Political news, analysis, commentary and more about California and beyond

Tom Campbell says:

To: Jerry and Phil From Tom Campbell Great idea to put specific, hard questions to the candidates. Here are my answers. Kind regards, Tom

1. Do you have a serious plan to address the structural deficit in California’s budget?

What combination of tax increases, spending cuts and borrowing do you think is required? Which taxes, which programs? What is the proper level of debt for the state to carry? If California’s debt level is too high, what are you going to do to reduce it? Does your plan have a prayer of winning support from enough of the opposition party to actually be implemented? What ideas do you have, beyond tired platitudes and knee jerk ideological sheep dip, for reclaiming control of the budget?

MY RESPONSE: We should budget based on revenues one year in arrears. There’s nothing partisan about that suggestion, so I think it has a good chance of being followed. It will take several years to accomplish this; but the “rainy day” fund aspect of Prop. 1A is a good start. After ten years, perhaps sooner, we would raise revenue one year, let it earn interest, and spend it the next year. There would never again be any doubt about how much money we would have to spend. And if there were a decline in revenues, we would see it a year in advance, and take steps with more care to address it. I put this proposal first because it has the best chance of being adopted. Democrats who want a higher tax, higher services state can argue for that; Republicans who want the opposite can argue for that; but no one can argue about how much money we actually have to spend.
Another alternative is the version of Prop. 76 that I drafted for the Legislature’s consideration. They did not even vote on it; and that led to the version (drafted by the Cal. Business Roundtable and Cal. Chamber of Commerce) that went to the ballot. The two were different. My version called for 1) emergency session of the Legislature whenever revenue dropped or expenses increased by more than 1% from the budget act numbers in any quarter, 45 days long, if no resolution was reached, then across-the-board cuts in all categories, excepting only what the Federal Constitution requires (e.g., debt service on California bonds); 2) carry forward last year’s budget when we don’t have a new one on time; 3) a rainy day fund into which revenue growth in excess of the previous 3 year average would go.
The ballot version gave the Governor the right to make the cuts, and I think that was a weakness, because it was characterized as a power-grab. Across-the-board cuts do not have that feature, so this might have a better chance (a ‘prayer’) of passage.

2. Do you have a serious plan to help create jobs in California?

How would you use the executive levers of state government to encourage and align with private business to generate economic development for green industries and building, alternative fuel sources and uses, digital, bio and nano technologies? What role should the University of California play in economic development? How important is state support of K-12 education, and what level of funding for public schools will you absolutely commit to? Should students who receive state aid to attend UCs and CSUs have a public service requirement? What is the role of the non-profit community in helping to grow the economy, and what relationship should the state have these groups?

MY RESPONSE:
Every new state regulation should carry a 5-year sunset. A regulation could be repromulgated if it’s been effective, otherwise, let it drop. There should be a rolling sunset review of all existing regulations, for the same purpose. Any regulation addressing an area already addressed by federal standards should be subjected to a specific cost-benefit finding before it can be promulgated, and should lay before the Legislature for 30 days before becoming effective, for legislative modification if appropriate.
Law suits that kill jobs should be discouraged by making the losing party pay at least some of the cost the other side bore in the litigation, perhaps up to the amount the losing party was prepared to pay their own attorney (with a narrow escape clause for unconscionable situations). This combination of regulatory and litigation reform will encourage those with jobs to offer to stay in California, rather than seek other states.
To attract and keep jobs, we need to continue public works unabated. That means freeways, water storage and transport, port facilities, airports, energy infrastructure, and other projects. It was devastating when those were in jeopardy by the budget melt down; imperiling our state’s economy, and our receipt of federal matching funds. In order to keep those projects going, in the midst of a recession, I did not oppose the budget deal.
On taxes, we need to lower every tax that discourages jobs in our state. We need to get more in line with our competitor states’ levels on income tax, sales tax, and business tax. (A good start was in the recent budget deal’s adoption of the single sales factor for apportioning multi-state income: before that change, we were actually taxing employers more the more employees they had in our state.) We should eliminate the sales tax on productive machinery, and adopt a capital gains tax mirroring the federal one, to encourage investment in California that leads to jobs. I’d keep Prop. 13; without it, our number one marginal income tax rate, number one state sales tax, and number 3 state business tax make California a very unattractive place to hire people. With Prop. 13, we can at least make the case to those wanting to build plants in our state that they can be sure they won’t get socked with higher property taxes once they can’t move. The present budget crisis makes it more difficult to lower taxes, but that should be our goal.
We should then let entrepreneurs decide where the best investments are. I’m worried about the state picking the next great technology. We might get it wrong, and we’d certainly be under a huge amount of political pressure to pick an industry that benefits the district of powerful members of the Legislature.

UC should foster economic development by allowing its professors to keep the intellectual property rights they create, with a flat percentage going to the state. It’s absurd to force brilliant chemists, engineers, physicists, natural scientists, medical researchers and others to go outside the university, and not share with their students, the commercial applications of what they create. Let them share their research with their students and find commercial applications. It will attract the best inventors to UC. The state will do fine by its fixed percentage, and by the economic benefits of what’s invented.

