What's News

So I had no opportunity to check in yesterday. It was a whirlwind 36-hour stay in NYC with the family of my significant other. Somehow we managed to squeeze in the Met, the Museum of Natural History, blowing up the floats for the Macy's Parade, Little Italy, etc. My news intake has been limited to the New York Times and whatever scraps are coming out of my full email inbox, so I don't have a great grasp of what's happening, but I did notice a few items.

* There was apparently "increased security" on the New York City subway today, but I used it and didn't see anything approaching that. 'Course, maybe I wasn't supposed to. And I heard absolutely nothing about the threat, although at lunch I saw a CNN headline screaming "holiday terror!" and thought "Thanksgiving with my parents, now THAT'S a holiday terror!" I'll be here all week, folks.

* There was some real terrorism today.

Terrorists armed with automatic weapons, bombs and grenades attacked at several sites in Mumbai on Wednesday and were holding Western hostages at two luxury hotels, authorities said. Police and Indian media reported at least 80 people were killed and hundreds wounded.

The gunmen targeted five-star hotels, a popular restaurant, hospitals, a police station, a train station and other sites in India's financial capital in attacks that began late Wednesday and continued into Thursday, police and witnesses said.

Near dawn Thursday, parts of the city remained under siege, with police and gunmen exchanging occasional gunfire at the hotels and an unknown number of people still held hostage, said A.N. Roy, a top police official.

Sounds frightening. Are those Western hotels?

* Turning to California, major congratulations to Calitics Match candidate Alyson Huber, who has won the AD-10 race after a late surge of provisional ballots. That's fantastic, and while it appeared after Election Night that the State Senate had done the better job by winning their only contested race, Hannah-Beth Jackson has fallen behind and now the Assembly has a net pickup of 3 seats. We still need to be critical about what went wrong in California, but that's a fairly decent pickup, and there are enough seats that'll be in play in 2010 to reach 2/3.

* Meanwhile, Fabian Nunez is going to work with Steve Schmidt. That is completely fitting.

* Looks like the auto industry may get their bailout after all. Just throw it on the $7 trillion dollar pile.

The California Report

Here are a few tidbits on this GOTV weekend!

• Obviously everyone is going to be working hard for their causes and candidates, so it may be a little quiet around here. I'll be out walking all day tomorrow. Oh, and don't vote for the racist guy, Bill Johnson, as a Judge of the Superior Court (Office number 125) in LA County.

• Yesterday was the deadline for bills to get passed out of their chamber of origin, and the Assembly passed major subprime mortgage legislation, without help from Republicans (6 of them abstained despite being seated right in the chamber). This bill has some good homeowner assistance elements that will allow people to restructure their financing before foreclosure. A mortgage bill has also passed the State Senate, so some form of legislation will hopefully get to the governor post haste.

• One of the biggest problems with the housing crisis is that, as home sale prices lower, homeowners are reassessing their value and getting their property tax lowered, decreasing state revenue yet more.

• Sticking in the shiv before riding off into the sunset, Fabian Nuñez writes a puzzling op-ed in the Sacramento Bee approving of the Governor's horrible idea to borrow against future lottery revenue. Considering that the only sustainable solution to the permanent crisis mode that we have in our budget is to reorganize the tax structure instead of constantly borrowing, I have no idea why any Democrat would veer so far off message and undermine the new Speaker's ability to move forward. What's more, lotteries are regressive taxes on the poor.

• One spot where there will be a lot of action on Tuesday is in Ventura County, where Democrats now outnumber Republicans and which could have contested elections in the Assembly, Senate and US Congress. However, the LA Times shows its political acumen by writing:

One of the more closely watched contests on Tuesday will be the Democratic primary in the 24th Congressional District. Insurance agent Mary Pallant of Oak Park; Marta Jorgensen, a Solvang educator; and Oxnard businesswoman Jill Martinez are running.

Marta Jorgensen quit the race over a month ago and endorsed Martinez. Way to go, LAT.

• Excellent news out of Los Angeles: there's been a $1 million dollar settlement with Hollywood Presbyterian Medical Center for their dumping homeless patients on Skid Row. They will also be monitored by a US Attorney for five years. This unethical practice has reached a reasonable conclusion. Hollywood Presbyterian deserved punishment.

• Trying to get rid of marijuana grow houses in Arcata is like trying to get rid of the Pacific Ocean on the California coast.

Enjoy!

California Report

• Do read Robert in Monterey's report about Abel Maldonado, Don Perata's best buddy, running as a write-in candidate in the Democratic primary to stall an attempt to get an opponent on the November ballot. First of all, this is an example of why crossfiling should be banned once and for all. Second, Abel Maldonado is a snake and I can now see why Don Perata would knock on doors for him. Apparently, neither of them have much interest in the democratic process.

• Arnold thinks the legalization of gender-neutral marriage will be a boost to the sluggish economy, but I hope he's not basing his entire budget on a sharp uptick in gay weddings. I mean, there are only so many Mr. Sulus rich enough to have that surge register more than a blip. By the way, good for Mr. Sulu. And good for Ellen DeGeneres for telling Straight Talk Express where to shove it.

• Speaking of John W. McCain, he's in California today. Nobody show him the PPIC numbers!

• Lucas mentioned this, but Darrell Issa got in the middle of a heated exchange between Henry Waxman and EPA Adminstrator Stephen Johnson over the EPA's breaking the Clean Air Act. Emptywheel has video:



• Why Fabian Nuñez is claiming racial bias at this late date over questions about his travel practices is completely beyond me. And he's taken to Spanish-language television for these accusations to stoke divisiveness in the Latino community, too. It's so counterproductive, as well as misleading.

• Speaking of Spanish-speaking media, this is an older story, but it's fascinating to me that the Spanish-language channels in LA are so much more substantive than the English-language ones, featuring longer, "more deeply reported" pieces.

