Are Republicans on Right Path to Take Back Governor’s Office in 2018?

Photo courtesy Franco Folini, flickr

Photo courtesy Franco Folini, flickr

Republicans will have a serious, competitive candidate for governor in 2018, Republican consultant Kevin Spillane told a conference sponsored by the Civil Justice Association of California last week. Spillane was a member of a panel that discussed California’s Changing Electorate.

Spillane’s certainty that Republicans will field a top candidate was summed up in one name – and that was not the name of any prospective candidate. The consultant said that wealthy Republican donor Charles Munger will make an effort to see that a strong Republican candidate is in the field.

Munger’s name has been floated in political circles from time to time as a possible candidate for high office but Munger has dismissed the notion.

When pressed which Republican might be that competitive candidate, Spillane mentioned first San Diego mayor Kevin Faulconer. He also suggested that Fresno mayor Ashley Swearengin and former Insurance Commissioner Steve Poizner could fit the role.

The distant gubernatorial race was also evident in CJAC’s choice of the luncheon keynote speaker. Lt. Gov. Gavin Newsom has announced his intention to run for the office. Newsom agreed that the discussion about the 2018 governor’s race has already gone mainstream even before the 2016 presidential election has been contested.

Other notes from the panel discussion:

Democratic Assembly consultant and former labor staffer Charu Khopkar said that labor was concerned with the Top-Two primary proposal because organized labor would have to spend much more money engaging in the Top-Two contests picking favorites among same party candidates. He admitted that the prediction has come true.

While the Top-Two was designed to select more moderate candidates, Political Data’s numbers guru, Paul Mitchell, challenged the idea that the Top-Two has had great effect except in a couple of isolated instances. He also argued that because Californians seem to self-select where they live in communities with pockets of like-minded liberals or conservatives, that has blunted the effect of redistricting reforms to select more moderate candidates. However, he suggested that the extension of term limits would have a greater effect on changing the nature of the legislature.

Spillane said the Republican caucus has become more moderate because it “caught up with political reality.” He said Republicans are on the right path, choosing appropriate candidates for competitive districts.

CJAC’s mission is to confront the litigious atmosphere in California, which ranks near the bottom of states in lawsuit climate.

Originally published by Fox and Hounds Daily

Feds vow continued pot prosecutions in CA

Over the strenuous objections of some California lawmakers, the Department of Justice vowed to continue prosecuting the medical marijuana industry in the Golden State.

Despite a recent bipartisan federal amendment de-funding the Department’s fight against medical marijuana, spokesman Patrick Rodenbush revealedto the Los Angeles Times that “it did not believe the amendment applies to cases against individuals or organizations.”

“Consistent with the Department’s stated enforcement priorities, we don’t expect that the amendment will impact our ability to prosecute private individuals or private entities who are violating the Controlled Substances Act.”

The interpretation put the DOJ squarely at odds with the amendment’s co-sponsors, Reps. Dana Rohrabacher, R-Calif., and Sam Farr, D-Calif. Rohrabacher spokesman Ken Grubbs said his boss “believes the amendment’s language is perfectly clear and that the DOJ’s self-referential interpretation is emphatically wrong.”

Farr echoed the comments. “The Justice Department’s interpretation of the amendment defies logic,” he said, according to the Huffington Post. “No reasonable person thinks prosecuting patients doesn’t interfere with a state’s medical marijuana laws. Lawyers can try to mince words but Congress was clear: Stop going after patients and dispensaries.”

Fueling the fire

The developments have heightened the controversy surrounding California’s efforts to gradually reform its marijuana laws to better reflect the reality of steadily increasing usage and rapidly changing mores. Despite growing public support for legalization and taxation, policymakers have faced sharp challenges in reconciling the pre-existing pot industry with the intended uniformity that regulation would bring.

Marijuana farming alone has raised the specter of awkward tradeoffs for liberal state Democrats, many of whom support both pot legalization and increased environmental regulation. As Jefferson Public Radio most recently observed, California pot farming has adversely affected both the state’s drought and its wildlife. “What we found is that in four of the streams that had marijuana cultivation, those four streams went dry. And the only stream that we monitored that did not go dry was free of marijuana cultivation,” said Scott Bauer, a California Fish and Wildlife biologist who lead-authored a new study showing the impact of pot on the “Emerald Triangle” of pot production in Humboldt and Mendocino counties.

Although the lion’s share of water consumption continued to run through the state’s large agricultural companies, officials have recognized that California produce holds a far more important and legitimate place in the state and national economy than California marijuana.

