Thursday, February 4, 2010

Crazy Like A Sheep

Somebody flipped the "crazy" switch on California politics this week.
And you thought Massachusetts was interesting?
I can't remember the last time I laughed out loud while watching a campaign commercial. But Carly Fiorina, the former Hewlett Packard CEO who's running for U.S. Senate in California, has produced the most unintentionally hysterical attack ad in recent history - maybe ever.
If you haven't seen the Demon Sheep yet, click here.
For months, Fiorina has been ignoring her Republican primary opponent, conservative Orange County Assemblyman Chuck DeVore, and focusing her fire on the Democratic incumbent, the always-vulnerable liberal lightning rod, Senator Barbara Boxer. But then Tom Campbell quit the race for governor and jumped into the Senate primary instead. Now Fiorina has a fight on her hands. Polls show Campbell has leapfrogged her among Republican voters, and the nomination is no longer hers for the taking (I'm not sure it ever really was, actually).
So how does Fiorina respond?
With this bizarre and extraordinary hit piece - which looks like either a Saturday Night Live spoof, a Monty Python outtake, or a Future Farmers of America video gone awry.
It comes complete with dramatic voiceover, sheep falling off pedestals, random barnyard animals skulking behind tax policy headlines and, best of all, a Fiorina staffer or some unfortunate actor wearing a sheep costume, bright red devil eyes and sensible shoes, crawling through a pasture pretending to be Tom Campbell. The "conservatives we admire" seem to be represented by cute, docile sheep, while Campbell's evil sheep might as well be named Damien.
Fiorina's point is that the ex-Congressman, ex-Berkeley Dean, ex-Schwarzenegger Finance Director is an "FCINO" (that's a new one on me), which stands for "Fiscal Conservative in Name Only."
Thank goodness she didn't slap him with the more traditional RINO label, or someone would have had to crawl around in a field full of rhinos.
Fiorina's campaign is certainly generating buzz with this web-only, more-than-three-minute spot - but maybe not the buzz she was looking for. Is that buzz the sound of wool shears?

The Fiorina camp isn't the only one going a little animal crackers this week. The California Democratic Party has launched a new website poking fun at her, called "Carly Failorina.com." The idea is to lampoon the Silicon Valley washout with tales of her business world failures. Except the website builds its premise on what a bad governor Fiorina would be - when she's running for the Senate. It took a few hours but the Dems have corrected their editing mistake.

On the campaign trail, Fiorina likes to deflect our questions about her stormy tenure at HP (when we're allowed to ask any) by pointing out how the company has rebounded, and claiming that she laid the groundwork for HP's current success. But the latest campaign finance disclosures show that her former colleagues don't seem to agree with her assessment. Hewlett Packard has given the maximum possible donation to the Boxer campaign - and many HP executives have made sizable donations to the Democrat too. There's only one Fiorina contribution listed from an HP employee - and it's for a measly 250 bucks.

And finally, there's the bizarre flap between the two remaining Republican candidates for Governor - state Insurance Commissioner Steve Poizner and former eBay CEO Meg Whitman. Whitman campaign strategist Mike Murphy made the mistake of emailing a Poizner staffer with the pointed suggestion that Poizner drop out of the race, since Whitman is creaming him in the polls despite all the money Poizner, yet another candidate who got rich in Silicon Valley, is pouring into his sputtering campaign. "We can spend $40 million+ tearing up Steve if we must," Murphy warned.
Poizner responded by going public with the email, accusing Whitman's camp of extortion, and referring the whole matter to the FBI. To which Murphy responded, "I'm starting to worry about the Commissioner's mental condition."
It's not likely anything will come of the "investigation" into Murphy's threats - but it's certainly made the otherwise sleepy race for the Republican nomination a little more interesting to watch. We're supposed to be doing a debate between these two this spring - I can't wait for that one.

That sound you hear in the background isn't demon sheep baahing - it's Democratic candidates Jerry Brown and Barbara Boxer cackling with glee. Whatever momentum California Republicans thought they'd gained from Scott Brown's Massachusetts Miracle has temporarily dissipated in a flurry of wild and woolly intramural attacks, that reveal how fractured the GOP remains between its moderate and conservative wings, and demonstrate how tough it will be to knock the Democrats off their power pedestal. They won't go like lambs to the slaughter.

