Follow the money

John Tamny says the housing slowdown might be good for the economy -- by driving investment back into more productive uses for the money.

Núñez 'compromise': AB 8?

In audio comments released by his office today, Assembly Speaker Fabian Núñez says health care negotiations are not on “life support” but are probably in the “critical care” unit. To get a deal, he says, the governor has to make the plans in his proposal more affordable; allow the state to buy prescription drugs in bulk on behalf of its residents; and make sure the system is under “some kind of control,” so that “every Californian who has health care now and has preexisting conditions can be assured that their health care needs will be fully met by any health care proposal we put on the table.”

Núñez says he and the governor are getting “closer and closer” to a deal but are still a ways away.

Then he lists three things the governor must do:

--Ditch his lottery proposal. It’s too risky, he says. Its prospects are uncertain, and voters don’t like it.
--Make the plans more affordable.
--Allow bulk purchasing of drugs by the state.

Put another way, it sounds as if the speaker is saying if the governor changes his proposal to make it identical to AB 8, the bill the governor vetoed, then Núñez will go along.

Good and bad on the individual mandate

This NY Times piece says the Netherlands and Switzerland are getting a lot of attention from health care reformers because they are two places that have made an individual mandate a centerpiece of universal health plans that include a significiant role for private insurers.

This article from the Boston Globe, meanwhile, chronicles the frustration of Massachusetts officials trying to get low-income residents to comply with their new mandate, even when the insurance is subsidized or free.

More terms for me but not for thee?

Opponents of Prop. 93, the term limits measure, are horrified that it might allow former lawmakers who served only 6 years in the Assembly or eight in the Senate to come back and serve again up to the limit of 12 years in one house. And supporters of the initiative insist that it would do no such thing. If not, though, why not? Why would it be good public policy to allow Fabian Nunez to serve 12 years, but not to allow Joe Canciamilla, who was recently termed out after six, to come back and serve another three terms? That makes no sense to me. And I agree with the lawyers Shane Goldmacher quotes that the measure would allow it, even if the "intent language" suggests otherwise.

Schwarzenegger-Boxer

I have never been sold on the theory that Schwarzenegger will run for the U.S. Senate. I think he likes executive power but would be bored in a legislative arena. I think he is more likely to retire to a role as a grand, worldwide elder statesman, a la Bill Clinton. But today's numbers from the Field Poll will certainly fuel the conversation for quite a while longer....Schwarzenegger holds a narrow lead over Barbara Boxer in a hypothetical 2010 match-up.

Gerrymanders and partisan pols

This academic paper co-authored by a UCSD researcher concludes that gerrymandered districts have not contributed to the polarization of Congress.

Tower of power

A typical 5-year-old in California consumes 65 pounds of "added sugar" a year, or 17 teaspoon fulls per day. This picture of a six-foot-tall tower of sugar, courtesy of the First 5 Commission, illustrates that amount. The commission is promoting the number to fight childhood obesity.

CalPIRG analyzes guv's plan

With the governor's plan set for a legisaltive hearing Wednesday, CalPIRG provides a reasoned analysis here, with some constructive criticism. It's worth reading at a time when much of the opposition has descended into hysterics and protest vigils.

Private v. 'socialized' fire fighting

Michael Millenson suggests that Orange County conservatives who are welcoming or even demanding their "socialized" fire protection this week should do the same when it comes to health care. An interesting argument.

I would add that 1) insurance companies used to provide private fire fighting before the government pretty much took over that job, and 2) there are signs that such protection might be coming back.

'A significant difference'

President Bush, appearing at an Escondido park after touring Southern California fire damage, lavished praise on Gov. Arnold Schwarzenegger and couldn't resist what sounded like a back-handed slap at the leadership in Louisiana after Katrina.

"I appreciate the leadership of Governor Schwarzenegger," Bush said. "I said earlier when we were at the neighborhood, there's no hill he's not willing to charge, no problem he's not willing to solve. And we've got a problem out here, and I appreciate his leadership. It makes a significant difference when you have somebody in the statehouse willing to take the lead."

Budget project: tax credit not enough

The folks at the California Budget Project take a look here at the governor's proposal for a tax credit to help middle income families afford health insurance. They're not impressed.