• We could see a settlement very shortly on prison overcrowding in the state which would not require early release. There are some decent components to this deal, but it basically gives everyone three more years to clean up their act, and I wouldn't be surprised if it just puts us in the same siutation come 2011. The policies needed are well-known; the political will remains elusive.

• The Bay Area AQMD passed a carbon tax for businesses that emit greenhouse gases. It's "not enough to change behavior," one expert said, but it does presage what may be coming down the pike for polluters. Whether you get there through selling carbon permits at auction or with a tax, the bottom line is that pollution is going to cost enough money to alter business' approach to engaging in it. This is a good step.

• Arnold's plan to borrow against the lottery (and it is borrowing) is getting almost unanimously bad reviews, including from the budget nun.

• Interesting that we denied the endorsement to Rep. Laura Richardson (CA-37) on the same day that she is forced to defend herself against allegations that she walked away from her foreclosed home in Sacramento. It sounds like the Congresswoman renegotiated the loan, but the conservative fever swamps are all over this one (check the comments in that LAT blog post). She did buy the half-million-dollar home with no money down, and then left Sacramento almost immediately after winning election to fill the open seat in Congress.

A Tale Of Two Speakers

Fabian Nunez hosted his final press conference as speaker yesterday, and began his post-speaker life by offering a series of proposals focused on process issues.

The redistricting component features an independent 17-member "hybrid" commission. No legislators will serve on the panel, with the majority picked randomly from a screened pool with no legislative influence and eight others picked by legislative leaders. Unlike the Voters First initiative that may appear on the November ballot, this proposal requires diversity in every step of the process and puts the Voting Rights Act first and foremost among the criteria in selecting districts. There's also a host of transparency and public input provisions.

The term limits provision is similar to Prop 93, but excludes the provisions that protected many incumbents that drew criticism. It reduces the maximum amount of time a person can serve in the Legislature from 14 years to 12 years, allowing a legislator to serve all their time in one house.

There's also a fundraising blackout period prohibiting campaign contributions to legislators and the Governor from May 15th until the budget is enacted.

These would go up on the ballot for passage by voters in November once they get through the Legislature. There is of course already a redistricting measure that appears to be on its way to the ballot, so it's unclear whether or not this is a "confuse and kill" strategy. But Nuñez said that his hope would be for one redistricting proposal on the ballot.

That's the past; here's the future.

Karen Bass has drawn up a short agenda for her two-year reign as Assembly speaker that begins next week.

There are only three items:

* Balance a state budget that Gov. Arnold Schwarzenegger has declared is "$20 billion out of whack."

* Create a ballot initiative that would produce $300 million to $500 million annually for foster care programs.

* Restructure California's tax system to make it conform to the modern world. Actually, she wants to create a blue-ribbon commission of "the best and the brightest" to tackle taxes.

That's all.

Foster care programs are Bass' pet issue, but otherwise she's focused on, I have to say, the ACTUAL problem facing California.

We are out of money. Not out of money in theoretical terms, or on a balance sheet somewhere, but physically out of money by August if no budget is enacted. The cash reserves are empty and the revenues aren't coming in. All that matters between now and August is that we put a budget in place that is SUSTAINABLE and, as Bass notes, in line with the modern world. All of this process stuff about redistricting and term limits is what gets pundits and press people all a-twitter, but it's not the problem in California. What Bass is saying without saying it is that we need to end the 2/3 requirement so we can have a legislature that reflects the will of the people. That's the only way we're going to pass a sustainable budget, that's the only way we'll get a 21st-century revenue system. And I believe she knows that.

The governor wants to sell out our future, sell bonds, sell the lottery, hold a fire sale and mortgage California for generations. We should not have to stand for that. Selling off the state to preserve tax cuts for the wealthy is not a "creative" solution. I have no idea how Karen Bass will fare in her 2 1/2 years as Speaker, but I'm now confident that she's at least focused on the right issues.

Make It The Yacht AND Oil Party

So as expected, Assembly Republicans killed a bill that would bring California in line with every other oil-extracting state and charge obscenely rich oil companies for taking our natural resources out of the ground.

With gasoline prices soaring, legislation to slap the oil industry with higher taxes died in the Assembly late Wednesday in the latest party-line battle over the state's beleaguered budget.

Republicans killed the two-pronged oil tax proposed by Assembly Speaker Fabian Núñez, which they considered a threat to the state's economy as well as political gamesmanship meant more for public relations than problem solving.

In turn, Núñez said at a news conference before the vote that the GOP could not continue to push "knee-jerk, no-tax rhetoric" without coming to grips with its effect on schools and other public services.

Speaker Núñez is in a tough spot, faced with a recalcitrant Yacht & Oil Party who is wedded to failed ideology. The best he can do is to continue to offer these proposals, argue forcefully for them, and hold the opposition accountable for their votes in November. On a blogger conference call earlier today, the Speaker talked about PTA members from red districts coming to the Capitol to protest these extreme education cuts. The Yacht & Oil Party will absolutely face a backlash if they keep this up. Democrats are making the differences clear, and that's the best we can hope for at the moment.

Another thing - what exactly is up with this argument from the Yacht & Oil Party that the Speaker timed his proposal to coincide with layoff notices from school districts? I didn't realize that POLITICS was out of bounds in the political arena. Of course it coincided; the only way you get people in this state to pay attention to what's happening in Sacramento is by taking advantage of opportunities to show the stark philosophical differences. Saying that "you're not allowed to tell people the consequences of our policies" is a loser argument for a loser party.

The Drive For 2/3: C'mon CDP, Come Along For The Ride

I am firmly committed to getting a 2/3 majority in both houses of the state Legislature by 2010. Fabian Nuñez believes that, in the Assembly, we can get halfway there by November.

