Jerry Brown’s moment of truth
The governor is staking his legacy—and California’s future—on Proposition 30
When California Gov. Jerry Brown addressed the state Chamber of Commerce earlier this year to gain support to raise taxes, he seemed to revel in admitting he was stuck in a box. This was precisely the dilemma that existentialist heroes relish: At a time when the word “taxes” had become dirty, he was more or less leveraging his political future, and the state’s, on a measure to broadly raise revenues.
This seemed like the only way out for a government that was running up massive deficits while firing teachers, shuttering libraries and cutting back support for the poor. But Brown embraces his image as one resolute man pitted against a cold and indifferent political universe.
“Aristotle’s poetics talks about three acts—the beginning, the middle and the end,” he told the business crowd in what was considered a well-received speech. “We’re just beginning act two. It’s true some politicians don’t have a third act. I hope I’m not one of them, because the third act is when it gets good. Act two is when the protagonist is under pressure to get out of the box he’s in,” he added. “You wait. We’re going to get to act three very soon.”
Over the past several decades, the Golden State has become a dyspeptic brew of deficits, faltering services and decaying schools—presided over by a government whose popularity rating barely clears the single digits. Californians are indeed waiting to see what Brown will do to get himself, and us, out of this mess.
The 74-year-old Brown is at his do-or-die moment: He came into office with an ironclad pledge that, with no higher political aspirations, he would deploy all of his accumulated political skills to solve, once and for all, the state’s perennial budget crisis and deficit.
Brown bolted out of the gate, vowing to engage the populace in a massive, straight-shooting “civic dialogue” that would do away with decades of empty political rhetoric and rationally approach tough fiscal realities.
And then he disappeared. “Frankly, he became invisible,” says a longtime Brown associate and admirer. “For the first six months, he was the most fucking boring guy in the state. It was really infuriating, and it was intentional.”
The governor wasn’t goofing off. He was cloistered inside the Capitol, talking mostly with Republicans, a weak party that has just enough legislative seats (by four, to be exact) to block the absurd two-thirds vote required to raise taxes. Brown was sure he could use his powers of persuasion to peel them off and make a grand bargain: budget cuts and pension reform in exchange for tax increases.
Instead, Brown hit a brick wall. “Jerry’s had sort of an Obama trajectory,” says Raphael Sonenshein, the executive director of the Los Angeles-based Edmund G. “Pat” Brown Institute of Public Affairs, named for the governor’s father, the 32nd California governor. “At first, he spent more time with the Republicans than Arnold [Schwarzenegger] did. But like Obama, Jerry didn’t understand he could do nothing with them and get nothing from them. I don’t think he fully grasped the cynical dynamics of the current Republican Party.”
Walking away empty-handed, Brown had to ruthlessly chop social spending so the state wouldn’t capsize. He slashed billions from already battered schools and health-care programs.
What Brown emerged with this year, finally, was a broad financial plan, one that he reluctantly—then enthusiastically—fused with a popular “millionaire’s tax” proposed by the smaller of two statewide teachers unions. The medulla of the plan is Proposition 30: a four-year, quarter-of-a-percent sales-tax increase, and a seven-year increase of 1 percent to 3 percent on earnings above $250,000. If voters approve the measure on Nov. 6, it will rake in about $9 billion for the next fiscal year, and it should significantly close the budget gap narrowed by Brown’s draconian spending cuts.
“Jerry’s a very shrewd politician,” says Dan Schnur, the director of the Jesse M. Unruh Institute of Politics at the University of Southern California and a former communications director for Gov. Pete Wilson. “He’s written the biggest ransom note in history. He’s telling voters: ‘Either pass this initiative or your kids are gonna get it in the head.’”
Brown is managing the country’s most populous state and the world’s ninth-largest economy. But he has no communications director and no chief of staff. His daily schedule is, well, daily, with little to no public advance notice of events. The governor should be leading a broad campaign promoting his plan to buck the national trend of no tax increases. Even his fiercest critics concede that Brown is about as smart as they come, the person best prepared to make the case for his crusade. But he hasn’t done so.
Instead, he’s running what some critics see as little more than a mom-and-pop operation, with Brown and his wife, the lawyer Anne Gust Brown, making virtually all decisions on their own. If the bombastic Arnold was overproduced, the ascetic Jerry is underproduced.
“What’s missing in Jerry’s austerity program is his taking the sufficient time to explain it’s a choice,” says Sonenshein. “Those of us who know Jerry sure wish we would see him out there more.”
Even some of his most reliable political allies have thrown their hands in the air. “He’s a brilliant guy, but he has no strategic skills, no organizational skills,” says a high-profile former state legislator. “He has a lot of interesting thoughts, but he can never correlate these thoughts into action. His office has no one you can deal with. His wife has the appearance of organization but no political skills, and there’s nobody else. You’ve got a state of 38 million people, and he’s a mess.”