In the hopes of squaring the policy circle on related issues, Gov. Jerry Brown’s administration formed a Blue Ribbon Commission on Marijuana Policy, placing Lt. Gov. Gavin Newsom at the head. At the end of March, the commission released its first progress report, sketching out an effort to balance safety and reform across areas including children, taxes and regulations.

Money measures

According to the Huffington Post, the commission took an uncertain approach to taxes — one that Lt. Gov. Newsom reiterated in an interview. Pot taxes, the report noted, “can result in greater state and local revenue, increasing the revenue available to do the work of government,” whereas “with a high tax, both sellers and buyers may opt out of the legal market in order to avoid paying the tax and continue to access marijuana through the illicit market.”

The perils of pot taxation have been on display recently in Colorado. There, revenue has been so high that, by law, a cut of the income must be returned to residents themselves. But, as High Times reported, confusion has set in statewide. Legislators haven’t figured out whether the money should go to pot purchasers or all residents. Republicans, typically in favor of rebates, have wound up opposed. Even pot producers, who supported the taxes to begin with, haven’t decided how to come down on the giveback. California lawmakers haven’t painted themselves into the same regulatory corner as Coloradans. But with federal pressure ongoing, Californians have begun to recognize that they’ll be on their own in determining how to liberalize pot laws without adverse consequences.

Originally published by CalWatchdog.com

Kamala Harris a Self-Professed ‘Blood-Sport’ Candidate

Attributing her success to a “blood sport” view of politics, California Attorney General Kamala Harris has established herself as the leading contender to replace Sen. Barbara Boxer, D-Calif., who is retiring in Jan. 2017.

“I always start my campaigns early, and I run hard,” Harris told the New York Times. “Maybe it comes from the rough-and-tumble world of San Francisco politics, where it’s not even a contact sport — it’s a blood sport. This is how I am as a candidate. This is how I run campaigns.”

But that attitude has helped set up what could be a difficult dynamic for Harris in her quest for the Senate.

She has cleared away key potential competitors from Northern California, such as Lt. Gov. Gavin Newsom, who has opted to run for governor in 2018. But Harris has not dispatched credible Democratic contenders in the Southland, including Rep. Adam Schiff of Burbank, Rep. Xavier Becerra of Los Angeles and Rep. Loretta Sanchez of Garden Grove. Then there are potential Republican contenders, such as Assemblyman Rocky Chávez of Oceanside.

For years, Southern Californian Democrats have chafed at what many have seen as an excessive degree of dominance within the state party by San Francisco and Sacramento-area members, including Boxer and Sen. Dianne Feinstein, both from Marin County; and Gov. Jerry Brown, the former mayor of Oakland.

A wide-open field

Harris’ aggressive approach to political advancement has helped knock one nationally recognized L.A. Latino out of the Senate scramble. Former L.A. Mayor Antonio Villaraigosa bailed out of contention late in February.

“I know that my heart and my family are here in California, not Washington, D.C.,” he said in a statement posted to Facebook. “I have decided not to run for the U.S. Senate and instead continue my efforts to make California a better place to live, work and raise a family.” Villaraigosa’s decision was seen as signaling greater interest in pursuing a bid for governor.

Even though Villaraigosa himself was seen as one of Harris’ most formidable would-be rivals, his weaknesses as a candidate were far greater than other Southern California Latinos currently weighing serious Senate bids. Villaraigosa struggled with personal scandal and an embarrassingly rough landing after leaving office, when he had to scrounge for lucrative work through personal connections and the strength of his name recognition.

Ironically, that opened the field for others to challenge Harris. The kind of travails Villaraigosa faced haven’t been a problem for Harris’ most likely Latino challengers. Schiff, Becerra and Sanchez have “been waiting for colleagues to retire so they can move up, and they still face the constant threat that even after biding their time, rivals could outmaneuver them,” the Los Angeles Times reported.

“But with scant hope that Democrats could seize control of the House next year, they are also stuck in the relatively powerless minority. Democrats stand a better chance of retaking the Senate, so the potential leap may be that much more tempting.”

Meanwhile, noted the Times, Harris still hasn’t made an impression on more than half of California’s registered voters, according to a poll conducted with USC Dornsife.

Pressure on the right

Despite expressing strong interest, neither Becerra nor Sanchez officially has declared their candidacy. For now, that gives an advantage to Chávez, the only other candidate to declare after Harris.

And within the California GOP, as the Sacramento Bee observed, his “résumé and standing as a state legislator make him the most prominent Republican among those weighing bids. A former city councilman in Oceanside, he spent nearly three decades in the Marines and later served as acting secretary to the state Department of Veterans Affairs.”

