I had no idea that crime rates in California varied so much by county until I saw this grpahic in a primer on criminal justice issues released today by the LAO. Read the whole thing here.
Posted by dweintraub at 10:17 AM
The New York Times today has a cautionary tale for those who want to wean us from fossil fuels: look at what happened with palm oil. An excerpt:
Spurred by government subsidies, energy companies became so enthusiastic that they designed generators that ran exclusively on the oil, which in theory would be cleaner than fossil fuels like coal because it is derived from plants.
But last year, when scientists studied practices at palm plantations in Indonesia and Malaysia, this green fairy tale began to look more like an environmental nightmare.
Rising demand for palm oil in Europe brought about the clearing of huge tracts of Southeast Asian rainforest and the overuse of chemical fertilizer there.
Worse still, the scientists said, space for the expanding palm plantations was often created by draining and burning peatland, which sent huge amounts of carbon emissions into the atmosphere.
Read the whole thing here.
Posted by dweintraub at 7:04 AM
The Census Bureau this morning published new numbers showing how the states rank in government spending and revenues. The latest numbers are from 2005. The latest rankings are from 2004. In that year, California was 10th in spending per capita on state and local government. You can find the information here.
The PPIC, meanwbile, is rolling out a report today based on that and similar data, showing where California puts its spending priorities compared to other states. You can find that one here.
Posted by dweintraub at 6:41 AM
Republcians in the state Senate have rolled out their health care proposal. It's a collection of tax credits, deregulation, fund shifts and expansion of Medi-Cal that emphasizes preventive and primary care, consumer choice and flexibility. You can read the entire outline here.
Posted by dweintraub at 11:28 AM
Assemblyman Lloyd Levine says he wants to ban the sale of incandescent light bulbs in California by 2012. Says the lawmaker:
"Incandescent light bulbs were first developed almost 125 years ago, and since that time they have undergone no major modifications. Meanwhile, they remain incredibly inefficient, converting only about five percent of the energy they receive into light. It’s time to take a step forward – energy-efficient bulbs are easy to use, require less electricity to do the same job, cut greenhouse gas emissions, and save consumers money.
"According to the Rocky Mountain Institute (RMI), a nonprofit organization that focuses on energy policy, replacing a 75-watt incandescent light bulb with a 20-watt compact fluorescent would result in the same amount of light but would save 1,300 pounds of carbon dioxide and save customers $55 over the life of the bulb (while the life of one 75-watt incandescent bulb is roughly 750 hours, the life of a compact fluorescent is a whopping 10,000 hours). Meanwhile, incandescent bulbs use 750 kWh over 10,000 hours, while compact fluorescents use only 180 kWh."
Posted by dweintraub at 10:41 AM
At least a few Republicans in Washington, D.C., led by Sen. Jeff Sessions of Alabama, have figured out that the most effective way to push their anti-immigration views is to argue that legal and illegal immigration holds down wages and hurts the poor. Sessions last week introduced an amendment to the minimum wage bill to withhold federal contracts from companies caught employing illegal immigrants. And this is what he said about the issue:
“We cannot have a discussion on minimum wage without recognizing the negative impact of illegal immigration on the salaries of American workers. The competition American workers face from illegal laborers is a serious problem that holds down their wages. Contractors need to be held accountable for not hiring Americans,” Sessions said. “I believe this amendment is a step in the right direction. Government contractors should set an example because they are being paid with tax dollars.”
This is potentially dangerous for Democrats, in California and elsewhere. They are unabashedly pro-immigrant, and many are agnostic on illegal immigration. Over the long term, that's probably good for the economy. But in the short term, just like outsourcing and technology, immigration causes disruption in labor markets and hurts those who are displaced. To the extent that Republicans can tap into that frustration among the middle class and working poor, they can benefit. It has always amazed me that more of them didn't use this language earlier, rather than focusing on the cultural issues or the cost of government services to illegals.
Don't forget, immigration was the top issue for California voters in this PPIC poll released last week. It out-polled education, health care, the economy and the state budget.
Posted by dweintraub at 10:18 AM
Over at Capitol Alert, Shane Goldmacher is reporting that Republican Todd Spitzer, who was bounced from the Public Safety committee, was apparently banished for referring to Democrats on the panel as "pro-criminal."
Here is the FlashReport column in which Spitzer used that term.
Posted by dweintraub at 2:36 PM
...about state transportation programs. From the legislative analyst. A sample:
Posted by dweintraub at 11:43 AM
My colleague Tom Philp has started a new blog on water issues. He opines here about a possible connection between the governor's health care proposal and his water proposals.
Posted by dweintraub at 12:49 PM
Here’s a little more detail on the topic of Clea Benson’s story in the Bee today about a potential shortfall in state revenue.
According to Brad Williams, the chief economist for the LAO, the state collected about $6.1 billion in estimated and miscellaneous personal income tax payments last December and January. For this December and January, the Department of Finance forecast a big jump, to $7.1 billion for the same two-month period. But the latest figures with just a few days left in January suggest that the total will actually go down, to right around $6 billion. And that, of course, would leave the governor with about a $1 billion hole in his budget estimate only weeks after it came off the press.
These are year-end payments that come from investors and small business owners, mostly. They reflect not only the final quarter of the calendar year, October through December, but also the year as a whole. If these taxpayers realize late that they had a great year, they usually pay up in their estimated payments so they don’t get dinged at tax time for underpaying. The payments usually, but not always, are a harbinger of what’s to come in April, the state’s biggest revenue collection month.
A couple of points might work in the other direction, however. One is that bank and corporation tax payments were stronger than expected in December, by about $350 million. The other is that the administration’s estimate for April is not as bullish relative to a year ago as it was for December and January. So it’s possible that even if these bad numbers are borne out in April, the effect won’t be as magnified as it otherwise would have been.
Posted by dweintraub at 12:38 PM
The Consumer Alliance for a Strong Economy has begun airing a new ad in Sacramento attacking the governor's tax proposals to fund health care. You can view it here.