UPDATE: Just got off the phone with the Fiorina campaign. Deputy Campaign Director Julie Soderlund says the skulking demon sheep is actually "stock footage" (could it be stockyard footage?) from some past campaign, so no one knows who's actually playing the Campbell-in-sheep's clothing. Their ad guy dug that up from his archives. They can't say when it was shot, or for whose campaign. If anyone remembers that image from an old ad, let us know! She also insists the spot is not "unintentionally" hilarious. She says it was designed to be "funny and edgy and shocking" and to get people blogging about it. Mission accomplished.

Sunday, January 31, 2010

Married To It

I just spent two and a half weeks covering the federal trial in San Francisco on the constitutionality of California's Proposition 8, which outlawed same-sex marriage. It was pretty exhausting stuff, given that it entailed eight hours in court, live reports on the radio almost every hour, and then another three or four hours of post-court news production each day. In fact, it has rendered me speechless: I have come down with a nasty cold that has robbed me of my voice. I sound like Don Corleone in "The Godfather." I am the Hoarse Whisperer. My only reporting recourse is to speak through my blog.

The trial was fascinating, maybe even historic. Time will tell. Here are some random observations and moments from the proceedings, that, in most cases, didn't make it onto the radio:

There were 23 lawyers in court each day, sometimes even more. The plaintiffs had a dazzling array of high-priced, high-powered lawyers with glittering resumes. The superstars, David Boies and Theodore Olson, were not working pro bono, as some assumed. They did reduce their rates, but they didn't take this case for free. The organization that brought the suit, the American Foundation for Equal Rights, raised millions of dollars to pay for it, from deep-pocketed donors like Rob Reiner, Steve Bing and David Geffen. Reiner came to court several times to observe the proceedings.

The other side had one powerhouse attorney, Chuck Cooper, and a phalanx of lesser associates, not all of whom seemed up to the task, quite frankly. They complained of being outgunned, and on some days, they were.

The lead attorney for Protect Marriage, the group that wrote Proposition 8 and put it on the ballot, is Andy Pugno. He didn't actually argue the case this time around, but he was the daily mouthpiece for the defendants. He's running for State Assembly in a Republican district in Sacramento this year. One of the defense arguments was that gays and lesbians have ample political clout in California and don't need judicial protection. Pugno better hope they're not as powerful as he made them out to be, because gay groups will be mobilizing to try to defeat him at the polls.

There was simmering tension between the two sides in court, and on long days, when folks were tired, there was some occasional sniping and snapping. But they also worked together in the spin room. Twice a day, attorneys for each side, and occasionally witnesses, would hold news conferences in the media center. First, the Protect Marriage team would slap its "Yes on 8" placard on the podium; then the American Foundation people would replace it with their sign. They stored them inside the podium, stuck to the wood with duct tape.

Funniest moment of the trial: In the middle of his lengthy, often painful crossexamination of defense expert David Blankenhorn, a staunch supporter of traditional marriage, plaintiffs' attorney Boies was ready to move from Blankenhorn's definition of marriage as a union of opposites to his contention that marriage is, by definition, a sexual relationship. "Now let's see if we can make sex boring," Boies quipped. To which Blankenhorn responded innocently, "Perhaps we can do that together." Everyone, including the judge and the authors of Proposition 8, laughed, long and hard. "No insinuations!" protested Blankenhorn, but it was too late.

District Judge Charles Breyer, who was instrumental in establishing the new media room at the federal courthouse, came down one day to check on us. Pleasant and amiable, he asked why I was always doing live shots on the phone and tweeting from the lobby, instead of from the media room. I told him the cell signal is shaky in there. Here's hoping he does something about it. He's not the chief judge, but his brother Steven IS on the U.S. Supreme Court, so he has a little weight to throw around.

