Davis Is Facing Tough Problems on His Own

After an election in which voters voiced deep dissatisfaction with his leadership, Gov. Gray Davis enters his second term with neither strong public support nor a well-defined mandate.

Many of those who cast ballots on Tuesday did so despite reservations about his job performance. Davis also campaigned without much of a platform, focusing instead on tearing down his Republican challenger, Bill Simon Jr.

Now, having governed for the last four years without many allies in the Legislature, Davis enters his second term facing tough problems without strong supporters.

“The minute he’s sworn in, he’s a lame-duck, term-limited incumbent, and it’s going to be -- to some degree -- more difficult to hold people in line,” said Garry South, the governor’s top political strategist.

The most immediate trouble for Davis is the state’s fiscal mess -- a looming budget shortfall that most experts predict will easily top $10 billion. He will soon be forced to choose between raising taxes and cutting billions of dollars in spending, much of it on popular programs.

Davis is certain to face fierce resistance in the Legislature, both from Republicans who refuse to raise taxes and Democrats who oppose program cuts.

But the battle over state money is only the most visible of the difficulties the centrist governor can expect in working with a polarized Legislature that became even more so Tuesday.

“I don’t think the second term is going to be a bed of roses,” South said.

Davis leads a state with substandard public schools, overcrowded freeways and uncertain water supplies. California also continues to feel the aftereffects of the energy crisis.

In his campaign for reelection, Davis offered little in the way of an agenda that he can now press in his second term. To win, he attacked Simon with television ads depicting the Republican as an untrustworthy and incompetent businessman.

In spots promoting himself, Davis looked backward, not forward, boasting of higher school test scores, more health coverage for children and other first-term advances. It was only at the end of the race that Davis ran an ad promising to pursue more of the same in his second term.

“I don’t know that we’ve even had a clear message from him on what he wants to do for the next four years, other than continuing the things he’s done so far,” said Larry N. Gerston, a political science professor at San Jose State.

But for any programs that cost money -- among them the health insurance for kids -- Davis is hamstrung by the state’s dismal fiscal outlook. This year, it was only after a two-month political stalemate that Davis and the Legislature cobbled together a plan to close a record budget gap of nearly $24 billion.

Next year could be worse. For now, the state’s estimated revenue shortfall is more than $10 billion, but analysts expect it to grow. A projected economic turnaround has not occurred. And the fiscal tricks used last year to balance the books -- spending postponement, fund transfers and the like -- now are just about exhausted, making a tax hike or big spending cuts all but inevitable.

Tuesday’s results were likely only to further hobble Davis as he confronts that issue. A ballot initiative to expand before- and after-school programs -- at a cost of up to $550 million a year -- was leading in early returns and could further constrain the state’s options for balancing the budget.

Over the course of the campaign, Davis refused to say how he would resolve the crisis.

Gerston said the outcome was inevitable: “He’s going to preside over the largest tax increase in recent memory. This has to be the worst-kept secret in the world.”

But Republicans resisted the tax hike ultimately enacted this year and have no incentive to be less steadfast next year.

Democrats retain solid majorities in both houses of the Legislature, but the budget requires a two-thirds vote, so a handful of Republicans must consent to any tax hike.

“Republicans are not going to sit still for a tax increase,” said Sherry Bebitch Jeffe, a political science professor at USC. “They don’t have to.”

Pressure for a tax hike will come not just from Democrats, but also from organized labor, a major supporter of the governor’s reelection effort. Art Pulaski, executive secretary treasurer of the California Labor Federation, said unions will seek a tax hike on the rich to avoid cuts elsewhere.

“You can’t cut any more,” Pulaski said. Advocating that view will be a strengthened caucus of liberal Democrats dominating both houses of the Legislature.

In several districts around the state, liberal Democrats and conservative Republicans defeated moderate opponents in the March primary, then went on to win the election Tuesday.

The deepening polarization of the Legislature is the result in part of a redistricting plan -- approved by representatives of both parties -- that created more solidly partisan districts, making it possible for more ideological candidates to prevail.

That leaves liberals prepared to fight to protect programs and conservatives ready to battle against tax hikes.

For Davis, a staunch moderate already unpopular among state lawmakers -- even within his own party -- the sharp divide within the Legislature portends trouble beyond the budget.

Even his advisors acknowledge that the coming months will test the governor. South said Davis “will have to keep the Legislature from trying to roll over him like a bus coming down the road” with liberal legislation -- and could risk his first veto override.

Another potential thorn for Davis is the cadre of Democrats in other statewide elected offices, nearly all of whom are potential candidates for governor in 2006.

Among them, according to early returns Tuesday, could be John Garamendi, the insurance commissioner candidate who ran for governor in 1994; state Atty Gen. Bill Lockyer; Treasurer Phil Angelides; and Lt. Gov. Cruz Bustamante. All of those officials were leading in early returns Tuesday.

To break away from the pack, strategists said, any one of them could try to embarrass the governor the way state Controller Kathleen Connell did by criticizing him during her 2001 campaign for mayor of Los Angeles. Already, Bustamante has run television ads portraying himself as courageous for speaking out against a Davis administration software procurement scandal.

“They might all start ganging up against Davis, because talk is cheap,” said GOP strategist Arnold Steinberg.

At the same time, it is not just the environment around Davis that is changing. Davis himself enters the new term with an unfamiliar worldview.

For decades, Davis has climbed the state political ladder, running for higher office time and again. Now, under term limits, Davis cannot run again for governor, so his march through the state political ranks is complete.

He could run for president or seek to replace Democratic Sen. Dianne Feinstein if she decides not to seek reelection in 2006. Or he could govern with an eye toward his legacy rather than toward the next campaign.

“It does provide him with an opportunity -- if he really wanted to -- to become an elder statesman,” Steinberg said. “The question is, what will be the last thing he wants to be remembered for?”