Billionaires

Who doesn’t support Ed Lee?

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One of the more interesting things about the Democratic County Central Committee’s mayoral endorsements was the lack of support for Mayor Ed Lee among the eight state and federal office holders who sit on the panel.


Under the party charter, any Democrat who lives in the city and represents San Francisco in Sacramento or Washington gets to vote at the DCCC. So U.S. Senator Dianne Feinstein, U.S. Reps. Nancy Pelosi and Jackie Speier, state Senators Mark Leno and Leland Yee, State Assembly Members Tom Ammiano and Fiona Ma and Attorney General Kamala Harris all had a say in who the party would support for mayor. None of those people ever show up at the meetings, but they’re allowed to appoint an alternate to represent their views.


And only Feinstein voted to endorse Lee.


Pelosi’s alternate didn’t show up for the endorsement meeting. Speier abstained. Yee voted for himself. Leno voted No Endorsement. Ammiano suported Avalos. Harris abstained. Fiona Ma voted for Bevan Dufty.


Not a rousing show of support for the incumbent.


(It would have been interesting if Lt. Governor Gavin Newsom were still on the DCCC, but Gav has moved to Marin, and he will now have the distinct honor of serving on that county’s committee.)


Meanwhile: I almost want to ignore Randy Shaw’s attempt to portray the DCCC (and some white progressives in general) as racist for not supporting any of the Asian candidates, since I think it’s too easy to throw that word around in this city, and journalists ought to be pretty careful when they do it. White people (like me and Randy Shaw) need to be particularly sensitive to race issues in the media — and I do think there are real tensions between some old-line progressives and emerging Asian political leaders who don’t always agree with progressives on issues. But that sensitivity should include not sensationalizing race or using race to score political points.


That said, it’s worth noting that of the four Asians on the Board of Supervisors, the DCCC endorsed three (Eric Mar, David Chiu, and Carmen Chu). The only one who didn’t get the DCCC nod for supervisor was Shaw’s candidate in District 6, Jane Kim.


Oh, and the Number 1 candidate endorsed by the Democratic Party is Latino. And the two fastest-growing non-white political populations in the city are Asians and Latinos.


You can fight forever about the politics of the DCCC endorsement and why the panel only chose two candidates. The Guardian will almost certainly support three, since that’s how RCV works. Why Yee, who has the support of both SEIU Local 1021 and the Sierra Club, got only two votes at the DCCC is a fair question. Why Chiu, who is a member of the DCCC, didn’t win the third slot is also an interesting political question. But I honestly don’t think race was a factor. Maybe I’m wrong.    


And as for the whole flap about Aaron Peskin, Rose Pak and the People’s Republic of China (based, by the way, on Peskin’s comments in a Falun Gong newspaper): I met with Rose Pak a few weeks ago, and in the course of talking about Leland Yee (who I will be profiling in the Aug. 31 Guardian) she told me that some progressives were accusing her of being a Communist — a reference to comments by Peskin and Chris Daly linking her to the PRC. She called it “red baiting.”


Just for the record: I’d by happy if Pak WAS a communist — maybe she’d be more interested in income redistribution, progressive taxation and land reform in San Francisco. I like communists. I even got me a picture of ol’ Leon Trostky hangin’ in my office (along with a picture of John Ross, another noted pinko). And years ago, when I had a garage, I really did have a commie flag tacked up on the wall. A friend bought it for me in the Soviet Union back in the day, and one of the reasons I loved it was that it was so poorly made that it started to unravel the minute I stuck the tacks in it, and the colors weren’t quite right, and the silkscreened hammer and sickle was way off center. Go team.


Seriously, I think the era when the label “Communist” was a serious smear is long over. Nobody cares any more. Besides, China isn’t really a Communist country these days, is it? I’m not an expert on the Chinese economy, but it seems much more hyper-capitalist to me. And it’s safe to say that there’s no Cuba-style forced economic equality in China, a country that has a handful of billionaires and a lot of very poor people and may have even worse income distribution than the United States.


Maybe we could talk about the issues?

Trash (summer) lit: Shut Your Eyes Tight

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Shut Your Eyes Tight
By John Verdon
Crown, 509 pp, $24



Ever since Thomas Harris created Hannibal Lecter and James Patterson devised the twisted psychokillers who populate the Alex Cross novels, there’s been something of a drive in thriller lit to top even the worst, most grusome stuff imaginable. It’s the Pulp Fiction Syndrome in trash lit — and although Shut Your Eyes Tight is hardly the worst of the recent offerings, I was only about a third of the way through the book when I took out my notepad and wrote:


“This is some sick fucking shit.”


Yep: Ritual machete decapitations (including the bride at a society wedding). Headless body in a rich man’s freezer (below a hundred chickens and some broccoli). Doll equivalent of a horse’s head in a bed. Sexual sadists taking advantage of kids at a reform school for juvie sex offenders.


Oh, and our hero gets a roofie in his drink and gets blackmailed by a fake art patron with no real vowels in his name over (possible) unconsious underage sex. And the Sicilian mob is involved. And an obscure-Elizabethan-literary-reference murderer who cites the works of  Thomas (why should this not surpise me) Kyd.


Naturally, Dave Gurney, the reluctant former homicide detective caught in the middle of all of this, is having tortured relationship problems. It’s sort of a bloody Green Acres: His wife wants to live a nice peaceful life in the country, and he can’t stop himself from getting dragged into dangerous and horrifying crime investigations. In fact, for all the gore, the scenes with the wife are some of the most painful stuff in the book.