Only one protester ever made it into the courtroom. He was carrying a Bible, and when he took a seat in one of the rows reserved for counsel, and started talking to the lawyers, he was admonished by the federal marshals. Then he started yelling "return the family to Jesus" and was dragged out of the courtroom and kicked out of the building. The next day, he came back. This time, they didn't let him in. He was stopped at the building's north entrance, and when he made a fuss, five Federal Protective Police officers swooped in. One put him in a hammerlock, another yanked his hands behind his back and cuffed him. He was wearing a Pittsburgh Steelers jersey and shorts on a wet, raw day. They confiscated his Bible but returned it to him after they booked, cited and released him.

Arnold Schwarzenegger tried so hard to stay out of the gay marriage debate. Twice, the state legislature legalized same sex marriage, and twice, the Governator vetoed it, saying it was a question for the voters or the courts, not the legislature. So the people finally voted, and then the courts got involved. That forced Schwarzenegger's hand, and he finally took a stand, opting not to defend the law. And now, if this lawsuit succeeds, he will go down in history as the "Wade" of same sex marriage - with Perry v. Schwarzenegger as the Roe v. Wade of gay rights, indelibly linking his name with the issue he had sidestepped for six years.

David Boies lived up to his reputation as a master cross-examiner. He grilled Proposition 8 proponent Dr. William Tam to a fine crisp. I thought maybe I should check for grill marks as Tam left the courtroom. I asked Boies if he had enjoyed himself, and he purred, "Ooh, that was fun. A good day, a good day. This is why I took the case. This is why I do this."

The defense carped about Judge Walker from the outset. He consistently ruled against them, in pre-trial motions and during the trial itself, and they seemed to think the deck was stacked in the plaintiffs' favor. But His Honor took great pains to appear even-handed, and, at the end of the trial, took the unusual step of coming down from the bench and shaking hands all around. He thanked and congratulated all the attorneys, said the youngest among them did a particularly fine job (I didn't necessarily agree), and said the "old hands" should be proud of how they've mentored the young'uns. The lawyers lined up and shook hands and traded pleasantries with the judge. It looked like the end of a hockey game. I kept waiting for the beefy Pugno to bodycheck Boies.

The plaintiffs, including AFER founder Chad Griffin and a gay couple from Burbank, celebrated gleefully the day the Supreme Court overturned campaign finance restrictions on corporations. Not because they agree with the decision - but because it was yet another 5-4 high court victory for their co-lead counsel, Ted Olson. "Do you really agree with this ruling?" I asked them. "It doesn't matter," one answered. "Boy, did we hire the right lawyer!"

And that's where they're resting their hopes. It's always risky to predict judicial outcomes based on what happens at trial (or even in an appellate hearing), but this was as one-sided a case as I've ever covered. The plaintiffs called 17 witnesses, the defense only two. The plaintiffs presented ten days of evidence to the defendants' two. The defense experts were eviscerated by Boies, and made as many salient points for the plaintiffs' argument as they did for their own side. Ultimately, though, this trial comes down to whether Chief District Judge Vaughn Walker thinks it was fair and reasonable for California voters to ban same sex marriage or not. If he was convinced by the plaintiffs that Proposition 8 doesn't meet the "strict scrutiny" test - in other words, the state doesn't have a compelling interest to keep same sex couples from marrying, and the law took away a fundamental right from a class of people who merit protection - he will declare the law unconstitutional. If he was persuaded by the defendants that there's a legitimate, rational basis for the measure, then he won't. But whatever he decides, the loser will appeal to the Ninth Circuit U.S. Court of Appeals in San Francisco, and the loser there will almost certainly seek relief from the U.S. Supreme Court.

That case will likely come up in 2012 or so (perhaps late 2011), smack dab in the middle of the next presidential campaign (which will be red meat for the Republicans and not good for Barack Obama). Justice Stevens, and perhaps Justice Ginsburg, will have been replaced by then by younger liberals. Assuming no changes in the conservative wing of the court, it's hard to imagine anything than another 5-4 vote in an Olson-argued case - but this time, to his detriment, to uphold Proposition 8. The plaintiffs are banking on Olson's conservative credentials (he was Solicitor General for President George W. Bush and beat Boies to win the landmark Bush v. Gore case that put W in the Oval Office) and his unparalleled won-lost record at the Supreme Court (he's now 45-12; no living lawyer has won or even argued that many Supreme Court cases) to carry the day when this case reaches Washington. They believe Olson will be able to sway swing-voting Justice Kennedy, and perhaps even Justice Scalia or Chief Justice Roberts, to produce a 5-4 or 6-3 vote in their favor.

