Governor Jerry Brown Beyond Left and Right Hype
26 Jan 2015
Depending upon whom you ask, California Governor Jerry Brown has either saved the Golden State from sure ruin or deserves an “F” rating as a “tax and spend” liberal who has chased away businesses, raised taxes egregiously and masked massive unfunded pension liability behind a new budget surplus in the billions. Who is right? Having lived in the state for 25 years, my evidence is anecdotal, so I went on a fact finding mission about Brown’s tenure beyond ideologues on either side grading him for their own purposes.
Honestly, the stunning weather and magnificent, varied terrain make it a little harder to feel pain in California, otherwise people wouldn’t flock to the state despite the high cost of living . So I conducted a poll of my own, asking residents of all political persuasions how they feel about the man once nicknamed “Governor Moonbeam.”
The consensus on the ground is that he’s a frugal, hard-working guy who has sacrificed certain programs, even screwing some over, for the good of the state overall.
From a dyed-in-the-wool progressive:
“He has hurt us throughout our retirement. His frugality also has consequence for the Labor movement and the heart of the Democratic Party alliance…if this is good for the mods and indies out there, so be it.”
From a Republican who, as he put it, left the Democrats once he got his first property tax bill:
“I hate that Jerry raised my taxes and the high speed train (which voters approved) is a glorious waste of money. That said, I do like that he is a straight shooter and has balanced the budget which nobody else could seem to do.”
From an Independent:
“He stabilized CA without going tea party or being a foolish out-of-touch progressive (See: Governor O’Malley of Maryland).”
But what about that “F” rating? According to data provided by Bloomberg last week,
“California is overtaking Brazil as the world’s seventh-largest economy, bolstered by rising employment, home values and personal and corporate income, a year after the most-populous state surpassed Russia and Italy.”
“The Golden State, with an equivalent gross domestic product of $2.20 trillion in 2013, expanded last year by almost every measure….and… “grew an average of 4.1 percent annually during the first three years of Brown’s most recent term.”
Bloomberg also reported that according to the Russell 3000 Index:
“…analysts are bullish on California based businesses,” and “companies based in the state will provide a 15 percent return to investors in the coming year, compared with 12 percent for the index.” “Agriculture in California produced $21.4 billion in revenue in 2012, three times more than the $6.8 billion in second-ranked Iowa”…and
“The number of companies in California that rank in the top 500 in the world in terms of market capitalization rose almost 48 percent since 2009.”
This is a victory that The New York Times referred to as “Jerry Brown’s Revenge,” since “California leads the nation in new high-tech, bio-tech and manufacturing jobs, a result in part that Brown attributes to the “yeasty and innovative” nature of the state. [Texas Governor] Perry can’t duplicate that, no matter how many corporate subsidies he passes around.”
Despite former Republican presidential candidate Mitt Romney comparing the state to Greece, it is bouncing back after the troubled leadership of both Gray Davis and the Governator, Arnold Schwarzenegger. That Governor Brown has managed to balance the budget is a feather in his cap – but what’s behind the curtain?
Unfunded pension liabilities have exploded in recent years here to the tune of 200%, a fact former State Controller and current Treasurer John Chiang readily acknowledges, which puts a big damper on the balanced budget claim.
Perhaps in response to complaints about those liabilities, Brown is asking that state retirees pay half their healthcare premiums. He is also suggesting that government workers be required to work longer before qualifying. Will this solve the problem? No. But the “third rail” is being stepped on. We’ll see if Mr. Brown’s dipping a toe in this water is a sign of things to come.
Other problems persist, however. Public education here is poorly run, resulting in buckets of dough earmarked for education that never quite makes it, coupled with teachers hampered by some clueless administrators. Any program is only as good as the people running it. John Deasy, the recently resigned LA School Superintendent, had a great deal of waste to show for his tenure and should have been ousted years ago.
Did Brown have any control over this? Perhaps not. But at the least – and this applies to a Chief Executive of either party in any state – he or she needs to enlist public pressure to hold middle managers accountable. These officers are Brown’s lieutenants in the fight. If they are incompetent or ineffective, the waste undermines overall policy effectiveness. Brown had a huge mess to deal with when he re-took office. Now that the state is more stable, it’s time to peer under a few other rocks and apply his reputed frugality and hard line thinking to those in the ranks who have gotten away with wasteful behavior for too long.
More painful is that the current jobless rate in California, while improved, still stands at 7.2 – the second highest in the nation, with “almost a quarter of Californians living in poverty, the highest rate in the nation, according to the U.S. Census Bureau, yet spending on welfare remains lower than before the recession began.”
Since Democrats have long controlled the state legislature, it is also shocking that they spent years denying tax credits that would keep TV/film production in the state. Industry professional John Smart who handles film clearances shared that there was “a long term arrogance in Sacramento re: Hollywood.” Thinking the biz would never really leave… “the lack of leadership regarding one of our primary “heirloom” industries was appalling, either completely unconscious or absolutely arrogant on the politicians part. Keeping movies in Hollywood is the very definition of no brainer if you are in a leadership position.”
Tax credits that encourage local production are not about filling the coffers of rich producers or marquis actors but like any business, those it employs will spend dough locally, boosting the state’s economy overall.
After much lobbying by agents (including my own), Governor Brown just signed AB1839, granting $330 million in tax credits to bring production back to the state. Governor Cuomo of New York, on the other hand, just did the opposite, so perhaps the increased production their state had been enjoying will once again trickle back to the left coast. Their loss will be the Golden State’s gain.
As to complaints about higher taxes leveed in California, Governor Brown maintains that his Proposition 30, enacted in 2012 to raise sales tax and taxes on the highest earners to help balance the budget was a temporary measure. He still plans to allow Prop 30 to expire in 2018 – yet he is already having to fight his own Legislature to stick to the promise.
Is sticker shock the only way to get voters to question what we are funding, why and whether or not the programs are being efficiently run? Apathy as to voting and civic involvement runs so high nationwide, one wonders if anything other than severe wallet pain will get anyone to take notice.
California’s outlook is better than when Brown took office and continues to improve. But what does that bode for the rest of the nation, where Republicans just won a resounding victory in the midterms?
Since the new Republican Congress began its session, they have doubled-down on social conservatism, further restricting women’s reproductive rights, rather than applying energy to solving economic problems. Couple this with newly minted Iowa Senator Joni Ernst delivering the SOTU response touting individual responsibility versus government assistance while ignoring the near half million her family has received in farm subsidies. This makes for a clear a disconnect between politics and reality (which both sides engage in); what middle class Americans really want and need versus what is being offered. That may in part explain Governor Brown’s relative popularity in a state prone to complaining and recalls.
Any politician’s approval rating is going to break along party lines to some degree. Yet the majority here see Governor Brown as a serious individual who is at least making an attempt to put the house in order – even if they view some of his ideas as wrongheaded or not far reaching enough.
The American people, tolerant to the last, will typically side with, and give a chance to, those with a plan to move us forward rather than those just engaging in vicious bluster.
Moderation is key. Contrary to prospective 2016 candidates or interest groups on the left or right who scream for ideological purity, we need leadership on a local, state, and federal level that does its best to represent everyone, not just those who inked the dot for them in the voting booth, or put money in their election campaign coffers.
There are surely those who would argue Governor Brown is on the wrong track, but going forward, someone who can show any positive progress is going to fare better with the electorate than one screaming platitudes in line with an ideological litmus test absent real economic plans to back them up.
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