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How Much From Special Interests?

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Sacramento Bee
Nov 17, 2004 - 01:00 AM

by Peter Schrag

Meeting your 'new day in California' governor

It's exactly a year today since Arnold Schwarzenegger, at his swearing in as California's governor, promised "a new day in California." He did not seek the office, he said, "to do things the way they've always been done." So what's new?

* On the margins, a lot for business: workers' compensation reform; gubernatorial support for a successful initiative limiting private lawsuits against polluters, unethical business practices and consumer fraud; gubernatorial backing - maybe critical, given the close vote - of a business-sponsored ballot measure to overturn a law requiring employers of 50 people or more to provide some health insurance for their workers.

* Reversal of the increase in the Vehicle License Fee, an increase that was, in effect, a restoration of fees that had long been in place and were cut during the flush times of the late 1990s. State policy always contemplated that in fiscal emergencies, the VLF would automatically be increased. The VLF cut, on Schwarzenegger's first day in office, immediately added $4 billion to the state's deficit.

* Negotiated repeal of the law passed in 2003 that restored the right of illegal aliens to obtain California driver's licenses, a right they had until the anti-immigrant backlash of a decade ago. The deal included the governor's promise to consider - or maybe approve, depending on whom you believe - a substitute. The governor said the original bill posed a security risk.

* Passage of a $15 billion deficit bond, support for the $3 billion stem-cell initiative passed by voters earlier this month plus a lot of other borrowing that, with interest, will add some $30 billion to the state's long-term debt.

* A reduction of $2 billion below the amount that the constitution requires in state funding for K-14 education, with a promise that it be repaid sometime in the future.

* Sharp increases in fees for students in all the state's colleges and universities both for the current year and the coming years and, had it not been for the vehement resistance of the Legislature, a suspension, for the first time in history, of the Master Plan that guaranteed all eligible students a place at the University of California or the California State University.

* A "renegotiated" contract with the state's powerful prison guards union that saves a little money in the short run in return for even greater benefits and union power in the future.

* A record amount in fund raising - all told some $17 million in the past year - by a governor who had pledged that because he was so rich he'd never need to take money from "special interests." He nonetheless took it in six-figure (and sometimes seven-figure) chunks from banks, insurance companies, Silicon Valley venture capitalists, drug and oil companies, big-box retailers and real estate developers, many of which do businesses with the state.

(The list, which is longer than this column, is at the Web site of the Foundation for Taxpayer and Consumer Rights: www.arnoldwatch.org)

"Any of those kinds of real big, powerful special interests," Schwarzenegger had said before his election, "if you take money from them you owe them something." What kind of special interests did he have in mind?

* A shower of gifts, as reported recently by the Los Angeles Times, from a variety of interest groups to senior administration staffers - dinners, tickets to sports events, Broadway shows and Disneyland.

* Victories on many of this month's ballot measures, on two of which his involvement probably made a real difference - but a singular lack of success in his efforts to elect more Republicans to the Legislature. Given that he appears to have regarded protection of his image - and thus his restrictions on the use of his picture in candidates' ads - more important than going all out in the cause, he probably knew his chances were slim.

As lots of other people have pointed out, Schwarzenegger's fiscal measures - particularly the borrowing and the raids on other funds - look remarkably like those of previous governors, only more so.

What few have pointed out is that even as the governor and his recently departed finance director, Donna Arduin, chopped spending, he offered little in the way of long-term ideas, plans, a vision, anything, for restoring California to the greatness he himself so often talked about during his campaign.

But for Schwarzenegger, personally, the past year has brought one remarkable success. Not only was he able to parlay his show business popularity into political clout with the voters and, secondarily with the Legislature; he was also able to elevate his personal image as governor far beyond anything that his performance in running the state would have earned anyone else.

Maybe he'll surprise us in 2005. The appointment of Berkeley business school dean and former California congressman Tom Campbell as finance director - and, more tellingly, Campbell's willingness to take the job - may signal some serious intentions on the policy side. It's certainly the most hopeful sign of the year - not a moment too soon.
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Peter Schrag can be reached at PO Box 15779, Sacramento, CA 95852-0779 or at pschrag@sacbee.com




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