But that's a long way off. Maybe this was all a big waste of time and money, a political publicity stunt with a preordained outcome. We'll be back in court for closing arguments sometime in March or April, and then a ruling from Judge Walker, maybe in May. And then we'll see where it goes from there.

I'd hate to think I lost my voice for nothing.

Tuesday, January 26, 2010

The Scott Heard Round the World

Cambridge, Mass.

I'm writing this while on a long weekend trip to Boston. Forlorn Martha Coakley signs poke sadly through the snow on the frozen white lawns of Cambridge. From what I gather here, they seem to have been the extent of her U.S. Senate campaign. Stunned Democrats still wander about in a glum daze, wondering how in the world their five-decade liberal lion Senator, the champion of national health, is being replaced by a conservative Cosmo centerfold. And not just any conservative, but one whose raison d'etre in the Senate will be to kill the very bill for which Ted Kennedy fought so long, the one he died thinking would finally become reality.

That irony is not lost on the majority of Bostonians who voted for Coakley, only to see her swamped by the Tea Party-fueled insurgency of one Scott Brown, a Republican State Senator from Wrentham whose previous claim to fame was fathering Ayla Brown, an American Idol finalist a few years back (I thought she was a cute, pleasant lightweight, but as I recall, her undoing was her poor choice of the Natasha Bedingfield song "Unwritten," not the thinness of her voice. But this isn't an Idol blog, is it? So sorry).

There is much teeth-gnashing and hand-wringing among Bay State Democrats. But just as at Concord, 235 years ago and maybe 25 miles from here, this revolutionary moment reverberates far beyond the borders of the Commonwealth.

The Democratic majority, not to mention the president's agenda, is in deep peril. Losing the gubernatorial races in Virginia and New Jersey was one thing, but fumbling away the special election to replace Senator Kennedy, and with it, the party's 60-vote supermajority, is quite another.

By most accounts, Coakley ran a lazy, arrogant campaign. The White House saw the warning signs way too late. Scott Brown went door-to-door and diner-to-diner, capitalizing on voter anger over lost jobs, bank bailouts, mounting national debt and a still-sputtering economy. He may only serve two years in the Senate (he must run again when Kennedy's term expires in 2012), but that could be long enough to scuttle health care reform and block Obama's judicial appointees.

President Obama seems to have gotten the wake-up call. Early word is he will come out swinging in his State of the Union speech, and he's already retooling for the midterm elections, trying to reclaim the populist mantle himself. Perhaps this Massachusetts loss will be the kick in the pants he, and the Democratic leadership, need. Many progressives here think Obama's been too timid in his first year - too quick to placate Republicans in the name of bipartisanship, and too slow to pursue the real change so many Americans thought they were voting for in November 2008.

The historic nature of his majority seems to have been lost on Obama. He's a Democratic president, with an astounding 79-seat edge in the House of Representatives and the largest Senate majority in a generation. Not since the post-Watergate campaign of 1976, when Jimmy Carter took the presidency with a 61-38 margin in the Senate (there was one independent), have the Democrats enjoyed this kind of power. Carter squandered it. Obama is in serious jeopardy of doing the same.

Just one year into the Obama presidency, the Carter comparisons are already apt. George W. Bush barely won the office, twice (and really only once), and had the barest of Congressional majorities, but still rammed the Republican agenda through with a Damn the Democrats, Full Speed Ahead attitude. Perhaps it's time for Obama to abandon the genteel, don't-rock-the-boat demeanor of recent vintage Democrats and do some serious, bare knuckle brawling. I'm all for postpartisanship and changing the tone, but it's clear the GOP has no interest at all in playing that game. The Republican Party went all in on stopping Obama, no matter what, even if he discovers the cure for cancer and wants to give it out for free, and their nothing-to-lose obstructionism is paying off beyond Michael Steele's wildest dreams. Can you imagine if the Republican Party had the kind of power the Democrats have (or had, until last week's election here)? There would be no political pussyfooting, trust me.

