NEWS ANALYSIS : Wilson Emerges From First Year Battered but Feisty : Capitol: Some are talking about him being a one-term governor. But he doesn’t regret seeking the job.

The story already is folklore here, of how California political guru Stuart K. Spencer cautioned Pete Wilson two winters ago against running for governor, warning that the state was “unmanageable” and “ungovernable.”

Wilson, although he had recently been reelected to the U.S. Senate, was agonizing over whether to leap into the race to succeed the retiring Gov. George Deukmejian.

Spencer, a seasoned counselor to Presidents and governors, invited his longtime friend to his isolated ranch in Oregon for some frank, relaxed conversation among the pines and manzanita, in front of a crackling fire.

“You’ve got the best job in the world right now--senator from California,” Spencer told Wilson. But the confident senator, a former San Diego mayor who always had coveted the governorship, was bit by the challenge of Sacramento. “I think it is governable and I think I can do it,” he replied .

Today, the governor calls this “the best example of someone’s advice not taken. . . . Stu has attributed to me a great stubbornness. I plead guilty.”

One year has passed since Wilson narrowly won his race for governor. And Spencer is looking more and more like a prophet.

The new Republican governor has been battered, hindered and absorbed by a series of crises, roadblocks and disasters--fiscal, political and natural. He has made only limited progress toward his long-range goal, proclaimed optimistically in the title of his first State of the State Address, of “Preparing a Path to the 21st Century.”

“Nobody could foresee it being as tough as it turned out to be,” said Bob White, Wilson’s veteran chief of staff.

First there was the crop-killing freeze, then the fifth year of drought, and a nagging recession that resulted in an unprecedented $14.3-billion budget deficit and big tax increases with program cuts. Add incessant conflict with the Republican right wing and the furor kicked up by Wilson’s veto of a gay rights bill. Also figure in the devastating Oakland fire and spread of another crop-ravager, the poinsettia whitefly. Now, history is starting to repeat: The state is facing a new budget deficit of several billion dollars and--if it doesn’t start raining soon--perhaps a sixth year of drought.

Wilson’s popularity has plummeted in the polls. And suddenly people are not talking so much about him running for President in 1996 as the favorite son of the state with the most convention delegates and electoral votes. They are beginning to talk about him possibly being only a one-term governor and getting tossed out of office in 1994, especially if he raises taxes again.

“You’re not using my name, right?” one prominent business supporter queried a reporter. “As of now, he’s a one-term governor.” Another politically savvy Republican observed: “The corporate community is very concerned about those taxes and their effect on California’s economy. He’s vulnerable. He may be a one-termer.”

Wilson, in a recent interview, said: “I’m not pleased by the polls, but I’m not surprised either. Actually, they are far less foreboding than the dramatic drop (in popularity) of several of my colleagues (in other states).”

As for the tax hikes, Wilson said “the public correctly understands that this (deficit) was an inherited disaster” left to him by the Deukmejian Administration. The taxes were inevitable, he continued, “unless you had people willing to make spending cuts far deeper” in education, health and welfare. “And neither (party) caucus in either house was.”

He flatly ruled out further tax increases, however. “We’re not looking to raise anybody’s cost of doing business,” he said. Does that mean the budget will have to be balanced entirely with spending cuts? “Yep.”

Feisty, confident, stubborn, energetic, aggressive--Wilson exhibits the traits he showed back at Spencer’s ranch house.

He is nearing the end of his legislative “honeymoon” year having acquired the reputation of a scrappy infighter.

“He’s a total and complete political animal,” Assembly Speaker Willie Brown (D-San Francisco) replied when asked what he had learned about Wilson. “That, and he’s real smart. And he only yields when you have superior numbers. There’s no give in him at all.”

Senate President Pro Tem David A. Roberti (D-Los Angeles) said: “The positive side is he’s a hands-on governor. But I tend to think he bears his resentments very intensely. I don’t feel I’m the brunt of it; it’s just something I sense, his dealings with people in his own party. At times, he’s very, very pleasant, but I think he’s capable of a mean streak.”

Roberti continued: “He’s a hard negotiator and there’s never a break in the negotiations until there’s a confrontation. . . . It just tells me that (in the future) we’re going to have a new way of negotiating with him. On every important issue, it’s going to be hardball the whole way. . . .

