Deukmejian Explores a State Frontier Bound by Frugality

Back when Ronald Reagan was governor, Democrats in the California Legislature would exact a big price every time he proposed giving surplus money back to the taxpayers through a rebate or property tax reform.

Led by Assembly Speaker Jesse M. Unruh (now state Treasurer) and Sen. George Miller (now a member of Congress), they would demand the governor’s approval of a major new education program. Almost invariably, this little form of extortion would work. Reagan would get his tax rebate, or some version of it, and the Democrats would win hundreds of millions of dollars in new money for schools.

Both sides would come out short-term political winners, although Reagan developed the reputation of an enemy of education.

All that has changed, even though California again has a Republican governor, George Deukmejian, and a Democratic majority in both houses of the Legislature.

With his continuing emphasis on education finance, Deukmejian has preempted a critical state issue. Even with a particularly frugal budget, as Deukmejian’s $37 billion spending plan for 1986-87 certainly is, the governor comes across to the voters as a most generous fellow in an area that affects most Californians.

In this election year, when Democrats in the Legislature pass bills to spend money for new programs, the governor can claim that the only way to approve such spending is to rob the schools of sorely needed money. Out comes the veto knife; Deukmejian has wielded it with relish and relative impunity in the past and is most likely to do again this year.

In fact, the modest 1986 program outlined in the governor’s budget and State of the State address last week seems well covered with political Teflon. Whenever Reagan, or even Deukmejian’s Democratic predecessor Edmund G. Brown Jr., submitted such a tight budget--less than 3% larger than the previous year’s--it invariably was described in bare-bones, skinflint terms. This was not the case with Deukmejian, however, who skillfully paved the way with a legislative address on the revived state economy, on his dedication to the education system, his commitment to cleaning up toxic wastes and his vision of the resurgence of California as the nation’s leadership state.

“Together, we have brought America’s frontier back to California--we brought California back to the future,” he said. No one can be quite sure what that means, but coming from a governor whose rhetoric does not normally soar or inspire, such phrases seemed at least to indicate a chief executive who feels confident and secure in his position.

The new or expanded programs Deukmejian announced were limited in number and cost, but high in political appeal. He proposed opening state offices in London and Tokyo to encourage expanded trade with California (California had such offices under Gov. Edmund G. Brown Sr. but they were closed by Reagan). He budgeted $37 million in his Rural Renaissance program to develop new business outside urban areas and to promote agricultural products abroad. He pledged an unspecified amount of new money to fight AIDS, acquired immune deficiency syndrome (Deukmejian first vetoed some AIDS funds last year and then accepted a smaller, subsequent appropriation). And he set aside again about $1 billion in a state contingency fund to offset unexpected emergency needs, resisting the temptation to turn it back to the voters as rebates in an election year.

The governor’s view of where California is and where it is going is clearly optimistic, based in part on an assumption that California residents will not stand for new programs that lead to new taxes. A much different view came from Assembly Speaker Willie L. Brown Jr. in his own assessment of the state of the state. Brown said California is facing massive problems and should meet them with aggressive new programs such as a state-administered liability insurance fund for local governments, a new school construction program and a bond issue to provide low-interest loans for farmers threatened with the loss of their land.

Brown set out a comprehensive agenda and attempted to explain the Assembly’s rejection last week of the governor’s plan for reorganizing state agencies to deal more effectively with toxic wastes--a major source of contention between the Assembly and the governor’s office. The speech impressed Sacramento insiders but reached only a limited television audience outside the capital.

Senate President pro tem David A. Roberti of Los Angeles had his own “Agenda of Opportunity” for California, one considerably more ambitious than Deukmejian’s. Roberti also emphasized the need for school construction and referred to the liability insurance “crisis.” Roberti has quarreled with Speaker Brown on the toxics issue and they do not always provide a united Democratic front against Deukmejian. In fact, the governor’s office often can count on the Senate as an ally rather than a foe.

Deukmejian’s fiscal hand was strengthened this past week when the Administration announced the new budget was within $100 million of state spending limits added to the state Constitution by voters in 1979. The initiative measure sponsored by citizen activist Paul Gann imposes a limit based on inflation and population growth. Whenever revenues exceed that limit, the excess must be returned to taxpayers. The state budget has never come near to the limit before because of higher inflation.

Administration officials said the limit would effectively block any attempt by Democrats to enact costly new programs, even if they were willing to sponsor tax increases to pay for them.

The major question is how the governor’s program will stand up under political assault from his expected Democratic opponent for governor, Los Angeles Mayor Tom Bradley, or whether the legislative details matter much. Bradley already has focused part of his campaign around environmental issues and allegations that Deukmejian has bungled the toxic waste problem despite clean-up pledges and budgeting new money for the program. Deukmejian, in turn, is fighting back with early and uncharacteristic aggressiveness, raising questions about Bradley’s own environmental record as mayor.

Deukmejian’s 1986 program skirts another environmental issue by maintaining the budget of the state Coastal Commission and adding two staff members. Last year, the governor attacked the work of the commission, trimmed its budget from $8.1 million to $6.5 million and cut the staff by 16.

Other portions of Deukmejian’s budget could be found wanting, including his glowing claims about what he has done for education the past three years. In spite of all the new money pumped into the system, California is far from a national leader in education finance. The state ranks 31st in per capita spending for local schools, 17th for higher education.

Even so, Speaker Brown and President pro tem Roberti largely avoided confrontation with the governor and his record in their own state of the state assessments. But then, they are not running for governor, merely trying to elect Democratic members of the Assembly and Senate. If the governor can occasionally take credit for Democratic legislative initiatives, as he does, they can let a little of his claimed achievements rub off on them. A productive 1986 legislative session could benefit all.

Some political insiders believe that if Deukmejian is vulnerable, it is not because of his record as a skilled manager of government, but because he has been too low-key and invisible in the managing process. While opinion polls show that a majority of voters consider him a good governor, his lack of flamboyance does not attract many excellent ratings. His strategy seems to be to play the role of the underdog and to come on strong as the frugal chief executive who returned California to economic health and fiscal stability while restoring the state’s education system to its former standard of excellence.

If Deukmejian has judged the California mood correctly, his 1986 State of the State address provides a solid foundation for a reelection campaign.