By Connie Kwong
Larry Gerston, a political science professor at San Jose State University, recently remarked, “I’m not saying the Democrats won’t get what they want. I am saying they will have to pay a price in terms of concessions that they previously didn’t have to pay. They have been spoiled.”
It’s true. Democrats have been spoiled in the Golden State. They’ve controlled both houses of the state legislature nearly every year since 1970.
However, recent scandals have forced three Democratic senators out of their seats. Although they still hold a majority in the state legislature, the Democrats have lost the supermajority they achieved in the 2012 elections, and, arguably, some of their credibility. Without the immense political capital that a supermajority entails, the Democrats will not be able to pass crucial legislation on economic issues with a two-thirds majority vote as easily as they’d like.
But I’ll venture to say that Governor Jerry Brown’s latest efforts to collaborate with Republicans on a new rainy-day fund show that the Democrats can turn this into a positive situation. The Democrats are being put to the test, and they can pass only if they demonstrate that they can work with Republicans to pass a new rainy-day fund bill.
That’s because Republicans are unlikely to embrace Brown’s newest rainy-day fund proposal, and for a good reason. A new proposal already exists in the pending budget initiative scheduled for the November ballot, requiring the state to hold in reserve any revenue that exceeded the previous year’s general fund spending, in addition to setting aside 3% of general fund revenue. Brown’s plan would replace the current proposal with one that’s tied to capital gains increases by requiring that the state only needs to set aside additional money for the fund in years when income from capital gains exceeds 6.5% of its revenue.
Supporters of Brown’s plan argue that it makes sense to design the fund so that its growth follows the business cycle, and it enables the legislature to focus more on reducing California’s debt burden instead of increasing the fund.
But Brown’s plan isn’t fiscally responsible, because it ignores the fact that the patterns of capital gains are simply too volatile to predict, making it harder to build a substantial reserve fund. It would also make it much easier for the state to declare times of crisis allowing it to dip into the reserve fund.
California Democrats and Republicans share a lot of the same fundamental views on the rainy-day fund.
They agree that it’s a necessary tool for times of economic crisis, and that because the original rainy-day fund established 2004 wasn’t effective enough, California needs a better one. Both parties agree that there are better alternatives to the current proposal on the ballot.
But with Governor Brown’s newest misguided proposal, and names like Leland Yee, Ron Calderon, and Roderick Wright making scandalous headlines for the party in recent news, the Democrats can’t afford to replace existing budget initiatives with bad ones. They need to show that they haven’t gotten too comfortable with being the majority party to the point of ignoring real political responsibility and fiscal accountability. California can’t pass a budget bill without a two-thirds majority, so Democrats have to work with Republicans to pass a new rainy day fund-bill that’s actually effective.
The truth is that passing successful legislation involves the two c-words – “concession” and “compromise.” And while it’s hard to put aside differences and make concessions and compromises, I’d like to think that both Democrats and Republicans can look to the Rolling Stones for some wise words when it comes to bipartisanship: “You can’t always get what you want, but if you try sometimes, well, you might find, you get what you need.”