidates in many of the contested races also have more money, sometimes substantially more, than their Democrat counterparts. Finally, the Republicans are led by a popular governor whose appeal crosses party lines, while in the minds of many voters, the Democrats remain the party of former Gov. Gray Davis. Schwarzenegger has already made automated phone calls into seven Assembly districts, and will almost certainly do more in the weeks before the election.

Currently, Democrats control the Assembly by a 48-32 margin. To make a serious dent in that gap, Republicans first have to defend at least three incumbents who will face stiff Democrat challenges: Guy Houston, Shirley Horton and Bonnie Garcia. Once they do that, Republicans plan to target several open seats with favorable registration numbers (31, 53, 54). They’re also looking at a few Democrat incumbents considered vulnerable (Barbara Mathews, Nicole Parra, Gloria Negrete McCleod). And in their dreams, Republicans are looking at longshots like Robert Pohl in AD 35 and, in a race in which the wealthy Republican nominee (Steve Poizner) has refused help from the party and is running as something of an independent, AD 21.

If they swept all of those races, an unlikely prospect at this point, Republicans would have 37 seats in the Assembly, to 43 for the Democrats.

OOPS: Missed one. The Reeps are also targeting the Dem-leaning 76th District in San Diego, where former Assemblywoman Tricia Hunter is the Republican nominee against Lori Saldana, who won the Democratic nod by sneaking through two better known and connected candidates who shot each other up in the primary.

Posted by dweintraub at 11:51 AM

August 4, 2004

Costa proposes part-time Legislature

Ted Costa, the sponsor of the Gray Davis Recall, has filed an initiative with the Attorney General’s office proposing to make California’s Legislature part-time.

Costa’s measure would limit the Legislature to no more than 90 days in session per year, and force lawmakers to adjourn by the end of June. It would not cut their pay. Costa told me he feared doing so would run afoul of the state’s single-subject rule for ballot measures. Legislators’ pay could still be reduced by the state’s salary-setting commission.

But strictly speaking, Costa’s proposal wouldn’t create a part-time Legislature so much as it would limit the time they could spend in Sacramento. If the 90 days didn’t include weekends, lawmakers would still be meeting 18 weeks per year, or about four and a half months. The rest of the time, they would be in their districts or holding interim committee hearings (which might also carry a per-diem reimbursement stipend).

For that reason, and especially if the pay were not cut substantially, I doubt the change would have much effect – good or ill -- on the people who run and serve and the product of the body. They would still, as they do now, vote out most of the legislation in the final weeks of the session. They’d just have less time to fuss around with it before getting to that point.

Costa says he hasn’t talked with the governor’s people about the idea, and at present has no source of funding for it.

“Everybody has been talking about this, but I couldn’t find anyone who was doing it,” he says. So he did.

Posted by dweintraub at 5:11 PM

Seniority raises

One of my favorite parts of the governor's California Performance Review is the section on merit raises. It turns out that 99 percent of the employees up for a merit raise get one. In other words, they have turned into de facto cost-of-living increases. But the state employees union doesn't see it that way. J.J. Jelincic, president of the CSEA, tells my colleagueJohn Hill that merit raises are based on the assumption that all workers get better with experience. If an employee isn't getting better and is therefore denied a raise, it's not his or her fault, but the supervisor's.

So, Jelincic said, if an employee isn't performing well enough to earn a raise, "it sounds like you've got a supervisor problem, not an employee problem."

Posted by dweintraub at 12:08 PM

August 3, 2004

The battle begins

Schwarzenegger formally accepts and hands over to a commission his California Performance Review, more than 1,000 recommendations on ways to streamline and improve the operation of state government. If he's serious and follows through, this thing will eventually define his tenure as governor. Find it here. The individual recommendations are all listed together at the end of "Issues and Recommendations" Part B.

Posted by dweintraub at 4:56 PM

August 2, 2004

Medi-Cal rewrite delayed

The Schwarzenegger Administration confirms that it will delay proposing a top-to-bottom overhaul of Medi-Cal until next January, as part of the governor's budget. The plan had been due for release today. Health and Welfare Secretary Kim Belshe outlines the reasons here.

Posted by dweintraub at 2:59 PM

Performance Review

Schwarzenegger is scheduled to kick off his next big initiative Tuesday, an overhaul of state government that he earlier this year described as “blowing up the boxes” on the government organization chart.

The plan prepared by a team of state employees has already leaked out, and, as could be expected, it is attracting plenty of criticism. Conventional wisdom seems to be saying that the Legislature will reject many, if not most, of the recommendations. The number one gripe heard so far seems to be that many of the ideas in the California Performance Review, by eliminating state boards and commissions and reorganizing government, would give the governor’s office more power than it has today. Others are carping on process, suggesting that the public should have been more involved in coming up with the proposals.

But the process is really just beginning. The report Schwarzenegger will receive Tuesday contains hundreds of recommendations, some of which he will adopt and pursue and others that he might reject. A commission he appointed plans a series of public hearings, and legislators will no doubt hold their own hearings to review the plan.

While each proposal needs to be considered on its merits, Schwarzenegger would be wise to keep his package together in the political discussion and in the public’s mind. It represents the completion – six months late – of his promise to audit the state’s books, and it’s his chance to show that he is serious about overhauling state government. Given his compromises on the budget, the fate of the performance review will tell us plenty about whether Schwarzenegger plans to be a true agent of change or a cautious incrementalist, like his predecessor.

Posted by dweintraub at 9:49 AM



At Crossroads, a panel of experts and the public debate the future of health care in California. We'd like you to join the conversation.

Daniel Weintraub


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