We all know the kind of change Obama promised takes time. Fixing an economy that's this broken, winning two wars and passing an ambitious domestic agenda doesn't come quickly, and it doesn't come cheap. But Obama no longer has the luxury of time. It's started raining here in Boston, hard, and the warmer storm is melting the frozen Charles River. The ice is cracking, the current is moving again, and it isn't moving in the Democrats' direction.

Tuesday, September 29, 2009

Here Comes Obama

Flash! Confirmed today that President Obama will pay his first post-election visit to San Francisco next month. He'll headline two fundraisers on Thursday, October 15th, both at the St. Francis Hotel. There will be your usual cocktail reception, followed by a bigger-ticket full-on dinner. The money will be split between the Democratic National Committee and Obama's own campaign apparatus, now known as Organizing for America (the successor to Obama for America).

It's possible Mr. Obama's first presidential visit here will actually happen a few days before that, because organizers of the Presidents Cup golf tournament at Harding Park still hope he'll be here for the awards ceremony on Sunday, October 11. Former Presidents Clinton and Bush the First are supposed to be here for that. It seems unlikely that President Obama would come to San Francisco on the 11th, leave for four days and then come back, but maybe that can fit into his presidential schedule somehow.

Also interesting to note that he hasn't been here yet. By this point in his presidency, Bill Clinton had already paid about four thousand visits to the Bay Area. He came to California dozens of times as president, because Clinton knew all too well that Democrats can't win the presidency without carrying California, and that the Golden State's deep pockets are the best place to find enough loose change to build a campaign war chest. Perhaps Obama is taking us for granted? I would expect him to step up the frequency of his California visits as we get closer to 2012.

Thursday, September 10, 2009

Lies, Damn Lies and Statistics

It was a stunning moment in the middle of last night's presidential address to Congress. As Barack Obama ran through the litany of untruths told by opponents of his plan to reform the nation's health care system (death panels, government-paid abortions, free medicine for illegal immigrants), Republican Congressman Joe Wilson of South Carolina shouted out "you lie!"

President Obama seemed stunned, not sure how to react. Speaker of the House Nancy Pelosi's eyes shot daggers Wilson's way. Vice President Biden and First Lady Michelle Obama shook their heads in disapproval. Democrats drowned Wilson in a chorus of boos. It sounded like a backbencher being shouted down during Question Time in Parliament. His fellow Republicans gave Wilson scolding looks, and the conservative from Columbia, SC seemed to sense immediately that he had done something wrong.

Wilson apologized later, admitting his outburst was "inappropriate and regrettable." It was also unprecedented. Never in anyone's memory had a member of Congress heckled the president during an address to a joint session. George W. Bush uttered all sorts of things that we now know to have been completely false, and not once did a liberal Democrat stand up and call him a liar, to his face, during a nationally televised speech. Can you imagine the Republican outrage if one had? The drumbeats for resignation, impeachment, maybe even public hanging for treason would have been deafening.

You can't access Wilson's House website right now - it's crashed from excessive traffic. His Twitter feed has been overwhelmed. His Democratic opponent in next year's election has reaped $100,000 in donations overnight from outraged voters. Conservative bloggers have already launched a campaign to respond in kind, seeking donations to re-elect this "great American hero."

So, was the president lying? Or was Wilson?

For the most part, the facts are with the president on this one. Some fairly quick research and interviews after the speech last night clarified what's true, and what isn't.

First off, on the issue of health care for illegal immigrants: The 1018-page House bill specifically outlaws spending federal money to provide health care for them. It couldn't be more explicit. So when the president told Congress "the reforms I'm proposing would not apply to those who are here illegally," he was telling the truth, and not, as Congressman Wilson asserted, lying.

But - and there's often a but when you're dealing with federal legislation - there is nothing in the bill that would keep illegals from buying their own health insurance, and as Republican Congressman Dan Lungren of Sacramento told me last night, House Democrats killed a GOP-sponsored amendment that would require people to show proof of citizenship to obtain government health benefits. In other words, the reform plan excludes illegal immigrants from health care coverage, but it lacks an enforcement provision to make sure they don't get it anyway. That's a sore point for the GOP, and the source of Wilson's anger.

On other points of contention, President Obama stretched the truth a bit, mostly through sins of omission.

