A path forward for California

January 12, 2011

This piece is one in a series on the fiscal challenge facing California, produced in partnership with the Working Families Summit and the California Center for Research on Women and Families.

By James P. Mayer, California Forward

Californians want a path forward – one right step after another. We need to make government work again and support economic recovery so families can pay their bills and keep their homes. A stronger economy means reinvestment in better schools, smarter criminal justice systems, and more effective safety nets.

To get there, California needs a workout plan: In three years, honest accounting can restore trust. In five years, a culture of performance can generate better results. In seven years, Californians will see strong returns – better jobs, better communities, better futures.


Step One: Stop the bleeding and start the healing

The Governor and lawmakers must agree on an honestly balanced, well-spent budget. Rather than fudging another budget based on unrealistic windfalls, policymakers should craft a three-year plan that achieves balance with real cuts or new revenue. Simultaneously, lawmakers must enact fiscal reforms that keep the state from digging deep financial holes, while creating a performance-focused culture that reduces waste and improves outcomes.

Budget reforms are critical to improving results and restoring public trust and confidence. Lawmakers should be required to use unexpected revenue in good times to pay off debt and save for the inevitable bad times (as ACA 4 on the 2012 ballot would do). California needs a Pay-Go rule, so lawmakers don’t make promises they can’t keep. The state budget should include performance metrics – so everyone knows if we’re getting our money’s worth – along with multi-year forecasts, so we can see the long-term impacts of budget deals. Finally, lawmakers need to spend as much time reviewing programs as they do passing new laws. Together, these reforms would focus lawmakers on setting priorities and using available resources to improve results.

Step Two: Make Government Work Again

Government provides essential services, and elected officials have a fundamental obligation to make sure programs work well. To improve results in education, social services, criminal justice, and other programs, California needs to restructure government. The local leaders responsible for delivering services need the authority to get the job done, so Californians – as citizens and voters – can hold them accountable for results.

1. The state should define statewide objectives and partner with local governments to reach them. Rather than micromanaging programs, the state must help local agencies and coordinate intervention when local efforts fail.

2. Local governments must be empowered to do a better job educating children; reducing crime, violence, drug abuse, and poverty, while supporting families and neighborhoods; and partnering with community groups and employers. This will require restructuring how California finances counties, cities and schools, and focusing on performance and results.

3. Local governments need to work together at the regional level to develop the workforce and infrastructure to attract private investments that generate jobs. The state should incentivize public agencies to innovate ways to achieve state goals for a healthy environment, adequate housing, and better mobility.

Step Three: Re-invest in everyone’s future

The common theme of the California dream is: a good education leads to a good job and a satisfying life in this special place. Over the last generation, California’s dysfunctional system of governance has eroded our ability to solve public challenges and thrive in a competitive and technology-driven global marketplace. Political gridlock and poor results are signals to investors and entrepreneurs to go elsewhere with their ideas, dollars, and jobs.

Some governance reforms have already been enacted. Over the next decade, a new generation of lawmakers will be elected from citizen-drawn districts and through an open primary process – encouraging bipartisan problem-solving. Term limit reform, if approved by voters in 2012, could stabilize the Legislature and allow a sustained effort to solve some of the larger challenges facing the state.

Finally, if Californians come together to restructure the relationships among the state and local governments, we will begin to see the benefits of better governance and renewed private investment: Continuous improvement in the performance of educational and social programs will allow the state to shift resources from prisons back to universities. Efficiency and innovation in regulations will allow businesses to pay higher wages while remaining competitive. Growing middle-income jobs will reduce the demand for public services and increase tax revenue. Reinvestment in education and infrastructure will attract more capital – leading to more jobs.

California Forward is committed to making this plan a reality. We will rely on solid, nonpartisan analysis and seek solutions embraced by a broad coalition. Californians seek – and deserve – public interest solutions that don’t tilt our democracy left or right, but make it responsive and competent.

James P. Mayer is the executive director of California Forward.

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