The core feature of Gov. Jerry Brown's proposed budget is that it delivers cuts in a framework of austerity, rather than development within short-term constraints. It continues the Hooverite smothering of California society that was Arnold Schwarzenegger's main achievement. The backlash has been relatively muted because some supporters' hope that Brown's massive cuts to key sectors like health and higher education is just reverse psychology - that it will scare people, even in the midst of still-accelerating foreclosures and unemployment far higher than the national average, to vote to raise taxes on themselves. Whether or not Brown's cuts are sincere doesn't actually matter: either way, they are disastrous fiscal and political strategy, for they hurt society, the economy, and Democrats at the same time. Austerity, whether for budget balancing or for promoting a backlash, never works to advance the only successful agenda the Democrats ever had in the 20th century -- development for the whole society rooted in a vision of government as a creative power.
Brown is one of the original Austerity Democrats of the 1970s, coined the term "the age of limits" as a progressive mantra, and was more conservative with state spending than Ronald Reagan had been. He was a New Democrat before Bill Clinton, and his post-McGovern generation inadvertently helped pass tax revolt legislation like Proposition 13 by no longer telling voters about the enormous benefits of public infrastructure and cheap, efficient, public goods that they got by paying taxes. Since 1978, every prospect of government-led social progress has been readily misframed as a probably unaffordable budgetary cost of dubious efficiency, and Democrats have largely accepted this premise. Brown's first budget proposal continued this tradition, rather than expressing the desire to rebuild for which so many had hoped.
Brown has made a huge substantive mistake by continuing Schwarzenegger's savage cuts in health, human services, and higher education: these cuts make the social infrastructure less effective, which makes present and future society more mediocre.
But Brown's proposed budget has two further flaws. One is political. The claim of Austerity Democrats is, "we cut now so that we can rebuild later." But while austerity rhetoric helps leading practitioners like Brown, Bill Clinton and Barack Obama win elections, it never helps them govern. Governing requires delivering programs that address real needs, from food and water testing to an affordable court system, occupational safety enforcement, police protection, and job retraining. Fiscal austerity prevents government from being a clear, positive value in people's lives, and Republicans have hamstrung governments for thirty years to their great political benefit. Without a developmental program for government, and the capacity to deliver, Democrats become dependent on incompetent or extremist Republican opposition for further victories. An example is that Bill Clinton, after the Republican landslide in 1994, won in 1996 in large part because he was running early in the Internet bubble against an unconvincing Bob Dole.
In other words, there are no second acts in austerity politics. There are the cuts, and then nasty battles with Republicans to reverse the cuts in part, but no real advances in health, education, or human services that justify taxpaying in the first place. The destruction of Obama's stimulus - its conversion into a mechanism merely for reducing cuts - is a recent case in point. Each time this happens, the Democratic agenda looks that much more ineffective in delivering real solutions to people's problems. Democratic victory become that much more dependent on offering a less offensive and destructive version of minimal government than that proposed by toxic and/or incoherent Republicans.
The third flaw in Brown's budget is the absence of any kind positive future agenda for the state. Democrats should be creating budgets that support innovation and social development. Even if little of a Brown development agenda could be funded this year or next, the vision needs to be front-and-center as a concrete goal to pressure compromises away from the devolutionary shrinking long delivered by the Right.
Democratic budgets need to spread awareness of the fact that while other countries have been moving forward, the U.S., paralyzed by backward political arguments, has been standing still. Democratic budgets should always be "counter-cyclical," stimulating consumption and employment in the short run and new forms of sustainable production in the medium run. Democratic budgets need to focus on the effects of the public sector on overall employee productivity: is that helped or in fact continuously harmed by cuts? Governor Brown knows that when you are in a deficit hole you should stop digging. But his budget offers no vision of what Californians should do instead. The continued one-way cutting in fact blocks the state's ability to develop this vision.
As a result of this continuing Democratic default, politicians of both parties govern on the basis of an antisocial premise that cripples government. This premise was recently expressed by California Republican State Senator Bob Huff on the Patt Morrison show.
I'm not pro corporate. I'm pro jobs. It's the corporations and the small businesses that create jobs. Public employees don't create jobs. It takes about 25 to 27 private sector jobs to support one public sector job. So I believe we should be scaling back the scope of government.
Well of course if it takes only one government worker to hold back 25 private sector ones, who wants government? When Democrats focus year after year on cutting back, it seems that they too believe that the private sector creates while the public sector sponges off of it. But this belief stands reality on its head. Corporations don't only pay taxes into the public sector but also receive various kinds of subsidies from it. They are also as likely to kill jobs as create them. By regularly boosting profits while either not hiring or repeating the mass layoffs that have become part of the national landscape, they often now put themselves at odds with the surrounding society. On the other hand, governments create jobs by, well, hiring people, and more deeply by creating the infrastructure and performing common services that make private-sector employment possible. Government employees produce services in exactly the same way that private sector workers do. They have a much broader and less profitable "market" than does the private sector - the whole society - and they produce common goods like roads and parks that the private sector simply will not produce.
A Democratic governor who cannot articulate the creative powers of the public sector will both fail politically and intensify the decline of the California economy. In Part II, I'll show how the three flaws in Brown's budget - immediate social damage that undermines the future while hurting Brown politically -- are converging to wreck California higher education.