Jerry Brown abandons key part of his California budget plan. Now what?

Gov. Jerry Brown has dropped his plan to broker a bipartisan California budget by asking voters, in a special election in June, to extend taxes to close the state’s $26.4 billion gap by $12 billion.

Budget cuts enacted by the Legislature and signed last week covered only $11.2 billion of the deficit.

Mr. Brown, who needed just four Republicans to sign off on the special election idea, cited an extensive list of GOP demands in return as the reason that a standoff could not be bridged.

"Each and every Republican legislator I've spoken to believes that voters should not have this right to vote unless I agree to an ever-changing list of collateral demands," he said in a statement late Tuesday afternoon. The list of 53 items was made public last week and is considered by many analysts as the reason behind the budget deal collapse.

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“Some had been talked about, but the list just kept getting bigger, some of which had nothing to do with the budget,” says Barbara O’Connor, director emeritus of the Institute for the Study of Politics and Media at California State University, Sacramento.

Brown announced he was willing to contemplate pension and regulatory reform and spending caps but "while we made significant progress on these reform issues, the Republicans continued to insist on including demands that would materially undermine any semblance of a balanced budget. In fact, they sought to worsen the state's problem by creating a $4 billion hole in the budget."

But Republicans have responded that "Governor Brown and the Dems can't have it both ways. They asked for ideas – and then complained there were too many,” said Tom Del Beccaro, chairman of the California Republican Party, in a statement. “They wanted specific budget solutions – and then complained there were too many details. They shout 'Let the people vote' – and then refuse to let the people vote on measures that will create jobs and bring permanent reforms to California government.”

Analysts say it was the constituencies behind both sides that were the problem.

“The unions limited the ground that Brown could give, the anti-tax GOP grassroots limited the ground that the Republicans could give, and so they could not find common ground,” says Jack Pitney, professor of government at Claremont McKenna College.

But Mike Zimmerman, chief of staff for Republican Assemblyman Martin Garrick, points out that just because the list was so long doesn’t mean Republicans were demanding all of them.

Public not following budget fight

“No one was saying we need all 53,” he says. “What’s upsetting is the governor said for a long time to bring him a list, so now I think it’s unfair for anyone to call the Republicans obstructionist. It should strike people as odd that not one was accommodated.”

Mr. Pitney counters that most Californians aren’t following the details of the budget fight and the GOP has missed a key opportunity.

“[Most Californians] don’t care who offered what deal to whom. They just want a resolution to the problem,” says Pitney. “Republicans briefly had an outside chance to shape policy. That window has closed. Now they are angry spectators. Their anger won’t do them much good. If Brown and the Legislature make deeper cuts, Republicans will get little benefit. Very few California voters would think, ‘The Democrats cut too much spending, so we should vote Republican!’”

IN PICTURES: Jerry Brown through the years

What next?

Analysts had previously opined that Democrats might try a different option of trying to get the taxes extended by a simple majority vote in the Legislature despite possible legal hurdles. The Democratic Senate president pro tem, Darrell Steinberg, said yesterday they no longer are contemplating that option.

Brown does not need to call an election to approve higher taxes; he can do so with a two-thirds vote of the Legislature. But in the heat of his campaign last year against billionaire Meg Whitman, who was selling herself as an economic-fixit for California, he promised voters he would seek their opinion before seeking more taxes.

Brown's fatal mistake

Some analysts say that is where Jerry Brown made his fatal mistake in this matter.

“Jerry Brown may have lost this battle last year during the campaign when he pledged not to raise taxes without a vote of the public,” says Robert Stern, President of the Center for Governmental Studies. “He thought his vast experience as a public official would overcome the partisan divisions that are far worse than they were when he was governor 33 years ago. As long as California requires a two-thirds vote of the Legislature to raise taxes, gridlock is likely. Two-thirds of the public can rarely agree on any major policy issue.”

[Editor's note: The name of the Center for Governmental Studies was incorrect in the original version.]

Conventional opinion now says Brown will likely seek to pursue a tax-hike initiative in the fall and will begin gathering signatures next week with the impetus of an all-cuts budget.

“The people will be very motivated now to sign up for an initiative in the fall,” says Ms. O’Connor. “When they see the all-cuts budget, they will know how it is likely to affect every citizen in the state, one way or another.”

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