Brown Blocks Dems' Budget Shot

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In a move that set the Capitol ablaze with chatter and -- depending on your company -- either praise or scorn, Governor Jerry Brown today vetoed the budget sent to him less than 24 hours ago by his fellow Democrats.

"California is facing a fiscal crisis, and very strong medicine must be taken," said Brown from behind his desk in a video posted on YouTube.

So now what?

The budget ratified Wednesday, largely on a party-line vote, placed the veteran pol in a sticky wicket: veto it and ruffle some feathers, or sign it and trigger a chorus of "Brown broke his promise about gimmicks" comments by pundits and potshot takers alike.

At first, few seemed to think he'd do it. In fact, in records dating back to 1901, no one has found a gubernatorial budget veto (although others have been threatened, as recently as the summer of 2008). But Jerry Brown has made a career out of defying conventional wisdom. And given his passionate rebuke of budget gimmicks during the 2010 campaign, the veto of the budget seems to at least make good on those promises.

But lest conspiracy theorists think this was actually a clever plot by Democrats (to what end, I don't know), the leaders of the two houses of the Legislature came out today and politely slammed Brown -- they are all Democrats, after all -- for making a bad call.

"The governor is fond of citing The Art of War," said Senate President pro Tem Darrell Steinberg at a morning news conference in the Capitol. "His decision is apparently part of some elaborate strategy to force a confrontation."

Democrats focused their fire on Brown's months long refusal to offer any kind of 'Plan B' in the event his cut-and-tax fiscal proposal was rejected by Republicans. Which, as we know, it was.

Steinberg also took aim at Brown's veto message (PDF) about the lack of enough real budget fixes, by reminding everyone that California gives its chief executive the power to strike spending via the line item veto.

"Quite frankly, his actions are dismaying," said Assembly Speaker John Perez.

While never calling the governor a bad person or a bad Democrat, the two legislative leaders seemed to do something even worse: they called him a bad politician.

Getty/Justin Sullivan

Perez: "The art of politics is finding that sweet spot where you get a s far as you can, and bring enough people with you. It's something the governor has struggled with."

Steinberg: "The governor is really getting caught up, and frankly a little bit confused, between total victory... and progress."

But Governor Brown, speaking to reporters today in Los Angeles, was insistent that his veto is the only way to go.

"With a lot of thought, I decided that a veto of the entire budget was the most productive way to proceed," he said. "I think it will shake up the system in a way that will give a better result."

But to be accurate, what Brown vetoed was the budget bill "in chief" -- that is, the budget absent the many implementing "trailer" bills. It turns out those bills have yet to reach his desk... and... there's a chance that he might actually like some of those. For example, the governor said today he's intrigued by the bill to force online retailers to collect state sales tax (the so-called "Amazon bill"). And then there's the fiercely debated plan to eliminate local redevelopment agencies; Brown's version came up short of legislative votes in March, but the Democratic alternative -- should it pass legal challenges -- brings in the same amount of money, and perhaps even more over time.

Republicans were all too happy to jump on Brown's Bad Budget Bandwagon today, essentially doing a 'I told you so' to their fellow legislators on the other side of the aisle.

"Governor Brown today did the right thing by vetoing the sham budget passed by legislative Democrats," said Assembly GOP leader Connie Conway in a statement. "It contained billions in illegal tax increases and lacked common-sense reforms."

Of course, Brown took particular aim at GOP legislators in his written and public veto messages, saying their reluctance to cut a deal earlier this year was the first fatal blow.

The governor's coalition of budget backers -- business, education, and others -- seemed to generally applaud his action, while gingerly sidestepping the "Dem-on-Dem" nature of the dispute.

And as a sideshow to the big veto decision, the Capitol community is also abuzz as to whether Brown's veto message -- saying the Democratic budget was "not a balanced solution" -- would force Controller John Chiang to invoke Proposition 25 and therefore block legislator salary and per diem payments this month. Chiang's only message so far: I'm looking at it.

The real question, for now, is whether the state's precarious finances can hold up for a traditional summer-long standoff. Earlier this year, the controller's experts said that the state government was projected to run out of cash in the bank sometime in July. A spokesman said today that new projections should be ready next week, ones that will take into account a current year windfall of some $3.2 billion above January estimates. But the money will probably, in the end, drive the debate; it's been made pretty clear that absent either a budget with complete solutions, or one predicated on Brown's tax extensions but including detailed cuts that would trigger on in their sted, Wall Street investors won't give us the cash... raising the specter of IOUs like those issued in 2009.

That's the real thing to watch as the Capitol community, giddy for a brief moment yesterday over the prospect of a slow and easy summer, now seems resigned to fight it out all over again.

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About John Myers

John Myers is senior editor of KQED's new California Politics & Government Desk. He has covered California politics for most of the past two decades, serving previously as Sacramento bureau chief for KQED News and most recently as political editor for KXTV News10 (ABC) in Sacramento. In 2014, he was named one of the nation's top statehouse reporters by The Washington Post. Follow him on Twitter @johnmyers.
  • Dennis Corcoran

    http://blogs.kqed.org/capitalnotes/2011/06/16/brown-blocks-dems-budget-shot/
    Dear Mr. Myers: I value your writing, your radio commentary and your podcasts with Mr. York.

    However, one of your recent comments was not cricket.
    You opined, in part, :
    “The budget ratified Wednesday, largely on a party-line vote, placed the veteran pol in a sticky wicket…”
    Sir, millions of your (potential) reader and (potential) podcast audience in India and cricket players everywhere else are (potentially) shocked at this inaccurate referral to the cricket game.

