Assistant Dean Carson Bruno on California Budgeting, Democrats Have Pseudo-Dictatorial Powers | Real Clear Markets

With California Budgeting, Democrats Have Pseudo-Dictatorial Powers

June 22, 2017 | Carson Bruno | Real Clear Markets

Last week was budget mania in Sacramento and in the chaos that always ensues, Sacramento’s Democratic leadership prevailed once again at using a legislative loophole to stack the cards in their favor.

First, a process primer.  In California, the Legislature must pass a balanced budget before 11:59 PM on June 15; if not, they are docked pay each day the budget is late. The Budget Act is a laundry list of expenditures. But many of these line items require policy action to legally implement the authorized funds.  To do this, the Legislature passes a budget package, which includes the Budget Act and budget trailer bills that make the policy to enact the Budget Act.

This otherwise innocuous process has become bastardized by politics.  Because the budget requires immediate implementation, the budget trailer bills are effective July 1 and because they are part of budget package, they avoid most of the legislative process (i.e. multiple committee review in addition to full chamber review).  As a result, Sacramento has turned to budget trailer bills to pass the unpassable and they have begun a nasty of habit of doing so to politically change the rules of the game to benefit their own political agenda. 

AB 1499 (2012): In the lead up to the 2012 November election, Democrats became concerned that Governor Jerry Brown’s California Teachers’ Association-backed Proposition 30 – raising the state’s income and sales taxes – might not pass. Historically, California voters – despite their liberal leaning – had been hesitant to approve of new taxes or fees. Polling was tepid (but not abysmal) but because the rules of game stipulated that propositions appeared on the ballot in the order that they qualified – Proposition 30 was the 11th measure to qualify in 2012 – and the habit of voters to more likely vote “no” on measures the further down the ballot they went, Democratic leadership feared that ballot fatigue would further reinforce the tax-skeptical nature of Californians. Enter Assembly Bill 1499, which was introduced in January 2012 to “express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2012.”  AB 1499 was gut-and-amended, largely in the backrooms of the Capitol, to dramatically overhaul how ballot propositions appear on the ballot, placing constitutional amendments and bond authorizations ahead of statutory initiatives. AB 1499 was only reviewed by the Senate Budget and Fiscal Review Committee before going to the full Assembly and Senate floors for votes. And because it was a budget trailer bill, it became effective immediately, completely reordering the 2012 ballot. Proposition 30 went from number 11 to number 1.  Would Proposition 30 have failed without AB 1499? Maybe not, but that doesn’t change the fact that Sacramento Democrats used the budget to change the rules to benefit a measure they supported and hoped would pass.

SB 96 (2017): Senate Bill 96 was introduced in January 2017 with “the intent of the Legislature to enact statutory changes relating to the Budget Act of 2017.” On June 9, the bill became a recall “reform” bill.  Coincidently, Democratic State Senator Josh Newman – who won a hotly contested election in 2016 by just 0.8 points – is facing the prospect of a recall election.   The Sacramento Bee nicely summarizes the purpose of SB 96 with their June 12 headline, “Democrats push new rules to help them win an election.” Because of the immediate implementation of budget trailers, these recall reforms change the rules mid-game, likely ensuring the recall won’t occur until November 2018 – a major electoral boost to an endangered member of the Democratic caucus. Is this particular recall a questionable use of the process? Maybe, but the voters have proven they are judicious when it comes to recall petitions and elections. Since 1913 – when California implemented the recall – just 9 recall efforts qualified for the ballot (or 6 percent). Of those, only 5 successfully recalled the targeted politician. Rather than run a campaign questioning the use of the recall against Senator Newman and the Senator defending his record, Democratic leadership crafted a bill in secret and the Legislature voted on it without any committee review. And Senate President Pro Tem, Kevin de León, had the audacity of calling the recall petition drive a “coordinate coup intended to undermine the will of the people.”

These two examples highlight Sacramento’s one-party rule using a process meant to implement the budget to dramatically overhaul policy to benefit themselves or their allies. By dodging the normal legislative process, Sacramento is consciously attempting to avoid debate on policy items. It’s almost as if they know they are doing something inappropriate.  This violates the basic foundation on which our democratic-republican governmental system operates and creates a slippery slope in how the Legislature makes and decides policy. The legislative process is meant to be deliberative ensuring thorough review of the merits, purpose, and content of the bill.

With only a simple majority needed to pass the budget, Sacramento Democrats don’t need any input from Republican leaders; this paves the way for pseudo-dictatorial powers by the Assembly Speaker, Senate President Pro Tem, and Governor. Consistently, transparency, and certainty are foundational components of the government-society relationship. If government becomes inconsistent in its processes, secretive in its decision-making, and discretionary in how it applies policy, the rule of law breaks down generating mistrust.  They may start with stacking the political cards, but who’s to say they won’t start stacking the economic cards in their or their allies’ favor next time.  While AB 1499 and SB 96 are just two recent examples, they signify a troubling trend in how Sacramento does business.