Speaking at the Sacramento Press Club yesterday, Assembly Speaker Fabian Nunez said Democrats should add three seats to their 48-32 majority in the California Assembly in November's elections.

Nunez made the prediction after new figures from the Secretary of State show a surge in Democratic registrations in all but two Assembly districts, including three held by incumbent Republicans who will be forced to leave office.

They include the desert/Riverside area seat held by Assemblywoman Bonnie Garcia, the San Diego seat of Assemblywoman Shirley Horton, and the Contra Costa/Sacramento Delta seat held by Assemblyman Guy Houston.

These are clearly the three seats to target. AD-80 (Garcia's seat) has some excellent candidates on the Democratic side, including Greg Pettis and the Hispanic Barack Obama, Manuel Perez. We have good candidates in AD-78 (Horton's old seat) and AD-15 (Houston's) as well - as those Caliticians in those districts can attest. Plus, we not only have registration advantages, but the advantage of a game-changing Democratic nominee at the top of the ticket (whether it's Obama or Clinton) that will bring new Democratic voters to the process. These three seats are prime opportunities, and there are other Assembly opportunities like Greg Aghazarian's seat (he's also termed out), and more in the Senate (Hannah Beth Jackson's bid in SD-19, the possible Jeff Denham recall, Abel Maldonado's SD-15).

However, I want to highlight this nugget about the way Assembly and Senate elections are managed in California.

If Democrats field strong candidates for these seats, we could be looking at a pickup of 2/3+ seats.

Each of the marquee races are expected to be $1 million+ contests. The new Assembly Speaker will be responsible for raising funds and overseeing the campaigns.

I've talked about this with party leaders several times, and nobody has given me an adequate explanation about this. In a way, it's a lot like the DCCC as the House-based campaign arm for national elections. But I'm struggling to understand why the Speaker (and the President Pro Tem of the Senate) have the sole responsibility of overseeing these elections and creating advertising, GOTV, etc. It seems to me that the California Democratic Party would be able to do a much better job in these districts, with their membership already on the ground and involved, and with a larger fundraising base to conduct the operations necessary. Yet for some reason, there is this bifurcation: the CDP deals with statewide races and Congressional seats, and the Assembly and Senate leadership do the legislative races. Is this just tradition? Why can't the CDP play in whatever race they wish?

This problem, or at least what I consider a problem, is compounded by the fact that we will have new leadership in the Assembly and Senate, leadership that may be unused to running multiple campaign operations out of their offices. I think Darrell Steinberg is a fine man (so does George Skelton) who's going to do a great job as the Senate leader, but I don't know how he's going to do facilitating Hannah Beth Jackson's race in the Thousand Oaks area. Furthermore, the new Assembly Speaker won't be picked for a month, and we have to start on these races right now. Obviously the Presidential race is going to take up all the oxygen in the fall, so ensuring that the Democratic candidates get their message out and the Republicans in these open seats are defined is crucial. And right now, for the next month, there's literally nobody to do that.

(Also, the proliferation of independent expenditure money in this state necessitates some organizational and financial help for legislative candidates that may otherwise just get swamped.)

I can hold judgment on the efficacy of this and bow to those wiser in the ways of California elections if I were given a satisfactory explanation for this structure. But nobody has done so, and I've spoken to a lot of people inside the CDP about this. I think 2008, in a favorable environment for Democrats, with no statewide races on the ballot at all, and with a badly broken Republican Party in California that is broke and rife with internal squabbling, would be an excellent time to shift this tradition, and for the CDP to exercise some muscle in these legislative districts, helping solid Democrats get elected and moving us ever closer to the desired 2/3 majority that we need to make the real changes necessary to move the state forward.

This is not an accusation, but a dialogue. I'm looking for ways for my party to be more effective.

Prop. 93's Achilles Heel

As we reach the beginning of the post-Nuñez and Perata era in the California Legislature, I want to reiterate what I said in a comment thread to the Speaker's top spokesman, almost a year ago, just days after the term limits measure was announced:

If it's so disastrous to (Nuñez') career and future plans to go through with this, why doesn't he sign a simple pledge stating that he will not benefit from a last-minute change in the law? He can certainly run for a State Senate seat, or Congress, or LA mayor, or whatever. But certainly, signing such a pledge would remove any appearance of impropriety, and give the Speaker freedom to serve MORE time in Sacramento, making him even wiser in how to negotiate that difficult terrain.

So can I fax the pledge right over?

The bottom line is that if the law wasn't seen to have benefited the 120 legislators in office to an outsized degree, it would have passed, because this is what turned off liberals and Democrats. George Skelton agrees.

What really stunk up Prop. 93 was an incumbents' sweetheart provision that mostly helped senators, including Perata. It would have allowed incumbents to serve 12 years in their current house regardless of previous service in the other house. So some senators could have spent 18 years in the Legislature, six more than advertised in Prop. 93.

Voters probably would have accepted a straight-up deal that allowed incumbents to choose either the new 12-year arrangement or the old 14-year system, but not be awarded extra "transition" years.

"They could have had term limits on a silver platter, but they got greedy," says Dan Schnur, a Republican consultant who has worked for redistricting reform. "They could have passed it with both hands tied behind their backs."

Of course, there would be no incentive for them to pass a term limits change if they didn't benefit from it. Where would the money come from? Good government groups don't have that kind of scratch.

But if Nuñez and Perata held a joint press conference three weeks before the election and said "We thought it over and we will not seek another term. The other legislators are free to do as they wish, but we believe in improving the state of California more than ourselves," then the "No" side would have had their legs cut out from under them. It was their entire strategy to make the proposition a referendum on the leadership. And liberals and Democrats had problems with the narrow tailoring of the initiative. They would have gotten the 4% they needed to pass the thing; all they had to do was sign my pledge.