In this case, Gurney is called to help solve the wedding-day homicide, which the husband (a truly weird psychiatrist) wants to blame on the household help, in this case a young man who — according to the police — might have been having an affair with the late lamented, or might have been mad at her husband, or might just be a crazed killer who conveniently split town and can’t be found. But the facts don’t quite add up — and Gurney has to piss off not only all of the direct players but a crew of state cops who have bungled the preliminary investigation.


He follows the threads through a bizarre world of crooks, fashion models, child molesters, billionaires, and assorted upstate New York characters until he runs into the grisly world he retired to avoid. You can imagine how his wife feels.


Somehow, it all works as a perfectly adequate (if a bit too lenghty) beach book for the lovers of batshit psychos and the cops who chase them. It’s on my recommended list.

Eco-funny: Kristina Wong goes green

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When things go wrong for performance artist Kristina Wong, you know it’s going to be a spectacular mess. A person with that much verve just wouldn’t be able to fail only halfway. So when she decided to “go green” the universe thanked her by almost blowing her up on the LA freeway in her bright pink, bio-fueled Mercedes. Now car-free in a city widely thought to be completely non-navigable without a motorized vehicle, this San Francisco-born “patronmartyr of carbon-free living,” is taking her new show on the road, to preach the good earth word with her signature madcap style.

Kristina’s multimedia productions, such as the nationally-recognized Wong Flew Over the Cuckoo’s Nest, are high-energy pastiches of autobiographical material, research stats, contrarian wisdom, and fearless deviations from any pigeonhole you might try to stuff her into. During Going Green the Wong Way, her fifth solo show, she’ll take you through the intricacies of the LA Public transportation system, appoint herself a “missionary of recycling,” mourn with “mother earth,” who is frankly getting a little fed up with our mess, and engage in a good old-fashioned plastic bag fight, during this limited homecoming run of five shows only, starting tonight (Thurs/14).

A tireless performer with a penchant for subversion, credits under Wong’s formidable belt include hanging out with the Billionaires for Bush campaign, a stint with award-winning sketch comedy troupe OPM, writing for the CBS Sketch Comedy Showcase (and Playgirl magazine!), going underground as a “Miss Chinatown” candidate, creating her own spoof mail-order bride service, and criss-crossing the country with the controlled chaos of her charmingly unpredictable solo shows. There are hundreds of ways to go wrong when attempting to go green, but going Wong can only ever be right.

http://www.youtube.com/watch?v=M7TYz7qm_Ec
 
Thurs/14-Sat/16, 8 p.m.; Sat/16-Sun/17, 3 p.m., $12-$15
Jewish Theatre
470 Florida, SF
(415) 522-0786
www.tjt-sf.org

Behind the all-smiles budget

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news@sfbg.com

When Mayor Ed Lee released his 2011-12 budget proposal June 1, all was sweetness and light at City Hall.

The mayor delivered the document in person, to the supervisors, in the board chambers. Sup. Carmen Chu, chair of the Budget Committee, was standing to the mayor’s right. Board President David Chiu was to his left. There was none of the imperious attitude we’d come to expect in the Gavin Newsom era — and little of the typical hostility from the board.

As Sup. David Campos, who was elected in November 2008, remarked afterward: “It’s the first time since I’ve been elected that the mayor has taken the time to come to chambers. It’s reflective of how this has been a lot more of an inclusionary process.”

Lee went even further. “This is a pretty happy time,” he said. “There are no layoffs, and instead of closing libraries we’ll be opening them.” That earned him an ovation from assembled city leaders, including mayoral candidates City Attorney Dennis Herrera and Assessor-Recorder Phil Ting along with District Attorney George Gascón. “I think this budget represents a lot of hope.”

It’s true that this year’s cuts won’t be as bad as the cuts over the past five years. It’s also true that the pain is spread a bit more — the police and fire departments, which Newsom, always the ambitious politician, wouldn’t touch, are taking their share of cuts.

But before everybody stands up and holds hands and sings “Kumbaya,” there’s some important perspective that’s missing here.

Over the past half-decade, San Francisco has cut roughly $1 billion out of General Fund spending. The Department of Public Health has eliminated three- quarters of the acute mental health beds. Six homeless resource centers have closed. The waiting list for a homeless family seeking shelter is between six and nine months. Muni service has been reduced and fares have been raised. Recreation centers have been closed. Library hours have been reduced.

In other words, services for the poor and middle class have been slashed below acceptable levels, year after year — and Mayor Lee’s budget doesn’t even begin to restore any of those cuts.

“We’re not ready yet to restore old cuts,” Lee told the Guardian in a June 2 interview. “It was enough for us to accomplish a pretty steady course and keep as much. Particularly with the critical nonprofits that provide services to seniors and youth and homeless shelters, we kept them as close as we could to what last year’s funding was.”

But the current level of funding is woefully inadequate. As Debbi Lerman, administrator of the Human Services Network, noted, the people who work in the nonprofits Lee was talking about haven’t had a pay raise in four years — even though the cost of living continues to rise. “Our costs have gone up with cost of inflation,” she noted.

She said the cuts over the past few years have deeply eroded services for children, homeless people, substance abuse programs, and others. “There have been significant cuts to every area of health and human services.”

And in a city with 14 billionaires and thousands more very wealthy people, Lee’s budget is distinctly lacking in significant new ways to find revenue.

