As he leaves office, Arnold Schwarzenegger is emphasizing his successes as governor. But it is his failures that need more public attention, because they may represent his greatest and most lasting contribution to California.
To understand this governorship, one must recognize a fundamental dichotomy. On matters in which Schwarzenegger had a healthy amount of control — orders he could execute with a pen, legislation that could pass with a simple majority of the Legislature, even ballot initiatives he could champion and pay for personally — the governor has much to brag about. He can point to landmark climate change legislation, bipartisan appointments made on merit, infrastructure bonds that represent a down payment on the rebuilding of California, workers' compensation reform and voter-approved political reforms to the redistricting process and primary election rules.
But on fiscal and budgetary matters, Schwarzenegger suffered defeat after defeat. The state's fiscal record after his seven years — California has the same budget deficit now as in 2003, with a much larger debt — has led commentators across the political spectrum to write him off as a failed governor. That conclusion has a factual basis — and is deeply wrong. And it obscures the most interesting and important lesson of his governorship. Put simply: The sheer number and surpassing scale of Schwarzenegger's failures to fix the state budget constitute a grand and peculiar success, especially if Californians heed the lessons they provide.
Schwarzenegger's relentless political pragmatism — unrestrained by ideology, consistency and other obsessions of the small-minded — led him to try virtually every budget-balancing policy possible under California's governing system. And his inherent restlessness, combined with a contrarian's tendency to jump off political cliffs with great fanfare and relish, led him to employ almost every conceivable political tactic and negotiation strategy.
To review: Schwarzenegger cut spending time and again, and advocated spending caps and a rainy day fund. But he also advocated for more money for K-12 and higher education. He called for eliminating programs that provide healthcare and insurance to Californians, and he spent a year trying, in vain, to establish universal healthcare coverage. He sought to build new public infrastructure, even as he tried to privatize and sell existing state buildings and land. He pushed to reverse regulation of business while launching a new wave of environmental regulation in the name of climate change. He protected sentencing laws that fill the prisons, and also sought to liberalize policies as a way to empty prisons and save money. He put new restraints on borrowing and then, when there was no other way to balance budgets, found ways around them.
He cut corporate and other taxes, and raised income and sales taxes. He denounced taxes on oil, and then later proposed one. He made a cut in the vehicle license fee his very first act as governor, and then reversed himself in 2009.
(This last reversal — his 2009 tax increase — was my favorite Schwarzenegger act of devil-may-care political cliff jumping. After mocking those who wanted tax increases as "losers" and "spending addicts" and "girlie men," the governor, without apology, demanded tax increases and lectured Republicans publicly for not going along with his mathematically necessary betrayal. That alone should win him immediate induction into the Chutzpah Hall of Fame.)
Tactically, he wooed lawmakers (in his famous smoking tent) and sought to pressure them, embarrass them or circumvent them. He employed a Republican chief of staff and a Democratic one. He tried to soothe voters with overly generous budgets (particularly when running for reelection in 2006), and also sought to scare them with Armageddon budget proposals to persuade them to adopt reforms. He made war against public employee unions at times, and courted them with appointments and new deals.
And he put his own money where his mouth was, spending tens of millions backing ballot measures to help get the state out of the mess.
The result? Schwarzenegger tried everything, and nothing really worked. The tax cuts and spending he supported made the deficit worse. His borrowing added to the debt. Republican lawmakers blocked most revenue increases, and Democrats and the unions blocked cuts. California voters, who love free lunches and hate tough medicine, approved his deficit borrowing in 2004 but rejected proposals that might require sacrifice, including a spending cap, a rainy day fund and a tax increase extension.