"Saying spending is poised to grow more than 50% faster than revenues, the state's chief budget analyst
called on lawmakers Wednesday to immediately begin cutting government programs or raising taxes to address a budget shortfall that has ballooned to $10 billion," reports Evan Halper in the Times.
"Nonpartisan Legislative Analyst
Elizabeth G. Hill, whom lawmakers of both parties look to for guidance on fiscal matters, said the cooling housing market, high energy prices and a batch of overly optimistic assumptions in the last budget are hitting state coffers hard.
"'The Legislature should start now' curbing spending and finding new revenue, she said. '
All the easy solutions are gone.'
"The deficit has grown to more than the state spends on its entire public university system, Hill said. "We're talking big dollars to close this gap."
"In less than three months -- since lawmakers passed the last budget and projected a reserve of about $4 billion -- California has plunged into the red. Property, sales and personal income taxes are down sharply as a result of the troubled housing market, and Hill predicted that the housing sector has yet to hit bottom."
George Skelton
writes: "There is n-o m-o-n-e-y.
"California's state government is i-n d-e-b-t and the hole is getting deeper.
"
We should change the name of this state to 'Denial.'"
But that's already the name of a river in Egypt, George...
"Unless the politicians and voters are willing to raise taxes, forget all these grandiose new government programs Sacramento has been yakking about concerning healthcare and education.
"In fact, forget them anyway for now. Tax increases will be needed just to pay for what the governor, the Legislature and the voters already have saddled on the state."
Dan Walters
writes "Historically, Democrats have believed that holding the line on spending would eventually force Republicans to raise taxes. Republicans have believed that if they hold out on taxes, Democrats will eventually make big spending cuts. The stalemate has generated years of deficits and massive borrowing to cover them.
"What will happen? Absolutely no one knows."
"A
Democratic health care plan cleared an Assembly committee Wednesday on a party-line vote, but legislative leaders and Gov. Arnold Schwarzenegger remain divided over how to cover 6.7 million uninsured Californians, writes the Bee's Kevin Yamamura.
"The Assembly Health Committee's 11-4 approval, entirely with Democratic support, sets up a Nov. 26 floor vote on a health care package that has dominated the Capitol's attention this year. The plan approved on Wednesday requires businesses to spend 2 percent to 6.5 percent of their payroll on health care or contribute to a state fund. It relies on voters to pass a $2-per-pack increase in the state's cigarette tax.
"'We're making considerable progress, and I expect we're going to get a deal,' said Assembly Speaker
Fabian Núñez, who presented the Democratic plan as its co-author. '
On the 26th, we're going to have session, and we're going to vote on a final bill. Before we have an actual deal, we've already decided on what day we're going to be voting on that deal. That's how strongly we feel we're going to get it done.'"
CW's John Howard reports that the health care debate
has create some tension within organized labor.
"When Art Pulaski, the head of the 2.1 million-strong California Labor Federation, picked up his Oct. 26 Sacramento Bee, he was not pleased: There in the opinion section was a piece written by a top carpenters’ union official blasting fellow union members for “effectively” killing health care reform.
“
In a misguided attempt to remain relevant, the California labor movement has resorted to a hyperpartisan approach and tactics such as fasting, candlelight vigils and chanting that forces one to assume that labor has lost the ability to do what it is supposed to do best—negotiate,” wrote
Daniel Curtin, director of the California Conference of Carpenters. “Labor has lost sight of a fundamental political maxim: Don’t let the perfect be the enemy of the good,” he added.
"The commentary fell like a bomb in the organized labor community, partly because of the sentiments expressed, partly because some in labor view Curtin as a too-close ally of the Republican governor, and partly because health care reform is back on the table and labor is actively engaged in the discussions.
Capitol Weekly reports on some of the
divisions on the Governor's pension commission. "A commission created to suggest changes to the state’s pension system was deeply divided over how to solve the issue of “pension spiking.” In fact, the commission could not even agree whether pension spiking exists, or if it is a problem, let alone what the solution should be.
"Tuesday’s meeting started off with choruses of virtual anonymity, with all of the commissioners agreeing to ways to increase transparency and openness in the pension systems. But the morning’s consensus on the panel quickly deteriorated when the subject of “pension spiking” was raised."
On Wednesday,
Gray Davis was back in Sacramento, while the Legislative Analyst cautioned that the state faces a $10 billion budget deficit next year.
The Bee's Dan Smith writes: "When [
Gray Davis]
came to the Sacramento Press Club on Wednesday, much seemed the same. Same dark suit, red tie, steel-blue shirt, perfectly coiffed white hair. There was a lot of policy talk about budget reserves and bonds. Davis even worked the room of 75 or so for about 20 minutes before he sat down, greeting each luncheon guest as if he were making a campaign fundraising pitch – just like the old days.