“There’s an upside to him: He works very hard at it, he participates intensely. That’s important.”

Fighter or not, there is little yet for Wilson to brag about.

He has made a modest start toward his loudly trumpeted, widely acclaimed emphasis on “preventive government”--tackling health and education problems in early childhood before they multiply into costly government dependency. In an era of severe government cutbacks, Wilson managed to wheedle $167 million from the Legislature for the start-up of his preventive agenda. He called it his proudest achievement so far. “It’s going to make a significant difference in the life of children,” he said.

But the Legislature has balked at creating the Cabinet-level office Wilson had sought to administer the innovative programs. The implementation bill was used by lawmakers as leverage over the governor on redistricting, among other issues. But more than that, Roberti said, the Legislature is naturally reluctant to expand the governor’s power, especially at the expense of a fellow Democrat, State Supt. of Public Instruction Bill Honig.

“We’re a little leery of turf here,” Roberti said. “Not so much our turf, but the aggrandizement of the executive (branch).”

The governor received broad praise for his firm but coolheaded management of the drought, particularly his creation of a novel “water bank” to buy surplus water from the haves--mostly farmers--and sell it to the have-nots, primarily in Southern California. Wary of another dry winter, the state is storing more water than it was a year ago.

Fortunately for the governor, he did not have to deal with the Legislature in parceling out scarce water supplies.

Applause is less universal for Wilson’s handling of the state’s budget deficit, which led to $7.6 billion in higher taxes and $3.2 billion in program cuts.

Indicative of the tension between Wilson and fellow Republicans in the Legislature--outright alienation in some cases--was Senate GOP Leader Ken Maddy’s recent comment to a reporter that henceforth he “will be more cautious” in dealing with the governor. To put this in perspective, the moderate Fresno senator is Wilson’s most loyal, most influential ally in the Legislature.

But Maddy thought Wilson pulled the rug out from under him at the end of the budget fight by endorsing a “soak-the-rich” income tax increase and backing away from a compromise the GOP leader had helped steer through the Senate. Maddy felt betrayed when the governor, listening to business interests, sent the state into the new fiscal year without a budget in a futile effort to achieve major reforms in the state’s workers’ compensation program.

“For us Republicans, it’s difficult to be too angry with our governor. There are a number of things he can help us with,” Maddy said, mentioning political fund raising and bill signings. “But there is a point where rebellion sets in. He can’t have all of us bad-mouthing him all the time if he has national ambitions. If your own party turns its back on you, it can make life pretty miserable.”

The budget fight particularly ruptured relations between the governor and conservative members of the Assembly--”cavemen,” their detractors call them. After Minority Leader Ross Johnson of La Habra persistently refused to support any tax hikes, a Wilson-sanctioned coup replaced him with the more cooperative Bill Jones of Fresno.

“There are a lot of people who feel strongly about the governor’s position on the budget and probably will continue to do so,” the soft-spoken Jones acknowledged.

One of those critics, Assemblyman Tom McClintock (R-Thousand Oaks), was more blunt: “The governor’s position is the fetal position--just make it go away. But the problem is not going to go away; it’s going to get infinitely worse. For 16 years, California governors have failed to summon the political vigor to ask how the taxpayers’ money is being spent. The rampant inefficiency and waste is appalling. There’s no substitute for a top-to-bottom downsizing of state government.”

Actually, Wilson is planning to create a blue-ribbon panel of business executives to recommend how to reduce government waste.

What especially infuriated Johnson, McClintock and other conservatives--and distressed many business interests--was Wilson’s early, up-front endorsement of tax increases as part of the budget solution. They insist that the governor could have coaxed more budget reforms and spending cuts from the Democratic-controlled Legislature if he had been less willing to raise taxes.

“That’s nonsense,” Wilson said. “I’ve heard all of that. And never did I hear anything in the way of solid, specific suggestions that would have come anywhere near to closing a (revenue) gap of that magnitude.” Furthermore, the governor said, the reforms in his budget solution--including the first cuts ever made in welfare benefits--”were very significant, far more than the state’s ever seen.”

