Partisanship Back in Play at Capitol

He quieted the Capitol infighting in his first months in office, but these days, Gov. Arnold Schwarzenegger is sounding like an unabashed partisan prepared to rethink bipartisan agreements.

In the early part of his term, Schwarzenegger forged difficult accords with the Legislature’s Democratic majority, deploying his celebrity and persuasive powers in winning campaigns to strengthen state finances and revamp the workers’ compensation system.

But during last summer’s budget fight, the fragile alliance frayed. A governor who had once cast Democratic lawmakers as “partners” began to ridicule them with the same zeal he had devoted to former Gov. Gray Davis in the recall campaign. He called his legislative opponents “girlie men.” He vetoed most of the major bills pushed by the Assembly’s Democratic speaker, Fabian Nunez of Los Angeles.

Now Schwarzenegger’s administration is flirting with a move that would, in essence, undo the marquee compromise of his first year in office -- the constitutional amendment requiring balanced budgets. His aides are considering a possible ballot initiative that would seek to limit state spending by tying it to changes in population and inflation.

Democrats say a cap would strip lawmakers of much of their discretion in putting together the budget; spending would rise and fall based on strict formulas. The balanced budget measure is, by contrast, more flexible, they say, permitting lawmakers to boost spending when tax revenue is high enough.

Ratified by voters in March, the balanced budget measure -- Proposition 58 -- was billed by Schwarzenegger as an effort to rein in spending as well as a symbol of a post-recall truce between the parties. If Schwarzenegger does push for a strict spending cap, as his fellow Republicans hope, Democrats say he’ll have gone back on his word and further soured relations.

A veteran now of bruising negotiations with lawmakers over the budget, workers’ compensation and prescription drug plans, the governor may be less hopeful than he once was about what can be realistically achieved in Sacramento through bipartisan consensus, analysts said.

“The message out of the recall was voters wanted their political leaders to start working together,” said Republican strategist Dan Schnur. “What Schwarzenegger has learned over the last 13 months is that voters may have sent that message, but no one in the state capital is listening.”

In the early going, Schwarzenegger ate Wiener schnitzel with Democratic leaders and praised everything from their tough negotiating skills to their chiseled stomachs. His best friend in the Capitol became the Senate’s cranky, proudly liberal Democratic leader, John Burton. Burton had free run of the governor’s office, walking through the halls with cups of frothy espresso for Schwarzenegger. So close were the two men that the governor’s staff scurried to set up meetings with disgruntled Republicans who were complaining about all the attention being paid to Burton.

Burton is gone now, forced to leave the Senate due to term limits. And Schwarzenegger seems less and less charmed by the Legislature. The turning point came in July, with Schwarzenegger stymied in his efforts to get a budget passed.

He told thousands of cheering supporters at an Ontario shopping mall that his legislative adversaries were “girlie men” who needed to be “terminated.”

Then he sought to make it happen. Though he had portrayed himself as a different kind of Republican, the governor endorsed 48 Republicans in legislative races and not one Democrat -- just as any orthodox Republican would have done. Though Democratic presidential candidate John Kerry was destined to win California, Schwarzenegger went to the crucial swing state of Ohio a few days before the election to campaign for President Bush.

After the election, Schwarzenegger held a news conference and was asked if he might favor a tax hike urged by Democratic leaders.

“Why would I listen to losers?” the governor responded.

Sacramento’s new year officially begins Jan. 5, when the governor gives the state-of-the-state address spelling out his priorities. One question the speech may answer is: Will Schwarzenegger persist in his message that Democratic lawmakers are obstacles to progress?

Whether he supports a spending cap may provide clues. His aides seem intrigued by the proposal now being discussed.

Sen. John Campbell (R-Irvine) is one of three sponsors pushing the spending-cap initiative, which echoes a cap that Schwarzenegger promised during the recall campaign and briefly embraced after taking office. He abandoned the idea when Democratic leaders balked, instead throwing his support to Proposition 58. The measure, he said, made a spending cap unnecessary.

“We don’t need one because this is really a great balanced budget,” the governor said in December 2003. “What this ensures is that legislators will never spend more money than the state takes in.”

Democrats contend that the bargain they had with Schwarzenegger was this: Democrats would help him win passage of a $15-billion borrowing plan and the balanced budget amendment in the March election. In exchange, the governor would decline to place his considerable popularity behind any spending-cap proposal.

“I have a very clear recollection of that,” Nunez said.

Democrats say a spending cap would fall hardest on their core constituencies -- poor and disabled people who depend on the state for social services.

Schwarzenegger’s office won’t say whether he will support a cap. But aides concede that spending is still unrestrained. Estimates put next year’s budget shortfall at $8 billion.

“The governor has said frequently that spending is out of control and the budget is out of whack, and so the governor is going to look at issues that will address the spending imbalance,” said Margita Thompson, Schwarzenegger’s spokeswoman.

When Sen. Campbell and other proponents have pitched a spending cap, they say the governor’s aides have appeared receptive. In recent weeks, the senator has twice discussed the matter with the state’s new director of finance, Tom Campbell (no relation).

“Tom reviewed it, and he was very interested in it,” the senator said. He added: “Are there people in the governor’s office who support the concept? Yes.”

Other supporters say that Schwarzenegger aides have privately asked about tweaking the proposed initiative and resubmitting it to the attorney general’s office for approval -- signaling at least some interest.

Political leaders should “get back to early 2004,” said former Assemblyman Darrell Steinberg (D-Sacramento), who was chairman of the Assembly Budget Committee. He left the Legislature earlier this month but intends to run for the state Senate.

“Let’s get back to the days when there was more of a sense that the parties could work together and the branches of government could work together,” Steinberg said.

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Times staff writers Evan Halper and Nancy Vogel contributed to this report.