Chávez’s political positioning also has raised hurdles for other Republicans considering a run. “He supports gay marriage and has chided members of his own party for blocking immigration reform,” noted the Bee. “He opposes abortion rights, however, a position he attributes to his Catholic upbringing.”

Running to the left or the right of Chávez could pose problems for GOP rivals. That could inspire the state party to rally around him relatively early. Although not an electoral cure-all, California Republicans could score a perceived coup by fielding a Latino candidate against Harris.

“A lot of things can happen on the way to a coronation,” Chávez recently told the New York Times.

Originally published by CalWatchdog.com

Which CA Legislators Received Most Gifts in 2014? Find Out Online

Mike McGuire made over $100,000 in 2014 as a Sonoma County supervisor and another $525 in parting gift certificates as the young Democrat left to take a $95,291-a-year job as a state senator.ethics_form_california_700_1407530095875_7285193_ver1.0_640_480

Richard Pan, a physician, took in just over $2,800 in gifts and travel payments, including a $440 outing at a San Francisco Giants baseball game, compliments of the Pacific Gas and Electric Co. Pan is now a Democratic state senator representing a Sacramento district.

And Jeff Stone, whose business, Innovative Compounding Pharmacy, is worth over $1 million, took 25 pages to document his property holdings, including a number of manufactured home rentals. The Riverside County Republican, too, is part of the state Senate’s freshman class.

Their financial information is part of the new filings of statements of economic interest for 2014, which went online Tuesday and are available for public perusal.

It’s the first filing for the freshman class of both the Assembly and the Senate — and for the public, it’s the first time to get a glimpse of their wealth as well as their perks.

Elected in November, taking gifts in December

Some got off to a quick start. Ling-Ling Chang, a new Republican assemblywoman from Chino Hills, declared $2,433 in travel payments over four days in December. In that period, she participated in an education symposium for the California Charter Schools Association for $1,258 and a policy summit for TechNet, a group that lobbies for tech giants with a hub in Los Altos, for which she claimed $1,175.

At the same TechNet event, freshman Assemblyman Bill Dodd, a Napa County Democrat, received $340. Both Chang and Dodd noted the money was for speech/panel participation.

Some like gifts in keeping with their interests. State Sen. Bob Hertzberg, a Los Angeles Democrat referred to as a “deal-making, cigar-smoking” guy in a 2004 L.A. Times profile, disclosed $765 in gifts involving cigars.

Hertzberg, a former speaker of the Assembly, is back in Sacramento after spending 13 years in the private sector.

Some of the financial disclosures are on the quirky side: Kansen Chu, a San Jose Democrat Assembly member, holds a financial interest of between $10,000 and $100,000 in NeuroSky, a company that sells a product that claims to use electrodes on your forehead to interpret brainwave electricity – and, yes, to read your mind.

Like most states, California requires annual disclosure of gifts as well as income and property interests. They are submitted to the state’s Fair Political Practices Commission, or FPPC, which also polices alleged violations of the state’s campaign laws.

At the state Assembly level, 18 of the 27 new state Assembly members come from the ranks of city councils. At the upper ranks, five of the 10 new senators are former Assembly members.

Lawmakers with a history of having hands slapped

The FPPC sends warnings to lawmakers who have violated the rules in the form of a public letter. And some taking new offices have already been warned of potential malfeasance.

Jeff Stone received a warning in 2010 about a 2009 vote when he was a supervisor in Riverside County, in which he “may” have violated conflict of interest provisions by awarding funds to a nonprofit that stood to benefit him.

“However, we have determined that an enforcement action for a violation is not warranted, because the funds awarded were restricted and could not be used for administrative costs of your source of income,” the note from the commission stated.

Pan has also received a warning about political behavior when he allegedly received services worth over $500 from a lobbyist who hosted a fundraiser for him in 2012.

Much is made of the staggering wealth of members of Congress, where California Sen. Dianne Feinstein is among the richest senators and Rep. Darrell Issa, R-Vista, is noted as the wealthiest among U.S. representatives.

At the state legislator level, wealth is not so easily tracked in California. Filers must note holdings in both real estate and stock ownership, which can indicate in increase in wealth.

Gifts, though, are more readily tracked. In California, the gift limit for 2013-14 was $440 for goods from a single source.

State Attorney General Kamala Harris in her filing for her final year in 2010 as district attorney in San Francisco reported no personal stock holdings. It was her last year before taking her current office and she received $1,869 in gifts, mostly flowers as a departure present.

In the previous year, 2009, she noted that her book, “Smart on Crime,” had earned her between $10,000 and $100,000 in royalties, although the book was released in October.

Book royalties are usually paid on a semi-annual or quarterly basis.