 

THE GOOD NEWS

Just about everyone agrees that the budget process this year has been far better than anything anyone experienced under Newsom. “He [Mayor Lee] listened to everybody,” Lerman said. “That doesn’t mean they fixed everything. Mayor Lee fixed as much as he could.”

At his press conference announcing the release of the budget, Lee thanked Police Chief Greg Suhr for having already made significant cuts through management restructuring and for considering an additional proposed cut of $20 million.

“We want to thank you for that great sacrifice,” Lee said, addressing Suhr, who sat in front row of public benches, dressed in uniform. Lee next acknowledged that adequate funding for social services also helps public safety. “Without those services, officers on the street would have a harder job,” he said.

Lee also praised the departments of Public Health and Human Services for helping to identify $39 million in federal dollars and $16 million in state dollars, to help keep services open and the city safer.

Lee noted that San Francisco no longer has a one-year budget process and has just released its first five-year financial plan as part of its decision to go in five-year planning cycles.

“To address this, I’ve asked for shared sacrifice, ” Lee continued, adding that he recently released his long-awaited pension reform charter amendment, emphasizing that it was built through a consensus and collaborative-based approach.

Lee also said he would consider asking voters to approve what he called “a recovery sales tax” in November if Gov. Jerry Brown is unable to extend the state’s sales tax. That would bring in $60 million — but it is only on the table as a way to backfill further state budget cuts.

Lee observed that San Francisco is growing, the economy is looking brighter, and unemployment is down from more than 10 percent last January to 8.5 percent today. He plugged the America’s Cup, the city’s local hire legislation, the Department of Public Works’ apprenticeship programs, and tourism, both in terms of earmarking funding in the budget for these programs and their potential to boost city revenues.

He said his budget proposed $308 million in infrastructure investments that include enhanced disability access, rebuilding jails, and energy efficiency, and is proposing a $248 million General Obligation bond for the November ballot to reduce the street repair backlog.

“We will get these streets repaired,” he promised.

“This submission of a budget is not an end at all, it’s the beginning of the process,” he continued, going on to recognize Chu for her work getting the process rolling and thanking Budget Analyst Harvey Rose in advance. “I do know his cooperation is critical.”

And he concluded by thanking each of the supervisors. “I will continue enjoying working with you — we need to keep the city family tight and together.”

The sentiment was welcomed by supervisors. “As he said, this is the beginning of the process, and it’s an important and symbolic step” Campos said. “The budget shows that a lot of good programs have been saved. But there is still work to do.

“There are still gaps in the safety network,” he added, singling out cuts to violence-prevention programs. “It’s my hope they will be restored.”

 

THE BAD NEWS

But even if the cuts for this year are restored, the city budget is nowhere near where it ought to be. “We still had to make cuts,” Lee acknowledged.

“We did consider very seriously a whole host of revenue ideas that we had,” he said. “They were not off the agenda at all.” At the same time, he noted that state law requires a two-thirds vote for new taxes (although that threshold drops to 50 percent in presidential election years). “We decided that it’s not that they were bad ideas, but that we wouldn’t be able to sell them at this time.”

Lee praised some of the revenue ideas that have been suggested in the past year, including the alcoholic beverage fee proposal by Sup. John Avalos, which Lee called “a pretty good idea.” He said that “a year or two from now” an additional sales tax and a parcel tax (for the police or for schools and open space) might be on the agenda.

The city now has a multiyear budget process and projections are supposed to go beyond a single year. But what’s missing — and what nobody is talking about — is a long-term plan to restore critical city services to a sustainable level. That means talking — now — about tax proposals for 2012 and beyond and including those revenue streams in long-term budget planning.

Because the city parks, the public health system, the libraries, the schools, affordable housing programs, and the social safety net are in terrible condition today, the result of year after year of all-cuts budgets. And while the supervisors and the mayor wrangle over the final details, and advocates try to win back a few dollars here and a few dollars there, it’s important to recognize that this budget does nothing to fix the damage.

“We’re about $10 million short of what we need right now to keep service providers at current levels,” noted Jennifer Freidenbach, who runs the Coalition on Homelessness. “But we also need to restore the health and human services system that was slaughtered under Gavin Newsom.”

Editor’s notes

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tredmond@sfbg.com

When Cornel West blasted President Obama May 16 in an interview with the website Truthdig, it set off a pretty wild debate on the left. For the most part, it’s been more heat than light (imagine that happening on the left!), but it raises a crucial question about the role progressives play in the Democratic Party — particularly in the 2012 election season.

The best analysis so far comes from Robert Cruikshank, who writes for the blog Calitics. In a May 23 piece, he noted that the right keeps winning battles because the conservatives know how to play coalition politics:

“Conservative communication discipline is enabled only by the fact that everyone in the coalition knows they will get something for their participation…. Everyone knows they will get their turn. Why would someone who is primarily motivated by a desire to outlaw abortion support an oil company that wants to drill offshore? Because the anti-choicers know that in a few weeks, the rest of the coalition will unite to defund Planned Parenthood. And a few weeks after that, everyone will come together to appease Wall Street and the billionaires by fighting Elizabeth Warren. And then they’ll all appease the U.S. Chamber by fighting to break a union.”

Not so with the Democratic Party under Obama. The Wall Street Democrats (the neoliberals, the DLC types, and the power-at-any-price folks) get their way all the time. And those us of who consider ourselves part of the economic left (also known as progressives) not only get thrown under the bus — we see our existing gains rolled back, in exchange for nothing.