Tested by fire

The fires sweeping across Southern California are a tragedy for all those affected, but they also represent both a challenge -- and an opportunity -- for Gov. Arnold Schwarzenegger. With tens of thousands of people already evacuated, and perhaps many more thousands to come, the fires appear to be the biggest emergency of Schwarzenegger's four years as governor, which, for California, have been remarkably free of natural disasters. The last major Southern California wildfires took place in October 2003, just after Schwarzenegger was elected but before he took office.

Californians will judge Schwarzenegger by how he reacts in this crisis, and how agencies under his control perform. A few minutes ago the governor appeared in San Diego County with the mayor of San Diego, county supervisors and the sheriff. He is saying all the right things about putting state resources into fighting the fires, and helping people recover.

But the hours and days ahead will be crucial, not only for those in the path of the fire, but for the public agencies charged with protecting them, and for the officials, from the governor on down, responsible for running those agencies.

UPDATE: Here is the media "pool report" on Schwarzenegger's visit to the scene of the Malibu fire before he went on to San Diego. It was filed by Jean Cowden Moore of the Ventura County Star.

Gov. Arnold Schwarzenegger was briefed on the strained resources used to
battle the wind-driven fires ravaging Southern California counties by state
and local fire and law enforcement officials in an incident command trailer
next to Malibu's public library Monday morning.

The governor was joined by Los Angeles County Sheriff Lee Baca, Los Angeles
County Supervisor Zev Yaroslavsky, California Fire Chief Ruben Grijalva, and
Kim Zagaris, the state fire and rescue chief for the governor's office of
emergency services.

"The Santa Ana winds are a huge problem for us," Grijalva said.

Ventura County Fire Department Chief Bob Roper pointed out the locations of
two fires burning in Ventura County on a map laid out before the governor.

"Particularly troublesome is the Ranch Fire in Castaic, moving northeast to
Piru and Val Verde," he said.

Zigaris said the California National Guard was asked to provide additional
helicopters, and two DC-10s were being used to battle the biggest fire, the
Buckweed Fire in Saugus.

Nevada and Oregon have also been asked to send resources in the form of
engines and two DC-7s. Oregon is sending the DC-7s, Zigaris said.

After the press conference, Schwarzenegger toured the charred remains of
Malibu Presbyterian Church, which was destroyed Sunday.

He was joined by Baca, Yaroslavsky, Assemblywoman Julia Brownley,
(D-Malibu), Malibu Mayor Pamela Conley Ulich and Grijalva.

As the governor walked among the ruins surveying the destruction, Grijalva
said resources in the state were not "totally drawn down."

Equipment and personnel from Northern California were on the way down to
help bolster the strained ranks in Southern California.

Eight out of nine helicopters, and 17 of 23 air tankers in the state
were being directed to the fires in Southern California.

"It's tragic," Schwarzenegger said of the wind-driven fires as he prepared
to leave the church. He added that "we have weather conditions that are
perfect for huge fires."

How did you rate the guv?

Here is a quick look at how Gov. Arnold Schwarzenegger’s bill signings and vetoes went in the eyes of a few interest groups. If you know of more lists out there, please send them along…

The California Chamber of Commerce asked publicly for 12 vetoes, and got 12 vetoes. Those measures, which the chamber labels “job killers,” included bills to require all employers to provide health insurance or else pay a fee of 7.5 percent of payroll; put “green building” standards into law; force employers to pay striking employees during a lock-out; end the right to a secret ballot for farm workers deciding whether to unionize; double permanent disability payments to injured workers; and put a new version of the governor’s low-carbon fuel standard into state law.

StopHiddenTaxes.org, a project of the California Taxpayers Association, targeted seven bills for veto, and the governor vetoed five of them and signed two. The two he signed will levy or increase fees to redact Social Security numbers from public county records and subsidize the installation of solar water heaters.

Sierra Club California listed 25 “top environmental bills” and asked Schwarzenegger to sign 24 of them and veto one. He signed 18 of the 24, and also signed the one bill the club asked him to veto. Among the bills he signed that the Sierra Club supported were measures to improve flood control in the Central Valley; strengthen enforcement of diesel emission control rules for off-road vehicles; prohibit the use of the phthalate chemicals in toys and childcare products; create a $250 million program to encourage the installation of solar water heaters; and require the state to develop a comprehensive strategy to increase the energy efficiency and reduce the pollution associated with current lighting technology. The one bill the Sierra Club asked him to veto but which he signed will make it easier for utilities to use hydro-electric power to get credit toward renewable energy requirements.