UPDATE: The Consumer Alliance, by the way, is a 501c4 organization formed to educate the public on public policy issues. As such, it has no legal oblgiation to disclose its donors, and doesn't do so.
Posted by dweintraub at 4:16 PM
According to the Department of Finance, the total value of the state version of the health care tax break Bush talked about Tuesday night is about $4 billion annually. That's the amount of state income tax Californians would be paying each year if their health benefits were taxed as income. What Bush is proposing on the federal level is to treat health benefits as income and then give everyone an automatic $15,000 deduction if they have family coverage and $7,500 for individual coverage. This would generally mean a shift in tax benefits from those with the most expensive employer-provided plans, which generally means the wealthiest people, to those who now buy their insurance on their own, which would include more middle-income people. The same could be done in California with a portion of that $4 billion. The health benefits exemption is the third largest tax exemption the state has, after the mortgage interest deduction and the exemption of retirement fund contributions made by employers.
UPDATE: The $4 billion number is from the Finance Department's annual report on "tax expenditures." You can find it here. The $4 billion represents the increased amount that would be paid in California personal income tax if the state treated employer-paid health benefits as regular income.
Posted by dweintraub at 10:39 AM
Health insurers generally reacted positively to Schwarzenegger's plan when he released it earlier this month. But in private they have been a little less laudatory. And little by little they are pointing out pieces of the plan that they could, well, live without.
Yesterday, the president and CEO of Wellpoint -- the Blue Cross parent -- told reporters and analysts that his company doesn't like the proposal to require insurers to spend 85 percent of premiums on services. He said because administrative costs are fixed, the limit would prevent the firm from offering low-cost plans where the percentage spent on admin would be higher.
You can read his comments here.
Posted by dweintraub at 10:07 AM
The Sacramento Bee today debuts its new subscription-only web coverage of the Capitol, known as Capitol Alert. Eventually, this blog will shift and become part of that product. It's all part of the new reality in the news business, where revenues from print are increasingly scarce and managers are looking for innovative ways to generate income from the Internet to keep our journalism alive. You can get a free glimpse of what the new service will look like here.
Posted by dweintraub at 6:59 AM
Senate leader Don Perata's political committee has produced a television ad promoting health care reform and has begun airing it in a small buy in Northern California. That's a strategy Perata used a year ago with the infrastructure bonds, helping to protect a base of support for the idea until a full-fledged, bipartisan plan was approved and placed on the ballot.
One nit: All the materials refer to Perata as the "Senate President." Sounds better than "President pro-tem." But pro-tem he is. The lieutenant governor is the president of the Senate. It's just about the lite-guv's only actual duty. Seems a shame to deprive him of it just to make your own title sound a little better.
Posted by dweintraub at 10:19 AM
Insurance Commissioner Steve Poizner has declared an "insurance emegency" that will allow out-of-state adjusters to assist California farmers who lost crops in the freeze.
Posted by dweintraub at 1:18 PM
Graphic: Legislative Analyst
The LAO has a good overview of what's at stake in the implementation of the infrastructure bonds voters approved in November. You can find the report here.
Posted by dweintraub at 11:23 AM
The U.S. Supreme Court today struck down an aspect of California's determinant sentencing criminal justice system. This could be the final nudge the state needs to overhaul the way it sentences and treat convicted felons.
Posted by dweintraub at 11:18 AM
California employers created a net of about 17,000 new jobs in December, but unemployment inched up to 4.8 percent as more people entered the workforce. The Bee's early story is here. And here is the press release from EDD.
Posted by dweintraub at 2:49 PM
The state has just been hit with an arbitration decision that is going to drive up salaries and benefits for prison guards by another $440 million. Much of that was anticipated, but about $147 million for this year and prior years, plus $46 million for next year, was not. The Department of Finance is planning to shave its cost-of-living increases to various departments to come up with the $46 million and avoid running a "net operating deficit" next year.
Posted by dweintraub at 1:32 PM
Mark Baldassare, the longtime pollster for the Public Policy Institute of California, has been named the institute's new president and CEO.
Baldassare says he will keep a hand in supervising the Institute's polling operation, which, he says, will continue at the same level of intensity to which we have become accustomed -- about a poll a month.
Posted by dweintraub at 12:02 PM
Here is my column today, which does a point by point comparison of the governor's health plan with those offered by the legislative leaders.
Posted by dweintraub at 11:56 AM
I moderated a panel this morning on redistricting reform sponsored by the Voices of Reform project. The turnout of panel participants was not encouraging. The organizers invited the four legislative leaders to come or send a representative, to be joined by a person from the governor's office.
Senate Republican Leader Dick Ackerman and Assembly Republican Leader Mike Villines attended, as did Cynthia Bryant, a deputy chief of staff for Schwarzenegger. But the speaker never committed to coming or sending anyone, and did neither. A representative of Perata's office had confirmed to attend but did not show up. That left the discussion a bit one-sided.
It was still rather informative, however. Villines and Ackerman both said they were enthusiastic about reform, looking for something that could pass muster with voters, and open to just about anything. They both said the idea of using judges to pick an independent panel is probably dead. Villines said he has had maybe a half dozen conversations with the speaker since November on the subject, and he believes Nunez is sincere about supporting an independent commission. He said they are probably most divided over how big of a role the Legislature should retain. He favors no role, while he said Nunez would like to keep the Legislature involved at some level.
As a final question, I asked all three panelists how they would rate the chances of something passing on this subject in the Legislature this year. Ackerman and Villines both rated it a 7 on a scale of 1 to 10. Bryant, saying she had to echo her boss's optimism on just about everything, gave it a 10.
The entire discussion is supposed to be webcast on the VOR site soon.
Posted by dweintraub at 3:54 PM
A federal appeals court has upheld a lower court decision striking down Maryland's "Wal-Mart" health care law, which would have required employers to spend 8 percent of payroll on health benefits or pay a surcharge to the state. The court ruled that the state law violates a federal law that gives the national government a clear field to regulate employee benefits. This could have direct consequences for Schwarzenegger's proposal, which would require employers to spend 4 percent of payroll on health care or pay a tax to the state.