Sure, we all agree on a lot of social issues. The neolibs and the progressives support abortion rights and gays in the military and, for the most part, same-sex marriage. We agree that evolution is science and creation is religion.

But on basic economic issues — who pays the taxes, who gets the money, military spending vs. education spending, radical inequality, concentration of wealth, corporate power — we might as well be on different political planets. And while we’re the most active, hard-working members of the Democratic coalition, we get completely ignored on national policy.

Obama ought to be worried — not just by West’s criticism (any president ought to expect some allies to be pissed off) but by the fact that he has created an unsustainable coalition. And some of the San Francisco politicians who call themselves progressives ought to be paying attention too: When your political partners get nothing, they eventually walk. 

 

California: The old, the rich and the poor

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California is getting older and poorer. That’s what the new census data shows. And everyone knows the combination is a troubling mix:


“We have a longevity revolution happening, and in San Francisco we’re calling it ‘the silver tsunami,’ ” said Valorie Villela, director of the 30th Street Senior Center. “It’s hitting hard, and once again our society is not prepared.”


She said her research shows that by 2025 in San Francisco, 1 in 5 people will be older than 65 and the number of people older than 85 will have doubled. That trend is coming at a time when the state has been running huge deficits year after year, forcing cuts to services such as adult day care and Medi-Cal.


It’s particularly intriguing since one out of every five billionaires in America lives in California. So we don’t have enough money to take care of our seniors, and things are just going to get worse — but there’s a vast amount of wealth in the state. You wonder.


If the state had four million people between the ages of 18 and 25 who had no money, no prospects, not enough to eat and no place to live while a handful of billionaires were living fat and happy and controlling an outsized portion of the state’s wealth, that would be a recipe for, well, fighting in the streets.


Seniors tend to vote more than kids, but they don’t, so far, tend to march and riot and break things and threaten the security of the wealthy (and the politicians who cater to them). But the next wave of seniors is different; the baby boomers know all about taking it to the streets. And they’re living longer and healthier. Your average 65 year old today can carry a torch and a pitchfork just fine. Some of them can even throw rocks and bottles and shout “Eat the Rich!” (Hey, they’ve been there and done that already. Still got the notes.)


So I think it’s safe to say that this current trend ain’t sustainable. And even the Republicans up in Sacramento ought to get that. Nothing is worse for plutocracy than a crowd of hungry, angry seniors who spent their college years in the SDS.

From Wisconsin to San Francisco

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Public Defender Jeff Adachi is scurrying all over town trying to explain how his version of pension reform is really “progressive.” It would be laughable if its implications weren’t so devastating for working people employed by the city and those living in and around San Francisco.

Adachi is rightfully worried that the events in Wisconsin and the national movement to defend union rights they have inspired will hurt his campaign. He is eager to say that he, unlike the Republicans in Wisconsin, supports unions’ rights to collective bargaining. But while Wisconsin Gov. Scott Walker and the Republican Legislature eliminated collective bargaining for their public employees to slash their wages, health care, and pensions, Adachi is slashing San Francisco’s workers pay and pensions through the ballot, effectively taking those items off the bargaining table. What’s the difference?

In both Wisconsin and San Francisco the deficit is the excuse to require cuts in public worker retirement and community services. Walker created Wisconsin’s deficit by granting huge tax cuts for corporations and the super-rich. In San Francisco, the deficit that cannot cover the city’s pension fund contributions was similarly brought on by three decades of tax cuts for corporations and the rich in California, compounded by former Mayor Gavin Newsom opposing nearly every revenue measure proposed throughout his seven-year reign — and by the city not contributing its share to the pension fund for all the years the stock market was doing well.

In determining how “progressive” Adachi’s measure is, we should, as always, follow the money. Here’s who’s is backing his proposal:

 Michael Moritz, the billionaire venture capitalist (and No. 308 last year on Forbes’ list of wealthiest Americans) who hosted fundraisers for Prop. B — Adachi’s first attempt last year at pension reform that was soundly defeated — and is a major financial backer of Republican Ohio Gov. John Kasich and the Ohio Republican Party Central Committee.

 Howard Leach, the billionaire financier who raised almost $400,000 for the George W. Bush campaign and was rewarded with the position of ambassador to France. He also contributes to the Republican Governors Association, whose major objective was the election of the new crop of conservative governors pushing anti-worker measures in Wisconsin, Ohio, Indiana, Florida, New Jersey, and other states.

 David Crane, who is a paltry multimillionaire former investment banker and close friend of and former top pension adviser to Republican former Gov. Arnold Schwarzenegger.

You have to wonder why these super-rich are suddenly so concerned about the parks and senior and youth programs, the mental health and drug abuse programs Adachi cites as being cut because of pension costs. If these billionaires were so moved, they could take the money they are sinking into Adachi’s measure and donate that to the programs. Or they could support some kind of progressive revenue measure that makes the wealthy downtown financiers and investors — who can afford to pay — ante up to protect the programs they claim to be concerned about.

No one is more concerned with the viability of the pension fund than those who plan to retire on it. That’s why the city’s unions are engaged in discussions with the city to develop real pension reform that is fact-based, principled, and compassionate to those trying to raise families in this economic climate.

So when Adachi’s high-priced signature gatherers (paid as much as $5 per signature to get Prop. B on the ballot) come to your neighborhood grocery store, just say “No!”

No, this is not what we call progressive policy. Not in Wisconsin, and not in San Francisco.

