California has to lean on Obama

‘If I am not for myself, who shall be for me?” Hillel, the Jewish sage, famously asked.

It’s a question that needs to be heard in Sacramento, where too many of the state’s elected officials seem resigned to denying medical care to 1 million children, cutting college scholarships, shutting the state’s parks, throwing welfare recipients into the streets and laying off 60,000 state employees.

The foremost dismantler of the state looks to be its own governor, who would terminate the state’s health insurance program for working-class kids rather than create an oil-extraction tax on oil companies -- out of fear, we can only presume, that Chevron will pack up its oil fields and haul them to a lower-tax state. In his ideological rigidity, the governor is matched by the Republicans in the Legislature, whose burning desire to smash the state exceeds the most fevered fantasies of ‘60s Berkeley radicals.

Democrats are countering with -- in addition to their oil-tax proposal -- a plan to hike the tobacco tax and reach into the state’s rainy-day fund, on the theory that enacting $24 billion in cuts, as the governor proposes, would be the social equivalent of the Flood. But they can’t enact these measures without some Republican votes and a governor willing to sign them.

Which means they need to do what America’s biggest banks and auto companies did -- turn to the feds. To date, a few prominent Sacramento Democrats have reached out politely to the Obama administration, but when the president’s people declined their request, they stole quietly back into the night.

It’s easy enough to understand the White House’s reluctance to intervene. If it offers loans to California, what about the other 40-plus states that are confronted with deficits? And it’s understandable that Democrats would prefer not to put the president on the spot. But the Flood cometh. The time for cutting your party’s leader some slack has passed.

After all, the case for the feds loaning money to California is the same as the case that persuaded the government to help out General Motors and Citibank: It’s too big to fail. One out of every eight Americans is a Californian. And if California, where the unemployment rate is already higher than in all but four other states, falls deeper into depression, it will substantially retard the nation’s recovery -- as a downturn in Nevada, Illinois or even Texas would not. California leads the nation in underwater mortgages, and massive cutbacks in state spending would create a new wave of defaults and foreclosures, swamping the nation’s (and the world’s) banks with yet another cascade of toxic assets.

The feds should approach California as they did General Motors -- demanding a fundamental restructuring of state finances as a condition for loans. In return for proffering, say, $8 billion in loans, the White House should demand $8 billion in tax hikes and $8 billion in cutbacks. It should also demand changes to the state’s Constitution that would upend California’s dysfunctional system of finances, sweeping away the two-thirds requirement for passing budgets and raising taxes, restoring local governments’ ability to fund themselves through property taxes and putting a stop to budgeting by initiative. The feds’ loan could be conditional on the state’s voters ratifying these changes in November.

The only way such a measure could pass, of course, would be if a very popular president named Obama campaigned for it.

If that’s too much to expect of a president who does have a lot on his plate, there are still other ways the feds could help. As Jean Ross of the California Budget Project has suggested, they could increase the federal contribution to Medi-Cal and the Healthy Families program that the governor is so eager to ax. Alternatively, Obama could ask Congress for a second stimulus that would enable states to maintain their pre-recession levels of services. In a recession, our federal system becomes a marvel of self-negation: While Washington spends to keep the economy from tanking, 50 state capitals cut their spending to match their diminished revenues. If Obama can’t help America recover by helping California, he needs to help America recover by helping all 50 states.

But where are the demands on Obama? Where are Jerry Brown, Gavin Newsom and Antonio Villaraigosa; Dianne Feinstein and Barbara Boxer; Nancy Pelosi and Henry Waxman? If we are not for ourselves, who shall be for us? And if not now, when?