For example, he's changed his tune slightly on whether we'll be able to keep the insurance coverage we have now, if we want to. For months, he has guaranteed that those who like their current plans can keep them. Last night, his wording was different: "Nothing in this plan will require you or your employer to change the coverage or the doctor you have."

That's true - it won't. But there's nothing to stop your employer from dumping its insurance plan, sending you out into the private market, or to a new insurance exchange, and possibly to a government-run option, if that idea survives the Congressional meat-grinder. There could be incentives in the legislation that make it more economical for companies to stop insuring their employees. The Congressional Budget Office projects that about three million workers will suffer that fate under the plan, as now written.

And what about the president's assertion that he "will not sign a plan that adds one dime to our deficits either now or in the future. Period" ? The president's first attempt at that line was interrupted by applause, so he said it twice. Both times, it wasn't 100% accurate. Well, he hasn't signed anything yet, so maybe he really means it. But it rang hollow, coming from a president who's already shown his willingness to increase the deficit at an exponential rate that would make even the Deficit King, George W. Bush, blush.

In fact, the CBO said the House bill would add more than $200 million to the deficit. But Pelosi and company dismissed that unbiased opinion, saying their bill would actually cut the red ink by $25 million. How did they reach that conclusion? They simply exempted about a quarter of a billion dollars that the bill spends on Medicare reimbursements for doctors. Even though Congress recently enacted "pay-as-you-go" legislation, requiring that all new programs be paid for, the Congressional negotiators made an exception for the reimbursements, and decided they don't have to be counted towards the total cost of the package.

Isn't that convenient? I think I'll subtract our mortgage payment from my expenses this month so that my bank statement can be printed in black ink for once.

On the hot-button issues, though, the president was telling the truth. There are no death panels in the health care bill. There is nothing in there allowing federal funding of abortions. The Hyde Amendment remains firmly in effect, and this bill does not repeal it. That won't stop his Republican opponents from saying otherwise as they try to derail reform.

The last ten minutes or so of this speech were as eloquent as any policy address you will ever hear. This wasn't an Inaugural Address; it was a nuts-and-bolts policy speech. Yet from the moment he brought up the late Ted Kennedy, Obama's rhetoric soared as movingly as ever. Singling out three iconic Republican Senators who'd worked with Kennedy on health-care issues was a particularly effective device. If you haven't read the text of Kennedy's deathbed letter to Obama about health care reform, click here. It will bring tears to your eyes.

It was a British Prime Minister, Benjamin Disraeli, who famously declared that "there are three kinds of lies: lies, damn lies and statistics" (although Mark Twain is the one who gave Disraeli's line wider circulation). We've heard more than our fair share of all three during the health care debate, and we're likely to hear many more. Last night's breach of Congressional etiquette would have felt familiar to Disraeli, but for Americans, it was much too reminiscent of last month's occasionally raucous public health care forums. Here's hoping that Congressman Wilson's outburst shocks the country back into a sober, civil discussion of a critically important issue. Sadly, as Disraeli might say, that's not bloody likely.

Wednesday, September 2, 2009

The Lieutenant Governator?

Just spent a long, late evening covering the special election in the 10th Congressional District, which sprawls across a gerrymandered swath of the East and North Bay Area. Our Lt. Governor, John Garamendi, won the Democratic nomination and Republican businessman-attorney David Harmer won the GOP nod. They'll face off in November, along with three minor-party candidates.

It's a safe seat for the Democrats, who enjoy a 47-29 registration advantage over Republicans in the district, which voted 2-1 for Barack Obama last November. And that sets up an interesting scenario for political junkies to ponder: Who will replace Garamendi as Arnold Schwarzenegger's second-in-command?

The LG is almost certain to win in November. Harmer is an attractive, sincere, thoughtful, articulate man - but he has almost no chance to snatch the seat from any Democrat, let alone someone as well-known and well-versed as Garamendi. Yes, Garamendi can be wooden on the stump - in fact, sometimes he's downright stump-like - wears his political ambitions on his sleeve (he's run for Governor HOW many times?), and flits to the nearest TV camera like a moth strapped to a light-seeking missile. But he really does know the issues better than anyone else, has tremendous experience on a wide range of public policy questions, and is a comfortable fit for the increasingly progressive district.

