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The California Recall, Part One
July 30, 2003
By Jack Rabbit

News that a recall of California Governor Gray Davis qualified for the ballot shook the American political establishment last week. To some, Davis is an inept leader who plays favorites with his campaign contributors, and the one responsible for huge long-term energy contracts at what are now well above market prices. To these people, Davis richly deserves to be removed from power now, three years before his term expires.

To others, the attempt to recall Davis is a pointless, partisan waste of time and money. They point out that Davis, a Democrat, was re-elected less than a year ago in a fair election, and that the effort to put the recall question on the ballot only gathered steam when Darrell Issa, a wealthy right-wing Republican congressman, poured $1.7 million of his own money into the effort.

As far as opponents of the recall are concerned, the Republicans are simply attempting to redo an election that went badly for them last time - not because there is any good reason to do so, but because they can take advantage of Davis' unpopularity during a budget crisis that is not entirely of his doing.

This is the first of two parts on the effort to recall Governor Davis. In this article, the reasons for the recall given by those who launched and financed the petition drive will be examined. In the next article, we will look at some of the announced and possible replacement candidates who may become governor should Davis be recalled.

The Recall is one of three reforms promoting direct democracy instituted in California by Governor Hiram Johnson and the Progressive Republicans of the Lincoln-Roosevelt League in 1911. The other two are the Initiative and the Referendum. Under these direct democracy features, if the state legislature does not act to pass necessary laws or remove corrupt and incompetent officials, then the people may take matters into their own hands. With enough signatures, a measure may be put on the ballot to enact a law (Initiative), repeal an act of the legislature (Referendum) or remove an official from power (Recall).

The problem in Johnson's time was the power that the railroads held over state government. Southern Pacific charged high shipping rates to cover the cost of bribing politicians. Johnson campaigned for governor on a pledge to "kick Southern Pacific out of politics." He did. Former President Theodore Roosevelt praised California's reforms. The following year, Governor Johnson ran as the Vice Presidential nominee with Roosevelt on the Bull Moose ticket.

In order to recall a state officer, supporters first need to gather signatures equaling 12 percent of the voters in the election that put the officer in power. They have 160 days to gather the signatures. The recall movement against Governor Davis officially began gathering signatures in March. They would need to gather 900,000 signatures to qualify the recall. Earlier in July, recall proponents turned in about 1.6 million signatures to the office of the Secretary of State. On July 23, Secretary of State Kevin Shelley announced that 1.3 million signatures were validated. The next day, as directed by the state constitution, Lieutenant Governor Cruz Bustamante set a date for the recall election. Bustamante had some leeway under the law and chose October 7, the last Tuesday in the range of dates he could select. He also announced that the election to replace Davis would be held the same day.

Under the state constitution, the sufficiency of the reasons given for recalling an officer is not subject to review. This guards against a recall target dragging out the process through frivolous lawsuits. However, most voters feel there must be some reason to recall a governor. A recall petition being pushed by Republican partisans simply to remove a Democratic governor would go nowhere. There is no doubt that Republicans have pushed and financed the recall drive. The question is whether they are acting as good citizens or as rank partisans.

The reasons given by the recall supporters that were printed on their petition are (ellipsis in the original):

Gross mismanagement of California finances by overspending taxpayers' money, threatening public safety by cutting funds to local governments, failing to account for the exorbitant cost of the energy fiasco, and failing in general to deal with the state's major problems until they get to the crisis stage. California should not have to be known as the state with poor schools, traffic jams, outrageous utility bills, and huge debts...all caused by gross mismanagement.

Otherwise, recall proponents claim: that California has the worst deficit in the United States; that California taxes are going up; that the state is bankrupt; and that Davis hid the real facts of the budget crisis from voters last November.

Are these good reasons to recall Governor Davis?

There seems to be something contradictory in stating that Governor Davis is overspending taxpayers' money with one hand and cutting funds to local governments with the other. It is true that past governors, notably Ronald Reagan, would place responsibility for state mandated programs on counties and then not provide them with the funds to do so. This was a fiscal gimmick that allowed the state budget to appear to be balanced, as mandated by the state constitution, while not raising taxes. And, of course, the state is currently cutting funds to local government and everyone else. As the recall proponents point out, the state is facing a $35 billion budget shortfall; that is not going to be met by increased spending.

On the other hand, it is true that California has the worst deficit in the United States. That should surprise no one. California is the one of the biggest states and has the world's fifth largest economy. Currently, every state in the union is facing a budget crisis. It stands to reason that California's is worse.

The reason for the nationwide problem is reduced revenues from the federal government. The federal government has decreased funding to the states in order to accommodate the reduced revenue owing to tax cuts passed by Congress and proposed by Mr. Bush and his team of economic advisors. Most of the federal tax cuts benefit the rich; most of the decrease of funding earmarked to the states either was a benefit to the poor or was federal aid to broader social concerns such as public education. This has put a squeeze on state and local governments across America.