That said, I'm very excited with Darrell Steinberg as the new President Pro Tem; he's a solid progressive. As for the Assembly, if this part of the palace intrigue is true, there's going to be some serious pushback:

Meanwhile, very reliable sources tell me that Democratic Assemblymember Charles Calderon has been trying to put together a deal with the Republicans in the Assembly-who number 32 in all-and to cobble together at least 9 Democrats in the body to get to 41, the magical number to become Speaker.

If we have a Lieber-Speaker in the midst, that's not going to work out well, to put it charitably. This needs some attention.

Spin Alley

You might as well call it "The Lying Lounge," but I just spent a little bit of time there. It's quite surreal, all this attention paid to people who are saying the most obvious statements imaginable ("My candidate did well!"). But I sought out some of our California legislators, and tried to ask them about some of the issues outside of the debate that we talk about a lot.

• Rep. Hilda Solis: It was great to see Rep. Solis here! I wasn't aware that she was a Clinton supporter (previously she had supported Bill Richardson), and I had to look up at her sign (every "spinner" has a sign) to recognize that after she started talking to me. She said that Hillary had a good chance to explain her proposals in a lot of detail tonight, including on health care and "green jobs." I mention that she was barely given a chance to mention green jobs, and asked her what she thought about the fact that every CNN debate has been sponsored by the coal industry. "I think that's not right," she said. She went on to mention some environmental justice legislation she's co-sponsored with Sen. Clinton, and I asked her to come to Calitics and tell us about it.

• Speaker Fabian Nuñez: I didn't want to hijack the interview, but I really wanted to hear his views in the aftermath of the health care reform failure in the State Senate. Fortunately, someone beat me to it, and wound the conversation around to that. After saying that Sen. Clinton "understands the complexities of the health care crisis," he was asked about the lessons of what took place in Sacramento this week. "That was a question of our fiscal crisis. The State Senate felt we couldn't afford it, and I respect their perspective. But at the federal level, there's a way to do it in a much more flexible way and get it paid for. For all the reasons we couldn't accomplish it at the state level, you can at the federal level." I wasn't able to add the question of what concrete proposals we could get through this year. But I respect that answer, maybe because it's what I've been saying for a long, long time.

• Rep. Xavier Becerra: The Hollywood Democrat is an Obama supporter, and he talked about how to get his message out to Latino voters. He talked about how his life is an embodiment of the immigrant experience and how he has worked with those communities. I asked him about the DTS voter issue, and how to get them educated that they have to opt in to get a Democratic primary ballot, and he basically said "Yeah, we have to do that." Wasn't much of an answer there. I think this is an under-the-radar issue in this primary.

• Secretary of State Debra Bowen: On E minus-5, she seemed calm. Bowen, in her role as elections cop, is maintaining a position of neutrality in the primary. "It'll be harder in the general election," she said. I asked her, in the aftermath of John Edwards dropping out of the race, should California look into Instant Runoff Voting so that people who voted early aren't disenfranchised by having their candidate drop out. She said that's something that the parties should look into ("The Green Party would probably do it immediately"), and that it would take a good deal of voter education, too. There are studies about voters in San Francisco who didn't understand IRV and ended up having their vote eventually not count because they only filled out one choice.

Well, I made the best of it and tried to get the least lies possible.

This Seems To Me To Be What Not To Do

With the collapse of the Schwarzenegger/Nuñez health care plan, the obvious inequities in a broken system continue. And legislators who have the motive, means, and opportunity to do what they can to reverse that have an obligation. Here's what I wrote in Speaker Nuñez' diary on the day of the Senate Health Committee vote:

...for whatever reason, your compromise isn't going to pass today. Now do you stamp your feet and wag a finger at those who submarined it and sit in the corner, or do you work to enact something that would be meaningful to California's many uninsured. That's the position of the moment, and so don't tell us why others have messed up your deal, tell us what you're going to do right now to pick up the pieces and move on.

I'd start with guaranteed issue, confidentially.

I am disappointed to report that the Speaker has gone the stamping of feet route.

Núñez suggested that support for a government-run, "single-payer" system lurked in the background and wound up undermining AB X1 1.

Schwarzenegger vetoed a government-run proposal in 2006. Another single-payer measure, Senate Bill 840 by Sen. Sheila Kuehl, D-Santa Monica, is pending in the Assembly.

Núñez vowed to subject it to the same kind of scrutiny his now-dead plan received. "I think it's time," he said, "for us to have an honest conversation about single payer."

He said that lawmakers "cannot create the false sense of hope that we can do something better if it hasn't been tested and put through the same type of scrutiny that our effort was put through."

What good is this "You drank my milkshake, now I drink your milkshake!" strategy? Is it really worth it to 6.5 million uninsured Californians to react to the demise of one health care plan by bulldozing another health care plan? This solipsism, the lashing out, the power plays, is exactly what's wrong with Sacramento.

The lessons of 1994 are that a combination of bad timing and the lack of openness in the process is what killed the Clinton health care plan. That's exactly what derailed this plan, and the proper response is to fix the eternal budgeting problems that will always make an overhaul supremely difficult, and to build a coalition that includes the grassroots in a deliberative way. The opportunity is going to be there if the budgeting structure is righted. But the CDP would need to get behind it on the ground. The groups that do appear, and let me stress that word, appear to be holding out for single payer, need to be brought into the process rather than assailed. There are national allies like MoveOn and the Campaign for America's Future and the whole of the progressive movement that could be invited into the process. And there are small-bore reforms that we could enact right now, that would prepare the ground very well for a national program like Ron Wyden's Healthy Americans Act or the proposals of the Democratic candidates, which have a much more stable federal fiscal structure on which to balance.

Too much of this process has been focused on tearing each other apart, and it's very upsetting to see the leadership continuing down that path.

Health Reform in California Dies

It looks like the dream of major health care reform is over in California, at least for this year. The LA Times reports:

Gov. Arnold Schwarzenegger's yearlong effort to arrange medical insurance for nearly all Californians will be rejected by a state Senate panel this afternoon, according to people familiar with the decision.