Equality California listed 8 gay rights bills that the group wanted the governor to sign. He vetoed AB 43 – which would have allowed same-sex marriage in California. But he signed the seven other bills sponsored by the group. Those bills were aimed at ending discrimination against gays and transgender individuals in government and schools and broadening the rights of domestic partners by making it easier for them to change their names when they form a union and file joint tax returns.

FlashReport.org, a conservative blog, listed what it called the 19 “worst” bills of the year from a conservative perspective and asked the governor to veto all of them. He vetoed 8 and signed 11. Among those he signed were two flood control bills, a measure to require increased water efficiency in toilet design, a bill to ban smoking in cars with kids, two gay rights bills, and two to regulate the design of ammunition and firearms in California. He also vetoed three other bills the group opposed but did not include in its list because Schwarzenegger had previously announced he would veto them.

Núñez on health care

Assembly Speaker Núñez had a press conference today at which he talked in detail about the chances for a compromise with the governor on health care. Among the the demands he said he still had:

-- He said he could support a sliding scale for the fee that employers would have to pay if they didn't provide health care for their workers, but he said that scale would have to slide at least up to the 7.5 percent that he required of all employers in his bill, AB 8. In the governor's plan, the fee slides from 1 percent to 4 percent depending on the size of the employer. Nunez said emphatically that he would not split the difference with the governor between Schwarzengger's 4 percent and his 7.5 percent.

-- He wants the employer fee to be "indexed" to health care inflation, so if health costs climb faster than wages, the employee fee would climb automatically to close the gap.

-- He said Schwarzenegger's proposed cap on premiums at 5 percent of an individual's income for those earning up to 350 percent of poverty was nice, but Núñez wants a cap of 5 percent of income on all health care costs, including not just premiums but deductibles, co-pays, drug costs and anything else that might come up.

-- He still opposes an individual mandate, but might support one if the subsidies covered people earning up to 450 percent of poverty, or more than $90,000 for a family of four. And it would have to include exemptions for people who, for whatever reason, still could not afford insurance.

-- He wants the state to buy drugs in bulk from the manufacturers and use its clout to demand discounts, which would be passed on to consumers.

If Núñez is serious about all this, it's very unlikely that there is going to be a deal. He said he really does not feel he should compromise further because his bill, AB 8, already represents a compromise between the governor's approach and single payer.

"Democrats support single payer," he said. "We want everybody to have health care as a right, not a privilege."

Maybe he will sign AB 8

At the rate he is going, anyway.

In this item I said it was "almost certain" that Schwarzenegger would veto more than half the 20 bills FlashReport.org flagged as the 20 "worst" sent to the governor's desk this fall, from a conservative perspective. And I predicted that he would more likely veto at least 15 of them.

Well, so far I am batting below the infamous "Mendoza" line, the slur named for a light-hitting shortstop and pasted on any major leaguer whose average is less than .200, or 20 percent, for the season. Of the first six bills from the FlashReport list on which Schwarzenegger has acted, he has signed five of them.

Two of those were flood control bills that I figured he would sign. But I didn't see him banning smoking in cars with kids, requiring even lower-flow toilets or adopting stricter regulations on new light bulbs. Go figure.

At any rate, there are still a handful of bills on the list that I thought he might sign, and probably a few more surprises to come, so his chances of hitting 15 vetoes appear to be dim. Almost as dim as I was, apparently, for making such a prediction.

Meanwhile, I don't think Schwarzenegger has acted yet on any of the 12 "job killer" bills that the Chamber of Commerce has recommended he veto. The chamber usually has a better record with the governor than the more ideological conservative activists whose views FlashReport reflects. But I'm not making any more predictions.

Kids in cars

The governor has signed SB 7, which will prohibit smoking in vehicles carrying a minor. And he has vetoed AB 881, which would have required parents to keep kids in car seats until they were 8 years old unless they met state-approved height and weight standards.

Both are tough bills, because they are "nanny" state bills but bills involving children, who actually need nannies.