Newsom likes gifts; Harris, not so much

This year, Harris, the leading Democratic nominee in the race to replace retiring U.S. Sen. Barbara Boxer, has more holdings to declare due to her marriage in August to fellow attorney Douglas Emhoff.

Harris’ filing shows holdings in Comcast, Costco, Home Depot, Nike, Verizon and Visa, which she notes were held in Emhoff’s IRA and are held separately. Harris, as the state’s chief law enforcement officer, could potentially oversee activity involving some of those companies.

Her gifts this time around are more modest: just one receipt of flowers, from Fox Entertainment, declared at $101.

The man initially seen as her rival for Boxer’s U.S. Senate seat, Lt. Gov. Gavin Newsom, has for years accepted more lucrative gifts.

In 2010, Newsom’s last year as mayor of San Francisco, he declared $3,512 in gifts, including tickets to the opera, symphony, sporting events and Cirque du Soleil.

Last year, Newsom, who declared in January that he would not run for Senate, reported $3,781 that again included tickets to sporting events, a crystal trophy and a Christofle tray.

Originally published on CalWatchdog.com

Villaraigosa Won’t Challenge Harris for Senate Seat

Former Los Angeles Mayor Antonio Villaraigosa announced he won’t challenge state Attorney General Kamala Harris for the U.S. Senate seat being vacated by Senator Barbara Boxer in 2016. That boosts the prospects of fellow Democrat Rep. Loretta Sanchez of Garden Grove.

Villaraigosa announced his decision Tuesday in a post on Facebook that foreshadowed a run for governor in 2018.

“I am humbled by the encouragement I’ve received from so many to serve in the United States Senate,” the former Democratic Speaker of the California Assembly wrote. “But as I think about how best to serve the people of this great state, I know that my heart and my family are here in California, not Washington, D.C.”

If Villaraigosa’s statement that his heart remains “here in California” wasn’t a clear enough indication of a future run for governor, he added he’ll continue his “efforts to make California a better place to live, work and raise a family.”

“We have come a long way, but our work is not done, and neither am I,” he concluded.

Kamala Harris

Villaraigosa’s decision to pass on an application for membership in “the world’s most exclusive club” follows similar announcements by Treasurer John Chiang, billionaire climate-change activist Tom Steyer and Lt. Gov. Gavin Newsom.

It didn’t take long for Harris, the only major announced Democratic candidate, to issue a statement praising the former Los Angeles mayor.

Kamala-Harris-hands“The city of Los Angeles, and our state and nation, have benefitted [sic] greatly from his leadership,” Harris said in a prepared statement tweeted by her campaign. “I know he has much more to offer. I wish him and his family all the best.”

Although Harris welcomed Villaraigosa’s exit from the race, the biggest beneficiary could be Loretta Sanchez. A moderate Orange County Democrat, Sanchez would have appealed to similar voters — Latinos and Southern Californians — as Villaraigosa.

Sanchez may prove formidable challenger to Harris

She hasn’t received the same media hype as Villaraigosa, but in some respects Sanchez may prove to be a more formidable challenger to Harris. The 10-term Democrat has said she’ll make a decision later this year. Sanchez has a head start on fundraising with nearly $400,000 in federal cash on hand, according to the most recent campaign finance reports.

Loretta SanchezHer statewide name identification, albeit lower than Villaraigosa’s, comes without the personal baggage. Early in his tenure as mayor, Villaraigosa disclosed an affair with a Telemundo newswoman. That was followed by photos showing the mayor partying with Hollywood bad boy Charlie Sheen at a hotel opening in Mexico.

But as pointed out by CalWatchdog.com, the biggest weight on a Villaraigosa campaign could be his support for Esteban Nunez, the son of former Assembly Speaker Fabian Nunez. Esteban pled guilty to manslaughter for the fatal stabbing of a 22-year-old college student. Villaraigosa, on official mayoral letterhead, wrote a letter of support for “a young man of good and upright character.”

The case was riddled with political favoritism, as detailed in a lengthy profile by the Los Angeles Times, and ended with Nunez friend Gov. Arnold Schwarzenegger’s commutation of Esteban’s sentence.

Latino Caucus: Senate contest bigger than any one candidate

Villaraigosa’s decision to pass on the race also does nothing to cool the burning frustrations of Latino political leaders, who are being pressured by some Democratic leaders to clear the field for Harris.

Earlier this year, former Speaker of the Assembly Willie Brown, who at one time dated Harris, said Villaraigosa should forgo a campaign out of respect for his friendship with the attorney general.

“His loyalty and his relationship with her should be so valuable, and he should, in my opinion, see it as an opportunity to demonstrate that,” Brown told the Sacramento Bee.