The move would effectively kill one of the governor's most ambitious policy goals.

Senate President Don Perata (D-Oakland) made the decision after canvassing Democratic senators over the weekend and finding almost no support for the measure, which the Assembly passed last month.

There was some thought that Perata would use some parliamentary maneuvers to ensure the bill's passage, but apparently he couldn't find anyone to create a majority for the measure.

Anthony York openly wonders whether or not this spells the end of the current leadership structure in the state Legislature.

But watching the California Legislature in action last week felt like watching the end of an era -- and bearing witness to the creation of a power vacuum. In a political ballet that played out over several days, the prospects for two seemingly unrelated but intimately connected political issues -- a healthcare reform bill and a change in the state's term-limits law -- withered simultaneously. And as their fortunes sank, so did the power of the current legislative leadership [...]

Then more bad news for the healthcare bill. Mid-afternoon Wednesday, Gloria Negrete McLeod (D-Chino) announced that she too was voting against the legislation, citing concerns about the affordability of the mandated insurance.After her vote, a senator who sits on the committee characterized the situation as a "total implosion." He told me that the rumored poll numbers on Proposition 93 were making it harder to get the healthcare bill out of committee. If the prospects for the initiative's passage were as bad as the numbers suggested, he said, the stigma of a lame duck, and a corresponding loss of influence, might attach to Perata and Nuñez.

Let me say that health care reform may end in California for now, but it does not end nationally, and indeed one has little effect on the other. This is still something in which Americans are broadly in favor. And it's still a framework that every Democratic candidate has laid out. With a new Democratic President, health care reform will be at the top of the agenda, and at the federal level it has a far greater chance of being fiscally sustainable. There are still significant measures that could be taken in California that would improve conditions, in particular mandating guaranteed issue and expanding public programs. But the perils and pitfalls of balancing an enormous overhaul on an unsteady budgetary picture proved too great. Perhaps some sanity in the fiscal structure would allow the next governor to revisit this, if need be.

UPDATE: Ezra Klein, echoing a familiar theme:

I'm not shocked, or even particularly saddened, by this. It never really looked to me like the finances worked out, and though the political coalition around the bill was heartening and impressive, the rabid dead-enders of the Californian GOP (they're actually worse than national Republicans) wouldn't allow even a cent of new money, and without a truly stable funding source, you really can't do this at the state level. Indeed, money is why all these state plans fail. For fiscal reasons, this has to be a federal initiative. Because states are more politically flexible than the federal government, they can often seem a more viable arena for health reform. But the policies always collapse.

Sen. Yee Throws Health Care Reform Into Total Chaos

The massive health care reform plan brokered by Governor Schwarzenegger and Speaker Nuñez has been fraying at the edges a bit in recent weeks. State hospitals appeared to waver on supporting the fees that would be charged to them under the plan, and hearings in the Senate Health Committee were delayed a week pending an analysis from the Legislative Analyst. That hearing is currently scheduled for Thursday, but State Senator Leland Yee just put a major wrench into that plan.

On the eve of a hearing for landmark health legislation, a spokesman for Sen. Leland Yee said the San Francisco Democrat will oppose the health care measure. The move throws into limbo whether the legislation has the necessary votes to move forward.

“The costs are a big concern for him,” said Adam Keigwin, a spokesman for Yee, regarding the $14 billion health care price tag that coincides with a projected $14.5 billion budget hole [...]

Keigwin said Yee conferred with labor leaders in his district over the weekend who were “almost unanimous” in urging Yee “to vote no.”

With Health Committee chair Sheila Kuehl already opposed to the bill, this means that it would be unable to get out of committee without a Republican crossover vote. And even with moderate (for the GOP) Abel Maldonado on the committee, that is unlikely.

I don't think this is the end of the bill by a longshot. Yee or Maldonado could have their arm twisted, or Kuehl could let the bill pass without a recommendation.

What happens next is unclear, though options certainly remain for passage.

For instance, Senate President Pro Tem Don Perata could ask Kuehl to grant the measure a courtesy vote, allowing it to proceed to the Senate floor despite her personal opposition.

In an interview Tuesday morning, Kuehl reiterated her position, saying, “I’ve been very clear with all the advocates and everybody that I do not favor the bill.”

She said she had not been contacted by Perata or his staff to support the bill. Asked if she would consider granting a courtesy vote if she was, she replied that she “can’t answer that.”

“In the Senate, we generally are equal as members,” Kuehl added.

Don Perata could also kick Yee off the committee and replace him, although he hasn't exactly been wildly supportive of the bill thus far.

What will happen is anyone's guess. But for the moment, this is a major blow to efforts to overhaul health care in California.

"I Really Want Some Of Those Guys To Stay."

When Arnold Schwarzenegger endorsed Prop. 93, some considered it the result of some deal on health care or some other quid pro quo. I thought it was much simpler than that.

Schwarzenegger has a good working relationship with Fabian Nuñez and Don Perata. He for the most part gets what he wants out of that relationship. Why would he want to change it for his last two years in office? The pessimist's view would be "Why would he want to housebreak someone else when these two are already housebroken?" The optimist's view is "He's moving forward on his agenda, why rock the boat?"

Arnold has now confirmed this, by the way.

Schwarzenegger said he has developed a "trust" with sitting legislative leaders and hopes to continue to work with them. The governor said he felt a loss when former Senate leader John Burton was termed out of the Legislature.

"I just got this groove going with this guy and we got to understanding each other and all of a sudden he's being ripped away," Schwarzenegger said.

The governor said he and current lawmakers would be better able to tackle major issues facing the state, from the budget crisis to the state's need for $500 billion worth of infrastructure improvements.

Besides, he said, "I really want some of those guys to stay."