Brown has heard all this before, and he’s built up his immunity. In fact, the criticism probably only encourages him to keep doing what he’s been doing. He’s brilliant and he knows it. And given the deplorable state of American and California politics, he clearly wears criticism as a badge of honor and believes firmly that he alone can begin to resolve the crisis that has become synonymous with California.
When I sat down to speak with Brown in the once stately Ronald Reagan Cabinet Room—which he has remodeled with a Spartan touch, not unlike that of a high-school faculty lounge—he was determined to push ahead with what he sees as his historic mandate: to build a stable water system for the state, construct a futuristic $68 billion high-speed rail system, turn more power over to local governments, move the state to alternative energies, and stabilize and reform the heretofore uncontrollable budget process—even if he has to do it on his own.
As of press time, Proposition 30 is too close to call, and Brown is fully aware of the possibility of defeat at the ballot box. So far, he has done an admirable job of placating the state’s business lobbies, which have traditionally been taxophobic. Most have either signed on to his measure or remained neutral.
Depending on how the election unfolds, Jerry Brown round two will be remembered as the man who saved California, or as the grinch who presided, solely, over its dismantling.
Marc Cooper: It’s difficult to imagine why you would come back to the California statehouse knowing you’d be jumping into a historic mess and would be forced to make very unpopular cuts. Did you misjudge something?
Jerry Brown: I came to this job fully and deeply aware of the dilemma—of the huge gap between revenue and spending obligations. I came as someone who has known every governor in my lifetime except Culbert Olson, who was elected in 1938. … I’ve followed every single election since that time. I would say I have a fair grasp of what’s going on in terms of politics, the Legislature, the governor and the budget. I full well knew that failure was and is an option, and will always be an option.
This dilemma has defied every governor since Earl Warren. Ronald Reagan raised the income tax. Fact! George Deukmejian raised the gas tax from 9 to 18 cents. Fact! But we’re in a world now where Republicans have a brand: “No taxes.” It’s as much a part of their identity as right to life is for Catholic bishops.
Given your knowledge of the state, did you expect to be so alone? Gov. Pete Wilson’s former communications director, Dan Schnur, says you are “standing on the 50-yard line while the two parties have retreated to the end zones.”
I knew cutting [programs] could run into a lot of opposition, and the result might be howls of execration. But if you’ve ever read The Stranger, then you can say that for all that I have tried to accomplish, all I ask is to be greeted with howls of execration on the day of my execution. (Laughs.) So I had that in mind, and I thought about it.
That you could go down in glory? Certainly there’s a better endgame for California than your personal sacrifice. What does the state need to get back on track even if your initiative passes? That’s not the end of it.
We need budget cuts. We need the continued growth of the economy for a long period of time. We’re suffering from the mortgage meltdown that killed 600,000 jobs in the construction industry. … We’re recovering from a national recession slowly—over 300,000 jobs [gained] since the recession. We’ve got a million to go.
That needs to continue, but that depends not only on [President] Barack Obama and the Congress and the Federal Reserve, but also on [German Chancellor Angela] Merkel, China, the European Union, and the self-organizing quality of the world economy. We need all that, which we don’t have control over.
What we do have control over is managing affairs to win public regard and confidence, and technically we need to make these hard cuts that Democrats don’t want to make, but a gimmicky sort of budget won’t lend itself to voters passing new taxes.
The Legislature’s approval rating is near single digits. Legislators seem to have declined radically in quality. How did we get into a place where state government seems both scorned and impotent?
It is what it is. The measure of inequality is getting worse—to be precise, the Gini coefficient [used to measure wealth inequality] shows America has more inequality than other comparable nations. California has more inequality than most of the states, more than 40 of them.
The Democrats want to help people who have been disadvantaged by this economy these last decades. The Republicans want to weaken and roll back various aspects of what the Democrats have tried to do—all sorts of good programs that good people come up with. They all cost money. Rarely if ever are they ever paid for on a long-term basis….
[W]e’ve got to live with what the voters want. If people say no, that’s a message to Democrats: “Knock it off, people don’t want it.” Or, if they [understand the problem], that will be: “Well, you can spend some, but not as much as you’d like, because we’ve still got to make serious cuts.” This is why my program is half cuts, half taxes.
So how do you find balance in the cuts you are making?
You have to ask: How much university do you want? How much do we want to cushion the shocks of capitalism on the families of California? How much do we want the people who pick our food in the hot fields of Imperial County to make? And if they don’t make much, how much should we help them in terms of supplement by the state? I’d say many compassionate people would say a lot more help is needed than is conceivable by any tax regime that could be imagined.