Posted by dweintraub at 3:36 PM
The governor addressed the Sacramento Press Club in his annual visit today and didn't break news. But that won't stop us from sharing a few tidbits.
--He clarified his position on the presidential campaign, sort of, saying he didn't intend "to chase the presidential candidates from state to state" but did plan a few strategic speeches around the country to try to bring attention to the issues he cares about and thinks the feds should be taking care of, including global warming, health care and immigration.
--He declined to endorse a candidate in the early running, suggested he would consider endorsing a Democrat or a Republican, then backed off that and said he would probably endorse a Republican but not until hearing what they all have to say.
--He said California should move its presidential primary from June to February so it can become "relevant" in the presidential nominating process. Right now, he said, the state is an "afterthought" except when it comes to fundraising.
"They take the money and run," he said.
--Asked about an LA Times editorial that said the U.S. Constitution should be amended so he could run for president, Schwarzenegger quipped:
"That's why I am for comprehensive immigration reform." He then added that he's not thinking about running for president at the moment.
--He said he has no relationship with House Speaker Nancy Pelosi but respects her and looks forward to forming a connection. He's also hoping she can deliver more federal money for California.
--He clarified his position on President Bush's new strategy in Iraq. He said he thinks the United States should not leave Iraq in chaos but should set a clear date by which its forces will leave so the country's government can prepare and build its forces to handle its own security. He suggested the end of this year. In the meantime, he won't second-guess Bush's decisions on how many troops to send and what to do with them.
On health care, he rejected suggestions that he is trying to do too much, too soon, and said flatly that he would not settle for a plan to cover all California children.
"This is going to get done," he said. "This is a state that has the opportunity to do big things. Not little things."
Brushing off criticism that his agenda is too ambitious, he drew an analogy from his former career, saying:
"The only way you know if you can lift 500 pounds is you put 500 pounds on the bar."
He also disclosed that he met this morning with representatives of consumer and business groups to try to start finding common ground on the health care issue, which has vexed state leaders for a generation. More such meetings are planned for the weeks ahead.
Posted by dweintraub at 1:57 PM
The governor has proclaimed a state of emergency in 10 California counties where farmers are suffering big losses from the ongoing freeze. They are:
Fresno, Kern, Kings, Madera, Merced, Monterey, San Luis Obispo, Santa Barbara, Tulare and Ventura.
The governor is asking for expedited federal assistance. More counties might be added to the list later if warranted.
Posted by dweintraub at 4:13 PM
Researchers from California Business for Education Excellence and the Pacific Research Institute have taken a look at what the state and its students are getting from more than $1 billion spent so far to help improve low-performing schools. Their conclusion: not much. The schools in the program are not doing any better than similar schools that did not participate and did not get the extra money, they say. And they say the state's accountability program is covering up that failure by using a system to assess schools that most people do not understand. They recommend dropping the complicated Academic Performance Index in favor of an easy-to-understand system that reports the percentage of students who reach grade-level proficiency. Their report's executive summary is here.
Posted by dweintraub at 10:29 AM
The Senate Office of Research has prepared a side-by-side comparison of the health plans proposed by Senate Leader Don Perata, Assembly Speaker Fabian Nunez, and Gov. Arnold Schwarzenegger. It's a very helpful document. You can download it here.
Posted by dweintraub at 4:21 PM
The state Senate has rejected the governor's re-appointment of CTA lobbyist Joe Nunez to the state board of education. Nunez has the votes of most of the Democrats in the Senate but couldn't get enough Republicans to get over the hump. In addition to working for the CTA, Nunez was chairman of the labor coalition that led the opposition to Schwarzenegger's 2005 reforms. But the governor reappointed him anyway because the two were in sync on high standards and expectations for all kids.
NOTE: An earlier version of this item suggested that Nunez fell short for a lack of Democratic votes. That was not the case.
Posted by dweintraub at 2:38 PM
Bill Saracino says Schwarzenegger's idea of a "post-partisan" era is just another way of saying a "post-Republican era."
But in reality the peace Schwarzenegger envisions in Sacramento is a phony peace, a peace as artificial as the governor’s tan. As one who ardently supported Schwarzenegger in 2003, it pains me that it is becoming clear that this emperor is wearing no clothes. Those in the state who actually do revere Friedman, Reagan, and other mainstream Republican leaders have a duty to point out this fact. This doesn’t make us obstructionists. It makes us realists.
Posted by dweintraub at 10:19 AM
Strange that the governor, just as he is closing in on a balanced budget, wants to change all the definitions and stop talking about the structural deficit. You'd think he would want more focus on it, not less. Anyway, it doesn't matter. The credit rating agencies will want to see the real numbers, and the LAO will no doubt cut through the spin and tell us what she thinks of the bottom line.
The governor's take is that he has reduced what he is calling the "gross operating deficit" in 2007-08 to about $1.8 billion. But after backing out things like spending on retiring the deficit bond, and one-time revenues, he says the true, or "net" operating deficit would be zero. Actually a tiny, $20 million surplus.
This is not such a wacky way of looking at it. What he is saying is, how much money will the state take in during that 12-month period, and how much will it spend on services delivered during that 12-month period? That's a decent way to judge the government's fiscal prudence. But it's not the entire story.
As for the structural deficit, the projection of revenues versus spending in the year after the proposed budget is done, the guv and his people now say don't bother, that's too far away to be meaningful. But that's the deficit he -- and we -- have been talking about for years. And that's the deficit he claims to have inherited. So he's not going to get away with ignoring it now. Besides, the structural deficit number is perhaps more important than the operating deficit -- gross or net -- because it tells us what the long-term trendlines look like, and it's an early red flag if the state is headed for trouble, or not getting out of trouble quickly enough.
Finance Director Mike Genest, when pushed, said his best guess of the structural deficit in '08-09 is about $800 million. If the LAO agrees, that's pretty good news, since it's billions less than was projected a few months ago. We will have to wait and see.
