California Sinking

For several months, I have noticed a lack of context from the press when discussing California's housing situation. Sales of new and existing homes were rising, yes, but for a very good reason - all the bargains created by a spate of foreclosures. In fact, the correlation matches up perfectly - the regions with the highest sales also have the lowest prices. An example is the High Desert region, with a 203.1% increase in sales year-over-year, but a median price of $121,970, the lowest in the state. The latest data on home sales shows a 41% decline in price year-over-year. Bloomberg's story reinforces the theory that only foreclosures are selling. Does this mean that property values have decreased by a concurrent amount? Not necessarily. But it does mean that a non-foreclosed home in this distressed market has virtually no chance of selling, making it impossible to find the bottom of the market. The price of foreclosures does affect the price of all homes, which is why stopping foreclosures is so important.

But that effort will be stymied by the continued erosion of the job market, leading to more unemployed and more people losing their homes.

California unemployment will peak at just over 12 percent late this year, setting a modern record, according to the latest forecast from the University of the Pacific.

Recovery will come slowly. Unemployment won't sink back into single digits until late 2011, or some two years after the recession is expected to officially end, according to a forecast released Tuesday by UOP.

There's typically a considerable lag between the beginning of an economic recovery and a drop in the unemployment rate, as companies are slow to re-hire even after business perks up.

We're talking about two more years, at least, of significantly reduced revenue collection rates. All the homes selling for pennies reduce the overall property tax revenue. No projection of future revenues can reasonably be believed in this environment. And so we'll continue to see yawning gaps, with a governmental structure woefully equipped to deal with them. The so-called "reform" of Prop. 1A, to hoard revenue in positive economic years to use in down years, will be inoperative for the foreseeable future, and even when the economy retains balance, the revenue forecasts for any spending cap will be increasingly based on these horrible years, leading to a disaster without end.

In years when revenues fall short, the state could use the reserve to cover spending up to the prior year's level, plus an adjustment for growth in population and the Consumer Price Index.

But increases in the state's senior population and health care costs have been outpacing both those measures, said Jean Ross, executive director of the California Budget Project, a nonprofit organization that focuses on the effect of budget policies on low-and middle-income Californians.

Moreover, Ross noted that under Proposition 58, the 2004 ballot measure, the state will continue to send 3 percent of revenues to the reserve, which would be subject to the tighter controls of Proposition 1A.

“It takes 3 percent off the top of the budget, and we don't have that,” Ross said.

Ross and Michael Cohen, a deputy legislative analyst who studied the measure in depth, both said Proposition 1A could force revenue into the reserve even in years in which the state faced deficits.

My guess is that this is why the AFSCME local 2620 voted to support the measure and others on the ballot, while the overall union called for rejection. The lure of easy money might sound nice for the locals, but unions with experience with spending caps in other states know that they accompany disaster.

Simply put, the state's in an enormous amount of trouble and has no structures to deal with it. This argues strongly for blowing up the boxes, for real this time, and starting over, by repealing the rules that subject the budget to tyranny and building a new vehicle for reform.

Not Aware Of All Internet Traditions

This AFSCME video has been making the rounds on YouTube for a long time. I've posted it on multiple occasions. I know that taking it out of the joke viral email forward and into the political arena changes things a bit, but are union leaders really upset that Eric Cantor sent over the video as a "response" to their ad blitz targeting neo-Hooverist GOP leaders?



I think the unions are just being opportunistic. And obviously, Cantor and the GOP's constant pro-family, anti-obscenity crusades shows a bit of hypocrisy here. But it's a funny video. And an Internet fave. Maybe I'm being thick, but I don't see the problem.

...Cantor's spokesperson had to apologize, which is fun. It's a rare Democratic hissy fit that worked. Imagine that.

AFSCME and UNITE Here Need To Cut It Out

Though John Edwards got quite a bit of union support, his backers never crossed the line in terms of advocating for their candidate. Two unions - one for Clinton, one for Obama - are doing so, and are really sullying the union name. And they need to stop.

AFSCME and UNITE Here are both responsible for some of the lower moments in this campaign. AFSCME dropped ugly mailers unfairly questioning Obama's record on abortion in New Hampshire. Their organizers pushed very hard against the line of union rules in Nevada. They dropped mailers in Florida, against DNC rules (Gerald McEntee was in the state for a few days, I understand). And UNITE Here is no better. They intimidated their workers in Nevada, trying to force them to vote for Obama (AFSCME ended up organizing inside their union, and were more successful). They ran the Spanish-language ad that basically said "Hillary doesn't care about Hispanic voters." They ALSO dropped literature in Florida.

90% of the lowball tactics in this primary have been carried out by these two unions. I think it's wrong for Clinton, particularly Bill Clinton, to ascribe these "union boss" stereotypes in describing them. But if the show fits...