Now, if you go to the Republican regime, and you keep cutting back, and you see what that does to the safety net, to the quality of our society, what it does to the space program, what it does to research, what it does to highways and roads, what it does to universities and schools—it’s pretty much a nightmare. The Republicans are pushing us further and further into the ditch, and the Democrats have perhaps some unrealistic expectations of where the people want to go….
It appears people in California are saying they don’t want a lot of these cuts, but they’re also saying they don’t want to spend the money to prevent them, and that’s the management task that politicians have. In California, I know from a credible survey, when you ask people, “How much waste is there in government?” the most popular answer is, “About 40 percent.”
Yes, 40 percent is unthinkable, and yet that is the considered judgment I’ve seen on the surveys. So until we cut 40 percent, I guess people won’t be happy. Cutting 40 percent would mean virtually eliminating schools, the court systems, prisons—we can’t function with that. There is a disconnect. Part of it is the propaganda from the right, part of it is the American tradition that we’re rugged individualists.
It’s a dilemma that we don’t live in a small community where we can assess what the services are and what the taxes are and adjust to it on a smaller scale. The diversity of belief and experience in smaller communities makes state government very contentious, and that’s why local control was a good idea. Local schools, cities—not some megastate.
I am not presenting a perfect solution, because we live in a fallen state, if I can use that term. This is not a perfect world, but we have to do the best we can. We have a [proposal] that I think will work, but it is opposed by Republicans and Democrats.
Proposition 30 will hit the top percent of income earners the hardest. Some of your critics say, “Here we go again. Jerry is staking the state’s future on the cyclical income of the business cycle. It’s too volatile.”
The top 1 percent in the state increased its share of the income from 10 to 22 percent. The bottom 80 percent of the state is declining. That’s just a fairness fact. The surveys indicate very clearly that no other tax [other than the one I propose] is going to pass. The alternative is not some broader-based tax, it’s doubling up on the cuts. People don’t want that either. …
Yeah, I’d rather have a broader tax—there should be ways to have a more rational tax—but that is not viable. It’s not going to pass the Legislature. It’s not going to pass by initiative. It’s a nonstarter. So the only choice is even more cuts or the tax I’m proposing—or one very close to it.
Californians have spent 20 years giving the thumbs-down to higher taxes. What makes you think all of a sudden things have changed?
First of all, we don’t know how open they are to it until we get to the election.
But you think they are, or you wouldn’t propose it.
There’s no choice—I’m doing the best I can. We’ve got our backs to the wall here. It may prove to be illusory, but we have an opening and we’re gonna take it. I think there’s a sense that those who’ve been blessed with so much good fortune should help the state in its dire need. I think that’s a belief. Second, the constant reductions—the university, public schools, police, other public services, library hours, all that: Enough already.
Some of your natural allies suggest that you don’t know what you are doing.
They’ve been saying that since 1970. I can read you a litany.
They say that with the immense challenge of getting this tax increase, you need a more robust staff, a real communications office, more public presence, better messaging.
What are you talking about? We’ve got hundreds of thousands of people! You see this hallway? It’s loaded with people. This is the biggest press office I’ve ever had in my life—we’ve got five people down there. Bigger than when [I was] running for president, running for governor.
So, I don’t know what that means. That’s a silly critique. Who made that critique? As soon as you have too many people around, you can’t manage them. A lack of messaging? I think the message is pretty clear. What message hasn’t gotten through?
I’m not saying this. Your allies are.
First, you need to define what you mean. “You need a message,” but “I can’t tell you what the message is.” There’s a gap here, but what? I need to put out more paper?
Most of what I’ve heard has been from Democrats who say you have been too invisible. They want you out there on the bully pulpit, pounding home the tax message.
Not enough of me? I have an acute sense that people have only so much tolerance for the political face. There was a fellow in Greece called Aristides the Just, and he offended some people in Athens, and they decided to ostracize him. “Why are you voting to ostracize me?” And the guy said, “We are tired of hearing from Aristides the Just.” So, based on that, I like to limit my public exposure.
That said, there is a political reality. You do have to win this campaign.
Right. And it does take money to buy the ads. And some debate. But messaging is a very manipulative concept made by advertisers. Like “Pepsi beats the others cold.” That’s messaging. Not a message.
So, what’s your message?
The message is: “We have this much money, we’re making some cuts, we’re doing some pension reform. It’s your call—if you can give us more revenue, we won’t have to make more cuts. If you can’t give us the revenue, we’ve got to make more cuts. The moment of truth is upon us. We see it in Europe, we see it in Washington [D.C.]. We have to stand and meet our maker here, which is fiscal balance.” That is what I am presenting as my value proposition.
Let’s say you do achieve victory. Today we have a $16 billion deficit. Your tax increase will meet only half of that.
We need more cuts.
Back to cuts?
We need half cuts, half taxes. I keep saying that.
Even with Prop. 30?