Roxanne Sanchez is president and Larry Bradshaw is San Francisco vice president of SEIU Local 1021.

Is David Crane just another Kochhead?

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This week the Chronicle majorly attacked State Sen. Leland Yee, claiming Yee tried “to distort the words” of billionaire investment banker and UC Regent David Crane on collective bargaining.

The Chron’s attack came on the heels of Yee’s attempt to block Crane’s UC Regents confirmation. And Yee’s attempt to block Crane came in response to an op-ed Crane wrote for the Chron titled “Should public employees have collective bargaining rights?”

In its counter-counter attack editorial this week, the Chronicle accused Yee of falsely claiming that Crane had “called for an end to collective bargaining rights for California teachers, nurses, firefighters, university employees and other public sector worker.”

“What the former adviser to Gov.Arnold Schwarzenegger did was present a history of collective bargaining in California and explain how a 1977 law had changed the balance of power by giving public employees power over their compensation and benefits,” the Chronicle stated. “Crane did assert that extending collective bargaining to employees who already have civil service protections ‘serves to reduce benefits for citizens and to raise costs for taxpayers. Anyone who would argue with that fact has not been paying attention to what is happening with state and local budgets lately.”

The Chronicle finished by praising Crane, who is currently a lecturer on Public Policy at Stanford University and is reportedly working with former Fed Chairman Paul Volcker to form a task force to examine current state budget practices. Crane, the Chron asserted, has “long been widely respected as a teller of inconvenient truths about the rising costs of public-employee pensions and benefits. He should not be silenced – or misquoted by opportunistic politicians. The Senate should vote to confirm him as regent.”

Now, when Schwarzenegger appointed Crane as a UC Regent in December 2010 as one of his last acts as Governor, the Sacramento Bee described Crane as Schwarzenegger’s “chief public employee pension critic.” But here in San Francisco, the Chron didn’t bother to flesh out Crane’s history of employment, campaign contributions, prior statements on collective bargaining, and financial investments.

Maybe it was because these public records reveal Crane to be less a dyed-in-the-wool Democrat and more of a Bushocrat, an ultra-rich investor who supported G.W. Bush through two elections, and repeatedly frames the collective bargaining rights of government employees as an obstacle standing in the way of pension reform and budget balancing.

Campaign finance records show that in March 1999, when Democrats were trying to hang onto the White House in the wake of Clinton’s sex scandals, Crane gave $1,000 to Bush. And in June 2003, just three months after Bush invaded Iraq on a false pretext, Crane saw fit to give Bush another $2,000.

The good news? Crane didn’t support Sarah Palin and John McCain in 2008. But he did donate $7,200 to Republican Tom Campbell’s unsuccessful 2010 bid for US Sen. Barbara Boxer’s seat. And here in San Francisco, Crane was one of several billionaires who wrote big fat checks last fall in support of Measure B, which sought to curb the pension and health benefits of city workers, most of whom will make a fraction in their lifetime of what Crane rakes in each year from his widely diversified financial portfolio.

Crane’s 2009 statement of economic interest shows he has over $1 million invested in Farallon Capital Partners, one of the world’s largest hedge funds, many of whose investors include top university endowments.

Crane also has over $1 million invested in Acacia Partners, over $1 million in Bislett Partners, over $1 million in Kensico Partners, over $1 million in Semper Vic Partners, over $1 million in Berkshire Hathaway, whose CEO is Warren Buffet, over $1 million in the HCP Absolute Return Fund, whose Board includes Warren Hellman, and up to $1 million in Hall Capital Management, whose Board includes Hellman and Gap heir John Fisher. Crane also owns several million dollars stake in real estate investments, and has sizeable stock in Wells Fargo, Chesapeake Energy, Microsoft, Google, Pangloss Oil, Whole Foods Market, M&T Bank Corp., IBM, American Express, WalMart and Exxon.

And he gets income from Acacia Partners and Babcock & Brown, where he was a former partner from 1979 to 2003. While at Babcock, Crane reportedly brokered a controversial jet-lease deal between Arnold Schwarzenegger and Singapore Airlines that allowed Schwarzenegger to defer taxes on millions of dollars. And in 2004, Crane went to work for then Republican Gov. Schwarzenegger as special advisor for Jobs and Economic Growth. The Terminator returned the favor by appointing Crane to the California Commission in Economic Development and the California High Speed Rail Authority. But Crane was rejected in Senate confirmation proceedings for a position on the board of California State Teachers Retirement System.

Now, clearly it’s not a crime to be a billionaire, even though the way some folks make their billions is criminal. But you have to wonder if UC really needs another ultra-rich Regent on its Board. You also have to wonder why the wealthy Crane sought reimbursements of $2,812 from UC in 2009, if he cares about saving the state money.

And Crane has made plenty of statements about collective bargaining rights and pension reform in recent months that seem to frame government employees as the bogey men, not just in California, but across the entire nation.

Take his April 2010 comments to the Los Angeles Times: “State legislators are afraid even to utter the words ‘pension reform’ for fear of alienating what has become — since passage of the Dills Act in 1978, which endowed state public employees with collective bargaining rights on top of their civil service protections — the single most politically influential constituency in our state: government employees,” Crane said.

Or what he said in August 2010 to the Fox Business Network: “Even if you took care of every one of these spiked above the iceberg level pensions in California, you would not take care of the pension problem in California, which is true of virtually every state in the country, at least those where, you know, government employees have collective bargaining rights,” Crane said

In December 2010, he told the L.A. Times that the year 1978, ”wasn’t notable just because of Proposition 13. That was also the year public employees gained a power Franklin D. Roosevelt had warned against: collective bargaining rights.”