There's advocacy and there's harm, and that's what AFSCME and UNITE Here are engaging in, harming their candidates and harming the union movement. In a time where the movement is finally starting to grow again, this is a real turn-off.

Hold On, Everybody

So there were two big charges coming from the Obama campaign out of Nevada: that there were numerous incidents of voter suppression and intimidation at the local precinct sites that swung the vote to Clinton; and, that they actually won Nevada (the front page of Obama's campaign website has a graphic showing the Nevada results with "Obama 13 delegates, Clinton 12 delegates"). Based on being there and talking to a lot of precinct captains and people in the know, I can speak to both of these issues.

First, the delegate count. When I spoke with Jill Derby in the immediate aftermath of the caucuses, she basically tried to dismiss the Obama campaign statement, by saying that no national delegates had been selected and that would be determined by an election at the state party convention in April. I pressed her further a little later, asking her essentially "All things being equal, assuming he remained in the race, would Obama wind up with more DNC delegates?" And she refused to give a straight answer. I later learned that Derby is pretty much known as a Clinton supporter, and she was pretty much trying to tell me "We'll make the delegate count reflect the will of the voters." But now, the NSDP has backtracked on that.

"No national convention delegates were awarded. That said, if the delegate preferences remain unchanged between now and April 2008, the calculations of national convention delegates being circulated by the Associated Press are correct. We look forward to our county and state conventions where we will choose the delegates for the nominee that Nevadans support."

On the face of this, many have made the argument that it invalidates the caucus process. I agree, but it's in the same way that the electoral college subverts the national election process. States weight their caucuses to get candidates out to the rural areas (in Nevada's case, it's really a rounding error that gives a little more importance to areas outside of Las Vegas and Clark County). In the aftermath of the election, they can't just renege on that. I agree with Chris Bowers that the media and the conventional wisdom can't just dismiss the real delegate count because they want to. Unfortunately, they are.

The other thing is that you have to understand the significance of the caucuses for party building. A primary is controlled (and paid for) by the state; a caucus is controlled (and paid for) by the parties. The Democrats had 115,800 Nevadans turn out; in 2004 they had 9,000. If you can get 116,000 people out to what amounts to a Democratic Party meeting, you can capture their information, excite them, and turn them out on Election Day. In states where the Democratic Party isn't very organized and politics is not part of the DNA (and believe me, that's Vegas to a T), caucuses actually play a very important role. They're HORRIBLE at picking a President, but they are great at strengthening the party.

The downside to this, especially in a state like Nevada with new caucuses and inexperienced caucus-goers, is that they're a disorganized mess. And this brings me to the charges of voting rights violations. Matt Stoller covers a fair bit of this today, and I was in the same caucus room as him and talked to a lot of the same people after the caucus, so our takes will track somewhat. The Nevada State Democratic Party, in setting up these caucuses, had to find over 1,700 precinct chairs to run them. There aren't 1,700 nonpartisan activists sitting around Nevada ready to run caucuses, so the chairs ended up being people who supported one candidate or another, and I would guess that a disproportionate amount supported Clinton. This is not to say that those precinct chairs cheated or anything, but the perception of bias was already ingrained before any votes were cast (a lot of those organizers ended up coming in from California and Colorado, too). In addition, the state put multiple precnicts on the same site (there were 1,700-some precincts and only 560 sites), NEVER TOLD THE VOTERS, and expected people who had never caucused before to show up and implicitly know where to go, leading to more chaos. Furthermore, the precinct CAPTAINS (those tasked with organizing voters for their respective candidates) weren't entirely knowledgeable about the process either. But they were told that they had to be assertive in working the rules. And many of them were.

There was a lot of hoopla surrounding the at-large caucuses on the Strip for the employees of the big hotels. Piecing together the evidence, it's clear that there were strong efforts by the labor leaders within the Culinary Workers union to get their folks to vote for Obama. It's also clear that invited a backlash. The picture at the top is from a sign, "I Support My Union, And I Support Hillary," that was paid for by the Clinton campaign, and handed out to Culinary Workers union members. AFSMCE organizers from Iowa and all over the country were organizing inside the union and getting people to caucus for Clinton. In addition, I heard that the rank and file of the union wasn't all that happy with their leadership to begin with, as dues have gone up without an accompanying increase in wages. The result of the Strip caucuses were that Hillary won 7 out of 9, when the projection was 2 to 1 for Obama.