Indeed, Wilson continued, “my biggest disappointment (as governor), I would have to say honestly, was the very erratic performance by the Legislature in response to (fiscal) crisis. Some (lawmakers) were good, some were not. Some simply didn’t have the stomach to do what was necessary.” Wilson said he was referring to both the courage to raise taxes and to cut spending. “If you can’t do either one, you’re not particularly relevant,” he said.

It would seem, based on what Wilson said in the interview, that there is hardly anything he would have done differently so far--not even his highly unpopular extension of the sales tax to candy and snack foods. Asked if the snack tax was a mistake, he quickly responded: “Is any tax a mistake? No tax is popular. To speak of a popular tax is an oxymoron. The only popular tax is one that someone else pays.”

But there is one thing he would not have done, the governor admitted: In hindsight, he should not have told a group of newspaper editorial writers last spring that it was very likely he would sign a bill outlawing job discrimination against homosexuals. “It was naive in retrospect,” he said. “I probably should have determined more of the relevant facts (of the issue).”

Wilson established an expectation among many gay rights activists that he would sign the bill, AB 101. When he vetoed the legislation--on the grounds that it was unnecessary and could lead to harassment of small businesses--widespread demonstrations erupted, many of them violent. “These are presumably adults who engage in temper tantrums that you wouldn’t tolerate in a 5-year-old,” the governor said. “Their reaction was really mindless and represents a distinct minority view.”

But he also angered many on the other side with a strongly worded veto message that denounced the “abhorrent excesses” of a “tiny minority of mean-spirited, gay-bashing bigots” who had vehemently opposed the legislation.

“Gay-bashing bigots? Most of the people who opposed the legislation don’t fall in that category,” Wilson said. “But I thought it was interesting that some people sort of rose to the bait and self-identified. That’s their problem, not mine, if someone says, ‘Yep, that’s me he’s talking about.’ ”

There is a strong suspicion among political observers in Sacramento that Wilson vetoed the legislation primarily to appease the Republican right wing and justified the action to himself by rationalizing that it would be bad for the state’s business climate. The governor denied this. Asked how much politics entered into his decision, he replied: “Not very much, because it was clearly a no-winner.”

Skeptics point out, however, that Wilson soon afterward signed legislation that many business interests objected to more strenuously: A bill, popular with the public, requiring major employers to allow workers four months unpaid leave to care for newborn children or seriously ill family members. To those contending it was inconsistent to veto the job discrimination bill while signing the family leave legislation--if the business climate truly was his main concern--the governor said, “I flatly disagree.”

To the contrary, Wilson said, it would have been personally inconsistent to veto the family leave bill because he had voted for similar measures in the U.S. Senate. Anyway, he continued, the family leave requirement “may be a more frequent inconvenience” for business, but not a greater financial burden than nuisance discrimination suits.

“The major concern ought to be maternity leave, an essential ingredient of a child getting a decent start in life,” Wilson said. “It’s entirely consistent with my emphasis on prevention.”

In fact, the governor said he wants to implement “a lot more” of his preventive agenda in the future, although “admittedly this is a terrible time for any kind of program because we are faced with the necessity of making cuts in most areas.”

Other goals, he said, are “to make California a competitive business climate . . . to reform the educational system so that we’ve got the competent work force able to compete and win and fulfill our destiny as the projected fourth-largest economy in the world by the turn of the century . . . and, the fundamental goal, to make this a safe, decent place in which people need no longer be fearful of drive-by shootings and of their kids being sold drugs in school.”

But Wilson’s aims are being thwarted by deep-rooted state problems that go beyond the immediate recession: An exploding population--a 26% increase in the 1980s plus another 21% projected in the 1990s--is exerting pressure on a fragile environment and squeezing a job base that is stagnant at best. According to a recent study by the state Department of Finance, this problem is compounded by the fact that the proportion of tax users, including children and the elderly, is growing much faster than the number of working-age taxpayers.

“He’s living every day with the budget,” said White, the governor’s chief of staff. “People want state services; they don’t want to pay for them.”

Wilson is not showing it, however, if he wishes he had listened more to Spencer back at that ranch. And Spencer says: “I think he made the right decision to run. I think, in the end, he’ll fight his way out of this.”