The new Democratic leader in the state senate, Darrell Steinberg, appears to have concluded -- correctly, it says here -- that California's legislative Republicans will never back any tax hike, no matter the current budget crisis. Republicans had thought they could block a budget solution because of the state's requirement of a two-thirds vote to pass a budget or raise taxes. But now Steinberg and Assembly Speaker Karen Bass have constructed a proposal that mixes revenue cuts and tax hikes and is designed to avoid the two-thirds rule. The result is highly technical and convoluted. One piece involves moving around tax revenues between state and local pots, another involves reducing some taxes while establishing or raising others. (Details are here, via the Sacramento Bee). but it should pass his chamber on a party-line vote. Here's hoping the Assembly then takes it up and sends it to the governor's desk.
At that point, Schwarzenegger might finally have some leverage with the Republicans. If he signs the bill, he'd be punching a hole in the two-thirds rule -- which provides the GOP with its role in the budget game. Perhaps Republicans would come to the table that point and deal on taxes. (UPDATE, LATER 12/17: Schwarzenegger aides indicate he opposes the Steinberg proposal -- they want more long-term cuts and budget savings -- so there goes any leverage. -JM). Or they could go to court and try to challenge this Steinberg legislation as unconstitutional. The Republicans could pay a high political price for doing that--they'd be using the courts to block a solution to the budget problem that the public desperately wants. The GOP would argue that they are fighting tax hikes, but I would be willing to wager that legislative Democrats and Schwarzenegger would win that public relations battle. And it's always possible they could lose in the courts, with judges establishing a new loophole in the two-thirds rule.
In any case, Steinberg, who is new in his job, is showing real leadership. His legislation is full of painful things -- cuts in programs and new taxes (in disguise) -- but it's necessary with California running so low on cash that infrastructure projects were halted today.
My only question: Why didn't somebody try this before?