It's a selfish view from the standpoint of Schwarzenegger (should the governor really be picking the majority leaders in the opposite party?), but perfectly coherent. He wants to continue the working relationship. In the short term, it's up to the voters to decide if that working relationship is good for California. I think the sum total of this site could be "Exhibit A," but your mileage may vary.

(As a side note, interesting how this experience vs. change question continues at the state level, no? Of course, we must wonder about the right kind or the wrong kind of experience.)

UPDATE: George Skelton channels me. And he essentially endorses Arnold's take. As I said, your mileage may vary.

Schwarzenegger's Gambit

Some pundits are coming out and calling Arnold Schwarzenegger's endorsement of Prop. 93, a relaxation of term limits for current legislators, a flip-flop. Others consider it the result of a quid-pro-quo arrangement in return for health care legislation.

Isn't it much easier than that? Schwarzenegger has a good working relationship with Fabian Nuñez and Don Perata. He for the most part gets what he wants out of that relationship. Why would he want to change it for his last two years in office? The pessimist's view would be "Why would he want to housebreak someone else when these two are already housebroken?" The optimist's view is "He's moving forward on his agenda, why rock the boat?"

Of course, voters have to consider the efficacy of this arrangement. Under this Governor-Legislature leadership we have a $14 billion dollar deficit, the worst prisons in America, historically low education funding, millions in the ranks of the uninsured, big job loss, and a housing market in shambles. It may be a working relationship that the Governor likes, but is it really one that the voters should like?

(I recognize that this is part of a short-term view of the situation. In the long term, I really don't think this initiative will do what it says. The idea that California lawmakers, who have all sorts of other options to govern - big-city and county Supervisor posts, the US Congress, Assembly-members who want to graduate to the State Senate - would bolt themselves to their chairs for 12 years is a stretch. I don't particularly think there should be term limits at all; this 12-year limit, where you have to decide whether to join the Senate or Assembly at the very beginning of your career, is kind of detrimental, in my view.

Whirlwind Health Care Plan About To Be Stopped By The State Senate?

Well, the swift justice that is Fabian Nuñez and the California State Assembly passed their health care bill in a flash today, just a couple days after reaching agreement on it with the Governor.

Don Perata is now asking the Legislative Analyst's Office to assess the impact on a health care overhaul on the state budget. While some have argued that this plan has its own funding source and will have no impact on the budget, Perata is obviously skeptical, and considering that so much of the budget does involve health and human services, the impact is far less clear than this assumption there's a wall between health care and all other state spending. Further, there's this quote:

“Nothing has changed in Sen. Perata’s position to not bring his caucus before the end of the year,” said Trost.

Which of course imperils the ability to bring the funding initiative before the voters in November.

I think Perata understands that Schwarzenegger has a time-honored tactic of gutting funding for various policies once new funding comes in through voter initiative or initial legislation. That is embodied in this quote:

"It's a very difficult conundrum for a member (of the Legislature) to have to explain that we're going to have to cut some jobs and (program) eligibility, but we'll have a real good deal in a couple of years," Perata said after a meeting in the governor's office.

What has torpedoed universal health care legislation in other states has been when costs outstrip the funding mechanism set up, forcing a dip into the general fund, which is unsustainable. Indeed, we know that the present budget crisis in the state shows little sign of letting up, as the mortgage mess worsens and the state slides into recession. I agree with George Skelton that the first priority has to be to stop the bleeding from an unsupportable revenue model for funding the state.

Our lawmakers could free all the inmates and shut down the prisons and that still wouldn't come close to balancing the budget. They'd also have to sever almost all state money to the University of California and state university system.

If they stopped providing Medi-Cal healthcare for poor people, including children, that wouldn't be enough.

Knock people off welfare? OK, if the state eliminated most welfare-type programs for poor people -- single moms with kids, the mentally ill, the aged, blind and disabled -- that would fill only two-thirds of the projected deficit hole [...]

Nobody in the Capitol except Republicans -- if you can believe them -- really thinks the budget can be honestly balanced without raising taxes. I especially don't accept that Schwarzenegger believes it. He just doesn't have any confidence in being able to talk skittish GOP lawmakers into voting for a tax hike. And some would need to in order to reach the necessary two-thirds majority vote.

It's long past time, however, to stop living in denial and demagoguing. If there's wasteful spending, chop it. But that won't balance the books. That much chopping wouldn't be politically feasible or publicly acceptable.

The governor and Legislature should -- but likely won't -- seize this opportunity to restructure the tax system, to make the revenue roller coaster less volatile in times of boom and bust.

And like it or not, a $14 billion dollar a year health care plan has an impact on that restructuring. I think it's clear what needs to be the priority. Sen. Perata is right. And you have to wonder whether Fabian Nuñez is more interested in legacy or extending his political career than the principles which brought him into public service in the first place.

UPDATE: The NYT has a story up about the Assembly passage here. This bit of duplicitous logic from the Governor always cracks me up.

Mr. Schwarzenegger has countered by saying there should be no linkage between the revenue measures needed to balance the budget and those needed to pay for the health insurance plan. He also argues that the health plan is intended to bring down costs by encouraging healthy habits, better management of chronic diseases, and electronic record-keeping. That, he says, should ultimately reduce the state’s health care expenses and help California fix its structural budget problems.

Apparently, you can't encourage healthy habits without a massive health care plan. Or engage in electronic record-keeping. See, without that individual madate you could never get junk food out of public schools!

That's just absurd. "Here's a bunch of stuff that would drive down health care costs no matter what the system. So pass my system so that we can implement all this stuff that'll drive down health care costs."

If you have to lie to sell your idea, it's probably not that good of an idea.

