Sacramento's new art of compromise

Schwarzenegger's fiscal agreement with legislature brings talk of new tone, and tensions.

After weeks of pronouncements and posturing that left California's political class befuddled - and at times upset - Gov. Arnold Schwarzenegger appears to be finally finding the fine art of compromise.

It has come slowly, lawmakers say, but last week brought out a side of Governor Schwarzenegger that many have been waiting for since he took office: the one willing to seek the middle ground. First with a contrite phone call to a group of legislators, and since through ceaseless meetings that stretched at least once past midnight, he resuscitated a crucial budget plan that lawmakers had seemingly defeated.

Even in these early days of his term, it is a significant moment - and one that could hint at the course of his administration. Faced with his first crisis since becoming governor - amid libel lawsuits, charges of broken campaign promises, and seeming legislative failure - Schwarzenegger has turned from tactics of intimidation toward consensus, tweaking California's partisan political culture and potentially setting him on a collision course with his own party.

"He was definitely reaching out and making it clear that he was willing to compromise," says Democratic Assemblyman John Dutra. "I was very encouraged."

There is, of course, much left to do. The two bills approved by the state Legislature late last week will ask voters to pass a $15 billion bond to handle current debt and a balanced-budget amendment to prevent deficits in the future. The Democratic secretary of state extended a deadline to allow the two bills to appear on the March ballot. But even if voters pass both measures, Sacramento will still have to look at the underlying causes of California's fiscal disaster - such as its excessive reliance on volatile sales taxes and the state's assumption of many local responsibilities.

Still, the fact that Schwarzenegger reached a compromise with legislative Democrats has changed the tenor in Sacramento. A week ago, the Legislature had descended into partisan bickering reminiscent of Gov. Gray Davis's days. It had refused to pass Schwarzenegger's plan, apparently dealing the governor his first major political defeat.

Then, not long after, Schwarzenegger announced that he would not hire an investigator to look into allegations of sexual harassment; he suggested that California might have to cut education to balance the budget; and that he might not be able to reimburse cities and counties for money lost when he cut the car tax. Each announcement went against campaign promises. One of the women who accused Schwarzenegger of sexual harassment even filed a libel suit for comments a press aide made about her.

Yet, last Monday, the political scene was beginning to shift behind the scenes. In two conference calls to various members of both parties of the Legislature, Schwarzenegger said he wasn't ready to give up his budget bill, and he was asking lawmakers for help.

"That was very positive," says Mr. Dutra, who participated in one of the calls. "[He said] he was willing to work hard to do this."

Reports indicate that two other people were crucial in the rapprochement as well: Schwarzenegger's wife, Maria Shriver, and Assemblyman Keith Richman, a GOP moderate. Both apparently worked behind the scenes to encourage the process to keep going when the rifts seemed insurmountable.

The compromise that has come out has cheered Democrats and given some Republicans pause. Democrats say some smoothing out was necessary. Since Schwarzenegger's inauguration day, when he called a special session of the Legislature to deal with the budget, many had complained of too much style and not enough substance. In short, the administration was slow to give them proposals to look at, and the ones lawmakers did see lacked specifics.

"The stuttering nature of the progress was a reflection of the [administration's] lack of sure-footedness," says Democratic Sen. Sheila Kuehl. "No one can blame him. He's new, and he's trying to move two large bills in a short amount of time."

But when Schwarzenegger then traveled to the districts of several moderate Demo- crats and asked voters to put pressure on lawmakers to support his plan, it smacked of coercion, critics say. "It's one thing to mess with the mind of a weight lifter," says Bruce Cain, a political scientist at the University of California at Berkeley. "It's another to mess with the collective mind of the Legislature."

To some, the gambit was pure political naiveté. To others, though, it points to what could be a deeper problem for Schwarzenegger: divisions within his own staff and party. "[It suggests] you've got the confrontationalists who want to show the Legislature who's boss and the accommodationists who are willing to take half a loaf," says Larry Gerston, a political scientist at San Jose State University. "That's not so surprising given the newness of the administration."

Indeed, the passage of Schwarzenegger's plan was met with muted support among many Republicans. Originally, he had pushed for a harder spending cap instead of the softer balanced-budget amendment. It was an idea directly from the playbook of former California Gov. Pete Wilson (R). If last week's conciliatory tack becomes a trend, it could lead to a peculiar dynamic in the Capitol, with Schwarzenegger at times facing more opposition from his own party than from Democrats.

"I think he'll have more difficulty getting support from his own caucus than with the Democratic caucus," says Dutra. "He's more interested in compromising than some of his advisers."

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