Posted by dweintraub at 5:27 PM
The governor's press conference was supposed to be about the budget, but some of the first questions were about, well, other stuff.
Q. It is true you are going to change parties and become an indpendent?
Q. How did you really break your leg?
A. (Paraphrasing here): By skiing too slowly. He said he was moving so slowly that when he fell, the pressure "torqued" his femur, complicated by the action of his artificial hip. (Did we know he had an artificial hip?) Anyway, he said if he had been going 50 mph when he fell, which he says he's done often (50 mph?) he would have been fine. But it was that slow fall that did him in. He never did say why he fell when he was going so slow. Hey, it happens.
The budget, by the way, is balanced, or so they say. More on that later, and in Thursday's column.
Posted by dweintraub at 3:09 PM
Here is my column on the governor's speech.
Short version: behind the smiles, the governor is pushing the Legislature again in ways that will make many lawmakers from both sides of the aisle uncomfortable. He is no longer issuing ultimatums, but he's no less impatient than he ever was.
Posted by dweintraub at 8:06 AM
Ah, post-partisanship at its finest. In the past, reactions from legislators of the same party as the governor were hardly worth reading, because they were all filled with platitudes about how great the governor is and how brilliant his ideas are. THis time, not so much. Below you'll find the official responses from most of the members of the Senate Republican Caucus. Several of them took the opportunity to highlight their differences with Schwarzenegger on health care, taxes, services for illegal immigrants and sentencing laws.
SACRAMENTO – Senate Republicans offer a number of comments regarding Governor Arnold Schwarzenegger’s State of the State Address:
Senate Republican Leader Dick Ackerman (R-Tustin) – “I am encouraged by the governor’s optimism and outlook for California’s future. His recognition of the need for more fiscal restraint to bring an end to the structural deficit should be embraced by the legislature as a top priority. The longer we allow this problem to exist the more difficult it is to address other important priorities in California.
“The governor also acknowledged the looming water supply crisis. This issue is too important for the legislature to wait any longer for a solution. Our economy, including food production and drinking water supplies, relies heavily on ample storage for both Southern and Northern California.
“T he governor is presenting an ambitious agenda for 2007. As we move forward, Republicans will remain committed to our core principles and do what is best for California.”
Senator George Runner (R-Antelope Valley), Caucus Chair – “We look forward to working with the Governor this year on his plans to invest in rebuilding California. I also applaud his continued commitment to improving public safety by building more prisons and jails so criminals are not released early into our neighborhoods.”
Senator Sam Aanestad (R-Grass Valley) – “I thought it was a very good speech. But where is the money going to come from? What are we going to sacrifice? What gets cut to pay for it all? The devil is in the details.”
Senator Jim Battin (R-La Quinta) – “I cannot support increasing taxes to provide healthcare benefits for illegal immigrants.”
Senator Dave Cogdill (R-Modesto) – “I am encouraged by the Governor’s State of the State address. It is obvious that he is taking the needs of our state seriously, particularly the critical need for improvements to our water system, in order to accommodate for the growth in California, and the anticipated hydrological changes. I am anxious to get to work with him, as well as my colleagues on both sides of the aisle, to develop a comprehensive, efficient plan for managing one of California’s most precious resources – water.”
Senator Dave Cox (R-Fair Oaks) – “I commend Governor Schwarzenegger for his proposal to introduce two new dams to increase the state’s water supply. This will bring much needed relief to farmers who need a bountiful and consistent supply of water to grow their crops, and in turn make it affordable for working families to put food on the dinner table. Increasing the water supply will also help a growing California meet its water and storage needs.
“In the months past, there has been a lot of talk of bipartisanship. Compromise is necessary and commendable as long as the Legislature and the Governor can uphold the central values of all Californians. This does not mean that as Republicans we must give up our principles.
Senator Jeff Denham (R-Merced) – “I applaud the Governor for taking on such tough policy issues this next legislative session,” said Senator Jeff Denham. “There are policy items in his agenda like water storage that I agree with passionately. However, I adamantly oppose parts of the Governor’s approach to prison reform. No matter what the reason, criminals should not be released early, before completing their full sentences. Any prison reform must protect law abiding citizens first over the comforts of criminals. Early release of prisoners only endangers our public.”
Senator Bob Dutton (R-Rancho Cucamonga) – “Governor Schwarzenegger has offered a broad wide-ranging vision for the state of California for 2007 and beyond during his State of the State address. I agree with the governor that we must address the educational needs of our school children, and the important issues of health care for legal residents of California, getting residents off of our welfare rolls and into the workforce, building and improving our state’s infrastructure system.
“As the saying goes, the “devil is in the details” and I look forward to seeing how all of these programs will be implemented. I remain committed to moving forward in a responsible way that will protect California jobs and not raise taxes.”
Senator Tom Harman (R-Huntington Beach) – “I applaud the Governor for his ambitious and visionary plan for California’s future, and I look forward to working with my colleagues across the aisle on these important issues. We must make some very tough decisions to ensure that we live within our means. Rest assured however, that I will not support any proposal that undermines my fiscal conservative principles.”
Senator Dennis Hollingsworth (R-Murrieta), Vice Chair of the Senate Budget and Fiscal Review Committee – “My hope is that the Governor’s stated desire to have the state live within its means, will result in his following tonight’s address with a budget that doesn’t spend more than we have, and doesn’t raise taxes.”
Senator Abel Maldonado (R-Santa Maria) – “Tonight’s State of the State address reminded me that the State of California needs to use its resources wisely. I applaud the Governor’s enthusiasm and optimistic vision for California’s future. However, the question that sticks in my mind is, ‘how are we going to pay for all these programs and who is going to pay?’ That’s the billion-dollar question.
“Last year, the Legislature passed a budget that left the state over $5 billion in debt. This deficit has grown to $5.5 billion. So, we have yet to climb out of the fiscal hole we created from the last budget enacted. I hope that this year we address this critical issue, begin to pay down our debt and ensure that California lives within its means. I look forward to working with my colleagues to develop practical, bi-partisan solutions that will benefit my constituents in the 15 th Senate District.”