K-12 is essential, and it is the state’s obligation. I particularly want to see the continuation of class size reduction. As a teacher for 26 years, I know I’m far more effective in a smaller class, and I did not have the special challenge of teaching students younger than adults. You asked about an absolute level of funding: there is no such absolute. Funding should be tied to results: we have to stop measuring commitment to education by inputs, and start measuring by outputs. Funding is a necessary, not a sufficient, factor in higher quality K-12. To respond to your question, as a benchmark, I’d like to see our per pupil funding in the top 10 of the US (it’s currently no. 26 according to the NEA), but ONLY if we get systemic changes at the same time: class size reduction, cap on administrative expenses, some system of merit pay, and scholarships for the parents of children in the 1% worst performing schools.
I think college students whether they go to UC, CSU, CCC, or private schools, should participate in public service. I think they want to; and it should be part of our California ethos. I’m hesitant about requiring it, however, for two reasons: 1) differing economic situations of different students could make such a requirement onerous financially ; 2) public service should be volunteered. Forced public service is almost self-contradictory. So, encourage it. Create scholarships based on it. Identify students who do it as Golden State Scholars (a piece of legislation that was patterned after the practice at the Haas School when I was Dean there). But don’t force it. In all these encouraging efforts, the role of the state and its universities should be to disseminate information about public service opportunities widely, and to work especially with groups like Hands Around the Bay, that match available public service opportunities with busy schedules.

3. What life experience do you have that proves your ability to work with a Legislature representing the breadth and depth of California?

What have you learned from watching Gray Davis and Arnold Schwarzenegger try and fail to force lawmakers to fall in line behind an agenda? What have you done that has prepared you for a job requiring an outsize ability to cajole, bully, stroke and persuade 120 raging egos who are accountable to small geopolitical units? Explain how your political skills have developed and candidly measure them against the non-stop cacophonous, complex and conflicting demands of being governor?

MY RESPONSE

As a State Senator, though a member of the minority party, I was voted the Most Effective State Senator, and the Best Overall State Senator, by the Cal Journal. As Finance Director, I negotiated a balanced budget, with no new taxes, no new borrowing, and no accounting gimmicks, by July 7, less than a week into the new fiscal year. I was Chairman of the Housing Committee in the Senate, Vice Chairman of Revenue and Taxation, Vice Chairman of the Education Subcommittee of the Budget Committee, and produced legislation that won bipartisan support. And I was a US Congressman for five terms, four years in the minority, five years in the majority, working with colleagues of both parties for federal legislation and appropriations vital for our state.

The Governor needs to be respected by and have respect for the Legislature. The Governor who wins by demonizing the other party, or the other branch, cannot hope to be effective once in office.

4. What is your plan for changing the dysfunctional structure of state government and what reforms will you fight for?

Should the state dump the two-thirds vote required to pass a budget? How about the two-thirds needed to approve tax measures? Should the standard be a 55 percent vote, or a simple majority? If you think we should keep the two-thirds standard, what is your political strategy for overcoming gridlock and getting to two-thirds? Do you think term limits have worked for California? If not how would you get rid of them? Do you support or oppose the open primary measure that will be on the June 2010 ballot?

MY RESPONSE:
The rule that used to apply was that a 2/3 vote was required only if the budget spent more than the Gann Limits: that is, more than the previous year adjusted for inflation and population. I’d reestablish that. Keep the 2/3 requirement for tax increases; otherwise, our taxes would rise above their already job-killing level. Recall that we’ve had a budget every year since the mid-1930’s when we first adopted the 2/3 requirement. It takes compromise, not ideology, and people knowledgeable about how the state government and the state economy works. Term limits have lost us many people with those skills; before considering their abolition, however, I’d want to consider a package of reforms of which term limits would be part. I support the open primary; I was very active in advancing the version that became law in 1996, but was eventually struck down by the US Supreme Court.

5. Would amending Proposition 13 be on or off the table in your administration?

Do you think Prop. 13 should be amended to allow a split roll assessment system that taxes commercial property at higher rates than residential? What about the problem of neighbors with similar houses who pay wildly different tax bills because of when they bought their homes? Do you think this inequity should be addressed or not? If he or she is not willing to advocate a change, what significant income source can the candidate point to that will even begin to generate enough income to meet the state’s needs?