    Perhaps, shocked by the sudden passage of the budget during daylight in June, you mixed metaphors and in your heart of hearts intended to type that the Governor was trapped in a “sticky thicket” of campaign promises.
    To his credit, the Governor slashed his way out of the thicket with his ever sharp veto pen.
    The real budget, I predict, will be signed by the Governor after the Summer Solstice and before the Autumnal Equinox.
    Happy Long Hot Summer,
    Dennis

  • Jakmove

    Good job gov. Brown

  • Mace

    Good for him…I’m glad he is a man of his word. Cali has been hit the hardest.

  • Moravecglobal

    Governor needs to turn to University of California for wage concessions. Californians suffer from greatest deficit of modern times. UC wages must reflect California’s ability to pay, not what others are paid. Campus chancellors, tenured & non-tenured faculty, UCOP are replaceable by more talented academics
    UC faculty, chancellor, vice chancellor, UCOP wage concessions:
    No furloughs
    18 percent reduction in UCOP salaries & $50 million cut.
    18 percent prune of campus chancellors’, vice chancellors’ salaries.
    15 percent trim of tenured faculty salaries, increased teaching load
    10 percent decrease in non-tenured faculty salaries, as well as increase research, teaching load
    100% elimination of all Academic Senate, Academic Council costs, wages.

    Overly optimistic predictions of future revenues do not solve the deficit. However, rose bushes bloom after pruning.

  • hello

    It was interesting. The one thing that the Governor seemed to take real issue with in the Budget is the sale-lease of the government buildings deal. He found the Amazon tax intriguing and he didn’t seem to find the overall structure (which does not include realignment or “bringing government closer to the people”) a deal braker. I could be entirely wrong of course but my (admittedly cynical) take on this (and yes, I’ve lived under Arnold for too long) is that with this veto Jerry wants to accomplish two things: 1) force the Democrats to make even steeper cuts (about 3-4Bn) in an all-cuts or majority budget and 2) raise his popularity so that when he does take out the blue pen, he will still have some political capital left…

  • http://www.kqed.org/weblog/capitalnotes/blog.jsp John Myers

    An interesting tidbit to share based on comments of “hello” above: when the budget plan was being described on Tuesday by a Democratic staffer, the staffer conceded that $4 billion-$5 billion of the solutions could be deemed “risky.” Others, of course, might use the term “doubtful.”

    Left unresolved by this week’s events is whether the governor would accept the $5 billion-$6 billion of supposedly “non-risky” solutions… with the rest having to be resolved by cuts or revenues.

  • hello

    @John: I didn’t see anything in the Governor’s comments either yesterday or previously to indicate that he would not sign a majority budget that has steeper cuts. But I don’t think he wants to be the first to make the cuts that will impact everyone in California. (Remember, to date 50% of Californians have said that they are “untouched” by the ongoing California fiscal crisis.) The cuts that are left to make will touch that 50% and my (admittedly cynical) read on the veto is that the Governor is not willing to be the first and only one to make those cuts.

  • surfon

    Any indicatitons the the legislature may try to place the taxes on the ballot by a majority vote?

  • hello

    Further to surfon’s question: Do you get the sense that the Democrats want (as of today) to stick their necks out for Governor’s Plan A? Because putting the tax measure on the ballot by a majority vote will mean a court challenge which (because it will effectively tie up the budget in courts) may impact Democrats’ electibility.

  • http://www.kqed.org/weblog/capitalnotes/blog.jsp John Myers

    Surfon: That issue, as you’re probably referring, was raised in an op-ed in today’s Sacramento Bee. It’s an interesting one, because the conventional wisdom (for what that’s worth!) says that the Legislature has no power — explicit, that is — to put anything other than a constitutional amendment on the ballot… which is one reason why this tax plan, temporary as it is, would have to be written into the state’s blueprint.

    Hello: I think if July 1 comes and goes without a budget, all kinds of things are going to be mulled over. First & foremost, the governor will then be facing — even at best — asking the voters to approve a tax “increase,” which polling suggests is the real kiss of death. The next 2 weeks will be worth watching closely.

  • hello

    @ John: Well, sure. But one of the things I personally am curious about is how committed is the Governor and the leadership of the Legislature to realignment. (For the record, I think the concept makes complete sense simply because people should be able to see what they’re buying with their tax dollars but the implementation of it has to date left much to be desired.) The reason I am asking this question is that the structure of the majority-vote budget which we have to believe was crafted by one of the original realignment proponents was the same old story we have seen many, many times before. Sacramento has a budget problem… which then rolls downhill to the counties. To some extent that’s inevitable. After all 70% of the funds collected are passed down to the local level. But this year that’s also pretty cynical because the counties really have been negotiating (more or less) in good faith. In fact, they have “given away” a billion dollars in Prop 63 funds to plug a General Fund hole. Now, maybe a billion isn’t a lot in the grand scheme of things but they would not have given a dime if they weren’t promised autonomy. In the budget they sent to the Governor, the Legislature took the money and in essence taxed the counties for the autonomy (certified expenditure authority)they currently enjoy. So I am very curious to know if the current structure of the budget proposal will stand.

  • http://www.kqed.org/weblog/capitalnotes/blog.jsp John Myers

    I think a lot of things will change by the time all is said and done, but the question you raise isn’t very easy to answer. The Guv seems resolute on the realignment issue, and the budget he vetoed rejected it largely because of money and not, I think, based on policy. But locals are leery, and rightfully so, of promises to keep them whole… and the Guv’s own plan has no identified financing once the taxes expire(d). Devil’s in the details, as they say.