Patriot Act-Esque

Arnold Schwarzenegger and Fabian Nuñez have made agreements behind closed doors on a new $14 billion dollar health care plan, and despite the fact that we're on the brink of a fiscal emergency, even though Don Perata has favored a go-slow approach, asking to deal with the burgeoning budget deficit before a new health package, it appears that we're going to have a vote in the Assembly on Monday. And that has displeased some key stakeholders.

Assembly Speaker Fabian Nuñez's effort to speed a healthcare overhaul plan through the Legislature is being opposed by the trade group that represents California's labor unions, which is taking the rare step of urging Democratic legislators to defy their own leader.

In a letter obtained Saturday, the California Labor Federation's leader, Art Pulaski, urged Assembly members to postpone the Monday vote on the bill, which Nuñez (D-Los Angeles) submitted Friday after reaching agreements with Gov. Arnold Schwarzenegger on the scope of a plan to require almost all Californians to hold healthcare insurance.

Writing that "we are dismayed at the process," Pulaski complained that neither labor nor lawmakers had had enough time to vet the complex measure and decide whether it offered adequate protections against middle-class workers' being forced to purchase insurance policies they could not afford.

"We feel cheated of the opportunity to take a position on a bill that will impact the lives of every working family in California," Pulaski wrote. "We do not know whether this bill will protect working families who cannot afford a healthcare mandate or whether families will be driven into low-quality, high-deductible plans."

So we have a bill submitted on a Friday which lawmakers are expected to vote coming Monday. It's 239 pages long and completely unclear, not just on affordability for the insurance itself, but on the floor for basic coverage and the ceiling for deductible costs. Health care experts have not fully made that determination. Add onto that the struggles of states to manage large-scale universal plans with their particular constraints, mainly on constitutionally mandated balanced budgets. We are in a $14 billion dollar budget hole and with a Governor itching to balance that on the backs of poor and elderly Californians with a 10% across-the-board budget cut. There simply aren't all that many areas you can cut that aren't protected by voter initiatives other than those in the health and human services sector. Does that factor in to this parallel plan at all? Not to mention the fact that so much of the funding option is predicated on federal funding at a time when the Democrats can't get SCHIP past the President's veto pen, which will result in tens of thousands of California children being denied coverage within a matter of weeks.

Despite all of these questions and concerns, the Assembly is being asked to rush through legislation that they probably haven't read or vetted. I think health care is simply too important to do so.

The California Report

Let me clear out my Inbox and set you on your weekend way:

• The Megan's Law website apparently is being used as a hit list and may have led to at least one death. This is the downside of a "what about the children?" über alles mentality.

• I'm not entirely certain about this claim that state lawmakers could have solved the mortgage crisis back in 2001 by cracking down on predatory lending practices. It's a boilerplate story, a typical "they bought off the politicians" frame. But the problem, as Paul Krugman notes today, is that home prices lowered, leading to negative equity for homeowners. Not sure what the lawmakers could have done about that. This is a national crisis that required federal action. And what action could be taken on the state level is in the purview of the Attorney General. Jerry Brown is investigating home loans from Countrywide Financial for improprieties, particularly forcing buyers with good credit into subprime mortgages.

• For all the talk about Steve Poizner, he is doing his job in suing Blue Shield for their loathsome practice of dropping patients retroactively after they seek coverage. Blue Shield's response?

The state's interpretation of laws governing policy cancellations "is simply wrong."

Stupid state, not knowing their own laws as well as a private entity!

• Nancy Pelosi is under fire for saying that Republicans like this war. Juan Cole is right to slam her for assuming that Republicans would act in good faith and help to end the war after the 2006 elections. What Republican Party was she talking about?

• Anthony Wright has the new amendments released to the public on the new health care reform. I should have a lot more on this over the weekend.

• I know that I didn't execute a House roundup in November, but honestly there wasn't a whole lot going on in the races. So I postponed it and will have a December roundup in the next few days.

• And finally, I would be remiss if I didn't mention the California Democratic Party buying three grand in French wine from Fabian Nuñez, who's now a wine salesman, I guess. I have to acknowledge Kevin Spillane (two Republicans in one day, I know) from the No on 93 campaign for the funny move of sending a bottle of Two Buck Chuck to Nuñez' office. It is an award winner.

One-Sided Negotiations

Boy, if you managed to stumble upon pages M8 and M9 of Sunday's LA Times yesterday, you sure picked up a great deal of information. On M8 was my Calitics buddy Robert's excellent critique of the Times' coverage of tax policy. And on M9 was a column by Anthony York of Capitol Weekly, which seeks to explain why legislative Democrats appear to be negotiating with themselves on health care reform. We learn that the Governor is basically holding his endorsement of Prop. 93 hostage in exchange for getting his way on health care.

Nuñez is scheduled to be termed out of the Assembly in November. If Proposition 93 passes, however, he could serve in the Assembly -- and presumably as speaker -- for six more years. If the measure fails, Nuñez would immediately become a lame-duck speaker, and talk of a successor would begin Feb. 6.

That's why he desperately needs Schwarzenegger's endorsement of Proposition 93. Most observers believe that voters will defeat the measure if it lacks the governor's seal of approval.

But Schwarzenegger's support comes at a price. The governor has consistently used Nuñez's desire to change the term-limits law as leverage in his negotiations with the speaker about healthcare reform, and it seems to be paying off.

We all suspected this was the case, but this appears to be more informed than opinion. So now we have a negotiation that's going to affect millions of Californians being predicated on the political career of one man. Nuñez is completely compromised, not only by needing to get a legislative victory to tout to the electorate, but by receiving the Schwarzenegger endorsement. Personally, I'm unconvinced that his endorsement is such a slam-dunk; it sure wasn't in 2005.

We see the direction that the negotiations have taken. First the Democrats were fully opposed to an individual mandate. Then they agreed to a mandate with cost controls (exemptions if coverage costs more than 6.5% of income). Then they'll drop that number. First the plan was that businesses would pay 8% in fees; then it became a sliding scale up to 6%; then it'll be down to 4, or 3, or really whatever the Governor wants. This is no way to negotiate. The Governor has absolutely no reason to budge off his numbers.

