Dems’ Idiocy on Pensions Recalls ’70s Tax Fiasco

Jun25

Not since the disco era, when a young Jerry Brown and a tone-deaf Legislature dithered away their chance to head off Prop. 13, has Sacramento seen such a spectacle of fatuous folly as legislative Democrats now display over pension reform.

Then, a too-little-too-late Sacto measure failed to cool simmering anger about property taxes, which boiled over with the landslide passage of 13.

Now, months after an older and wiser Governor Brown sent lawmakers an eminently sensible package of pension reforms, Democratic legislative leaders ho-hum that they’ll get around to it, maybe, eventually, sometime, as labor types insist retirement costs ain’t no big deal anyhow..

In taking this laid-back approach to retirement reform, the Democrats and unions foolishly disdain the concern of taxpayers, who perceive pensions as a visible symbol of pigs-at-the-trough government spending. In the process, their arrogance puts further at risk the 50-50 chance of voters passing Brown’s $8 billion tax increase initiative in November.

“The thing with Sacramento is there are a lot of urgent issues,” Dave Low, chair of the union coalition Californians for Retirement Security, smugly told Peter Henderson of Reuters, who further reported that Low “argues that the economy may have improved enough by the time of the next election that pensions will not be as pressing an issue.”

Seriously? Next up: Dave tells cat and duck to chill – red hen’s all over that bread-baking thing.

Quick trip in the way-back machine. For those condemned to repeat who don’t remember the not-so-distant past: In the late 1970s, the combination of a real estate bubble, an auto-pilot system of setting property tax bills and a growing state surplus made over-burdened homeowners look to Sacramento for tax relief.

As Roger Rapoport detailed in his essential “California Dreaming,” Jerry Brown, fresh off his zesty, first failed campaign for president, spent a year-and-a-half bickering with lawmakers over three measures to provide relief for local taxpayers. When his pet bill was defeated in 1977, the governor reacted with a classic Moonbeam formulation:

“It’s like a shotgun wedding and the bridegroom isn’t quite ready to go to the altar,” the Governor explained after losing. “The senators should go home and meditate.”

As political pressure grew, Capitol pols responded the next year with S.B. 1, a much-debated plan they were certain would head off Prop. 13, dubbed the Jarvis-Gann Initiative after its authors, the mild-mannered Sacramento conservative activist Paul Gann and his lunatic L.A. sidekick, Howard. Rapoport again:

Endorsed by the legislature, S.B. 1 went on the June ballot as Proposition 8 with the governor and many leading politicians believing that it would ensure the defeat of Proposition 13. Jerry remarked: “I think Proposition 13 will be defeated and I will do anything I can to see that happens. The Jarvis amendment is a tax trap.”

How that’s workin’ out, Gandalf?

Brown’s talent for reading the mood of the public, pretty well-honed by 1978, grew considerably sharper as he performed a spectacular tour de force in implementing Prop. 13, a one-for-the-ages flip flop that led to his landslide re-election.

Perhaps that’s why he, apparently alone among Democrats now resident in Sacramento, seems to think that the recent overwhelming votes in favor of public employee retirement reform in San Diego and – for heaven’s sake – San Jose are, you know, worthy of notice.

“The pension vote in San Jose, which is… a more liberal city than the state as a whole, is a very powerful signal that pension reform is an imperative. It’s really important.”

Tomorrow’s another day: Senate leader Darrell Steinberg, to his credit, keeps saying that he understands the importance of getting pension reform passed this year. But his actions: not so much.

Brown’s plan was banished months ago to a phony special committee. Republicans then wisely stole a march on Democrats by endorsing the governor’s package in toto; last week, the GOP tried to bring it up for a vote, another smart play, before the leadership played into their hands by crushing the effort.

“We’ve just witnessed my Democrat colleagues pass their half-baked budget based on closed door talks that shut out the public,” said GOP leader Bob Huff.  “Now they seem intent on denying the public a vote on pensions. Closed door deals and back room negotiations are hardly the recipe for meaningful reform.”