But there WAS a real-world impact to the lawsuit brought by Clinton allies to shut down the Strip caucuses, and particularly Bill Clinton's comments that those employees' votes would "count five times as much" as regular Nevadans. This is a complete and utter falsehood, but coming from a former President, it had weight. Apparently that soundbite was played over and over on Las Vegas TV and radio. There were statements from the teacher's union that the lawsuit was designed to protect voter rights, when the impact would have only been to shut down the Strip caucuses and prevent people from participating. They were making wild claims about how all employees would get to vote at their workplace, which weren't true. And on the ground, people got that message, and the Culinary Workers union were absolutely painted as the caricature of "powerful union bosses" trying to steal the vote. So Hillary's success in Clark County must be attributed to that in part.

Like the rest of the media, I went to one of the casinos to observe a caucus (Hillary beat Barack at the Wynn, 189-187). It was fascinating and hilarious and I can't wait to write about it, and I don't regret it. But the media's obsession with those caucuses diverted attention from all of the other ones in the Vegas area. And this is where most of the alleged voter intimidation and voter suppression took place (See here, here, and here). With more transparency and a media spotlight, I think there would have been less opportunity.

But let's be clear about these charges. In many cases, the rules weren't properly explained. Here's Stoller:

The central claim of the Obama camp is that Clinton-affiliated chairs were telling their people to show up at 11:30 and then shutting doors to caucus-goers at 11:30 instead of 12. Aside from the fact that party rules conflict with each other on this point, many of the caucus goers really wanted the event to start and end quickly, because they were working. In the middle of the caucus I attended, about a third of the room emptied out because of a shift change (their votes had been counted). In other words, there were good reasons to shut the doors at 11:30.

I heard one report of an Obama precinct captain trying to get the doors shut at 11:30. In truth, the precinct chair had the discretion to keep them open. So it was very muddled.

There are other charges, like voter cards moved into the Hillary camp (it appears the party didn't expect the high turnout and didn't have enough cards or voter registration forms), Hillary caucus-goers attempting to be counted in different precincts on the same site, precinct captains telling caucus goers for non-viable candidates that they had to go home instead of their right to make a new choice, electioneering in places where it was forbidden, etc. My take on all of this is that there were a lot of sharp elbows thrown. Supporters of each candidate were very assertive and trying to do their best. The Hillary precinct captains may have been a little more prepared and a little more experienced for this kind of hardball politics. But that's not universally true. Here's my favorite on-the-ground story from desmoulins at MyDD, an Edwards precinct captain (who I talked a lot of this over with last night):

As the end of the first allignment approached, Clinton had 80, Obama 46, Edwards 13, Kucinic 2 and uncommitted 2. Each of the 3 campaigns made a short pitch for the 2 Kucinic supporters who then said they would come to Edwards if it would make us viable. The uncommitted voters also agreed to come if it would make us viable, as did one Obama voter and one Clinton voter. I was now only three voters short, but I could not let the 15 minutes expire without at least getting 3 more uncommitted (because members of viable groups cannot reallign under NV rules). So I went to the Clinton group and explained that if they helped me reach viability, they could deprive Obama of at least 2 delegates without hurting their own cause. I urged them to move at least 3 people to uncommitted, which would at least make it mathematically possible for us to reach the 22 we needed for viability.

To my surprise, the Clinton captain had no idea what I was talking about and could not understand either why they should move supporters to uncommitted, or why I would suggest that most of the Edwards supporters would go to Obama if we failed to be viable. I explained quickly and had more or less convinced her when time ran out. I pointed out she had to do it now and that if my math was wrong, she could get her voters back in the 2nd 15 minutes. She agreed but only one Clinton supporter volunteered to move. As I pleaded for her and one of the two others assisting her to move themselves, the Obama captain quite rightly began to point out that time was up. (I had told the Obama captain I would come to their group if I were not viable, but to her credit, she was not put off that I was trying to help Edwards at her expense.)

You had a lot of inexperienced caucus goers and inexperienced precinct captains and inexperienced precinct chairs, and there's no question that some people took advantage of that opportunity. The idea that it impacted the vote one way or the other is just not very realistic. Clinton's precinct organizers were more ORGANIZED, and they took advantage of a lot of opportunities. Is that suppression? I can't say that it is, really. I'd be more concerned by the Barack Hussein Obama robocall, if I were the Obama people.

What I do know is that the Obama campaign taking this up as a rallying cry has the potential to be very dangerous. If they are trying to leverage an idea that the Clinton campaign cheated into winning with black voters in South Carolina, that could get extremely ugly. I would hope they would step back from the brink. And the same with the Clinton campaign; Bill Clinton saying that he personally heard a union rep threaten an employee is just not credible. This plays into a growing racial gap that I saw on display a little bit at the Wynn casino caucus. It's a scorched-earth strategy for the Obama campaign to call up the ghosts of 2000 in Florida and 2004 in Ohio in the context of a Democratic primary where the allegations are murky. It will cause a severe rift in the party and could have implications into November. I don't think anybody comes out of Nevada looking good, sadly. The election has gotten very high school and petty, as issues have been pushed to the side. This has the feeling of a missed moment.