If Davis should be recalled for this, so should every other governor in every state. Perhaps a better solution should be that voters, rather than recalling their governors, should take a good, hard look at their local congressman's voting record and compare that to his opponent's ideas. Perhaps if one's representative voted for Mr. Bush's irresponsible tax cuts, one ought to seriously consider voting for that representative's opponent.

The charge that California is bankrupt is false. In spite of budget problems, the state has not declared bankruptcy. Not yet, anyway. As for the charge that California's taxes are going up, they're probably right. In this kind of crisis, taxes should go up and state spending should be cut. Any political candidate who implies that the problem can be solved without doing both is selling snake oil.

California's budget shortfall was made worse by the long-tem energy contracts into which Governor Davis entered during the energy shortage of 2001. Most of us know the story. California decided in the nineties to deregulate its power. That was a terrible idea for which there is plenty of blame to go around. This created a dysfunctional market that was easily gamed by unscrupulous energy providers like Enron. Power was diverted away from California to other markets, creating an artificial shortage in the winter of 2000/01. At the same time, power plants run by private utility companies were taken off line for maintenance - or so they said - further reducing the available supply of power. Through the use of such tactics, prices skyrocketed. Governor Davis stepped in and negotiated long-term contracts with the energy suppliers at the same time he denounced them as "pirates." This had the effect of stabilizing prices, but it also locked California into power rates much higher than the current market value.

California was in a no-win situation that winter. Davis took a way out that provided energy for Californians and brought prices down. While prices are lower now, it is doubtful that, had Davis not negotiated long-term contracts, they would have ceased to skyrocket.

Davis may also have been relying on eventually getting relief from the Federal Energy Regulatory Commission (FERC). Davis appealed to FERC for relief, hoping to be able to renegotiate the contracts. The argument he presented is that California was negotiating under duress, since its negotiating partners were none other than the very energy companies who gamed a dysfunctional market. While California may have been entitled to such relief, it would be foolish to expect it from a regulatory commission appointed by Mr. Bush. In the Bush administration, a regulatory commission appears to be expected to be a tool of the industry it regulates. That is exactly how FERC behaved. They ruled on the one hand that the market was indeed dysfunctional but on the other that California was entitled to only a fraction of the relief for which Davis was asking, and denied the state the right to renegotiate contracts. The energy companies were called naughty boys and told they could keep their ill-gotten gains.

On the charge that Davis "fail(ed) . . . to deal with the state's major problems until they get to the crisis stage", Davis' critics may be able to draw blood by pointing back to the energy crisis. As part of the California deregulation plan, San Diego was used as a guinea pig. Price caps were lifted in 1998. Throughout 2000, with deregulation in place in San Diego, prices went through the roof. Many critics of deregulation saw this, in the words of Ralph Nader, as "the canary in the coal mine" of California's energy deregulation plans. When San Diego power rates tripled, Davis should have taken action to make sure that the problems that San Diego experienced would not become the rule for statewide deregulation. However, Davis did nothing and all Californians soon became San Diegans in the energy game.

The failure to act when the alarms rang in San Diego was a serious blunder on Davis' part. Is it worthy of recall? Probably not by itself. However, it doesn't speak well of his ability for planning and foresight. It makes it easy to imagine that there is somebody in California who would be a better governor.

The final charge against Davis made by the recall backers is that he misled the public about the extent of California's financial woes when he ran for governor last year. That charge is almost beyond proof. We can be sure that Davis' picture of California's financial health was much rosier than reality, but did Davis have reason to know that last year? Again, this might be a reason to mistrust Davis' judgment, but not to accuse him of malfeasance.

We have examined today the reasons for recalling Governor Davis given by the backers of the movement. The question for the voters of the state of California is: are these sufficient reasons? Almost all of these reasons are refuted, some more decisively than others. Those that remain probably do not constitute sufficient reason to recall a governor.

Davis is bound to be unpopular at the moment. If any other person were governor of California now, he would probably be just as unpopular. The state must make some painful decisions. Taxes must be raised. Spending, even on programs deemed popular or necessary, must be cut. Nobody could possibly be very happy about this situation.

Recalling Governor Davis won't change that.

If one considers the reason to recall a governor to be malfeasance, then it would seem that those pushing the recall of Governor Davis have not made their case. Davis has made mistakes, but so has every governor. The state is in financial crisis, but so is every state. Has Davis willfully ruined the state? Nothing suggests that he has.

This Californian plans to vote No on the recall on October 7. Between now and then, if the recall proponents wish to persuade this citizen to change his mind, they will have to show some new evidence that is more convincing than the Niger document of serious wrongdoing on Davis' part. Otherwise, it would appear that either their motivation for recalling Davis is dishonestly partisan, or that they just think a lower bar for recalling a statewide official than should be necessary.

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