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California: Talks on a budget have collapsed, but is this a disaster or an opportunity? We say the latter. It's time for a showdown between the people and public-sector interests.
Jerry Brown should have known better. Maybe — privately — he did. But whatever California's governor really thought about the prospects of getting voters to go along with his tax plan, he now has to think about a Plan B.
This past week, he officially broke off negotiations with Republicans whose votes he needed to put a measure on the June ballot to extend expiring tax and fee increases for five years.
The usual he-said, she-said ensued. According to Brown, the handful of GOP lawmakers even willing to deal with him were demanding too much and would have made the state's deficit worse.
The Republicans countered that Brown couldn't bring himself to stand up to unions and trial lawyers. But it doesn't really matter who's right. What matters now is that the budget crisis will have to be resolved some other way.
There are several possible courses from this point. The least likely, because it almost certainly violates the state's constitution and would be instantly litigated, is for the Democrats to put the tax measure on the ballot by a simple majority vote in the legislature.
Brown and the legislature could also fall back on the fiscal funny business — internal borrowing and lending between state accounts, rosy economic scenarios and the like — that his predecessor, Arnold Schwarzenegger, used to paper over budget gaps.
Brown ran for office promising not to do this sort of thing. And it's wearing thin with creditors. Already, California has the lowest Standard & Poor's credit rating of any state.
Or they could get lucky and get a boost from a recovering economy. This isn't outside the realm of possibility. In February, California added nearly 100,000 jobs, its highest monthly gain in at least 20 years. If that jump wasn't a fluke, state revenues may soon be rising as well.
But it's a stretch to expect the budget gap to close all by itself. And even if the crisis eases, the political forces set in motion by Brown's aborted budget talks aren't so easily constrained. They now have a life of their own.
This is especially true of two ideas floated by the Republicans — public pension reform (aimed at shifting future liabilities from taxpayers to government workers) and a cap on state spending. Brown refused to let these onto the June ballot. But November is a different story, because there is time to qualify initiatives.
Economy: Amid the good news of a rebounding stock market and better job growth comes a warning: Inflation may flare up soon. If it does, don’t blame business. Maybe you think it's crazy to worry about inflation when the consumer price index is rising at a modest 1.5% year over year. ...
Leadership: As we put CIA boots on the ground to find out who the rebels are and withdraw air support as they retreat, our defense secretary describes how we're making up our policy as we go along. Defense Secretary Robert Gates and Adm. Mike Mullen, the chairman of the Joint Chiefs of ...
Media: Funny, we always thought a key job of editors was to make sure the actual meaning of words mattered. Well, maybe not after all. Just ask a Washington Post blogger and the watchdogs at Media Matters, the George Soros-funded group dedicated to advancing a leftist agenda by playing at ...
With Japan's nuclear crisis and a wave of instability crossing the Middle East, pols and pundits are turning again to the question of our energy future. Will civil war and strife disrupt access to oil and our way of life? Can the United States change its century-old pattern of relying heavily upon ...
Mitt Romney may have waived goodbye to the GOP nomination with his assertion that he could start unraveling ObamaCare by issuing an executive order as soon as he moved into the White House. "If I were president," Romney wrote on the website of the conservative magazine National Review, "on Day One ...
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