“California hasn’t been the same since,” Crane continued. “Public workers have gained at the expense of private workers as government spending was redirected from infrastructure and education to higher salaries, pensions and other benefits.”

And in his Feb. 27 Chronicle op-ed, Crane claimed that, “The battle in Wisconsin is not over collective bargaining rights generally but rather the appropriateness of those rights in the public sector ”

“Collective bargaining is a good thing when it’s needed to equalize power, but when public employees already have that equality because of civil service protections, collective bargaining in the public sector serves to reduce benefits for citizens and to raise costs for taxpayers,” Crane continued. “Citizens and taxpayers should consider this as they watch events unfold in Madison.”

As of today, letters are circulating in Sacramento opposing Crane’s confirmation. And Sen. Ted W. Lieu (D-Torrance), Chair of the Labor and Industrial Relations Committee in Sacramento, has already signaled his opposition.

“I cannot support someone for the powerful post of UC Regent who continues to perpetuate the myth that collective bargaining caused our state economic crisis and has a fundamental misunderstanding of how our state budget operates,” Lieu said in a statement. He noted that in the Chron op-ed Crane claimed that because of collective bargaining, “general fund spending on higher education, parks and environmental protection was flat or lower.” 
“As a matter of historical fact, that is false,” Lieu countered. “ Our general fund spending generally declined because of a national economic recession.  The recession was not caused by collective bargaining or public sector unions, but by private sector, out of control Wall Street firms at the time.”

“The specific reason our general fund spending sharply declined was because the person Mr. Crane advised, former Gov. Arnold Schwarzenegger, reduced the Vehicle License Fee and replaced it with . . . nothing,” Lieu continued. “As a result, the state general fund lost over $5 to $6 billion in revenues per year for every year Mr. Schwarzenegger was in office.  The VLF reduction has resulted in a total loss of over $30 billion to the state, an amount in excess of the current California budgetary shortfall.  How conveniently Mr. Crane forgot to mention that critical fact when it doesn’t suit his ideological assault on public sector unions.”

“Now that Mr. Crane senses his confirmation may be in jeopardy, he attempts to marginalize his own Op-Ed by releasing a new statement saying he really didn’t mean to attack all public sector unions, just those who happen to have statutory civil service protections,” Lieu added. “For those in Ivory Towers that distinction may have some academic meaning, but for everyone else in the real world that is a distinction without a difference. Civil Service protections do not prevent employees from being terminated or laid off, they provide standards for government to follow when firing or disciplining employees. Such protections do not guarantee appropriate wages or benefits, nor address a plethora of other issues, such as workforce safety issues.”
 
“Mr. Crane’s Op-Ed also discusses political spending by public sector unions, “Lieu concluded. “In his world view, political spending by the California Teachers Association is inappropriate, but the massive political spending by the Koch Brothers would presumably be acceptable. I cannot, and will not, support someone for the post of UC Regent who blames public sector employees, such as teachers, for somehow being responsible for our economic crisis or the resulting decline in general fund spending.  We need UC Regents who are interested in solving problems, not those who twist historical facts to suit an ideological agenda.”

So, as I wait for Crane to return my call, I’ll leave you with something reporter Peter Byrne, who authored the award-winning investigative series ‘Investor’s Club” How the Regents of the University of California spin public funds into private profit,” said to me yesterday when I asked him about the wisdom of putting investment bankers on the UC Regents Board. “Putting investment bankers in front of a plate of $63 billion is like putting a pound of hamburger in front of a bunch of feral cats. They are going to eat it. It’s in their nature.”

So, would confirming Crane be like adding another feral cat to the mix? Is he just another Kochhead? Or is he just maligned and misunderstood, as the Chron vehemently implies?

The future of the San Francisco left

72

That, at least, was the title of the Milk Club forum March 1. Quite a panel, too: Sups. Avalos, Campos, Chiu, Kim and Mar. Tim Paulson from the Labor Council. Former Milk Club Prez Jef Sheehy. Tiny from Poor Magazine. And me.


I told the assembled that it was worth reminding ourselves how far we’ve come — when I started in this business, in 1982, Dianne Feinstein was mayor, there was exactly one reliable progressive on the Board of Supervisors (Harry Britt) and it was impossible for grassroots types without big gobs of money to get elected to high office. I’ve lived through Feinstein, Agnos, Jordan and Brown, all (until the end of the Brown Era) with at-large boards. It was awful trying to get anything good done; all we could do was fight to prevent the truly horrible from happening. Under Brown, as Sheehy noted, San Francisco politics was locked down, tight; the machine ruled, the Democratic Party was not a force for progressive issues and only a few exceptional leaders, like Tom Ammiano, kept the spirit alive.


Today, the very fact that five supervisors showed up at a Milk Club event to talk about progressive politics shows how district elections has transformed the city and how far we’ve come.


That said, we’ve still failed to make much progress on the most important issue of the day — the gap between the rich and the poor, the fact that this city has great povery and great wealth and the utterly unsustainable economic and tax system that has made us the most socially unequal society in the industrialized world.


Sheehy talked about the schools (both he and are are parents of kids in the public schools). Good schools, he said, are one of the most important socialequalizers; with a good education, poor kids have a chance. But while our local billionaires enjoy nice tax breaks, we’re starving the schools.