Or double. It’s either $16 billion or $8 billion. That’s the issue. You can’t stop the cuts—we’re living beyond our means.
While speaking to the state Chamber of Commerce, you said this is merely act two, with a lot more to come.
Well, I didn’t want them to think we’re finished. (Laughs.)
So is act three another term?
That I don’t know. We’re just in the struggle. We’re not waiting for a second term to get the budget balanced. I came in to fix things, if I can. A lot of people question that.
Some people say the state will never be fixed until Proposition 13, which passed in 1978, is reformed. We need a split roll, they say, that would raise taxes on commercial property to see the revenue we need. Are we going to see any proposals like that in another term?
I just don’t want to go there. I’m just not ready to recommend a split roll on Prop. 13. If you want a split roll, go organize your friends and put it on the ballot. There’d be a hell of a lot of opposition. I don’t reject any idea out of hand—everything is possible. But lots of businesses are hurting. You increase their property taxes, that’ll be a problem.
What about other reforms, like doing away with the two-thirds majority needed to raise taxes?
You can’t get [the Legislature] to lower the two-thirds [majority] on taxes; you’ve got to put it before the people. It’s all up to the voters. I took the path I felt had the highest probability of success, and it is by no means guaranteed. So we’re moving forward carefully. Reform is always on the table, but people who say they’re going to transform whole systems have to be careful.
Because things are rarely transformed. That’s not how it works. When I was in the seminary, there were all these treatises on perfection. You know—how to become perfect, how to get rid of all your faults. Didn’t happen. After doing meditation, after doing penance, after reading the ascetical treatises, the lives of the saints, you wind up pretty much where you started.
You know, some people said they were going to go to Washington and were going to transform Washington. And that hasn’t been transformed. Even the Adams-Jefferson race was nasty. Not much has changed since. … War, depression—that is when you have brief moments when you can make a decisive move. We have had some of those moments. Whether we have made the decisive moves is another question.
When you came into office this time, you talked with Republicans for months. A lot of people warned you not to try, but apparently you thought you could transform them. Would you do it over again, even though you got nothing?
I don’t think there’s an absolute here. But true, we couldn’t get the four votes we needed. The Republicans who voted for Arnold [Schwarzenegger], they lost their jobs, and most of these people just don’t want to lose their jobs. That’s just the way it is.
Some observers say the current California gridlock will disappear in 10 to 15 years when the demographics of the state catch up with the electorate. The voters are older, whiter, wealthier than the population, but that is changing.
That sounds a bit utopian to me. First of all, in 10 or 15 years we’ll probably be suffering extreme weather events. We’ll have plenty of problems then. Not to mention the aging European stock that will feel besieged.
Barring extreme weather, if the state becomes increasingly majority-minority, when it becomes browner—browner, with a small “B”—won’t we see a political sea change?
It’ll be browner because we’ll be having forest fires.
Come on, you’re more optimistic than that.
No. Ever read Jim E. Hansen? Climate change is serious stuff. Extreme events—they will happen. We’ll cope with them. But there’ll be more expenses. We’re storing up a lot of liabilities that we’ll have to deal with. Yes, there will be a different demographic balance, different environmental challenges, and there’ll be a different economic picture. It’s very hard to predict. I would say it’s not going be any easier than it is today. It will probably be harder.
Something to look forward to.
I’m looking forward to it.
I enjoy this type of work.
So what’s the best scenario after your tenure—where are we in two or three years?
We have balance, and people feel confidence in our fiscal management. We have our water plan launched, our cap-and-trade is working, our prison realignment is reducing recidivism at a lower cost, we’ve gotten some reform in our educational funding—being more successful particularly among low-income families. We are building our track for our high-speed rail. Our trade and ports are humming along, and the environmental leadership of California has been picked up by other states in the nation.
We also need schools, and they have been battered. I have to imagine that these cuts are quite painful.
I don’t want to cut more universities, although there might be trigger cuts in the universities [if the bill fails].
But you didn’t answer. Do you feel a sense of regret?
I’m forced to make the cuts, but a lot of the spending didn’t exist the last time I was here. … The government has taken on much more responsibility—in many ways rightfully so, given the problems we’re encountering—but the electorate is not there. We absolutely have to do more in government. But we have to bring the people along.
Yet we are facing a well-armed neo-liberal propaganda lobby that is promoting the notion that the market, however big the corporate players, should get bigger and government has to get smaller and smaller.
You see yourself as someone who doesn’t have the luxury of ideology, rather just some guiding principles. You’re kind of a pragmatic implementer of what is possible.
I don’t want to deal with the impossible. That sounds rather futile. I know—I worked with Mother Teresa. Guys would come in half-dying, she feeds them, and the guys get a little better. She gives them a shirt, and out the door they go. Onto the streets of Calcutta. They’re not getting a pension. There it is, that’s life. That’s life on planet Earth.