So it's safe to assume Mr. Garamendi goes to Washington this fall - giving Governor Schwarzenegger the opportunity to appoint his replacement. Under California law, there will be no special election to choose Garamendi's successor. Governors and Lt. Governors are elected separately in California, which is why we have a Republican in the big fancy office and a Democrat in the smaller one down the hall. But if the #2 job becomes vacant, #1 gets to fill it. Both the State Assembly and State Senate have to confirm the governor's choice, with only a simple majority required.

So whom does Arnold pick to serve the remainder of Garamendi's term, which runs through January 2011?

We have to assume he will nominate a Republican. Schwarzenegger remains one, although some in his party would say it's in name only. Under normal circumstances, legislative Democrats might be willing to confirm any reasonable choice (read: not a fire-breathing right-winger). But the circumstances aren't exactly normal, for a few reasons.

First off, we have a major statewide election next year. Might Schwarzenegger give one of the three Republicans running to succeed him a huge boost by elevating him (or her) to the Lieutenant Governorship? How about Tom Campbell, the governor's former finance director, not to mention ex-Congressman, State Senator, Stanford law professor and Cal business school dean? What about Meg Whitman, the ex-eBay CEO and frontrunning Republican gubernatorial candidate? Not likely for Whitman, although Campbell's an intriguing choice. Problem is, he may not be conservative enough to win the Republican primary, but he's moderate enough to win a general election, so Democrats probably won't want to give him any help.

What about one of the people who's already running for the number two job? Schwarzenegger could give a huge lift to Merced State Senator Jeff Denham, the leading Republican contender for lieutenant governor in 2010, who has a huge lead in money raised over the only other Republican candidate, his Senate colleague Sam Aanestad. State Senator Dean Florez heads the Democratic field, but there's no reason Schwarzenegger would pick him. But confirming Denham would damage their party's chances of beating him next year, so Democrats would probably nix that nominee.

Perhaps Schwarzenegger will find a caretaker, even a Democratic one, who would be palatable to the Democratic majority. Former Senate president pro tem Don Perata? He's running for Mayor of Oakland and recovering from prostate cancer, so he might be preoccupied. How about Willie Brown? He and the Governator had a cozy lunch last week in San Francisco, with Arnold tweeting out photos of the two and Willie gushing about their good time in his newspaper column. It would be a nice career-capper for the former San Francisco Mayor and longtime Assembly Speaker. But can you imagine the Republican outrage if Schwarzenegger actually put Willie Brown a heartbeat away from the governor's office?

The thing is though, while the vice presidency is famously not worth a bucket of warm spit, the Lieutenant Governor of California actually has some real power. He gets to chair all sorts of commissions and sit on various boards, including the Regents. One of those is the State Lands Commission, a three-member panel that consists of the LG, the State Controller and the Finance Director. Earlier this year, the commission voted 2-1 to block the Schwarzenegger-supported plan to allow new oil drilling off the Santa Barbara coast. Garamendi was the deciding vote. So if the governor replaces him with a Republican, one presumably beholden to some degree to Schwarzenegger, that vote could be reversed, and just like that, whether the legislature likes it or not, say hello to oil rigs along Tranquillon Ridge.

You can bet that will come up when the Democratic leadership goes into the governor's office tomorrow to discuss which nominees might be acceptable.

And then there's Abel Maldonado. You remember him - he's the middle-of-the-road Republican from Santa Maria, who represents another ridiculously-drawn district in the State Senate, reaching all the way up to the southern tip of the Bay Area, who broke party ranks last winter and voted with the Democrats to raise taxes to balance the budget. He desperately wants to run for statewide office. His Republican colleagues consider him a traitor, and he's not their ideological soulmate. Democrats can't wait for him to leave the Senate, because they've been salivating over his district, which they consider ripe for turning. Snatching Maldonado's seat would give them a 26-14 edge in the Senate, just one short of that elusive two-thirds majority they need to raise taxes and pass budgets.