Senator Bob Margett (R- Glendora) – “California faces serious problems which should not be tied up in partisan politics—water, education, and prisons are just a few. The Governor has proposed an ambitious agenda to address these issues and I am committed to working with him and my colleagues to find solutions. However, these solutions must not raise taxes, impede economic growth, or be fiscally irresponsible.”
Senator Mark Wyland (R-Carlsbad) – “I applaud the governor’s call for Career Technical Education (CTE) funding. For too long, this critical component of our education system has been ignored. We simply have far too many high school students dropping out, and the fact is that many others don’t want to go to college.”
We can do a better job of preparing those students to enter the workforce. Restoring CTE programs to California’s high schools will result in a dramatically lowered drop out rate, and turn around young lives by offering them a future. I will work with the Governor closely on career technical education because it can affect many other policy areas that need assistance.”
Posted by dweintraub at 9:17 PM
Here is the Democratic response:
Democratic Response to Governor Arnold Schwarzenegger’s State of the State Address
SACRAMENTO—Speaker Fabian Núñez and Senate Pro Tem Don Perata issued the following statements in response to Governor Arnold Schwarzenegger’s State of the State address:
“Tonight we heard the Governor talk about his priorities. And like last year, we are ready to roll up our sleeves and get things done for California. Working with the Governor, we raised the minimum wage and passed a plan to provide affordable prescription drugs. We enacted a landmark bill to reduce greenhouse gas emissions that is attracting attention worldwide. We are eager to continue this bipartisan momentum and move California forward.”
“But bipartisanship only works when we can agree on the problems we have to solve, and the urgency of solving them. That’s why it’s more important than ever to tune out the hyper-partisan politics advanced by the extremes on the right and focus on the big problems facing our state.”
“That begins by fixing California’s broken health care system. Our plans include employers, employees and, only where necessary, government. To keep health care affordable and accessible, we focus on wellness, keeping costs down, and making insurance companies pay their fair share.”
“We’ll also focus on keeping our air healthy to breathe. Building on last year’s victory for the environment -- our landmark global warming bill -- we will be introducing new legislation to help develop clean alternative fuels, as the Governor mentioned. This will help all of us play a role in reducing the tailpipe emissions that make up 40% of all greenhouse gases.”
“We also will be relentless in focusing on education. Nothing is more important than ensuring children can get the education they need to compete and succeed. We will not retreat in our pursuit of educational reforms.”
“Finally, we are facing a multi-billion dollar budget gap. But at a time when our state is enjoying unprecedented prosperity, we will not balance the budget on the backs of seniors and our most vulnerable citizens.”
“Last year, we accomplished something pretty remarkable for a bunch of politicians: We stopped telling everyone else how to do their jobs and instead we did ours. In November, voters approved our bipartisan plan to rebuild California -- a $37 billion investment to modernize and strengthen our economy.”
“You gave us a vote of confidence. We must honor that confidence by putting those dollars to work right away rebuilding California’s highways, schools and levees. But, Rebuilding California is about more than cement and steel – it’s about prosperity and safety. It’s about strengthening and expanding the middle class. It’s about better schools, affordable health care and clean air and water.”
“We look forward to working with the Governor again this year, but let’s be clear: We will not just pay lip service to achieving these goals. We won’t take breakfasts away from poor kids. We won’t let Wall Street traders control our fight against global warming.”
“Tonight’s about speeches – and the Governor set some lofty goals. But even the best speech won’t build a school for your kids, won’t help your family get medical care, won’t reduce global warming. It’s not what the Governor says in January that counts, it’s what he signs in September.”
“The work of government does not take place once a year under bright lights and cameras. Like your job, lawmakers must work day after day after day to get results. Last year, we showed what we can do working together for California. Together, Democrats are out to prove that last year’s progress wasn’t a fluke.”
Posted by dweintraub at 6:55 PM
Here is the prepared text of the governor's speech.
Prepared Text of Governor Schwarzenegger's 2007 State of the State Address
Lieutenant Governor Garamendi, Speaker Nunez, Senate Leader Perata, my fellow servants of the people, ladies and gentlemen... I am honored to stand here once again.
I want to thank the legislature, as I did in my Inaugural, for putting the people above politics last year--an election year. The federal government was paralyzed by gridlock and games. But you here in this chamber acted on infrastructure, the minimum wage, prescription drug costs and the reduction of greenhouse gases in our atmosphere. What this said to the people is: we are not waiting for politics. We are not waiting for our problems to get worse. We are not waiting for the federal government. We are not waiting--period. Because, the future does not wait.
I believe that together not only can we lead California into the future...we can show the nation and the world how to get there. We can do this because we have the economic strength, the population, the technological force of a nation-state. We are the modern equivalent of the ancient city states of Athens and Sparta. California has the ideas of Athens and the power of Sparta.
As you know, California, if a nation, would be the sixth largest economy in the world. But it goes so much beyond that. According to The Economist magazine, California is home to three of the top six universities in the world. California has more Nobel Laureates, more scientists, more engineers more researchers, more high-Tech companies than any other state. We are responsible for one of every four U.S. patents. We account for one of every five U.S. technology jobs. We attract almost half of all U.S. venture capital, which funds the ideas and industries of the future. California leads the nation in biotechnology. We lead the nation in nanotechnology. We lead the nation in medical technology. We lead the nation in information technology. We will soon be the recognized leader in clean technology.
Worldwide, clean-tech investments are up 50 percent in the first nine months of last year alone. California is spurring clean technology by the environmental standards we are setting. Our innovation, our science, our knowledge, our creativity is un-equaled on the face of the earth. The 21st century can be the Golden Century for the Golden State.
I have asked myself, what must we do in this chamber to help fulfill this future? It starts very simply. We can start by working together.
Usually when a governor gives his State of the State Address, he talks about his vision. This year I want to talk about "our" vision, because I think we all want the same thing for Californians.