That comment inspired grumblings from members of the California Latino Caucus, who say the race is bigger than any one Latino candidate. Earlier this month, the group released a poll showing a Latino candidate could contend with Harris. The survey of 600 likely Latino voters, according to CalBuzz, showed Villaraigosa leading Harris, with Sanchez not far behind in third place.

“The U.S. Senate race has importance beyond the contestants themselves,” Assemblywoman Nora Campos, D-San Jose, said in a press release. “This is not about one candidate or another. An exciting race can generate enthusiasm among voters that have not been energized in years.”

Other Democratic candidates that are considering the race include Rep. Adam Schiff of Burbank, Rep. Xavier Becerra of Los Angeles and former Secretary of the Army Louis Caldera.

On the Republican side, Assemblyman Rocky Chavez of Carlsbad and former California Republican Party chairman Tom Del Beccaro are seriously exploring bids.

Originally published by CalWatchdog.com

Gavin Newsom for Governor?

Shaking up an already fast-moving political landscape, Lt. Gov. Gavin Newsom revealed in an email to his list that he had taken the first step toward a run for governor in 2018.

Framing his announcement as a characteristically Californian statement “without evasiveness or equivocation,” he explained he was creating the initial committee necessary to mustering resources for a run. Gavin Newsom

A combination of reasons fueled Newsom’s early jump into a race that’s still out on the other side of the next presidential election. On the one hand, as the Los Angeles Times reported, Newsom’s committee will empower him to “raise up to $28,200 per supporter for both the primary and general elections, meaning he can collect $56,400 per donor.”

On his website, Newsom played up the practical importance of that head start. He said running “in America’s largest, most diverse state demands that I start raising resources now.”

On the other hand, Newsom, like other Democrats victorious in their last election cycle, has maintained a sizable war chest — in Newsom’s case, around $3 million. Nevertheless, Newsom likely will be expected to come up with much more than that.

“Running for governor is likely to cost $30 million to $50 million, or possibly much more,” the Washington Post observed. “Meg Whitman, the former eBay chief executive who ran against Brown in 2010, spent $144 million on a losing campaign.”

A quiet deal?

In the meanwhile, attention has focused on the timing between Newsom’s announcement and Attorney General Kamala Harris’s announcement that she will run to replace retiring Barbara Boxer in the U.S. Senate.

Just last month, Newsom told San Francisco radio station KGO that it was “laughably premature” to discuss his possible interest in taking over for Brown in 2018. He described his disinterest in Boxer’s seat as merely dispositional. “I’ve got a bias toward my children, my wife, my family. I’ve enjoyed my time as mayor, and I like the executive side of the world.”

The careful positioning led some to speculate that Harris and Newsom, close enough to share the same consultant, quietly bargained behind the scenes to run for different offices. Publicly, that was denied. A source close to Harris told the San Francisco Chronicle she and Newsom didn’t make a deal to split up their campaigns:

“She never talked to him,” the source said. “I think he read the tea leaves and made his decision.”

“However, Newsom — who has long let it be known that he wants to be governor — said he talked to Harris on Sunday night to let her know that he wasn’t going to be running for Senate.”

Decision time

Now that both Harris and Newsom have formalized their plans, the pressure has ratcheted up on other ambitious Democrats, whose next steps are the subject of feverish speculation. Top Democrats in Los Angeles have been affected most by the Harris/Newsom split.

As the Post reported, the two San Franciscans have long been “cognizant of the other’s ambitions and aware that running against each other could provide an opportunity for a rival from Los Angeles” — specifically, former Los Angeles Mayor Antonio Villaraigosa, who faces “renewed pressure” to choose which rival, if any, to challenge.

In Washington, D.C., making the rounds on the occasion of accepting an award, Villaraigosa stayed mum on the Senate race, preferring to regale reporters with a campaign-like discussion of the importance of education. That in itself could reflect a greater interest in a gubernatorial run, however.

Villaraigosa conspicuously supported the parents in the Vergara case, which challenged California’s teacher tenure system, claimed the existing system discriminates against minorities and the poor. And he endorsed Marshall Tuck, the reformer opposed by the teachers’ unions in November’s race for state superintendent of public instruction.

By contrast, Harris filed the Vergara appeal in the case, defending the status quo, an action supported by Newsom.

And Harris and Newsom endorsed Tuck’s opponent, union-backed incumbent Tom Torlakson, who won the race.

Originally published on CalWatchdog.com

Gavin Newsom Starts Fundraising for 2018 Gubernatorial Bid

As reported by the Los Angeles Times:

California Lt. Gov. Gavin Newsom announced Wednesday that he has opened a fundraising account to run for governor in 2018.

