If you watched the presidential debate Friday night or read the post-debate coverage, you probably recall both candidates’ refusal to straight-up answer Moderator Jim Lehrer’s question about how a $700 billion bailout of ailing financial institutions could crimp the candidates’ bold (and expensive) plans for the nation.
Granted, Lehrer’s is a tough question to answer, and frankly, it might not be answerable in the course of a four- or even eight-year presidency. But if either candidate is willing to take a longer view, he might learn a lesson from California Governor Arnold Schwarzenegger.
Schwarzenegger was, of course, ushered into office as his predecessor, Gray Davis, was shown the door via recall election. Schwarzenegger boosted his election on promises to “fix” what Davis could not: California’s recurring inability to manage its budget. In boom times, state coffers swelled; legislators spent the largesse and made the spending repeatable, even if the boom eventually went bust, which it always did.
Despite his campaign promises, Schwarzenegger was unable to deliver a solution to this dilemma in his first term. And it now appears he won’t deliver a solution in his second term either — not with California’s economy again in bust mode, spiraling downward with the nation’s economy.
But according to the Sacramento Bee’s Daniel Weintraub, there’s a potential silver lining in this cloud: Schwarzenegger might secure the next best thing to a solution while he’s in office; namely, a solution that, years hence, could prove its worth and define his legacy. (Note: In addition to writing a column and blog for the Bee, Weintraub has authored an excellent book on Schwarzenegger, Party of One. TMV Chief Joe Gandelman was quoted in that book and offered a review of it this summer.)
In excerpted form, here’s how Weintraub (in his weekly column) summarizes Schwarzenegger’s long-term solution to the state’s budget woes, subject to voter approval:
• Require that the first 3 percent of tax revenues each year go into the new rainy-day fund …
• Require that unanticipated revenue windfalls be deposited into the reserve … All the transfers to the reserve would continue automatically until the reserve reached 12.5 percent of the general fund, or the equivalent of about $13 billion in today’s budget …
• Lock that money down … The final plan allows lawmakers to tap the reserve only when revenues grow less than required to maintain the previous year’s level of services while accommodating population growth and inflation …
• Allow the governor to make mid-year corrections … to suspend automatic cost-of-living increases for entitlement programs and cut spending on state operations in a fiscal emergency …
… if the plan had been law for the past 10 years and had worked as intended, spending would have grown more slowly, and the state would have had about $10 billion in reserve to cushion the blow of the economic slowdown.
OK. So how is this plan relevant to McCain and Obama? How might it help them answer Jim Lehrer’s question?
First, the presidential candidates might acknowledge (as I did earlier) that there are no easy or convenient answers to Lehrer’s question. Second, they might admit we will have to stop spending on ineffective programs (as Obama noted during the debate) and perhaps freeze spending on other programs (as McCain suggested). Third, they might recommend that, while we wrestle with near-term compromises, we also take a long-term approach to managing our spending, through both good times and bad — and here point to Schwarzenegger’s “rainy day fund” as a model for consideration.
This answer still might not include the level of detail some would prefer, but it strikes me as more realistic, more substantive, and more reassuring than what either candidate offered Friday night.
On the other hand, why would the candidates be willing to do this? Why, in particular, would Obama be willing to point to an opposite-party politician’s proposal? In short, because they already share common ground with the governor; all three are cut from similar political cloth.
I spoke with Daniel Weintraub Friday morning, eight-plus hours before the presidential debate. Going into that interview, I wanted to understand Weintraub’s thoughts on today’s Schwarzenegger versus the one portrayed in his book a year ago. Did Schwarzenegger’s latest victories and setbacks change, in any way, the conclusions about him that Weintraub reached in Party of One?
Of course, when Weintraub and I talked, neither of us knew Jim Lehrer would ask the bailout question he did — which is precisely why I was somewhat surprised how relevant Weintraub’s comments proved to be, as I read back over them this weekend.
Weintraub said he believes Schwarzenegger is as much a “party of one” today as he was when the book was published, if not more so. Case in point: Schwarzenegger’s threat to veto the budget the legislature sent him — a threat that eventually gave him his “rainy day fund.” In that dispute, legislators in both major parties were fighting Schwarzenegger, suggesting to Weintraub that the governor “remains in many ways a lone ranger in state government.” Weintraub added:
Sometimes he’s able to pull both sides together. Often, he stands alone. Governing for Schwarzenegger was always going to be difficult as a member of the minority party. In this capital, he’s a minority inside a minority.
Later, asked if he saw any similarities to Schwarzenegger in the major-party presidential candidates, Weintraub suggested McCain might be “the closer parallel” …
[McCain] is known as a maverick. He considers himself a Republican but seems comfortable crossing party lines or breaking with his party over platform or dogma. Obviously, there are differences between [McCain and Schwarzenegger] on certain issues. But in their approach, they’re quite similar.
Weintraub also acknowledged that, while lacking the same track record McCain has of bucking his own party, Obama has:
… built much of his campaign around the idea of reaching across party lines – and he has connected with many Independents and Republicans on that basis.
So why would either McCain or Obama take a page from Schwarzenegger? If you concur with Weintraub’s analysis, as I do, this shouldn’t even be a question for McCain. No, the McCain of 2008 is not the McCain of 2000, but he and Schwarzenegger are still, in many respects, “parties of one” in their respective jurisdictions. Regarding Obama, party loyalties might make the nod to Schwarzenegger more difficult, but doing so would be wholly consistent with the Senator’s perceived persona as (in the words of The Economist’s editors) “a consensus-seeking pragmatist,” with his repeated promises of bipartisanship, of pursuing strong ideas regardless of the letter (D or R) attached to them.
Both presidential candidates should at least consider what Schwarzenegger hath wrought. There are two debates remaining between them, and another moderator could reasonably take up Lehrer’s question, pressing the candidates to try again on their answers.