Kim talked abou the need for summer school and longer school years (I would add longer school days). These are things San Francisco can do — if we’re willing. “We’re talking about taxes,” Sheehy said, and he’s right.


In the past five years, I think we’ve cut about a billion dollars out of the General Fund, labor has given back more than $300 million — and we’ve raised $90 million in new taxes. Not good enough, not even close.


Yes, the bad economy is to blame for our fiscal problems, but so is the fact that we have a tax structure that systematically underfunds the public sector. (And yes, my conservative friends, cops shouldn’t retire with $250,000 a year pensions. Got it.)


Tiny made a strong statement about the essential problem facing the city when she asked, “who isn’t here?” She didn’t just mean that there were too many white people in the room (althought that was true); she meant that there were were too many working-class and poor people who can no longer live in San Francisco.


Sheehy was even more blunt: “In five years,” he said, looking out at the room, “none of us are going to be here.”
And my essential message to the crowd (and the elected officials on the panel) was: We don’t have to accept that. These are problmes we can address, right here in San Francisco. If we want to, we can shift the burden of paying the costs of society at least a little bit off the backs of the poor and middle class and onto the rich.


Nobody directly disagreed with me. In fact, Chiu announced that “income inequality is something all of us care about.”
How agressively he and others try to turn that concern into legislation will tell us something.


Two other interesting moments:


1. Every single person on the panel talked about how important Tom Ammiano was to the modern progressive movement. One by one, every panelists described the 1999 Ammiano for Mayor campaign as a defining moment in their lives and in the emergence of today’s progressive politics. Good to see the guy get the recognition he so richly deserves.


2. Campos, who was sitting next to Chiu, made a point of saying that there’s no longer a progressive majority on the board, and he pointed to the committee assignments that gave conservatives control of some key panels. Chiu responded: “At the end of the day, we have a progressive majority on the board that will serve as a backstop” to anything bad that comes out of committees.


It was curious; it sounded almost as if Chiu was disappointed in his own assignments. Why would you need a “backstop” if the committees were good in the first place?


So I called him the next day and asked him about it. First he said he thought the commitees were balanced and it was all going to be fine. But when I asked him directly — why not appoint progressive majorities on the key committees? — he responded:


“I wish the board presidency vote hadn’t turned out the way it did.”


In other words: If the progressives had all voted for Chiu, he wouldn’t have appointed conservatives to key posts of power. Instead, some progressives voted for Avalos, and Chiu won with the votes of Carmen Chu, Scott Wiener, Sean Elsbernd and Mark Farrell (along with Kim and Mar). The payback, the deal, the whatever you want to call it, means that bad decisions will be made at Land Use and Rules and maybe in the Budget Committee, and Chiu as much as admitted that the progressive majority will have to go to unusual lengths to undo them.


I know how politics works; I know you have to dance with the ones that brung you and all that. But it would be nice if every now and then someone would do something just because it was the right thing to do, and to hell with the political consequences.


I suppose that’s too much to ask.


 

Warren Hellman: The rich are undertaxed

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I couldn’t reach financier Warren Hellman before I wrote my column in this week’s paper talking about the employee pension discussions. But he called me yesterday (Feb. 16) after he’d seen it, and I expected he’d give me some shit.


Wrong.


In fact, Hellman had only one problem with my analysis: “Your article is didn’t go far enough.” Turns out he thinks I was a bit too easy on the billionaires.


“When you compare upper-echelon tax rates [in America] to any developed country in the world,” Hellman said, “the rich pay very low taxes here. You’re article is exactly correct — the wealthy are undertaxed.” He told me that he’s stopped trying to amass more personal wealth (“it’s all going into a foundation”) because he realizes that he couldn’t possibly spend all the money he has “and all that happens if you leave it all to the next generation is that you spoil your kids.” 


Quite a statement coming from one of the city’s richest and most influential business leaders.


Of course, putting all the money in a foundation isn’t the only answer.   The only way to address the wealth gap, and the decline in social, education and infrastructure spending, to for the government to get more involved — and that means collecting more tax money from the people who can afford to pay it. Hellman told me that he’s not about to accept a reduction in his lifestyle — but we both agreed that he doesn’t have to. He could pay a lot more in taxes and still be really, really rich.


So we talked about my proposal, which goes like this:


I’ve got a suggestion for the pension reform negotiators. Why not talk a little about parity.


 Yes, pensions have to be fixed; let’s start at the top. Maybe nobody should have a pension of more than $100,000 a year; certainly, a former police chief shouldn’t get $250,000 a year for life. Maybe the highest-paid city employees should have to pay more into the pension system to protect the pensions of the people who make less. I could easily support progressive pension reform that would save the city money.


 I just think tax reform should also be part of the equation.


 Hellman wants $300 million in pension savings? Good — how about pairing it with $300 million in new taxes on the wealthy? How about big business and rich people give up something this time around, instead of all of the cuts falling on public employees and poor San Franciscans?


And Hellman, to his credit, didn’t disagree with the concept. His problem he said, was with the politics. “Taxes are the third rail of politics,” he said. “I’ve gotten my head handed to me three times now when I’ve supported tax increases.” 


But I still think there’s a way to move forward here. The city employee unions agree to some sort of pension reform, which starts with a pension cap and higher payments from higher earners (not with what amounts to a pay cut for lower-wage employees who have already taken pay cuts in the past few years). Then Hellman, Mayor Ed Lee and Sup. Sean Elsbernd agree to support a progressive tax measure that would bring in badly needed revenue for public services and education.


