"Everyone thought we were the Bad News Bears up against the New York Yankees. But we pulled it out."
-- Anne Gust Brown, referring to her husband's campaign against billionaire Meg Whitman, in her introduction of Governor-elect Jerry Brown's victory speech. Brown won in a landslide.
In the long and winding road that is Jerry Brown's life, there has been no shortage of odysseys. But with 2010 drawing to a close, and Brown confronting one of the greatest crises of governance seen in a modern state, it's worth looking at this particular one.
A year ago at the holiday parties of the smart political set, Brown was seen as the most likely next governor of California. He'd cleared the field for the Democratic nomination and his Republican rivals, though loaded with money, didn't seem all that formidable.
But early this year, the conventional wisdom changed. Billionaire Meg Whitman, making good on her promise to spend more than any other individual in the history of American politics, was inundating the airwaves. The media, mostly stiffed by Whitman herself, was hyping her megabucks consultants and staff, and every one of their tech-heavy moves, as an awesome political machine.
Moving hard to the right, as expected, to win the Republican nomination, Whitman nonetheless moved into a statistical dead heat with Brown, who had led her by nearly 30 points in the fall of 2009.
Most of the media and political community in California, always overly impressed by very big money, alternated between screaming in alarm at the rise of Whitman and exulting in her looming victory.
Brown had raised, and was continuing to raise very big money, over $37 million in all, but couldn't go toe to toe with Whitman over the fateful period between the June primary and Labor Day weekend. If he tried to, he'd lose a war of attrition against Whitman, whose campaign resources, both personal and corporate, were essentially unlimited.
With Brown choosing to ignore the hysterical chorus, keeping his powder dry in a Zen rope-a-dope strategy, Whitman's plan was to blow him away while he was off the air, building a 12 to 15-point lead that he couldn't make up after Labor Day.
But three things happened in this crucial period.
First, Brown cagily executed a series of statements and actions keeping him very much in the public eye. (As his brilliant mother Bernice told his sister Kathleen, then the state treasurer, in the early '90s, state attorney general is the best office from which to run for governor.)
Second, Whitman became overexposed. And exposed as a dishonest candidate with dishonest advertising in the plethora of consultant-driven messages she unleashed. (It's important to keep in mind that consultants, who are also vendors, don't make more money by telling a politician to do less.)
Third, Brown got by with a little help from his friends in labor. It was never as big an effort as initially advertised, ironically by an independent expenditure committee that got the most media hype but did the least. But the California Working Families group, headed by consultants Roger Salazar and Larry Grisolano, keyed a larger, in many respects makeshift, effort that nonetheless pinned important labels on Whitman.
By the time Brown started ramping things up on Labor Day weekend, he was still running even with Whitman. Her summer-long offensive had failed.
Though Brown's initial advertising required some adjustment, by the end of September, and the advent of the first debate, he had moved into a slight lead over Whitman. Then came Nicky Diaz, Whitman's longtime illegal immigrant housekeeper, unceremoniously fired last year when she asked the billionaire for help with her legal status.
Whitman already had a huge problem on illegal immigration from the primary. With a poor record on Latino hiring at eBay, Whitman had embraced comprehensive immigration reform as a means of appealing to Latino voters. But rival Steve Poizner launched a devastating, unending attack on her in the primary, forcing her to move far away from her earlier position. After the primary, she tried to pretend that hadn't happened, launching a megabucks effort to try to con Latino voters into believing she was really for them. Her hypocrisy was already beginning to backfire. Then her hypocrisy was squared by the emergence of Diaz.
With younger Democrats becoming more comfortable with Brown the more they got to know him, he had been headed for an eight point win. That turned into a landslide.
Brown beat Whitman, 54% to 41%, with a whopping 1.301 million-vote margin, in the process winning more votes than any gubernatorial candidate in American history.
Senator Barbara Boxer, who beat ex-Hewlett Packard CEO Carly Fiorina, 52% to 42%, won by 1.001 million votes. Remember when the California Senate race was supposed to be a great opportunity for a Republican takeover?
The turnout was big, too, the biggest since 1994, nearly 60%. So much for the supposedly non-existent Democratic and labor GOTV program, not to mention the vaunted Republican program, which never really materialized despite many media reports touting it.
Now Brown, the inveterately youthful veteran pol, who is much more like the ancient yet ever regenerated and mischievous Doctor in Doctor Who than the wizened wizard Gandalf of the ponderous Lord of the Rings, has a massive crisis of governance on his hands.
It's nothing he and his longtime friends and advisors hadn't expected.
When I spoke with Tom Quinn and Lucie Gikovich, two of Brown's oldest friends and advisors, the day after the election at Brown's converted warehouse headquarters in Oakland, they were in a contemplative mood. But they knew it couldn't last.
