As featured on p. 218 of "Bloggers on the Bus," under the name "a MyDD blogger."

Monday, February 16, 2009

The Abyss

Just to recap the scene in the Capitol over the weekend, the State Senate and Assembly held their members in round-the-clock sessions, debating the budget deal, without any success on grabbing the additional Republican vote needed for passage. The word in the Capitol is that Darrell Steinberg and Dave Cox had a handshake deal and Cox broke it. There is another session scheduled today starting at 11am, and it is the intention of Steinberg to keep holding floor sessions until a Republican cracks. While I didn't think it was the best strategy to announce a deal and start voting on it until there was one in place (although the Cox reneging rumor changes my perspective a bit), Steinberg seems to have backed into a strategy of playing Yacht Party obstruction out very publicly, so that the essential insanity of their anti-tax, sink-the-state agenda can be well-described by what's left of political state media. George Skelton does the math and refutes the Yacht Party assertion that cutting spending alone can solve the budget crisis, and Dan Walters manages to describe the situation accurately.

And we all sit at our computers and type out our "even Dan Walters and George Skelton believe" articles, eternally hopeful that this is the corner-turning event, that the public will find the right people to blame for the sorry state of affairs, and punish them repeatedly forever more. Only it's wishful thinking. First of all, I hate to break it, but nobody reads George Skelton and Dan Walters. They are opinion leaders to about .001% of the electorate. Second, there was another audience watching Sacramento this weekend, and they were the bondholders, who would be crazy to allow California to borrow one more red cent from them given the political fracturing (and this budget calls for 1.1 trillion red cents, or $11 billion dollars, to be borrowed). Even if this passed tomorrow there would need to be lots of short-term debt floated to manage the cash crisis until new revenues actually reached state coffers, and with the bond rating the lowest in the country and the dysfunction being played out, I don't see it happening.

The other point is that this is, let's face it, a bad deal for Californians. Among the sweeteners thrown in the deal to attract that elusive third Republican vote are a $10,000 tax break for home buyers to re-inflate the bubble and set the state economy up for an even bigger crash; weakened anti-pollution laws that will cost the state additional public health and environmental cleanup spending in the long-term; a potential budget cap that will make it impossible for public schools and social services to meet demand; and much more. The tax changes, which are short-term except for a huge break to multinationals, tax things that we want to encourage in a downturn, work and consumption. What the federal government is offering to spur demand and get the economy moving again is exactly what the state government will be cutting to balance the budget. That's not an argument to kill it, but it's a reflection of reality.

So there will be at best a kind of zero-growth stasis, and at worst a further crumbling of the local economy, with shrunken revenues likely to require another round of this by summer. Ultimately, the media cannot help the Democratic Party solve this problem. The bill is coming due for 30 years of anti-tax zealotry and the belief that we can provide whatever citizens need without paying for it. There isn't a light at the end of the tunnel. That some opinion leaders are coming around about 20 years to late doesn't wash the blood from their hands. And that the Democratic Party is finally thinking that they should maybe fight against the 2/3 requirement that has relegated them to a functional minority in Sacramento since is was instituted doesn't absolve them for 30 years of inattention.

It gives me no pleasure to bear the bad news, but there's no wake-up call on the horizon. Even all 38 million Californians coming to the same "Hey, GOP is suxxor" conclusion at the same time doesn't change structural realities. Those must be fought for over years if not decades, and it is not defeatist to wonder whether it's too late.

Labels: , , , , , , , , , ,