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Will impulse to spend or reform win out in California?
By George Passantino
In the blockbuster Spider-Man 3, Spider-Man/Peter Parker finds himself waging a war of the soul.
The friendly neighborhood Spider-Man—the one defined by humanity, righteousness and justice—is pitted against a black-suited alter ego that is more self-absorbed and aggressive.
"The power [of the black suit] feels good," Peter Parker admits. "But you lose yourself to it."
California's own action hero knows the feeling. In essence, this is the same battle that Gov. Arnold Schwarzenegger appears to be fighting within his political heart.
On one side, we have Arnold the "reformer" who was ushered into Sacramento on a wave of promises to "blow up" the boxes of big government, buck special interests, and restore fiscal sanity to the Golden State. The Milton Friedman-esque Arnold speaks of focusing on the state's core competency, improving service, and "doing more with less."
In his 2005 State of the State Address, when the reformer was his dominant side, he declared, "To solve the budget's continuing structural deficit, we must reform the way the government spends its money. And to restore the trust of the people, we must reform the way the government operates."
This year he has proposed paying down billions in state debt ahead of schedule, privatizing the California Lottery for higher returns, and selling off EdFund, the state-controlled entity that administers federal student loan operations in California. This is precisely the kind of cost-cutting, streamlining and out-of-the-box thinking Californians expected when they elected him.
But while the reformer is pursuing meaningful change, his black-suited alter ego is busy proposing a budget that spends $1.5 billion more than the state will bring in this year. The Legislative Analyst's Office (LAO) says if Schwarzenegger's budget is approved the state shortfall will be $5 billion next year. This big-spending governor is more Gray Davis than superhero.
Under Gov. Schwarzenegger's tenure, State General Fund spending has sky-rocketed by 26 billion during his tenure. By contrast, former Gov. Davis increased spending approximately $19 billion.
And the red ink could get worse. Since November, the state approved more than $40 billion in new infrastructure bonds proposed by Schwarzenegger, the legislature approved an additional $7 billion in prison bonds and there is still more to come. Schwarzenegger still speaks of more massive infrastructure bonds over the coming years. On top of that, the state has somewhere between $40 and $70 billion in health care costs for retirees that it hasn't planned for or funded.
Spider-Man grew frustrated that criminals were spared the swift justice that they deserve and this made him vulnerable to the lure of his alter ego. He found himself exacting his own form of revenge, forgetting his core values.
Likewise, not long after taking office, Schwarzenegger realized that any reform efforts, whether a top-to bottom review of state government or more targeted reforms, would be met with fierce opposition from special interests. He began compromising on core principles and abandoning many of the promises he made during his recall campaign.
"That's his [Schwarzenegger's] problem: He'll surrender at the first sign of a fight," State Sen. Tom McClintock (R-Thousand Oaks) recently surmised.
See our prisons for the prime example of this. Since taking office, state correctional costs have increased by more than 65 percent, rising to roughly $10 billion in his current budget. Additionally, the current budget fails to account for likely increases in correctional guard contracts which the Legislative Analysts Office estimates to cost an additional $330 million per year. It is the sum of decisions like this that has created the situation our state now faces.
In the end, Peter Parker had to battle his alter ego and make a choice about who he was. He realized that he, not external forces, control his legacy. Now, Schwarzenegger must make a similar choice. His governing legacy is being written. Does he want to be remembered as the Governor who took on tough battles, fixed Gray Davis' mess and emerged victorious or the cowering steward that embraced the status quo, even as the state slipped deeper and deeper into crisis? It's his choice.
"It's the choices that make us who we are, and we can always choose to do what's right," Peter Parker waxed poetically.
Let's hope Schwarzenegger has learned that voters sent him to Sacramento to stand up for them by standing up for his "reformer" principles.
George Passantino is a Senior Fellow with the Reason Foundation. In 2004, he served as a Director of Governor Schwarzenegger's California Performance Review. Reason's California research and commentary is here.
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