Quinn is Brown's longest standing advisor, dating back to 1969. He was Brown's campaign manager when he won his first public offices and was first elected governor in 1974, and served in his cabinet with an environmental portfolio as head of the Air Resources Board, which today is in charge of California's landmark climate change program. Now he's in the media business and, along with Anne Gust Brown, is one of the governor-elect's two most important advisors.
Gikovich was Brown's confidential secretary during his first terms governor and flew out from Washington for his election to an historic third term.
Both reminisced about Brown's first campaign headquarters, even funkier than the current one. It was at Sunset and Vine in Hollywood. The previous tenant had left behind many cans of pornographic films, which the campaign, probably wisely, decided against selling.
How was the victory in 1974 different from that of 2010? For one thing, Quinn and Gikovich agreed, they were more ambitious when they were younger (and less ambitious than the young staffers milling about). For another, the situation today is more daunting.
Their old colleague from Brown's first gubernatorial campaign, former Governor Gray Davis, agreed in a later phone conversation. He joined Brown's team after the 1974 Democratic primary. Brown had been impressed by Davis after meeting him at candidate forums, Davis having run a fruitless campaign for state treasurer against the legendary Jesse Unruh.
As Brown has conducted a semi-stealthy transition, one thing is for sure. The Era of Limits, which Brown famously/notoriously proclaimed in the '70s, has returned.
Last week he conducted his second "civic dialogue" event on the state's chronic budget crisis, this time at UCLA. Brown noted that voters are both skeptical and conflicted about government. They want to avoid reductions in services but they don't seem to want to raise taxes.
"We're in a dilemma as a society," Brown said.
The format was similar to the previous Wednesday's event in Sacramento, with Brown and a team of high-ranking experts on the stage -- including past and future state budget director Ana Matosantos, state Treasurer Bill Lockyer, and state Controller John Chiang -- laying out the dire fiscal situation, and hundreds in attendance asking questions and making statements.
The difference this time was the emphasis on education, and the fact that most of the Legislature was not in attendance. Many of those who were present serve on school boards, are parents, or work in education.
When the crowd applauded as Brown began, he warned that they might not be applauding after he unveils his first budget proposal on January 10th.
California already ranks near the bottom of the nation's states in spending per student. And the state's student-to-staff ratios are also near the bottom. The state is 49th in students per teacher, 49th in students per counselor, 47th in students per administrator, and 50th in students per librarian.
When state Treasurer Bill Lockyer, toward the end of the event, which ran over two hours in length, noted that education is the key to economic performance by recounting that just a matter of decades ago Jamaica, Nigeria, and Singapore were all on the same economic footing, Brown quipped that he has a biography of Singapore leader Lee Kuan Yew which he hasn't gotten around to reading. But he vowed that if he had Lee's authority, there would be great change in California. He was joking, of course.
Then he said that, nonetheless, when his budget comes out, anyone reading it should sit down first. And that anyone driving should make sure their seatbelt is fastened.
Noting as he did in the first event that the budget crisis began over a decade ago, Brown emphasized a search for understanding rather than blame. Brown seeks to get all the players on the same page in discussing the crisis and its solutions. If you can agree on the framework, Brown believes, solutions are much more likely. Brown also seeks to educate the public through the media. Polling shows, as I've said for quite awhile, that voters are very confused about their state government and hold many contradictory and wildly misinformed points of view.
But the news media hasn't reported many of the facts, which is a major reason why the public is ignorant. In fact, I didn't see a lot of reporting of budget realities in the stories on Brown's forum to highlight those budget realities.
"It's very hard to get any agreement if there's no consensus on what the underlying facts are," Brown noted.
Contrary to what most voters believe, as state budget director Matosantos and the others pointed out, 71.1% of the state government's general fund expenditures actually go to fund local government and its services. Only 13.3% goes to state operations. 6.7% goes to debt service, 5.3% to the state's universities, and 3.6% to public pension systems.
The state employee payroll is only $9.2 billion, not quite a third of the budget deficit, so bashing state employees is not the solution.
In any event, two-thirds of the state employee payroll is in corrections, in large part because of the prison build-up that has been so popular at the polls.
Absent permanent budget solutions, cuts, revenues, or both, large budget deficits will persist for years.
That's true even with the slow-building economic recovery. The UCLA forecast is that unemployment will drop below 11% next year; it's 12.4% now. But it's a slow-growth recovery without a new economic boom, such as greentech. We've had the bubbles, in real estate and dot-coms, and they haven't lasted.
The global recession absolutely devastated state revenues, which totally undercut Schwarzenegger's nascent reforms. And the state government responded with three budgets in a row relying heavily on short-term solutions and solutions that did not materialize. In fact, over three-quarters of the budget solutions of the past three years fall into those categories.