It’s possible that the tax measure would have to wait until Nov. 2012, when it would only require a 50 percent vote. Maybe both measures go on that ballot. And Hellman, Elsbernd and Lee use their clout with downtown to push the Chamber of Commerce and the Commitee on JOBS to at least stay neutral and cut off any big-money campaign against the tax measure. Then they all agree to help raise money and campaign to pass it. And labor agrees to work for both measures.


Hellman said he feared that “one would kill the other” and both measures might fail. But I believe the people of San Francisco are willing to support new taxes — progressive new taxes — if they don’t think the money’s going to waste. And pairing pension refrom with new taxes sends a strong message: We’re all sharing the pain. Particularly if Hellman, Elsbernd and Lee can sell the tax package part of the deal to the business community.


It’s worth a try. Because otherwise, we’re going to have another Prop. B battle, both sides are going to spend a ton of money, and nobody’s going to walk away happy.


“It’s worth thinking about,” Hellman told me. I hope so.

Hellman and Obama feel your pain

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The Bay Citizen has a detailed report on the backroom discussions taking place around pension reform, and there aren’t any real surprises. The cops and firefighters seem to be leading the talks from the public-employee union perspective, although the other unions are there, and Mayor Lee has taken over the gavel from financier Warren Hellman. Sean Elsbernd is involved, but they’ve kept Jeff Adachi out. (And what the hell is Nathan Ballard doing in this mix?)


But what got me when I read the story this weekend was the quote from Hellman:


In an interview Thursday afternoon, Hellman said the group must come up with annual savings of $300 million to $400 million. (Proposition B was to have saved the city $120 million.)


“I hate that it comes out of the hide” of city workers, particularly those making modest salaries, Hellman said. “It is going to be really painful.”


It reminds me of Obama’s comments on his budget cuts: They’ll be painful and he hates to do it, but these tough decisions have to be made for the good of all of us.


My question: Why doesn’t anything ever come out of the hides of the billionaires?


From the start of this recession, working-class people, public employees and the poor have taken huge hits. Nothing — nothing — has happened to the top echelon of society. If anything, they’ve only gotten richer. The bankers who destoryed the economy with financial instruments even they didn’t understand? They’re not in the poor house. They haven’t had their homes foreclosed. They’re all doing just fine.


In fact, the United States government just kindly allowed them to keep their tax cuts for another two years.


Obama isn’t going to miss any meals. His kids will still have their fancy private school. He won’t have to worry about his pension vanishing or eating cat food in his old age. Same goes for Hellman; there’s nothing in the world that he could possibly want to buy that he can’t have.


So it makes me really mad to hear them talk about feeling bad about budget cuts and reducing pensions. If they feel bad, then why not do something about it?


Hellman’s not a bad guy. I’ve met him, he’s pleasant and polite and sincere about wanting to help the city. I couldn’t reach him on the phone today, but I’ll keep trying, because I have a question:


Over the past five years, city employees have given back hundreds of millions of dollars in wage and benefit concessions. Social programs have been cut by hundreds of millions more. And the rich in this town have given back nothing. Mr. Hellman: Is that fair?


I’ve got a suggestion for the pension reform negotiators. Why not talk a little about parity.


Yes, pensions have to be fixed; let’s start at the top. Maybe nobody should have a pension of more than $100,000 a year; certainly, a former police chief shouldn’t get $250,000 a year for life. Maybe the highest-paid city employees should have to pay more into the pension system to protect the pensions of the people who make less. I could easily support progressive pension reform that would save the city money.


I just think tax reform should also be part of the equation.


Hellman wants $300 million in pension savings? Good — how about pairing it with $300 million in new taxes on the wealthy? How about big business and rich people give up something this time around, instead of all of the cuts falling on public employees and poor San Franciscans?


I’m good with pension reform, really I am. And I’m not involved in the negotiations. But I’m a San Francisco progressive who will have to vote on the ultimate outcome. Give me something to work with here, guys.


 


 

80 billionaires — and California’s broke?

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Jerry Brown’s message to educators was framed as bleak — but as I pointed out, there were some bright spots. At least the new gov mentioned that this is a rich state that ought to be able to afford education. Robert Cruickshank at Calitics has a nice post on the point:


A tax increase of about $20 billion would secure our public services for years to come with a very tiny impact on our economic activity. Surely 1% of our GDP can be harnessed to fund the services that we must have for broadly shared prosperity in this state.


Let me take it a step further. I just went through the Forbes 400 list of the richest Americans and started counting, and guess what? A full 80 of the 400 live in California. That’s one out of every five billionaires in America, living right here in a state that can’t afford to educate its kids.


Then I took out my calculator and added up a long row of numbers and got a big one: The total net worth of the billionaires in California is $231.8 billion. Ten percent of that wipes out the budget deficit. And that doesn’t even count the folks worth $900 million or less; they didn’t make the list.


Folks: This is a very, very rich state. A very modest tax increase on a very tiny number of people could solve our budget problems not just today but into the foreseeable future.


This is the message Brown needs to deliver to the people of the state — and if the antitax people (or my trolls) want to argue that all the rich people would leave if we taxed them just a little bit, let me say: That’s ridiculous. David Geffen is going to move out of Malibu because he has to pay a teeny bit more of his income, money he won’t miss, in taxes? Ain’t happening.


That’s it, Jerry. That’s your answer. Now get to work.