SB 7, banning smoking in cars carrying a minor, seems to make sense, especially if you can't stand cigarette smoke or the idea of subjecting kids to it in a confined space. But it also begs the question: if not in car, how about in a one-bedroom apartment, or an office, or any other confined space? You have to wonder where the state will draw the line. And where it should draw the line.

AB 881, the car-seat bill, is probably an easier call, because the law already requires kids up to age 6 to be in special restraints. In his veto message, Schwarzenegger said it would be better to educate parents about obeying the laws we already have rather than passing new laws requiring more children to be in car seats.

For those of you keeping track at home, both of these bills were on the FlashReport.org conservative Web site's list of the 20 "worst bills" that they wanted the governor to veto. So far he has acted on four of the bills, signing 3 and vetoing only one. But remember, governors tend to sign bills in the light of day to reap the most credit, and veto bills late at night or in huge bunches at the end of the bill-signing period.

I still think his final score on these 20 bills is going to be much closer to 3-to-1 against than 3-to-1 in favor.

Governor signs flood bills

The governor signed SB 5 and AB 162 today, the first of the 20 bills on FlashReport's list of the "20 worst bills" that they think the governor should veto. I guess they are 0-for-2. But these are the two bills I thought he was most likely to sign, so they shouldn't fret too much. There's still hope for the rest of their list!

These two bills are flood control measures that the conservative FlashReport says would take local land use authority away under the guise of flood protection. But flood protection, and floods, are regional issues, not just local ones. And a flood of New Orleans proportions, which is certainly possible in the Central Valley, would be a statewide and national problem as the taxpayers are asked, and pressured, to bail out the victims. Doesn't it make more sense to try to prevent some of that damage from happening in the first place?

The ideal solution might be to repeal the federal flood insurance program so that people who build and buy in floodplains have to recognize the risk they are taking upfront. But since that's not going to happen, measures like these are the next best alternative.

The right to build

Virginia Postrel has a short but illuminating piece in The Atlantic about the effect of real estate, and real estate regulation, in sorting Americans into red and blue states.

'Mandatory private (or public) insurance'

PatientRevolt.org, an offshoot of the left-wing Foundation for Taxpayer and Consumer Rights, is raising money to try to air this comercial in the Sacramento market as a shot across the bow at policymakers trying to come up with a consensus health reform plan. If nothing else it shows one potential strategy for bringing down a ballot measure if one is put before the voters. The theme: "mandatory private health insurance" -- the individual mandate that the governor, centrist think tanks and some Democrats, including Hillary Clinton and Oregon Sen. Ron Wyden, support.

It's interesting that "mandatory private health insurance" is considered evil while "mandatory public health insurance" is supposed to be our savior. This particular ad also mentions that we would all be required to buy insurance while the insurers wouldn't be required to cap its costs. Isn't the same true for single payer? In fact, the projected, first-year costs for the Democratic leadership plan and Sheila Kuehl's single payer plan are about the same: The leadership plan envisions a 7.5 percent payroll tax on employers and premiums on individuals capped at 5 percent. The Kuehl plan would have an 8 percent tax on employers and a 4 percent tax on individuals. The biggest difference between the two is that under the leadership plan, the managers of a government-run risk pool would bargain with multiple insurance companies to get the best price on plans that everyone would choose from. Under Kuehl's plan, at least the way she envisions it, the government managers would cut the insurance companies out of the process and set prices for individual doctors, hospitals and labs and pay them for treating us. Either way, though, the taxes and the coverage are "mandatory."

Understanding post-partisanship

This op-ed by Tony Quinn is a good summary of Schwarzenegger's policy victories and failures over the past year or so, but I think it perpetuates a common misunderstanding of what the governor is trying to do. Under the headline, "Post-partisanship fails," Quinn says Schwarzenegger has failed because the Republicans in the Legislature don't like his policies. The only way for the governor accomplishes anything, then, is to give the Democrats what they want.

I have a slightly different take, which forms the basis for my book, "Party of One," to be published in January.