So. Let the wheels turn. May the Machiavellian machinations begin. Increase your majority in the Senate - or risk offshore oil drilling? These are some of the weights the Democrats will have to balance as they consider whom, and whether, to confirm. Schwarzenegger may find himself handcuffed by the legislative leaders, who aren't going to want to give anyone with real ambitions a big leg up. They will almost certainly urge him to name a placeholder - maybe someone like former Controller Steve Westly, although Westly still may have future designs on running for governor again himself someday.

I'm not placing any bets, and I'm not taking any either. And I've gone on way too long, so let's call it a night! By the way, I do have lots I'd like to blog about on the health care debate, and I know I haven't been a very active blogger lately, but remember, I micro-blog on Twitter all day, so you can always follow my tweets at twitter.com/sovernnation.

Monday, July 20, 2009

A Bear Market

A few months ago, California Governor Arnold Schwarzenegger stumbled across a grizzly bear while visiting Montana. Luckily for him, it was hollow and made of bronze. But still, it was life-sized, and reminded him of the great grizzlies that once roamed his beloved Golden State, so he bought it and brought it home to Sacramento.

The governor installed his new bear smack dab in the middle of the Capitol hallway, right in front of his office. This was good news for the Highway Patrol officers who guard Schwarzenegger's lair, since the bronze grizzly replaced them as the focus of visiting tourists' snapshots. It also made a nice bollard, adding another level of security outside the governor's office. And it gave the reporters who cover the governor somewhere to rest their microphones during his occasional hallway news conferences on the state budget crisis.

Today (and we use that term loosely since this very long day has about ten minutes left in it) was the last day of California's latest budget stalemate. As we staked out what would prove to be the final Big Five meeting of the crisis, the governor's staffers brought out a press pool, something we refer to as a "mult box," because it has multiple microphone outputs for the media to plug into, thus sparing the bear the indignity of all those microphones duct-taped to its bronze back.

It occurred to me that the bear could be put to better use as California struggles to balance its books. Why not carve a slot along its spine, and turn it into a Piggy Bear? (Or would that be a Beary Bank?) Certainly all those tourists who line up in the hall hoping for a glimpse of the Governator would gladly drop a quarter or two into the bear's belly for the privilege of posing with it. We could charge the out-of-staters a buck, or maybe even five; after all, they're freeloaders anyway, getting a free tour of our Capitol and occupying valuable hall space without paying any rent, all on the California taxpayers' dime.

Once the great beast proved his worth, the state Treasurer could securitize the bear, as California likes to do with all its longterm assets. Why, we could sell Bear-er Bonds. Perhaps Bear Stearns could handle that for us. After all, they pioneered those securitized asset deals, didn't they?

Oh wait. That got them in trouble. They went belly up - as extinct as the California grizzly.

Governor Schwarzenegger and his pals in the legislature found some other ways to balance the books, ending my five-hour reverie about the bear (who is still unnamed, by the way) by coming out of their meeting to announce a Deal At Long Last to erase the state's $26 billion deficit. It isn't pretty; they plan to slash $6 billion from K-12 education, $3 billion more from higher ed, more than a billion from the prisons, more than a billion from medical care for the poor, etc. etc. The governor gets to close some state parks (but thankfully, just a few), resume oil drilling from a single rig off Santa Barbara, tighten up on fraud and abuse in welfare programs, and raid the treasuries of California's counties to the tune of $4.3 billion. All of this assumes the approval of two-thirds of each house of the state legislature, some of whom have been known to hold this sort of budget deal hostage until the appropriate legislative ransom is paid.

If the deal does go through, it should allow the state to resume selling bonds, which would mean an end to the IOUs that have brought California international embarrassment for the last three weeks. It doesn't really mean an end to the state's financial crisis, since tax revenues are still declining, and the budget is likely to fall further out of balance before the year is out (think about this: already this calendar year, the state has had to cut, borrow or manipulate more than 60 billion dollars out of its spending plan - which is more than half the state budget).

Which means we're likely to be back in that hallway at some point this fall, sprawled across the marble floor, charging our iPhones and laptops on the taxpayers' electric bill, resuming our vigil as our fearless leaders grapple with yet another shortfall, and squabble over how to close it.

At which point I say, let's open up the bear market. Name that grizzly, saw out a slot in his back and put the California Golden Bear to work.

Otherwise, we could be bearish on California for a long, long time.