Palo Alto

Located just a short stroll from California’s capitol, Memorial Auditorium long has been a venue for political celebrations. More recently, it’s been a graveyard for governors of the Golden State.

Gray Davis held his second swearing-in at the big building in Sacramento. Eleven months later, he was out of a job. His replacement, Arnold Schwarzenegger, visited the auditorium a week before his historic recall win. Arnold vowed to mend state government’s dysfunctional ways; his reform agenda was unceremoniously terminated.

That Jerry Brown, California’s next governor come January 3, would choose the same locale to begin a dialogue on the predominant issue facing him in 2011—a state budget deficit that’s $28 billion and climbing—shows the once and future “Governor Moonbeam” isn’t superstitious. But just what he can achieve, beyond one-day summits and public posturing, is anyone’s guess.

Then again, the enigmatic Brown has long been one of California’s favorite guessing games.

Having held the job from 1975 to 1983 (succeeding some fellow named Reagan), Brown is returning to the governor’s office either in an act of civic-mindedness or as a compulsive campaigner. He beat Republican Meg Whitman decisively in a bitter fight over personality and not policy—so what is his blueprint for fixing California’s woes? And, perhaps most vexing of all, can the notoriously peripatetic Brown (twice a presidential candidate during his two terms as governor, and a third time against Bill Clinton in 1992) stay focused on what presumably is the final chapter in a four-decade political career?

Here are three reasons why Brown could, theoretically at least, provide positive answers to those questions:

He has nowhere (else) to run. At age 72, Brown will soon be the nation’s oldest governor—of a state devoted to life, liberty, and the pursuit of age-defying solutions. Sure, there’s no stopping Brown from challenging President Obama in 2012 if he wants to be a latter-day Harold Stassen. The problem is, unlike his “we the people” crusade against Clinton and the Democratic establishment in 1992, Governor Moonbeam Version 2.0 wasn’t designed with ideology in mind. In California’s 2010 gubernatorial race, Brown didn’t campaign as a neo- or paleo-Democrat. Instead, he offered himself as a tightwad and an experienced government hand—in short, the anti-Whitman. It’s not what the left craves in the way of an anti-Obama insurgency. This is good news for Cali-fornians, who have suffered the consequences of three previous governors distracted by national politics.

He has nowhere to go but up. Californians like to use four-letter words to describe the goings-on in Sacramento—“hope” not being one of them. According to the Public Policy Institute of California, only 13 percent of voters approve of the two branches of state government’s working arrangement. Only 2 percent of Californians trust the state to always do right. Just 3 percent have a great deal of faith in Sacramento’s decision-making process. After seven years of a predecessor enamored of “fantastic” ideas (hydrogen highways, high-speed rail, curbing greenhouses gases), there’s an opening for Brown. And that would be embracing smaller-scale ideas, much as Bill Clinton did in rebuilding his presidency. The governor-elect isn’t much a fan of the initiative process (though California seems headed to a big initiative fight in 2011 over taxes), which might also work to his advantage if he can end the seemingly endless cycle of campaigning that characterized the Era of Arnold—with the exception of 2007, California has held a regularly scheduled or special statewide election every year since 2002.

He may be able to say no to his own base. Gray Davis, the last Democrat to rule California (and, by the way, Brown’s gubernatorial chief of staff), took office after 16 years of Republican governors. He wasted little time before lurching to the left, paying back public employee unions that had paved his way to victory. Brown did the same in 1975 as a newly elected post-Reagan governor, pacifying liberals with all kinds of goodies, including collective bargaining rights for the aforementioned unions. The difference then: Brown was an idealist. Now, he’s more pragmatic—or so he’d have you believe. He’s also sending mixed signals about seeking a second term in 2014, meaning he might feel less beholden to labor’s purse strings. The liberals who dominate the state legislature will expect Brown to sign bills that Schwarzenegger vetoed: state-run single-payer health care, access to college financial aid for illegal aliens. Brown may not be as accommodating. It’s worth remembering that Brown was the last California governor to have a veto overridden (12 in all during his two previous terms).

In the meantime, something far less speculative is California’s horrific fiscal outlook. In addition to the $28 billion budget shortfall that must be solved by next summer, lawmakers face an ongoing $20 billion annual spending-revenue imbalance for the foreseeable future. California’s credit card is maxed out, with $15 billion already owed in “recovery” bonds for budgetary borrowing. Of course, that’s peanuts compared with California’s pension obligations, which may run as high as $500 billion. America’s nation-sized state holds the dubious distinction of being the world’s eighth largest economy with one of the worst credit ratings in the country. Not that a recovery is expected any time soon: California employment won’t return to its prerecession level for another eight years at least.

Where this is taking Brown and his fellow Democrats seemed obvious after his Memorial Auditorium dog and pony show on December 8 (and a similar event in Los Angeles about a week later): a tax increase, put before voters in a special election at some point in 2011. Perhaps Brown was simply preaching to a choir of Democrats who don’t believe California has a spending problem, but the liberal spin was hard to miss: The Golden State ranks next to last in students per teacher and is fourth worst in number of state employees per resident. Meanwhile, there was precious little talk of privatization, outsourcing to local government, or trimming government waste. Brown also repeatedly referred to California as “the world’s eighth richest political jurisdiction,” perhaps a warning sign that he’ll soon ask the citizenry to surrender more of that wealth.

But before he does so, maybe Brown should talk to the outgoing governor. In special elections in 2005 and 2009, Schwarzenegger campaigned for 10 ballot measures. All 4 of Arnold’s measures in the first special election went down to defeat, buried in an avalanche of campaign spending by liberal special interests. In 2009, Arnold tried to sell California on 6 budget-related initiatives. All but one—prohibiting pay increases for lawmakers during deficit years—lost handily; only one of the 5 losing initiatives received more than 38 percent support.

The antigovernment trend continued this past November. Californians approved Proposition 26, requiring a two-thirds majority for fee increases by the legislature—a virtual impossibility. Two other initiatives marketed under the guise of revenue enhancement—Prop 19, legalizing recreational marijuana use, and Prop 24, undoing business tax incentives—were soundly rejected. Voters even said no to an $18 automobile fee to finance state park operations.

Schwarzenegger understood the folly of his ways, telling reporters at one point: “If I would do another Terminator movie, I would have Terminator travel back in time and tell Arnold not to have a special election.” Time will tell if California’s next governor—also a time traveler, from out of the Golden State’s past—discovers the same remorse.

Bill Whalen, a Hoover Institution research fellow, analyzes California and national politics.

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