But the hocus-pocus of politicians is matched by the dangerous fantasies of ideologues.
California is not one of the highest tax states in America. Actually, it ranks 15th in taxes and fees compared to other states, and is less burdensome than most of its Western neighbors.
And California state government is not flooded with employees. California actually ranks fourth lowest in the nation in the ratio of state employees per 10,000 residents.
Brown is playing it close to the vest as to precisely what he will do.
Which hasn't stopped speculation.
What is certain is that there will be more cuts. There is no way around that. It's also certain that popular programs can't be salvaged with a cuts-only approach.
Perhaps some of these programs, which make up the bulk of state spending, can be devolved back to the local level, where the services are actually delivered. Perhaps their people can take responsibility for specific decisions to fund or not fund.
For California, alone among the large states in America, is in a straightjacket of governance. Part of it is due to the two-thirds requirement to raise taxes while only a majority is needed to cut or create a loophole. (These "tax expenditures" are greater than half the state budget, and are hardly examined after they are enacted.) Another part is due to the hyper-partisanship that afflicts Sacramento. Two implacable forces face off on most occasions, the anti-government faction and the ultra-government faction.
So, since the late '90s, beginning with Republican Governor Pete Wilson cutting the car tax, we've seen every bit of revenue and more used for spending or tax cuts.
And now, like Texas and most other states, California has a big budget deficit. And since state government, unlike the federal government, can't run big deficits or print money -- something that presidents from Ronald Reagan on, with the exception of Bill Clinton, have done as a matter of routine -- California has a crisis of political dysfunction.
Even though it is the world's eighth largest economy, as big as those of New York and Texas combined.
As Lockyer and Stephen Levy, director of the Center for the Continuing Study of the California Economy, point out, California's demise is more than a bit exaggerated.
Thirty years ago, general fund expenditures totaled about $7.43 for every $100 of personal income. In the 2009-10 fiscal year, that ratio was almost $2 less, at $5.52 for every $100 of personal income. In the current fiscal year, per capita general fund expenditures will total $2,246, less than the $2,289 spent 10 years ago and roughly equal to the inflation-adjusted level of 15 years ago.
From 2000 to 2009, the number of businesses per capita in California held steady, while the number dropped slightly in Texas, Arizona and Nevada.
The state's high unemployment rate, which is nonetheless lower than that of neighboring Nevada, frequently touted as the supposed beneficiary of California's demise, is due in large measure to this being "a bleak time for the construction industry. Construction spending in California declined from $100 billion in 2005 to $40 billion last year, as we went from building 200,000 new homes a year to fewer than 40,000 and the state lost more than 600,000 construction-related jobs."
Despite its problems, California has had strong economic growth over the past decade. As Levy and Lockyer point out: "From 1999 to 2009, the state's GDP rose by 27.2%. That's better growth than in the U.S. as a whole, which saw GDP growth of 20.2%, or in Texas, where GDP grew by 25.9%."
And California is getting more than half the nation's venture capital investments, more than it was getting at the beginning of the last decade.
Perhaps this more balanced perspective, recognizing that the state's government is within a few realignments and less than one percent of GDP of being flush, is why Brown seems undaunted by a daunting situation.
Last Tuesday night in Sacramento, Brown accepted the award of his late father's induction into the California Hall of Fame from Governor Arnold Schwarzenegger, who referred to Governor Pat as the "builder of modern California."
For his part, the once and future governor said that the term that most brought to mind his father is "go-getter," which Brown implicitly applied to Schwarzenegger, a quintessential go-getter whose job approval rating has moved back up from the low 20s this past summer to 32% in the latest Public Policy Institute of California poll, as well as the other Hall of Fame inductees.
Brown then told an amusing anecdote about the time he took his father to a monastery, where the former governor was thoroughly bored by the silence and meditation.
Having gone on vacation with Pat Brown, I can only imagine.
Schwarzenegger referred to the once and future governor's father as the "builder of modern California." Which indeed he was, in many respects, with the universities, highways, and water systems we still rely on today.
For his part, Jerry Brown recalled his dad as a "go-getter," whose imperative was to "just keep going, keep pushing."
"I once took him to the monastery," he recalled. "He got so bored and so restless. He did not like meditating."
It's clear now that Jerry Brown, for all his penchant for meditation and analytical thinking, is his own sort of go-getter. As we've seen with his patience in the campaign just past, he doesn't act simply to be active, as he once might have done. He acts when it's time to act.
That sense of timing will be critical as Brown moves forward. On the one hand, he confronts a very serious crisis. On the other hand, it is a ridiculous crisis. Such is life.