The central theme of my book is that to assess Schwarzenegger's performance, you have to go beyond the views of the 63 Republicans who serve in the Legislature, and a few hundred or thousand who work for the party behind the scenes. Unlike those folks, millions of Republican voters actually seem to agree with Schwarzenegger's policies, on everything from the environment to health care, infrastructure, crime, education, even social issues like gay rights. They give him high marks for his performance and voted for him in greater numbers than they did for the last two, very conservative Republican nominees for governor.

Sure, Schwarzenegger would love to get Republican votes in the Legislature for his proposals. And on things like the budget and the infrastructure bonds, when he absolutely needed their votes, he got them. But he also knows that since his views are closer to the mainstream than theirs, he can work with the Democrats to craft compromises that he can live with and which he thinks the voters will support.

That is what he is doing right now on health care, for example, pushing for an individual mandate that Democratic lawmakers oppose and a plan with a more modest burden on employers than the Democrats have proposed. Republican lawmakers hate the whole thing. That is their perogative. But there are signs that Republican voters might actually like it. Why should Schwarzenegger limit his policy options to what the Legislature will approve if he thinks there is a chance of getting something better some other way? If he gets something on the ballot and the voters reject it, that would be a failure. But Republicans support in the Legislature is not necessarily a good predictor of which way the state's voters will go.

On the environment, Republican lawmakers hated AB 32, but Schwarzenegger crafted a middle ground that had ambitious goals for limiting greenhouse gases while preserving a role for market forces. That's a provision that Democratic lawmakers have been bitterly complaining about almost since the day they claimed that they had hosed the governor in the negotations.

On prisons, Schwarzenegger fought for new cells (a Republican position), even though Democrats said they didn't want to build any more. The result was a compromise that included new beds and a new commitment to rehabilitation and parole reform.

On gay rights, while a Democrat would have signed a gay marraige bill by now, Schwarzenegger has consistently said that he respects the will of the voters in banning it, and the only way to change that is for a court to strike down the ban or for the voters to reverse themselves. Yet he has signed almost every bill sent to his desk to expand the rights of gay couples in domestic partnerships. Again, pretty consistent with the mainstream of the California electorate, and probably even the Republican Party. Go ask 10 Republicans on the street if the state should legalize gay marriage and six or seven might say no. But ask those same 10 if they think gay couples in civil unions should have the same rights as heterosexuals, and the numbers will be the complete reverse.

Next year, when education policy rises again to the top of the agenda, expect Schwarzenegger to focus on accountability and closing the achievement gap, local control and flexibility, rather than simply pouring more money into the system.

All of this is pretty consistent with where regular Republican voters are, even if it almost always fails to satisfy the handful of Republicans who serve in the Legislature.

Schwarzenegger has made plenty of mistakes, and he has some failures on his record. But post-partisanship should be judged by the final policy results, however achieved, not by the number of Republican votes in the Legislature for a particular proposal.

No loophole left behind

I have never been a big fan of "No Child Left Behind." California was actually doing pretty well on its road to reform before the feds intervened. This piece by Chester Finn in the WSJ suggests that many states are dumbing down their standards to meet the program's otherwise unatainable goals.

Erecting a fence without a license?

California licenses 177 occupations, more than any other state in the nation. Adam Summers takes a look at why that matters.

California spending on schools

California ranks 34th in the nation in spending per K-12 pupil and 34th in education spending as a percentage of personal income, while the state is 48th in the number of pupils per K-12 teacher, according to this new policy brief from the California Budget Project.

The manipulation of carbon

This rather technical piece in The Economist has some intriguing stuff about some California companies that are on the cutting edge of biofuels research, the parallels between drug and energy research, and the future, or lack thereof, of ethanol.

Wal-Mart's market woes

I think this WSJ piece on Wal-Mart probably downplays the effect of the political opposition campaign on the company's expansion plans. But its main point, that the giant retailer is struggling against market forces favoring better service, higher quality, cleaner stores, and more convenience, is worth noting. In some ways Wal-Mart appears to be a victim of the nation's economic success: as people move up the economic ladder, they no longer value "everyday low prices" as much as they used to.

Rec center sued by disabled rights activist closes doors

Basketball Town, the 50,000-square feet recreational facility in Rancho Cordova, has shut its doors, blaming the closure on the cost of fighting a disabled rights suit filed by a patron who couldn't get access to an upstairs birthday party. Here is an earlier story about the dispute.