Let me tell you about some of the ideas of our legislative leaders. Speaker Nunez has made research into alternative energy and transportation fuels a top priority this year. Speaker Nunez, I will work with you.
A top priority for Senate Leader Perata is to create a world-class water transit system in the Bay area that could maintain vital transportation links after an earthquake or other disaster. Senator Perata, I will work with you.
Republican leaders in both the Senate and the Assembly have made debt reduction and building water storage their top priorities this year. Senator Ackerman, Assembly Leader Villines, I will work with you.
Let me explain some of the other areas where we can come together this year. In November, the people approved the first phase of infrastructure bonds necessary to rebuild our state.
During a speech at the Pat Brown Institute, I heard Senator Perata say that the people of California expect to see the construction cranes right away. They want to see action. Senator, I agree absolutely. We, the elected leaders, must authorize the cranes, the bulldozers, the cement trucks to begin their work without delay.
This is a test for those of us in this chamber in another way. Will the process turn into a porkfest as it did in Washington with all the earmarks and the backroom deals? Or, when we have allocated the spending, will the people say, "They spent our money wisely?" Yet this is more than just about the people's money. It is about the people's trust. Let us not disappoint them.
We must also be good stewards, because we must go back to the people for permission to build more and finish the job. The building has just begun. One year ago I unveiled the 200 billion dollar plan that prepared California for the next ten years. We are a big state and we have big needs. And we made a big down payment. But the job is not finished.
Some areas, such as prisons and water storage weren't included. And we still have more roads to build, more schools to construct, more universities to equip to keep up with the future. As I said last year, California's population is expected to increase by as much as 30 percent over the next 20 years. That is the equivalent of adding three new cities the size of Los Angeles'. We have to prepare for that growth.
So this year we must invest in five infrastructure areas in particular --public safety, water supply, transportation, education and disaster preparedness.
Let me give you a couple of examples why we must act. Public safety is the first priority of government. Our prisons are in crisis. We have inherited a problem that was put off year after year. Last year I called a special session to address the crisis. That session was not successful, so I declared a state of emergency. It is still an emergency. Our prison system is a powder keg. It poses a danger to prisoners, a danger to officers... and a danger to the well-being of the public if -- as the federal courts have threatened -- we are forced to release prisoners because of overcrowding. We have thousands of prisoners housed in gymnasiums, TV rooms, dining rooms, hallways, anywhere there is a space. 172,000 prisoners in facilities designed to hold about 100,000. That is a danger and a disgrace.
Here are the court-ordered choices we face: We build more prisons or we release criminals. We build more prisons or the court takes money from education and health care and builds the prisons itself. I am not in favor of releasing criminals. I am not in favor of taking money from classrooms and emergency rooms to build cells. Where do you stand? We must act. And we must act this year. Which is why on December 21st, I stood with Senator Gloria Romero and Senator George Runner and Assemblyman Greg Aghazarian to introduce comprehensive prison reform. We need a justice system that's fair, that's tough and that offers hope for those who can still turn their lives around.
Let me give another infrastructure example. The number of high technology companies we have in California is related to how many brilliant scientists we have in our universities...which in turn is related to how many smart undergraduates we have... which is related to the number of high school students who graduate... and so on down through the grades. That small child with the sticky hands starting the first day of kindergarten is the foundation of California's economic power and leadership.
We must invest in education. It's not just how much money we spend but also how we spend it. I have seen the need with my own eyes as I've toured schools across the state. I went to a school with bed sheets on the windows rather than blinds. I went to a school that was so overcrowded the gyms locker-room was used for teaching space.
The education bond that passed in November builds 10,000 new classrooms and renovates 38,000 more, but that gets us only through the next two years. We need to build for the future.
This year I ask you to invest in 15,000more classrooms and renovate 40,000 more. Yet we must build not only structures, but accountability and transparency into our education system. As a step toward the day when parents will have real choice in our public education system where to send their children, we should provide parents with relevant, accessible information, not bury it in the bureaucracy. If you can get information about a car online, why can't you get information about your local school online? What percentage of money goes into the classroom? Does the school offer after-school programs, music, art, PE programs? What is the graduation rate? The drop-out rate? You cannot easily get this information today.
So how can a school or a school district be held accountable? I want to work with the legislature to make this information readily available and user-friendly for the parents so that they can make intelligent choices about their child's school.
We must also continue to reinvigorate career tech education, support quality charter schools and find innovative solutions to the teacher shortage. I will not discuss all of our infrastructure proposals this evening, but I want to say one final thing about this topic. Rebuilding California is not a burden. It is not a chore. It is a privilege. It is a privilege to be able to help this state reach its full potential. It is a privilege to be able to help future generations fulfill their promise. And when they look back, they will see you in this room, and they will be grateful for what you have done.
Now, in addition to addressing our infrastructure last year, the legislature joined with me in passing the historic global warming measure that caps greenhouse gas emissions.
We hear so much about climate change. One area where we definitely need the climate to change is the national government's attitude toward global warming. It would not act so California did. California has taken the leadership in moving the entire country beyond debate and denial... to action. As California goes, so goes the rest of the nation.
I ask you to appropriate the funds to implement this global warming legislation, so that we can become part of the world market that is already trading credits for the reduction of greenhouse gases.
I also ask you to work with me on another environmental first. I propose that California be the first in the world to develop a low carbon fuel standard that leads us away from fossil fuels. And let us use the freedom and flexibility of the market to accomplish it. Let us blaze the way, for the U.S., for China and for the rest of the world. Our cars have been running on dirty fuel for too long. Our country has been dependent on foreign oil for too long.
I ask you to set in motion the means to free ourselves from oil and from OPEC.
I ask you to encourage the free market to overthrow the old order.
California has the muscle to bring about such change. I say use it.
When I first came here in 1968, one of the first things I did was to ask people where I could get health insurance because I knew that, as an athlete, injuries can happen. Here is the ironic thing about health care today. California's medical care, its medical knowledge, its medical technology is as strong and vibrant as a bodybuilder. Yet our health care system itself is a sick old man.