In an email to supporters, Newsom said “our state is defined by its independent, outspoken spirit.  When Californians see something we truly believe in, we say so and act accordingly – without evasiveness or equivocation.

“So today I’m announcing that I’m creating a committee to run for California governor in 2018.  Because I truly and passionately believe in the future of this great state.”

Newsom has long wanted to be governor …

Click here to read the full story

Sen. Boxer Announces Retirement

Sen. Barbara Boxer, D-Calif., today announced her retirement. In office since her 1992 election, she has been considered one of the country’s most liberal senators.

Elected the same year as the more moderate Sen. Dianne Feinstein, D-Calif., the two were called the “Thelma & Louise” of the Senate, after the 1991 feminist “buddy movie” starring Geena Davis and Susan Sarandon.

Yet Boxer has been amenable to compromise with Republicans on some issues, such as water policy. As CalWatchdog.com reported last November, “Remarkably, Sen. Boxer had co-sponsored with Feinstein the Senate bill that became the basis of Feinstein’s negotiations with California’s House Republicans” on water policy over the state’s severe drought.

After serving as a supervisor in Marin County, she was elected to the U.S. House of Representatives in 1982 and quickly became a major liberal voice in Congress. As she ran for the Senate in 1992, a brief scandal erupted over her bouncing 87 checks on the special House Bank.

The scandal only fazed her campaign, as she went on to beat conservative Republican stalwart Bruce Herschensohn by 4.9 percentage points. He was hampered in the last weeks of his campaign by revelations that he had attended a strip club, something that wouldn’t matter in the post-Bill Clinton era, but did 23 years ago.

After that, Boxer more handily won her re-election bids against Republican opponents: in 1998 against Treasurer Matt Fong; in 2004 against Secretary of State Bill Jones; and in 2010 against former HP CEO Carly Fiorina.

However, Boxer’s victory margins always were less than those of Feinstein.

Issues

On economic issues, Boxer opposed President Bush’s tax cuts. But she supported his 2008 bailout of the financial system at the start of the Great Recession.

She has been a major supporter of President Obama’s programs, especially his American Recovery and Reinvestment Act of 2009. And she backed the Affordable Care Act, or Obamacare.

On social issues, throughout her career Boxer has been pro-choice on abortion. And she strongly backed legalizing same-sex marriage.

On foreign policy, she broke with Feinstein over Iraq policy. Feinstein supported the resolution in Oct. 2002 authorizing force against Iraq, which gave the green-light to President Bush invading Iraq in March 2003. Boxer opposed it.

She has favored more gun control. But oddly for a liberal, she has opposed legalizing marijuana because it could increase crime and car accidents.

After Boxer

Boxer’s exodus from the Senate sets off a scramble to replace her in the 2016 election. With Republicans doing much better in last November’s election, even they might have a chance of taking the seat in Nov. 2016. Should he choose to run, Neel Kashkari, who lost to incumbent Jerry Brown for governor, would have a leg up this time because this would be an open seat.

But most attention would be on the Democratic field in the June 2016 primary. Top candidates include Lt. Gov. Gavin Newsom, Attorney General Kamala Harris and Treasurer John Chiang, a rising star the last eight years for his open-government reforms as state controller.

A new Democrat in Boxer’s seat won’t so much be less liberal, as a different kind of liberal because of a change in generations.

Currently, the three top elected posts in the state are held by Democrats who came of political age way back in the 1960s: Brown, 78; Boxer, 74; and Feinstein, 81. Like Boxer, Feinstein lives in wealthy Marin County, something unlikely to be repeated by a new senator.

Boxer’s retirement is the beginning of the changing of the guard in state politics.

This post originally appeared on CalWatchdog.com

Pension crisis divides CA Dems on UC tuition hikes

 

 

Janet_NapolitanoA 14-7 vote yesterday by the full University of California Board of Regents made it official: Golden State Democrats are deeply divided on tuition increases, thanks to the intractable politics of underfunded pensions.

On one side are Democrats who favored the increases, including UC President Janet Napolitano, formerly President Obama’s secretary of the Department of Homeland Security; Regent Richard C. Blum, the husband of long-time U.S. Sen. Dianne Feinstein, D-Calif.; and the school’s overwhelmingly Democratic faculty, who seek the tuition hikes to fill their pension plan that is $25 billion underfunded and would benefit from the extra money taken from students.

Napolitano insisted the UC system could not maintain its “vitality” or “stability” without more money from students.

