Pin the fail on the donkey

It seems as if California Democrats are unchallengeable now. The Republican Party is in a shambolic state, down to 29 percent of the electorate and falling, while Democrats are ascendant, occupying all statewide offices and having recently won more than two-thirds of the seats in both houses of the state Legislature, plus the California congressional delegation.

However, despite the smashing victory for Gov. Jerry Brown and the Democratic Party last November with Proposition 30—which stands as a rebuke to the anti-tax atmosphere engendered more than 30 years ago by the passage of the Proposition 13 property-tax initiative—things could still go very wrong for Democrats.

In fact, an early warning may have just arrived from heavily Democratic Los Angeles. In this month’s election, a half-cent sales-tax measure to fund cash-strapped Los Angeles city government went down big, 55 percent to 45 percent, despite backing from the Democratic city council and Mayor Antonio Villaraigosa.

Former Gov. Gray Davis has a sense of how things can go well in politics and how things can go south. He was Brown’s chief of staff for seven years during his first two terms as governor in the 1970s and early 1980s. Davis went on to win two statewide offices before winning two terms of his own as governor, only to be recalled in the midst of a budget crisis and in the aftermath of an electric-power crisis.

“Everything that goes up,” as he noted in a recent discussion, “can also come down.”

The question is: How might that happen? And how soon?

Democratic strategist David Townsend argues that the Republican Party is “too white, too right and too uptight.”

But Townsend does see a major problem on the horizon. “I think,” he says, “that someday, the pension balloon is going to come crashing down and could give a Republican a shot of riding it to the governor’s office. Short of that, the Republicans can’t get out of their own way. I think California is going to stay blue a long time.”

Republicans are sounding pretty modest these days. New California GOP chairman Jim Brulte says he is “dedicated to the nuts and bolts” of reviving his party. He promises little more than a “legitimate” candidate to run against Brown, who has made no announcement but shows every sign of going for a record fourth term as governor.

“I doubt any Dems run against the governor, but I think the GOP should be able to field a legitimate candidate,” says Aaron McLear, who was the chief spokesman for the No on 30 campaign against Brown’s 2012 revenue initiative. Prior to that, he was a Republican National Committee staffer and former Gov. Arnold Schwarzenegger’s last gubernatorial press secretary.

“The Dems will overreach,” he predicts, “and run a government that continues to serve public-employee unions at the expense of all else. The question is whether and when the GOP can take advantage of that.”

Here are five potential pitfalls for the ascendant Democrats. It might well take a combination of troubles for the Democrats to fall:

There are lots of estimates of the shortfall in public pensions. But it seems clear that there is a shortfall of $150 billion or more.

Brown signed legislation that raises the retirement age for new state employees, limits annual benefits to $132,120 and requires increased contributions from state workers who aren’t contributing half of their retirement costs. But that’s for the future. An unfunded liability remains.

McLear argues that Democrats have already done the damage to themselves.

“They already did screw it up on pensions,” he states. “Brown got rolled and agreed to far less than his initial plan, which he said was the ’minimum’ that needs [to be] done. Now that they’ve checked the box on pensions, they won’t come back to it, which means employee costs will continue to grow and crowd out welfare, higher ed, K-12, parks, transportation and all else.”

The numbers when it comes to shortfalls in retiree health care are not as daunting as the pension numbers. But they are still big.

In contrast to the pension system, which creates a fund that can generate earnings to cover expenses, the state’s retiree health-care system operates on a pay-as-you-go basis. But as State Controller John Chiang reported early this year, the state has a more than $60 billion gap over the next 30 years.

How the governing Democrats deal with this over time will prove very interesting. So far, there are few indications.

In the latest Field Poll, 57 percent of California voters say Democrats favor “too many big government projects that the state cannot afford right now.”

Democratic constituencies have many agendas, from the social-safety network to the environment and beyond. There’s always a danger in going too far.

When Davis came in as governor following 16 years of Republican governorships, he was beset by many demands from constituencies that had gone wanting. While he initially resisted much of the many wish lists he received, he did go along with quite a few things after being weakened in the electric-power crisis.

That, and Republican refusal to raise taxes, helped produce a budget crisis.

But as Davis notes now, Brown does not have quite the same scale of demands today, as Schwarzenegger was more moderate than the two Republicans, Pete Wilson and George Deukmejian, who preceded the Davis governorship.

Conversely, there is a danger in doing too little.

If nothing happens to change people’s lives for the better, cynicism can set in and Democratic-base enthusiasm can flatten.

The failure of this month’s tax-hike measure in Democratic-friendly Los Angeles was telling, proving again that voters require a serious selling job to approve new revenues, especially coming from themselves and especially when they’re suspicious about how the money’s being spent.

Los Angeles, like other cities, has a local government that is finding an increasing share of its revenue going to compensation and benefits for current public employees and retirees, while public services continue at the same level or even decline.

Two Democrats will fight it out in the May runoff for mayor; a Republican challenger finished a distant third with a measly 16 percent of the vote, so the tax-hike measure wasn’t trounced by a flood of Republicans.

Democratic prospects in L.A. aren’t hurt in this election cycle by the crunch between spending and revenues.