You know the reasons --rising costs, lack of coverage -- nearly 6.5 million Californians have no insurance at all. Recently I visited California Hospital Medical Center in downtown Los Angeles. Last year, the uninsured people who came to the emergency room left behind 60 million dollars in unpaid bills. That's in one hospital. Multiply that by the number of hospitals in California, and the amount runs into the billions. Guess who's paying for all this? You and me and all of us who are lucky enough to have coverage. That's who pays.
The people with insurance pay a hidden tax through higher deductibles, higher costs, higher premiums, higher copays.
This year we must take action on health care. Yesterday I announced my proposal. I know you also have proposals. I have always said you can never have too many ideas. So all ideas, regardless of origin, are still on the table. I do believe, however, that the ultimate answer will come from the principle of shared responsibility --by the government, by employers, by health plans, by doctors, by hospitals and by the individual.
In the past, health care reform was always dead on arrival. But this year you can feel something different in the air. You can feel the energy, the momentum, the desire for action. You can feel that the time is right. Both leaders have said to me, "We will get this done." Ladies and gentlemen, we will get this done. California is going to lead the nation in breaking new ground to meet the health care needs of its people.
Tomorrow, I will outline my budget, which is balanced and which fully funds education. When I first became governor, we had an operating deficit of $16.5 billion. I said that through discipline and through new revenues that flow from economic growth, we would reduce the deficit over time. Last year, we got it down to $4 billion. Tomorrow, I will propose a budget that will dramatically reduce this deficit even further.
Now here is the great thing. We have made this progress without raising taxes. We have reduced the deficit, not by burdening the people and our businesses, but by encouraging economic growth. This year California has the highest revenues in its history and the lowest unemployment rate in 30 years. Ladies and gentlemen, the state of our state is strong.
We still have very difficult choices to make on the budget, and I am eager to work with you on these choices. I am not asking you not to be a Republican or not to be a Democrat or to give up your principles. I am asking you to be Californians and to work out a solution that is the best possible answer to the challenges we face. As long as we recognize some progress toward our individual visions -- whether Republican or Democrat --this should allow us the freedom to reach a budget agreement and to go forward together.
One last item. I again this year raise the issue of political reform. California politics is a centrifuge that forces voters, policies and parties away from the center. The centrifuge is powered by the way our legislative and congressional districts are drawn. They are drawn to eliminate party competition. They work against the mainstream, which is where most Californians are. Currently, ours is not a system of the people, by the people and for the people. It is a system of the parties, by the parties, for the parties.
In the past three election cycles, only 4 of California's 459 congressional and legislative seats changed hands. There was more turnover in the Hapsburg monarchy than the California legislature.
I ask you to work with me to create an independent commission to fix a political system that has become petrified by self-interest. California certainly is not alone in this. No state legislature in U.S. history has put a redistricting reform on the ballot. California can be the leader.
You will not benefit politically from this. I will not benefit politically from this. But the people will benefit from this. I ask you to work with me to do the right thing for the people.
Let me close with this thought. We accomplished historic things last year. Let us make this year historic as well. I know that what I have proposed is an ambitious agenda. I heard that last year and the year before that and the year before that. Yes, it's an ambitious agenda, but we must be ambitious to get California to the future. We are addressing needs that have been ignored for decades. This is important work. It is hard, heavy work. What we are doing relates directly to the kind of state this will be in ten or twenty years. But is this not what government should be doing?
For too long Californians just stared at this mountain called the future. We couldn't climb it because our current problems blocked the path. We couldn't climb it because it was politically too steep. We couldn't climb it because we couldn't agree on the route that takes us there. But last year, we made the decision, we took a deep breath and we began our ascent. Working together we can scale that mountain. We can stand on top of it. And one day we will look down from it and say to ourselves, look how far we've come, look where we are, look what we've accomplished for the people. Ladies and gentlemen of the legislature, let us continue the climb we began last year. Thank you very much.
Posted by dweintraub at 5:07 PM
The governor's health care plan has a number of moving parts, and the temptation in the Legislature will be to keep some while dropping others. But two parts that will be difficult to disentangle are the mandate on insurers to cover everyone regardless of prior conditions and the mandate on individuals to have coverage for themselves.
Why? If insurers are required to cover everyone without regard to prior illnesses, then consumers will have a huge incentive to game the system. The point of buying insurance is to cover yourself against future, unknown risk. Some people pay in and never need it. Others pay in and need far more coverage than can be paid for by their premiums. It's all about sharing risk.
But if you can get insurance when you're already sick, then it would make sense financially for people to simply not buy it until they need it. It's as if you could buy fire insurance when your house was already ablaze. Why buy it in advance if you might never need it? In health insurance, that would lead to an increase in the number of uninsured and an increase in rates, since only the sickest people would be buying coverage. The individual mandate pushes back against that problem by requiring everyone to have coverage -- before they get sick. It broadens rather than shrinks the risk pool, spreading the costs to a bigger group of people.
Some consumer groups are applauding Schwarzenegger's proposal for guaranteed issue and community rating, which would prohibit insurers from using anything other than age and geography in setting rates. At the same time, many of these same groups are opposed to the individual mandate. But adopting one without the other would be a good way to send the entire system toward implosion.
Posted by dweintraub at 7:26 AM
If the governor's proposal to cut welfare benefits for kids whose parents don't move quickly enough into the workforce seemed to come out of nowhere, that's because it did. Schwarzenegger during last year's campaign refused to answer questions from the press and public about his strategy for balancing the budget without raising taxes. Everything, he said, would be taken care of by economic growth.
As a result, Californians were left in the dark about the kinds of actions it would take to close a $5 billion gap between projected spending and revenues. This one was prompted not only by the governor's need to shave costs but by federal pressure to move adults on welfare into the workforce. But there will be more unpleasant proposals. Many, like this one, will be dead on arrival in the Legislature. And there chances of passing might not have been much better even if Schwarzenegger had levelled with voters during the campaign about the state's dire fiscal condition. But at least he would have begun the conversation.