In the 14-7 vote, among those seven opposed were some heavy-hitters in Democratic state politics: Gov. Jerry Brown, Lt. Gov. Gavin Newsom, Assembly Speaker Toni Atkins and State Supt. of Public Instruction Tom Torlakson — all just re-elected to their offices; and former Speaker John Perez. Also in this camp would be many students who have protested the increases.

Brown went to the extraordinary length of offering his own counterproposal, falling back on the traditional idea of convening a panel of experts to recommend a policy.

Although the split among Democrats has dominated the news, tuition has not been the only issue to introduce party fractures in recent months.

State Democrats previously divided on education in the wake of the Vergara ruling, wherein Judge Rolf Treu ruled that California’s teacher tenure system unconstitutionally violated students’ civil rights. The controversy helped tee up a close and rancorous race between union-backed incumbent Superintendent of Public Instruction Tom Torlakson and his challenger, Marshall Tuck. Both are Democrats.

But a broader range of issues also proved problematic. Environmentalists chafed, for instance, at Brown’s diversion of cap-and-trade fees into the costly high-speed rail project, which wouldn’t help reduce statewide emissions for years.

An open secret

The pensions crisis, however, has been quietly pushing Democrats apart. Outgoing controller and incoming Treasurer John Chiang, encouraged by Gov. Brown, developed a reputation for laying bare the abuses of pension funds like the California Public Employee’s Retirement System, whose pension-sweetening machinations recently drew the ire of the governor.

Chiang’s relatively bold stand has led some observers to speculate he could upset an anticipated struggle between Newsom and Attorney General Kamala Harris to replace Barbara Boxer in the U.S. Senate two years from now. For the moment, however, Chiang has helped drive a wedge into the Democratic Party by giving political cover to Democrats willing to object to California’s pension burdens. And though the pension issues at the heart of the UC tuition increase have been an open secret, they have yet to receive a commensurate amount of media attention.

As Bloomberg recently reported, the UC system operates an independent $90.7 billion pension fund, underfunded by about 20 percent. The state of California covers the employer’s percentage of pension costs for most state employees, but not for UC teachers.

Nathan Brostrom, UC’s chief financial officer, put the problem to Bloomberg in blunt terms. “Frankly, if the state were to pay that, we would not be proposing a tuition increase,” he said.

But Bloomberg pointed out, “Brown’s budget office says the pension system is independent and lawmakers have no input into how it is structured or the level of benefits provided. If the state were to pay more toward the university’s retirement costs,” Brown’s administration reasoned, “It would essentially be the same as giving them more funding.”

Given Sacramento’s current level of pension obligations — and the fraught politics surrounding the outcome of pension-fueled municipal bankruptcies in cities like Stockton — state Democrats have not been motivated to take on the UC’s massive pension obligations.

Student frustrations

Confusion and a sense of powerlessness among students have deepened the political impact of UC’s pensions.

At San Francisco’s UC campus in Mission Bay, where the regents gathered, “hundreds of students” staged angry protests, with some, as the San Francisco Chronicle reported, breaching “metal barricades and police security lines.”

Ry Rivard at Inside Higher Ed recounted the judgment of Student Regent Sadia Saifuddin, who told Regents she’d been obliged to take on four jobs to cover her schooling costs. Saying “students have always been taken hostage,” Saifuddin claimed “students have always had to pay the price of economic mismanagement by the regents and the state.”

This article was originally published on CalWatchdog.com

 

Pension funds feel heat on climate change issue

This piece was originally published on Calpensions.com:

CalPERS signed a United Nations pledge in Montreal last week to measure the “carbon footprint” of its $296 billion investment portfolio, with the goal of reporting the results before a UN climate change conference in Paris late next year.

CalSTRS announced in response to a UN climate summit in New York last week that its investments in “clean energy and technology,” now valued at $1.4 billion, will be increased to $3.7 billion over the next five years.

UC Regents voted on Sept. 17 to reject a student-led call for divesting fossil fuels from a $91 billion investment portfolio (three-quarters in retirement funds), but did not rule out using divestment later after developing a new investment framework.

Pension funds have used their investment clout for targeted social goals, notably divestments or stock boycotts of apartheid South Africa and tobacco. Curbing the use of carbon-emitting fossil fuels said to be disastrously warning the climate is a much larger global undertaking.

“We call on other investors to join us in assessing the climate risk in their investment portfolios and using that knowledge and insight in their investment decision,” Priya Mathur, the CalPERS board vice president, said in the carbon pledge news release.

President Obama called for more worldwide action to reduce climate change as he spoke at the UN climate summit in New York last week. “Nobody can sit on the sidelines on this issue,” he said.

Consultants announced last week that 180 institutions (pensions, religious, philanthropic, local governments and others) have pledged to divest fossil fuel holdings worth $50 billion, including the $860 million Rockefeller fund, founded on an oil fortune.