But in the long run, they may well be. And California as a whole is not nearly so Democratic as Los Angeles.

There is also a lot of debate about where California ranks among the states on the level of taxation. But there is little debate that that level has gone up. We did, after all, just enact Prop. 30, which places a sizable surcharge on high-income taxpayers and a quarter-cent increase in the sales tax.

The Field Poll finds that 52 percent of voters worry about “tax policies that are hurting California’s economy.” That’s a number today.

But prior to Brown’s trip east last month for the National Governors Association conference, a major Washington Post story ran with leading economists debunking conservative claims that Prop. 30 will negatively impact California’s economy.

The question is when the tax burden will have an impact beyond a few professional golfers.

Meanwhile, California is turning around. The economy has improved significantly since the depths of the great global recession.

Unemployment is still 9.8 percent. That’s two percentage points above the national rate. However, the state economy has grown a great deal over the past year.

California’s unemployment rate fell by 1.4 percentage points in 2012. That’s twice as good as the national improvement during the same time period.

But the national economic recovery is anemic, with threats all over.

The federal budget sequester has had little immediate impact, but could weigh on the economy over time. The continuing crisis of the eurozone is a worrying factor, as is economic slowdown in China.

Then there is the possibility of war, with conflict over Iran’s nuclear program always looming on the horizon. A big spike in oil prices would devastate California.

These are mega-factors that no governor or legislative leadership can affect. But as Davis pointed out, “The people in charge get the credit for good times and the blame for bad times. That’s the way it works.”

A governing party can become a ruling party.

As California moves ever closer to becoming a one-party state, the prospect of scandal becomes greater.

We’ve seen it in neighboring Mexico, where the long-ruling PRI (Institutional Revolutionary Party) finally lost power after being engulfed in scandal. (Only to win it back from the new conservative party, but that’s another story.)

And we’ve seen it in Japan, where the long-ruling Liberal Democratic Party was also engulfed in scandal and also lost power. Only to win it back in the wake of massive governmental fumbling around the 2011 earthquake, tsunami and nuclear disaster.

Although there have been a few scandals here and there, especially at the level of local government, California has been largely free of political scandal.

But if that were to change, for the party in power at the center, things could become problematic for Democrats.

Also problematic: 47 percent of California voters in the Field Poll say Brown “favors organized labor too much.”

Being seen as the creature of any one powerful constituency is never a good thing in politics. As Republicans are noting with regard to the wealthy.

Put this perception together with other problems, especially dissatisfaction with public services, and Democrats have a significant problem.

One of the main reasons Prop. 30 passed was due to voter trust in Brown, which is more than 60 percent in the latest Field Poll.

“Brown keeps the Democrats from looking out of control,” opines one leading Republican consultant who doesn’t want to offend now-dominant Democratic legislators.

It would have been difficult for a candidate less established than Brown to have withstood billionaire Republican Meg Whitman’s avalanche of spending in 2010.

While Brown has had a health scare or two—minor skin cancer and successfully treated prostate cancer—he seems good to go for another term. But then, term limits, enacted after his first governorship of the 1970s and 1980s, go into effect for him, too.

And Democrats, in a post-Brown era, will have to hope that the party is still ahead of the game.

Meanwhile, this year’s election cycle is well underway.

Brown has some very nice polling numbers from the latest Field Poll. His job approval is up to 57 percent, the highest it’s been in this go-round as governor. Only 31 percent disapprove.

And a plurality of California voters now believes the state is heading in the right direction, the highest that number has been since 2007, i.e., before the great global recession.

A big majority, 55 percent to 39 percent, likes the fact that both houses of the Legislature are now in supermajority Democratic control.

Republicans have until next year to come up with a candidate for governor, which they don’t have yet, even though at every state convention at this stage of the process in the past, there was a major candidate or two on hand to do the developmental work that anyone must do to mount a serious campaign.

It’s very hard to see how a Republican can beat Brown.

Meanwhile, more numbers from the Field Poll carry more signs of a shift to the left by California voters.

Same-sex marriage is now overwhelmingly favored by California voters, 61 percent to 32 percent, an almost exact turnaround over the past 36 years. In 1977, when Field first polled on gay marriage, it was overwhelmingly opposed, 59 percent to 28 percent.

Same-sex marriage is now supported by all the major groupings in the state—ethnic, geographic, sociological, ideological, partisan, religious—with only three exceptions: conservatives, Republicans and Protestants. Or, put another way, the folks who met at the California Republican Party convention.

Who weren’t at all happy about the Field Poll showing a whopping 90-percent level of voter support for granting longtime illegal immigrants a pathway to citizenship, as well as a majority backing drivers licenses for illegal immigrants.

That followed polling showing strong support for California’s landmark climate-change program—70 percent of California voters back this controversial bête noire of the political right and fossil-fuel advocates—and for more stringent gun controls. There is even a new Field Poll showing a 54-percent-to-43-percent majority of California voters now support legalizing marijuana. This is the highest, as it were, level ever. In 1969, only 13 percent favored legalization.

After that rendition, the lights of 2014 look bright, indeed, for California Democrats.

But as former Gov. Davis notes, “It’s important for Democrats not to get overconfident.”

For the lights of present success can blind one to dangers on the horizon.