MY RESPONSE:

When I was California Finance Director, I’d speak before the California Manufacturers’ Association, the Chamber of Commerce, and other groups, whose members included some employers thinking of moving out of the state. One of the only arguments I had for them to stay was Prop.13’s limits on taxing commercial property. If the employer moved to Texas, for instance, where the sales tax is lower and there is no income tax, the property might be reassessed once it was developed to the point that it could not move. That could not happen in California. So the “split roll” idea is job-killer. On the residential side, the inequity favors those who stay in their homes a long time–-while not perfect, this tends to be older home-owners, more likely to be on fixed-incomes and unable to pay a higher real property tax. In deciding whether to buy a home, purchasers know the property tax and decide whether they can afford it or not. So, the inequity to which the question refers is really not so unfair; you know it upfront, and decide to buy or not.
Regarding new revenue sources, first, constrain the rate of growth of spending. It’s a mistake to ask the question about new revenue when we’re still increasing spending more than population and cost-of-living. Restore the Gann Limit; any revenue raised in excess of that needed to pay last year’s expenditures increased by inflation and population should go into the rainy day fund, or to buy down the state’s endebtedness, or for one time infrastructure.
It’s unbelievable but true: if we spent what the first Gray Davis budget had proposed, increased by inflation and by the growth of population since then, we’d be balanced this year, even with the huge drop in revenue! So, constrain the rate of growth of spending.
Second, go to zero based budgeting. Curb the entitlement mentality that says the state MUST spend according to a formula. No. We have so much money, and our elected representatives will dispute how to spend that amount of money. Period.

Third, if we can lower taxes that cost us jobs, we should. The best way to balance the budget is to see the state’s economy grow. I was part of the last US Congress that balanced the budget, in 2000; it was not due to higher taxes but higher collections from taxes due to the vibrant economy.

Nevertheless, I did not demagogue the budget deal. In a crisis, of unparalleled proportions, caused by a national economic meltdown, it made no sense to stop all public works in our state. We should have adopted Prop. 76 back in 2005. We need to make the structural reforms I’ve suggested above. But an emergency is just that, and you can’t fix it within a single year. Nor can you fire your way to prosperity. We should go to the public employee unions and negotiate give backs; but the numbers are simply not there to balance the budget by firing people.

Lastly, if we have the chance to trade off between taxes, the least damaging tax at this current moment is a gasoline tax. It has substantial environmental benefits. Gas was above $4 a gallon in California last summer; it’s now about $2.25. I repeat, I don’t want to increase taxes: but there is a difference between a tax that brings us back to a price level for gasoline that our state endured in recent memory, and a tax that adds to the cost of hiring people in our state (which employer taxes, income taxes, and sales taxes do much more than a gasoline tax).

6. What actions, or inactions, do you propose to take on polarizing hot button issues?

How will you use the power and influence of the governor’s office to affect same sex marriage, abortion rights, offshore oil drilling and illegal immigrations, including the questions of drivers’ licenses, publicly financed health and education for undocumented workers and their families?

MY RESPONSE:
A Governor needs to be clear about the Governor’s own views, express them, and not demonize the other side. People of good will can approach issues differently and that does not make them venal. So tone it down. And look for the areas of commonality, not the areas of difference. Like getting more jobs for Californians, and preparing the next generation to be ready for those jobs when it’s their turn.
Here are my positions, with respect for those who disagree: gay people should have the same rights as straight people, including the right to marry, a woman should make the choice on abortion up until the time of viability, we should not drill offshore where it would damage our fishing or tourism industry or run a higher risk of damaging the environment than shipping petroleum does, those who break our country’s laws to come here should not be treated as though they were legally here, except that public health should be accessible lest all be endangered by communicable disease, and children K-12 should be in school lest they be recruited for criminal activity, drivers’ licenses should not be granted to those who are not here legally , and we should use the California National Guard to assist in making our border more secure.

7. What kind of administration will you run in regards to special interests and the media, and what values and qualities will you seek in assembling a staff and making appointments?

How will you relate to the media and voters in terms of transparency, open government laws and documents? In your professional life, have you been open and accessible or closed, protected and isolated? Explain your past associations and future intentions regarding the California Teachers Association, the California Correctional Peace Officers Association, the Business Roundtable, the California Chamber of Commerce and other big interests in the Capitol? Who do you consult with and listen to? Why should voters trust these people in and around the Horseshoe?

MY RESPONSE:

My five terms as a US Congressman, two years as a State Senator, and year as Finance Director, indicate how I would carry myself as Governor with regard to special interests and media. I was open to hear all points of view, I was never considered to be captured by any. The Cal Journal rated me the Most Ethical State Senator. I was very active in fostering the study of ethics at the business school at Cal, when I was Dean.
I have frequently sought the advice of the CTA Union, though sorry that they opposed Prop. 76, and even sorrier that they succeeded in defeating Prop. 76! I respect teachers, and have benefited from what their union has to tell me. Similarly, my relations with the Prison Guards union has been cordial and constructive, including my years on the State Senate Judiciary Committee and the special ad hoc committee on prison construction. I have many friends in the Business Roundtable and the California Chamber of Commerce, and count their executive directors as personal friends as well. However, I have disagreed with both organizations from time to time.
The groups with expertise should not be cut off because they have a point of view, or a group of individuals, to represent. The wise public servant knows the difference between receiving useful information, including practical advice, and being intimidated. That’s how I would be as Governor.