Posted by dweintraub at 7:05 AM
For a full discussion and links regarding the governor's health care plan, please go to our new healthcare policy blog, Crossroads/Healthcare. Join the conversation!
Posted by dweintraub at 2:50 PM
Gov. Schwarzenegger gave a rousing defense of centrism in his inaugural address today, declaring himself a "post-partisan" governor and insisting that centrism doesn't need to be weak or watered down but can be creative and dynamic. He said Californians, and Americans, are looking for a politics that transcends partisanship and instead seeks to solve problems using the best ideas of the right and the left.
He's right on both counts, and to the extent he continues to follow that path, he will probably continue to be a popular governor.
But don't expect that approach to mean peace in the Capitol. As Schwarzenegger knows, the Legislature is dominted by politicians from the left and the right in their respective parties, and many of them have no use for the center. Democrats will surely howl if Schwarzenegger tries to make good on his promise to balance the budget and increase access to health care without raising taxes. Republicans have already made clear their displeasure with Schwarzenegger's policies on the environment, gay rights and health care for illegal immigrants. Almost none of his fellow Republicans voted for the legislation that the governor now cites as evidence that the parties can work together to get things done.
Schwarzenegger is a social liberal, an environmental progressive and somewhat of a pro-business fiscal conservative -- all positions that put him squarely in the mainstream of the California electorate. But the stream in which he paddles in in the Capitol is more of a trickle. Almost no one else in that building holds the combination of views to which Schwarzenegger adheres.
Last year he piled up accomplishments mostly by focusing on issues with which he agreed with Democrats, sometimes by bending to their will, sometimes getting them to bend to his. But the concessions he was able to wring from the Democratic majority were almost never enough to satisfy Republican lawmakers. And they don't define bipartisanship as 41 Democrats and the governor.
If he really wants to be bi-partisan or, as he says, post-partisan, he has to somehow find a way to moderate the left wing in the Legislature while nudging his own right-wing allies closer to the center he is talking so much about. And that will not be an easy task.
Posted by dweintraub at 1:47 PM
The governor's people are dribbling out the details of his health care plan. This
is the latest, a fact sheet describing two elements of the plan. One would require employers to establish accounts through which employees could make tax-free contributions to their health care, whether or not the employer offered insurance. The governor's people are calling these health savings accounts, and it appears they are talking about making HSA contributions tax deductible in California as they are in most other states. The second element is a wellness program that would require insurers to offer rewards for gym memberships and other steps to stay healthy. As Anthony Wright of Health Access California told the Sacramento Bee, these are (in his view) nice ornaments. But what we really need to see is the tree.
Posted by dweintraub at 8:49 AM
This is one of the slides from a power point presentation that the guv's people have posted on his Web site to try make a case for why he wants to reform health care. It shows the breakdown by employment and family status of the 20 percent of Californians who are uninsured. The rest of the presentation is here.
Posted by dweintraub at 4:20 PM
The governor's folks are putting the final touches on the event planned for Monday at which Schwarzenegger will unveil his health care plan, and they are hoping that the method by which he discloses the plan will be as powerful as the details of the plan itself.
The governor is to be surrounded on stage by a dozen or so representatives from various interest groups with a stake in the debate, including employers, providers, consumers and others. Not all of those people will like everything about the plan, and they will be encouraged to say what they like about it, and what they don't like about it, as a way to kick off what the governor says he hopes will be a robust debate. The event will be webcast, and afterward, a second webcast will feature the advisers who helped develop the plan taking questions and comments from an online audience.
This story by the Sacramento Bee's Clea Benson says the plan will include a proposal to insure all children and some sort of individual and employer mandates.
Posted by dweintraub at 10:37 AM
Gov. Schwarzenegger wants to make a big push in 2007 to improve and expand vocational education --now known as career technical education. Here is the latest from his office on the proposal he unveiled today.
Posted by dweintraub at 2:10 PM
Here is the latest Field Poll, which focuses entirely on Californians' views on health care. It is the first of two such polls Field plans to release this week. This one shows widespread anxiety about health care in California, including concerns about rising costs and insecurity about whether people will continue to have insurance coverage and be able to pay for expensive care if and when they need it.
The highlights, according to Field:
California voters have mixed views of the state’s health care system overall. Statewide, 51% report being satisfied with the health care system today, while 44% are dissatisfied. There is a sense of foreboding about the future, however, as more than three times as many believing the system will be worse five years from now (39%) than think it will be better (12%). Another 40% expect no change, while 9% have no opinion.
Voters offer a wide range of concerns about the health care system as it relates to their own lives. For example, greater than three in four voters (77%) worry that they might not be able to pay for the costs of a major illness and injury, and another 75% are concerned about employers potentially cutting back on the amount they contribute for a worker’s health care.
The possibility of not having or losing health care coverage troubles seven in ten (71%). A similar majority (71%) is worried about being able to pay the costs of their health care premiums, deductibles and co-payments. Concerns about having access to quality doctors and health service services (68%) or having to wait or put off getting needed care (67%) are also cited by greater than two in three voters statewide. The inability to pay for needed prescription drugs (64%) or not being able to obtain affordable health insurance due to a pre-existing health condition (62%) is also seen a possible problem by
more than six in ten.
Posted by dweintraub at 7:13 AM
Frank Russo comments here on consumer group opposition to one of Schwarzenegger's appointees to the Public Utilities Commission, based on her stance that market forces are for the most part sufficient to compel cell phone companies to treat their customers well. A Senate confirmation hearing is scheduled today for Rachelle Chong.
Russo doesn't mention that Chong's views on the issue appear to be exactly the same as those held by Susan Kennedy, the governor's chief of staff who served on the PUC before coming back to Sacramento to work for Schwarzenegger. It will be interesting to see how hard Kennedy fights for Chong's confirmation.
Posted by dweintraub at 6:59 AM