How Low Can You Go

I think Hillary Clinton and Rudy Giuliani have the same printer.



I must say that I'm feeling much better about a potential Obama candidacy now that he's being attacked from the right from within his own party. Hillary, on the other hand, is playing the fear card. She's using Bush tactics because her strategists feel that it's the only way to stop the runaway train. As Matt Stoller notes, there are any number of attacks opponents could use to critique Obama's own tactics in this race, and none of them would include the words "he's too liberal." And the only possible reason you would make that argument is to say "he's not electable," which is blown out of the water by all the new people he brought into the process in Iowa.

Meanwhile, the AFSCME board excoriated their chief Gerald McEntee for producing such a mailer (it was under AFSCME cover).

Revising And Extending My Remarks On Hillary Clinton

I was a bit surprised to see so many people focusing on the substantive question that tripped up Hillary Clinton in Tuesday's debate, and not what the episode revealed about her political character. To reiterate, I think Eliot Spitzer is a great leader, and what he is doing on the driver's license issue, particularly by beating back the hate speech of the likes of Lou Dobbs, is admirable. There are illegal drivers on the roads because we don't have a functioning public transit system in America. The driver's license should not be the main form of ID in America, it should simply allow you to operate a motor vehicle. If you have unlicensed drivers all over the roads, there are going to be serious public safety issues. That's all this issue is about, and it's not a federal one, furthermore.

I initially thought Clinton nailed the issue and was far better than Chris Dodd, who frankly sounded clueless about it. But her eventual response, marked by a backtrack to "I understand but I do not endorse," trying to be on all sides of it, was revelatory. It was status quo, all-things-to-all-people, value-challenged Democratic politics. I reject that. Apparently Clinton tried to clean up her response yesterday, but even that wasn't crystal clear.

So here's the statement that Camp Hillary gave to The Times today in response to questions about where she stands on the issue:

"Senator Clinton supports governors like Governor Spitzer who believe they need such a measure to deal with the crisis caused by this administration’s failure to pass comprehensive immigration reform," her campaign said.

It's almost too obvious to point out, but this just isn't an expression of support for Spitzer's proposed policies in any way. It even falls short of overt support for Spitzer in general -- it says she supports governors "like" Spitzer who are faced with policy conundrums of this sort. This is basically a clearer way of saying what she said yesterday -- Spitzer is trying to solve a problem that needs to be solved, and she supports the idea of trying to do something about it with policies similar to these.

The AFSCME endorsement kind of blunted the impact of this waffling, although John Edwards nabbing the New Hampshire SEIU may prove more important. The point is less about the contentious issue of driver's licenses for illegal immigrants - one that State Senator Gil Cedillo has been nobly pushing out here in California for years - it's about Hillary Clinton's judgment. She is far too constrained by political expediency, and would rather dance around a tough issue than lead on it and bring people to her position. That's not the kind of leadership I really want to see in the White House.

If I Have To Spend Eight Years Listening To Mark Penn...

Just kill me.



Welcome to your time machine. A Hillary Clinton presidency will be eight more years of parsing and waffling and incomplete thoughts. Look, just come out and say it. She didn't want a press release that said "Hillary Wants To Give Illegals Candy." But that press release will happen anyway, so what's the point? Why not try to get OUT IN FRONT of an issue for a change.

In the absence of any leadership on immigration from the left, the issue has been demagogued to death. I heard a guy last night on right-wing radio talking about how his tax refund was lower than ever this year, and blaming illegals for it. Uh, the federal government sets tax policy, not Jose Jimenez, and they've been redistributing wealth upwards for decades. There's serious concern among the middle class about their economic future, and this has been seized upon by nativists. It's the precarious underbelly of right-wing populism, and this radio caller's comment was the distilled essence of it. They think they're not getting ahead because the illegals are taking their jobs and sucking up government services because they have no "survival skills" (a direct quote). Survival skills are ALL that a Mexican national travelling through deserts and rivers to feed his family has. They're contributing more to the economy than they're taking away, and they're being exploited by cruel and greedy employers. Fix that part of the issue, which has been degraded severely in the Bush era, and you fix it all.

Someone needs to be giving voice to the voiceless and fighting for an immigration reform that is sensible and reflects American principles. Hillary Clinton and her spinners offer nothing but mush. She won the AFSCME endorsement today, so that'll probably overshadow last night's pathetic performance. And her team will probably be successful in framing it as "6 guys ganging up to attack 1 woman" (uh, it's called being the frontrunner, if you don't like it, drop out). But we need more than status quo, follow the polls, mushy-middle technocracy. There are too many challenges we face for that to characterize the next 8 years.