A coalition of groups announced that nearly 350 global institutional investors, managing $24 trillion, called on government leaders to phase out fossil fuel subsidies and provide “carbon pricing,” which would help redirect investments to clean energy.

Carbon pricing, charging a tax or fee for emitting a ton of carbon dioxide, is favored by many economists as a workable way to reduce global warming. The concept has the support of CalPERS and CalSTRS.

“If a meaningful price on carbon emissions is established, CalSTRS believes its clean energy and low-carbon investment could grow to almost $9.5 billion, nearly seven times the current level of investment,” Chris Ailman, CalSTRS chief investment officer, said in the climatesummit news release.

California has a limited form of carbon pricing with a “cap-and-trade” program for oil refineries, power plants and large factories. As a cap on greenhouse gases tightens, industries must cut their emissions or buy an “allowance” from other firms or the state.

Calling for action on climate change, demonstrators marched through Manhattan last week at the climate summit, as many as 400,000 in some estimates. But there also are climate change skeptics. Summit news reports showed contrasting views of how the issue is viewed in the political arena.

National Public Radio reported that Chris Lehane, a Democratic strategist for a committee putting money from billionaire Tom Steyer into a half-dozen close races, said, “In many of these campaigns, climate is being used as a wedge issue, focused on Republicans.”

Fox News reported that Dan Simmons of the Institute for Energy Research said a recent Gallup poll found 41 percent think the economy is America’s biggest problem, while only 1 percent cited the environment and pollution. “Limiting greenhouse gas is not something that the majority of Americans consider one of the most pressing issues of our time,” he said.

CalPERS and CalSTRS have moved away from divestment, troubled by the cost, no hard evidence of results and legislative meddling. They prefer to use their status as shareholders for “constructive engagement” with companies to push for change.

California Public Employees Retirement System consultants estimated that a 1987 law requiring divestment of South African-connected firms cost CalPERS $529 million, and not being able to invest that amount boosted the total to $1.86 billion by 2006.

South African divestment cost the California State Teachers Retirement System $600 million to $750 million, the consultants said. Similar costs resulted when CalPERS and CalSTRS voluntarily divested tobacco stock.

The two big pension funds clashed with the Legislature over a 2007 law requiring divestment of foreign companies doing defense or energy business in Iran. Labor-backed Proposition 162 in 1992 gives public pension systems sole control of their funds.

Now climate change is creating a new wave of pressure. Last July the mayors of Oakland, Berkeley and Richmond published an article in the Sacramento Bee urging CalPERS to join their cities and San Francisco and Santa Monica in fossil fuel divestment.

The mayors said that if global warming is to be limited to 2 degrees Celsius, believed to be the best chance of avoiding runaway climate disruption, no more than a third of proven fossil fuel reserves can be consumed prior to 2050.

If governments act to control climate change, the mayors said, the companies will have to leave most of their reserves in the ground, even though they continue to spend hundreds of billions exploring for new reserves.

“A growing ‘carbon bubble’ — overvalued companies, wasted capital and stranded assets — poses a huge risk to investments in fossil fuels,” the mayors said.

When the CalSTRS board was urged to divest fossil fuels last June, similar arguments were made by Deborah Silvey and Jane Vosburg, representing teachers and retirees with the 350 Bay Area Divestment Campaign.

The international grassroots campaign founded by author Bill McKibben takes its name from the view of some scientists that the current carbon dioxide in the atmosphere, 392 parts per million, must be reduced to 350 ppm to avoid a climate tipping point.

After a 10-campus student group, “Fossil Free UC,” urged divestment, UC Regents appointed a task force on sustainable investing. The regents adopted the task force recommendations during a well-attended meeting Sept. 17.

The goal is to develop a framework for sustainable UC investing by next July that includes ESG (environmental, social and governance) factors. An evaluation of ESG strategies is to include “whether to use divestment.”

Regent Bonnie Reiss said that making the case for divestment should be an “uphill battle” because of fiduciary obligations. Reiss and Regent Gavin Newsom suggested a look at coal holdings, which Stanford University plans to divest.

The University of California also will “allocate $1 billion over a period of five years to solutions-oriented investments such as renewable power and fuels, energy efficiency, and/or sustainable food and agriculture.”

Meanwhile, 350.org groups throughout California have been working to get the support of CalPERS and CalSTRS members and unions and may soon launch a formal divestment campaign, “Fossil Free California.”

Reporter Ed Mendel covered the Capitol in Sacramento for nearly three decades, most recently for the San Diego Union-Tribune. More stories are at Calpensions.com.