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Pushing California Off the Cliff: Blocking the Budget to Destroy the Environment

by: Brian Leubitz

Fri Dec 19, 2008 at 07:27:43 AM PST


Arnold got to talking about vetoing the Legislature's budget plan, and it immediately becomes clear what is going on here: The Shock Doctrine.  The Republicans, including Governor Schwarzenegger, are using the budget disaster to destroy labor and environmental gains. At this point they don't even try to hide it: they are going after CEQA, going after labor contracts, and going after the generations old experience of public investment in infrastructure.  

First, from the Governor:

Well, read through it. You see, that it is one thing, when you say economic recovery package. But then read through it. It actually doesn't do anything and it makes it more difficult, actually, to do certain projects. And we will give you a briefing on the details -- Will Kempton can take you through the infrastructure package and all of those kind of things. They have not at all addressed the CEQA. They have not at all addressed the public-private partnerships. They have not addressed at all that we can go and -- as a matter of fact, they made it tough, that we can lay off people. They even said that we have to ask labor if we can have the furloughs that we recommended.

This is why I called it yesterday "Legislating Under Duress", the Governor and the Republicans have a gun to the Democrats' head in the budget disaster.  The thing is that not only does the GOP think that the Democrats will eventually blink, but going over the brink wouldn't be that big of a deal. They get to slash and burn through labor and forget about the government.  It is good to be the Green Governor isn't it?

Speaker Bass calls this what it is, Russian roulette with our future.  After all the gun isn't really on the politicians of California. Sure, they'll get some political blowback, but the gun is pointing squarely at the people of California.  The Governor claims to negotiate, then takes his marbles home with him. From the Speaker:

I am frankly surprised how willing Governor Schwarzenegger is to push California over a cliff when he clearly is not fully aware of what the bills we passed today do.  The governor said we didn't do economic stimulus.  We did $3 billion worth of bond acceleration to get job-creating infrastructure projects moving for transportation, drought relief, park restoration and green technologies. He said we didn't address CEQA-- we expedited CEQA for transportation projects and surplus property and we eased restrictions for hospital construction.  All these actions will also help create jobs. He said we didn't address public private partnerships.  We expanded public private partnerships - despite opposition from labor.

This is a stick-up, an attempt to drive us back into the third world of economic inequity, class warfare, and a grim future. Say goodbye to Pat Brown's California, say hello to Kurt Russell's.  

Brian Leubitz :: Pushing California Off the Cliff: Blocking the Budget to Destroy the Environment
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Brilliant post (0.00 / 0)
That's it in a nutshell.

Meanwhile public private partnerships like toll roads are rapidly being exposed as another another Ponzi scheme, with Australian toll road giant Macquarie marking down their assets by billions.

Macquarie's 2008 Annual Report, released at the end of June, stated the company's eleven toll roads were worth a total of A$8.6 billion. The company's calculation of this value is defined as, "in today's terms the cash the toll road is expected to generate over the life of the concession (the period over which the right to levy tolls is given)." As of yesterday, that total value had slumped to just A$6.5 billion.

For several years, tolling advocates had pointed to Macquarie as the model of success. So many executives became rich at the company that it even became known as a "millionaire factory." With easy credit and cheap financing the company was able to create the appearance of growth through continual acquisition of public assets. Now the severe tightening of the credit market over the past year has removed that option. The company faces traffic slumps of between three and twenty-three percent, depending on the road.



Call the bluff (5.00 / 1)
This is poker.  The legislature needs to call his bluff.  They should keep sending him bills and every time they send him one, they should take away one of their consessions to him. He will be remembered as a failed governor who would not prevent the shutdown of the state government because he wanted to score some cheap political points for his crony's.  He will try to divert the blame, but the lions-share of the blame will fall on him. Todays Non Sequitor illustrates the problem perfectly.

This mess is now a political campaign. The Governor threw down the gauntlet yesterday with his veto. His challenge should be met with bold and aggressive action.


"This mess is now a political campaign" (0.00 / 0)
Absolutely right.

Watching a local news broadcast, which covered this by showing Arnold trash the bill, did not include any information for the listener as to what the issues were.  Anyone who thinks that they can do this from Sacramento in the usual way is deluded.

I don't think a full collapse of the state's finances can be avoided now.  The new legislature coming in is not materially different than the one we had yesterday.  Arnold is clearly not willing to govern from the center.  And there is no solution that will not allow taxes.  So ultimately, the political class is going to have to go outside of the legislature and the lobbyists and start trying to politicize the populous.

At this point, the collapse is going to be driven by the financial system and not by the politicians.  The means to raise money for on-going operations has already begun to disappear; we can't sell our bonds.  And since a lot of businesses depend upon the operations of the state government, these businesses are going to under great stress, and many will go under.

I don't think that anything is really achieved right now by delaying the inevitable.  If the Democratic legislators stay at the table, all they are going to do is delay action on a tax increase.  So they should walk away from the table, and start working to undermine the GOP.

The best way to do that is go after the GOP's financial base.  Unions can strike, and they should.  Businesses can be identified, publicized, and boycotted.  Meet-ups and demonstrations can be planned across the state.  And the state party should get off its sorry ass and help with this.  


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