"During a short speech and question-and-answer banter with the crowd Wednesday, the Democrat had much praise for the Republican who replaced him after the recall, Gov. Arnold Schwarzenegger. After all, Davis pointed out, the governor hired former Davis Cabinet secretary
Susan Kennedy to be his chief of staff, is doing "a phenomenal job" drawing attention to global warming and "doing everything (he) can to light a fire under the Bush administration to either lead or get out of the way."
"'
When someone takes the baton from you, keeps running in the same direction and then hires many of the same people who advised you, it's hard to feel anything but good about that person,' Davis said. 'Basically what the governor has done on many of the issues I care about is enhance them and move them farther down the road.'
"But he acknowledged that while policy may be a common bond between Schwarzenegger and himself, there are obvious stylistic differences.
"'
I think the governor is one of the greatest salespeople on the planet Earth,' he said.
"Davis said he believed 'in making progress on kind of a consistent basis, in part because I didn't want anyone to get scared.'
"
'I want to take life in kind of bite-sized chunks,' he said. '(Schwarzenegger) is much grander and bolder in his vision, and I think it's served California well.'"
"In separate rulings, two Superior Court judges yesterday
rejected tribal lawsuits filed to block a statewide vote on gambling agreements that could bring the next major wave of Indian casino expansion.
"With immediate appeals promised, the verdicts set the stage for the first higher-court review of an unresolved legal debate over the rules for qualifying referendums, ballot measures designed to overturn recently enacted legislation.
"In largely identical lawsuits [against] the Pechanga band near Temecula and Morongo tribe of eastern Riverside County argued that state law requires signatures gathered to qualify a referendum must be collected and verified within 90 days.
"Judges
Jack Sapunor and
Gail Ohanesian disagreed, concluding that state law permits verification after a 90-day period for signature gathering."
"Republican State Insurance Commissioner
Steve Poizner has come under fire this year for hiring a former insurance industry lobbyist as one of his top legal aides. Wednesday, the Silicon Valley entrepreneur and potential gubernatorial contender
moved to blunt that criticism by announcing he's hired another attorney, this one with experience suing insurance companies," reports Mike Zapler in the Merc News.
"
Adam M. Cole, a partner in San Francisco-based corporate law firm Heller Ehrman, will fill the position of Poizner's general counsel. While Cole's firm has represented State Farm in lawsuits challenging Proposition 103 - California's landmark law that regulates auto insurance rates - Cole said he was completely removed from that work. He said his work has focused on representing policyholders in claims against insurance companies.
"'The general counsel has to be consumer-oriented' and Cole fits that role well, Poizner said.
"Poizner introduced Cole - a Harvard Law School graduate and former Peace Corps volunteer who has taught insurance law at University of California-Berkeley's Boalt Hall law school - to a small group of reporters summoned to his office. It was unusual for a statewide politician to announce a staff selection that way, and suggested that Poizner is eager to counter criticism that his office is forging too-close ties with the insurance industry."
"
Robert Dynes, University of California's embattled president, a target="new" href="http://www.signonsandiego.com/uniontrib/20071115/news_1n15dynes.html">will receive the second-highest salary of any professor in his field when he steps down from his post and returns to the faculty at UCSD, under a proposal made public last night," writes the U-T's Eleanor Yang Siu.
"The proposal, which UC's governing board of regents will vote on today in Los Angeles, sets Dynes' salary at $245,000 a year – exceeding every physicist in the 10-campus system except Nobel laureate
David Gross, who earns $254,900 at UC Santa Barbara. The proposed salary surpasses -that of another Santa Barbara Nobel laureate,
Alan Heeger, by roughly $20,000.
"
The plan also calls for Dynes to first take a year of administrative leave, equivalent to a sabbatical, at his current salary of $405,000."Dynes, 65, also will receive an annual pension of about $145,000 when he retires. He was pressured to resign in the fall, after weathering criticism over his handling of a controversy in which executives were quietly paid millions of dollars in pay and perks. He will step down as president in June, or when his replacement is found."
Meanwhile, "Regents delayed a decision on increasing student fees until they receive the governor's state budget proposal in January. The UC budget proposal calls for undergraduate fees to rise 7 percent next year if the state does not provide an extra $70.5 million in revenue.
"Lt. Gov.
John Garamendi, who serves as a regent by virtue of his office, said he will introduce a resolution in January to limit fee hikes to the rate of inflation."
Anf from our
If At First You Don't Succeed Files, LA Observed updates us on the latest gubernatorial appointment. "
Dancing with the Stars" didn't work out for Leeza Gibbons, so the former celebrity gossip monger has time to take a new gig — Gov. Arnold Schwarzenegger's a
ppointee to the board that oversees California's stem-cell research institute. Gibbons will be the designated Alzheimer's advocate on the Independent Citizens Oversight Committee. Gibbons, whose mother and grandmother suffered from Alzheimer's, is co-founder of the Leeza Gibbons Memory Foundation and Leeza's Place.