The Governor clearly cares about leaving a legacy on healthcare reform, and a smart negotiating strategy would tie that legacy to specifics that could not be compromised. But that's clearly not how it's being waged. And York even explains how a savvy negotiator could turn this right around.

If a (health care funding) plan ends up on the ballot, it would be a tough sell. All previous healthcare initiatives have been defeated. And with current budget forecasts for 2008 putting the revenue shortfall at $10 billion, an expensive reform plan -- some estimates put the price tag at $12 billion -- would face even more trouble. To win passage, Schwarzenegger will need help from unions and Nuñez. But if Proposition 93 fails in February, the lame-duck Nuñez could be ousted as speaker, losing his bully pulpit to campaign for reform.That would leave Republican Schwarzenegger as the face of a campaign relying heavily on unions and other Democratic-friendly groups while confronting stiff opposition from many business groups.

The Governor actually needs the Legislature as much as the Legislature needs the Governor. But that's not how the battle is being fought, because the Democrats have decided to put themselves in a position of weakness.

Fabian's Law

The Fair Political Practices Commission is proposing new disclosure laws for travel expenses for legislators, which are obviously in response to revelations about Fabian Nuñez' lavish globetrotting. The regulations would require public proof that all activities had a legitimate government purpose, before the fact rather than after it comes out in the media.

Under a proposal made Monday by the state's ethics watchdog, detailed public disclosure of who benefited from such spending would be required of state officeholders, if given final approval next month. In addition, certain nonprofit groups involved in political campaigns would be forced to reveal their donors under a separate proposal by the Fair Political Practices Commission [...]

Under the new proposal, politicians and candidates would have to publicly list the gift recipients by name and the nature of the gift. They also would have to provide the dates of meals, the number of people at a meal and whether the diners included the politician's family or staff.

For out-of-state travel, politicians would have to disclose the dates and destination of travel and whether expenditures covered family and staff.

In all of these categories, the reports "shall state facts sufficient to demonstrate the political, legislative, or governmental purpose of the expenditure."

The rule also would require campaign account treasurers to make available to the commission, but not necessarily to the public, the names of all people who benefited from travel and meal expenditures.

The proposal was met favorably by the Nuñez camp as a way to improve accountability and increase sunshine. I can't see anyone, even the non-profits, finding this disagreeable unless they want to closely guard their own personal secrets. This is a common-sense measure to ensure taxpayers that their good name - and their money - is being used legitimately and to the benefit of the state.

California: Special Session-O-Rama

Looks like that Dec. 5 deadline for voting on a health care proposal has been extended, after the power play of scheduling it on the day of the Republican Assembly retreat was justified by the Speaker's office by saying "Deadlines are deadlines." Until they aren't.

And now, there's talk of a third special session, this one on the subprime mortgage crisis. I guess the inaction on the first two was not sufficient; we need a third. And I appreciate efforts to stop predatory lending, though I'm not sure how this would make a dent in what is a national credit lending problem.

I'm still not sure we have a housing "crisis" or just a housing market downturn, but I am pretty sure that nothing the Assembly is going to do in a special session this year is going to affect it one way or the other. Well, they are probably capable of making it worse. But I don't think they can or will do anything to increase the value of my home, and while I'd love the help, I don't particularly think they should try.

I'm not as dismissive as Dan Weintraub; this is most definitely a crisis. But I'm not really sure what the Assembly can do. The bills they have proposed would only apply to new loans. That's important, but they would not do a whole lot for those facing foreclosure. And anyway, those entering into new loans would have to be deaf, dumb and blind to agree to some no-money-down ARM at this point. And this bit from the press conference is flat-out embarrassing:

In an illustration of the complexity of the crisis, though, one of the homeowners presented at the press conference as a victim said the house he lost was actually one of two that he owned.

While many owners have lost homes they occupied, others were investors who saw the real estate run-up of the past decade as an investment opportunity.

Sacramento resident Carlos Villegas said he was forced into foreclosure when monthly payments on the house he bought in 2005 shot up from $2,200 to $3,550.

"They gave me three days to move," he said. "I feel frustrated with the system.

In response to questions from reporters, Villegas said after the foreclosure, he moved back to a smaller house he had purchased 10 years earlier, which he had been renting out.

Of all the people with foreclosure problems, you found a guy with another house?!?

The credit mess is a national problem, and state solutions are nice, but they're not going to work. Perhaps driving down the costs of healthcare through a new reform would be the BEST way to help those struggling with home payments.

Prop 93: Prison Guards Reverse Themselves

(This is about the term-limits initiative hitting the state ballot in February. First in a series)

Unexpected, at least to me:

The state correctional officers union on Friday reversed its earlier support of the Proposition 93 term-limits initiative and is promising to "put in as much as it takes" to help defeat the measure championed by Democratic Assembly Speaker Fabian Núñez of Los Angeles.

"We haven't determined the overall number yet, but we have not been shy in the past in spending money on causes we believe in," said Lance Corcoran, the spokesman for the California Correctional Peace Officers Association. "We're going to put in as much as it takes." [...]

In a prepared statement, CCPOA President Mike Jimenez said the union had changed its position because of the Legislature's failure to connect the term-limits measure to another proposal that would change the state's process for redrawing political boundaries.

Jimenez also ripped the Legislature's performance in the most recent session as "remarkable for the leadership's failures -- not its accomplishments -- on a wide range of issues."

I look forward to seeing angry screeds about what awful people the prison guards are on the California Majority Report. I'm guessing this is about that awful cave to Arnold on trying to build our way out of the prison crisis. Maybe if the Legislature showed a little leadership, they'd be getting some help in their incumbency-protection racket.