1. Surround yourself with good people:
When George W. Bush ran for the Presidency in 2000, the biggest worry in many voters’ minds was whether this one-term governor of Texas who, much like Arnold, was not a gifted public speaker could handle the job. Bush countered this by surrounding himself with the most experienced people possible; he selected Dick Cheney to be his running mate and hinted that Colin Powell had a spot reserved in the cabinet-to-be. Schwarzenegger did much the same thing during his campaign, appointing former Gov. Pete Wilson, a moderate Republican who handled California’s last fiscal crisis in the early 90s, to be his campaign chairman. He also hired several of Wilson’s former staffers to run his operation. Now that he’s won the job, it seems likely that he’ll bring many former Wilsonians to Sacramento with him a smart move, because they already have relationships with legislators and bureaucrats there the people Schwarzenegger spent his campaign bashing. One potential drawback: people might suspect Schwarzenegger is a figurehead with all these more experienced hands around him something some Democrats still whisper about Bush so the Terminator needs to occasionally remind people who’s in charge.
2. Learn the fine art of compromise.
Schwarzenegger did not pick an easy time to take office. The state government handled its $38 billion deficit in the fiscal 2004 budget largely with loans and fiscal shell games. Almost 60% of the budget gap was closed with borrowing, accounting changes and other one time fixes, according to the California Budget Project. Schwarzenegger needs to deliver a budget proposal for fiscal ‘05 to the legislature by January 10th and it has to close an $8 billion hole shifted from the last go around. Some analysts are predicting the deficit will be closer to $10 billion as tax revenues continue to drop with the economy.
Schwarzenegger has made his job more difficult by making three popular pledges: he’ll repeal the recent increase of the car tax, he won’t raise taxes and he won’t cut education spending. The car tax repeal alone will widen the budget gap by $4 billion. But Arnold shrewdly avoided revealing any other details of his plan to fix the budget, arguing he first needs to audit the entire government. While that wasn’t fair to voters and in exit polls two-thirds griped that he hadn’t given them enough information they voted for him anyway, and now he can go to the legislature with some flexibility to negotiate.
He’ll need it. Democrats have a solid majority in both chambers of roughly 60%, and a two-thirds majority is needed to pass any budget. Schwarzenegger claims he can solve the deficit by cutting wasteful spending but in reality, one politician’s wasteful spending is another’s valuable service to the people. Arnold is going to have to make some deals, keeping Republicans solidly behind him while luring half the Democrats over to a budget they can get behind. If he does this well, he can probably pass some version of the remainder of his priorities: renegotiating state employee contracts, workers’ compensation reforms and streamlining school systems. But he can’t forget rule #3:
3. Don’t be afraid to knock some heads.
The day after the election, Schwarzenegger and Democratic Senate Majority Leader John Burton had a nice phone call about working together, but, Burton told reporters later, the senator told Schwarzenegger he can’t repeal the car tax without the legislature’s approval. At his press conference later in the day, Schwarzenegger replied, “We have a difference of opinion.” It will probably be the first of many with the legislature. Some Arnold will have to make compromises on, but sometimes he’ll have to draw the line. He is the Governor after all, and he can use the status of his office and his line item veto to get things done his way. The results of the recall help him too: 44% of Californians voted against the recall, but Arnold won 49% of the vote a solid mandate. Republicans may not trust him fully because he’s a moderate and most GOP legislators are conservative, but he won hands down in their districts, which gives them enough reason to stay on his good side. And Schwarzenegger won in most Democratic districts too, except for the Bay area, so Democrats can’t give him too hard a time either. “A lot of Democrats will not want him campaigning against them in their districts,” says Tony Quinn, a political analyst.
Arnold can’t throw his weight around too much. After all, in 1999 another moderate governor took office in California and got into trouble that way. Many people forget now, but Gray Davis was a moderate Democrat when he took office. He got a lot done his first two years by sticking to the center and making both Democrats and Republicans work for him. In late 2000 he remarked of Democratic legislators, “Their job is to implement my vision.” But Davis got into trouble when times turned tough first during the 2001 energy crisis and then during the budget mess and he had no allies to turn to. It was easy to get things done when he had a 50% approval rating. A few months ago, with his ratings in the 20% range, he had no capital with lawmakers. Does Arnold have the skills to do better? He better hope so he only has three years before he faces reelection, not to mention that it wouldn’t be hard for Democrats to get a new recall on the ballot if he should stumble. Here comes the hard part.