Calbuzz could not be more sympathetic to the plight of Steinberg, who appears to be the last sane person in the Legislature, and whose days consist of being pecked to death by ducks. That said, he may have grown so used to ignoring Republicans that he can no longer hear them, even when they make sense, and even if it’s in his own self-interest.

Steinberg told reporters last week the Legislature will pass some form of reform, if not before their month-long July vacation, then surely when they return in August. Ah, manana.

Let’s be blunt. Democrats, whose political livelihoods have steadily and increasingly become dependent on union money since Jerry Brown in his first term signed the legislation that gave state employees collective bargaining rights, are terrified of moving an inch on pensions without permission and marching orders from the labor groups that finance their campaigns.

News flash: the Coupal/Fox/Fleischman cabal, whose mission in life is torpedoing Brown’s tax plan, is not stretched out on the couch eating bon bons while the libs work through their issues. They’ve already begun directing voters’ attention to Dems trolling for more taxes without lifting a finger on pension reform, and they sound pretty reasonable making their case. Joel Fox last week:

California government desperately needs real pension reform and spending reform. Taxpayers cannot be relied upon to bail out the too generous offerings politicians have handed out to public employees in health and pension benefits while the taxpayers struggle to support their own health care and retirement funds.

Passing tax increases without first achieving serious reforms means we likely will be looking at more of the former and none of the latter.

Let’s face it, even when if Dems finally get around to pension reform (August! At the latest! Really!) – it’s a safe bet that what they pass will be neither as comprehensive nor as substantive as what Brown pitched back in January. Otherwise, why not vote on it now?

That will hand the anti-tax jihadists a swell opportunity to frame the legislation as faux reform, a fig leaf measure cynically passed as part of the campaign to raise taxes; by dragging their heels on pensions now, Democrats also strengthen the conservative argument for the union-busting “Stop Special Interest Money Now Act,” the misleading right-wing initiative aimed at draining labor’s political contribution funds. More: it also appears that Dems intend to put pension reform in line behind Brown’s request for authorization of $2.7 billion in bonds for the increasingly unpopular-with-the-public High Speed Rail project.

Secret memo to D.S.: There may be ways to make it easier for the GOP and Jarvis crowd to sink Brown’s tax increase. We can’t think of any offhand, but we’ll be sure to get back to you if we do.

Bottom line: As a practical matter, pension reform is not the most pressing fiscal issue facing the state, as we’ve stipulated before. As a political matter, however, it’s a sine qua non for convincing voters to raise their own taxes.

Gandalf is betting his governorship on his tax initiative. It’s a high-stakes, high-risk political play, the most ballsy, high visibility move by a prominent state leader to explain to voters why government needs revenue since Howard Jarvis bitch-slapped a 40-year old Jerry Brown and sent every politician in California scurrying for cover for the next third-of-a-century.

If Brown loses his bet, don’t look for anybody else to try it for the next thirty years, at least.


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  1. avatar OC Progressive says:

    Republicans had a brief period earlier this year when they could have negotiated for a significant pension reform package in exchange for compromise on more revenue for the state.

    Instead, they submitted a ransom list of petty demands and kicked the pension can down the road.

    The Republicans could see the end game here, where they had the opportunity to continue bashing public employee pensions to starve government, rather than actually attempt to govern.

    There is plenty of blame to go around, but blaming the Dems alone just does not cut it when the Republicans were too cowardly to seize their one big opportunity for reform.

  2. avatar smoker1 says:

    The GOP is a political party in name only. Democrats run this state and deserve all the credit and all the blame for the actions of the state.

  3. avatar tonyseton says:

    What do you suppose would be the results of a statewide vote eliminating public employee pensions?
    What would be the vote for eliminating public employee unions?

  4. avatar chuckmcfadden says:

    The gist of the piece seems to me to be 1. That in reality, public employee pensions really aren’t that big a deal and 2. Nonetheless, the public is aroused and attention must be paid.

    OK, let’s say the governor and the Dems pass comprehensive, sensible pension reform. Guess what will happen then. The Republicans will go through it with a fine-tooth comb, find some obscure section, and contrive to make it the section that creates headlines over a public employee ripoff of “hard-earned taxpayer dollars.”