California Insider

Donna Arduin, late of Schwarzenegger's Finance Department, is set to launch a new consulting firm with two other high-powered conservative fiscal experts: Art Laffer and Stephen Moore. Laffer, of course, is one of the fathers of supply side economics and is best known for his "Laffer Curve" showing how lower tax rates can produce higher revenues. Moore, until recently president of the Club for Growth, now heads the Free Enterprise Fund, a Washington, D.C.-based lobbying group.

The firm will be known as Arduin, Laffer & Moore with offices in Florida, San Diego and Washington, D.C.

The company, according to a soon-to-be-released statement, will provide "strategic budget, tax, and economic consulting advice and analysis to state and local governments. The new firm will also provide economic analysis for companies and trade associations, provide economic and budget research and testimony, develop economic arguments for proposed legislation and offer solutions to various fiscal problems."

...declared by Schwarzenegger today for Ventura County, site of this week's killer mudslide.

Legislative Analyst Liz Hill is out with her quick assessment of the governor's budget. Her bottom line:

The 2005-06 budget plan has several positive attributes. It realistically portrays the size of the problem facing the state and contains reasonable estimates for its solutions. It also contains a significant amount of ongoing savings.

However, while the budget's proposals would address the 2005-06 shortfall, it falls well short of fully addressing the state's ongoing structural imbalances. Moreover, its budget reform proposals would dramatically reduce the ability of future policy makers to establish budget priorities when addressing future budget shortfalls.

Read the whole thing.

Attended a briefing for reporters yesterday by Assembly Budget Chairman John Laird of Santa Cruz and two colleagues. While there were a few interesting nuggets, it's fair to say that these folks seem, somehow, to have been caught flat-footed by Schwarzenegger's aggressive agenda. Facing a $9 billion shortfall, they oppose Schwarzenegger's biggest cuts but shy away from the logical alternative: across-the-board tax increases. They wanted to focus instead on loophole closures and tax law enforcement. And they had no ideas of their own on how to control the state's runaway spending. They pleaded a lack of time -- the governor's budget had been out for only a day -- but surely they, like everyone else in the Capitol, knew pretty much what was coming. With Schwarzenegger gunning for the ballot, the legislative calendar this year seems likely to be accelerated. Everything will have to move in fast motion. If the Democrats want to keep up with the governor, they are going to have to get up to speed. An alternative, balanced budget of their own would be a nice place to start.

"I will put the attention on that and I will keep hammering away," he said. "I am like an Alabama tick. I stick there and you can't get rid of me."

--Schwarzenegger, in an interview with the Union-Tribune editorial board. He also says he is open to changing term limits:

"The special interests are becoming more powerful and smarter and having more influence than the legislators because they're such experts," the governor said. "They're around forever. That's a big disadvantage now, and so now people are talking about maybe we should extend the term limits."

With the almost constant chatter about loosening legislative term limits, I've never heard anyone mention the two-term limit on statewide officeholders, including the governor. Wonder if anyone, as part of the deal, might be interested in extending that to, say, three terms?

Election law blogger Rick Hasen comments on the limits, literally, on Schwarzenegger's ability to finance his proposed reform campaign via ballot initiatives.