Vol. 12, No. 2,856W - The American Reporter - March 18, 2006

Jill Stewart

by Jill Stewart
American Rerporter Correspondent
Sacramento, Calif.

SACRAMENTO, Jan. 4, 2003 -- Well, hellooo carrot and stick. Gov. Arnold Schwarzenegger just displayed dramatic examples of both in his dealings with the California legislature, which is still reeling from it and is scrambling in private to figure out how to deal with it.

But the real story as 2003 wraps up is the psychology of the governor himself, what we've learned after watching him for nearly six weeks in office, and what it portends for California's fiscal health.

Schwarzenegger is a neophyte to Sacramento politics, where nothing is really as it appears and most legislators are working with both a public agenda and a private agenda. With his boyish grin and beefcake image, it's easy to forget that Schwarzenegger has mastered both strategic and tactical thinking in two other highly competitive, big-money venues: global bodybuilding and Hollywood filmmaking.

Called "the Oak" for his immense size and impenetrable concentration during the 1970s, Schwarzenegger found unique ways to psyche out his bodybuilding opponents, who were among the most adept in the world at psyching out competition.

In one of the few biographies about him, "Arnold Schwarzenegger: A Portrait," by George Butler, one scene portrays a manager teasing Schwarzenegger that he might win his seventh Mr. Olympia title because he knew some judges. Schwarzenegger responded that he was interested only in influencing competitors like Mike Mentzer: "Already, Mike Mentzer has left the gym this morning. [Mike] said, 'You're driving me crazy with that smile.' . So this afternoon he misses training to see a shrink. He should remember that another Austrian was King of the Shrinks. I could advise him for free."

Schwarzenegger abandoned much of his early bluster when he adapted to the more subtle, vicious, high-stakes game in Hollywood. He figured it out fast and rocketed to the top in part because of his mastery of strategy. When he realized that his hulky killer persona was hemming him in as a star and turning off some filmgoers, for example, he set out to make comedies that showed another side. "Twins" and "Kindergarten Cop" were huge hits.

Sacramento has a far lower profile than either global bodybuilding or the film industry. Yet far more is at stake. California's fiscal health, for one. Moreover, Sacramento is the petri dish for legislative leaders who move to Congress, and Sacramento's the place where the huge unions are increasingly playing king maker as they attempt to assert domination over California politics.

When Schwarzenegger went back to the negotiating table in early December to hammer out a deal with Assembly Speaker Herb Wesson on his fiscal recovery act for the March ballot, Schwarzenegger was not merely showing Sacramento that a guy once called the Oak knew how to bend.

Schwarzenegger gave up significantly more ground than did Wesson, by abandoning his and the Republicans' key demand for a true spending cap on the legislature.=20

But Schwarzenegger was not simply negotiating a deal. He was administering a crucial psychological test to the legislature - not an usual move for somebody used to world-level competition in two other industries. He could have dug in his heels, insisted upon the spending cap, and launched a petition-gathering drive to put his spending cap and bond package on the November ballot.

Given the foul mood of California voters toward the Legislature and its spending habits, Schwarzenegger could have won that November tussle.

Instead, he administered this test: If I give you guys a big concession - if I offer you a carrot by clearly backing off from the spending cap I want, and if I praise you and make you look good in the bargain - will you give me something big back?

Essentially, Schwarzenegger was asking, What sort of folks am I dealing with here? What sort of integrity and mettle have they got?=20

So Schwarzenegger compromised, upsetting several Republicans by giving up too much. Yet he continued to press hard for the thing he wanted even more: immediate cuts in current-year spending by the legislature so money could be freed to repay cities and counties who lost out when Schwarzenegger reversed the tripling of the hated car tax.

He'd made a campaign promise to the cities and counties to make them whole again, and he intended to fulfill it.=20

But the legislature shined him on. His proposals to make current-year spending cuts were not even allowed onto the floor of the legislature for debate and a vote. Instead, Senate President Pro Tem John Burton and Speaker Wesson sent the legislature home until 2004.

Mayors and sheriffs in cities and counties, who needed millions of dollars restored to them for December alone, were furious. They squawked angrily at Schwarzenegger and the legislature, and threatened to sue the state.=20

How illuminating for the new governor, whose first test of the legislature had come to a close.

Now, Schwarzenegger has a solid feel for how legislative leaders handle compromise.

They don't. In Sacramento, compromise has come to mean squeezing as much as possible out of the other side. Period.

So the Oak went and got a stick.

That's no proof of strategic brilliance, since use of the stick is a classic tactic once the carrot has failed. But it was a clear demonstration of his readiness to use power.

The stick was provided by a law signed by Gray Davis, but never used by the indecisive former governor. It allows the governor to get around the legislature by directly appropriating money in times of emergency.

The new governor reinstituted $2.65 billion to local governments, and further directed that $150 million in line item budget cuts be made immediately to help offset the payments to cities and counties until the legislature makes further cuts.

Schwarzenegger's Dec. 18 press conference was as riveting as things get in policy wonkish Sacramento. Democratic Mayor of Oakland Jerry Brown charged gleefully to the dais, never left Schwarzenegger's shoulder, and then boomed out, "The governor exercised executive power to the max! That's the only way you get anything done around here!"

And Democratic Mayor of Los Angeles James Hahn appeared deeply moved, saying, "Wow, what a difference a week makes," before breaking into a standing ovation for Schwarzenegger.

Schwarzenegger, the strategic thinker, will naturally continue to deal with the legislative leaders. But he will form alliances with the people whom he has learned can be counted upon to engage in honest compromise. The honest compromisers include people such as wonderfully pragmatic and moderate Democratic state Controller Steve Westly, who backed his plan to return money to the cities and counties. Watch for the governor to take actions in future months that boost the gravitas of people like Westly.

Watch also for a higher profile for the so-called "Bipartisan Group" of less than 20 legislators, long dismissed as powerless by the hardcore partisans who dominate the 120-member legislature. This group of reasonable Democratic and Republican pragmatists has gained the ear of Schwarzenegger. They played the key role in getting the grumpy legislative leaders to resume broken negotiations on the spending cap.

"We want things to actually work around here," says Democratic Assemblyman Joe Canciamilla of Pittsburg, who co-leads the group with Republican Assemblyman Keith Richman of Northridge. Says Richman: "Now we're talking with the governor about other solutions to other problems." The irony is that even if Schwarzenegger builds a fledgling bipartisan/moderate effort, he will increasingly be pulled toward partisan politics because of the coming presidential election.

With Democrats still nursing bitter wounds over the 2000 election controversy, with Howard Dean turning up the heat on President George W. Bush, and with sharp divisions over Iraq, 2004 could be the most partisan election in memory.

Schwarzenegger has already been named Honorary Chair of the Bush-Cheney '04 California Leadership Team, and stated on Dec. 18, "President Bush has shown great leadership by acting decisively to transform tough challenges into golden opportunities."

By mid-2004, right when Schwarzenegger must complete a crucial budget deal with the majority Democrats in the legislature, Sacramento will be an ugly quagmire of partisan gamesmanship. The governor will have to decide, at that point, exactly how much to help Bush and the Republicans. Because whenever Schwarzenegger steps to a microphone with a George W. '04 banner behind it, a crowd of protesters is bound to appear, demanding that the governor go the hell home and take care of California.

Among Schwarzenegger's loudest critics will certanly be the unions, whose leaders are fuming that he has correctly singled them out as the worst special interest manipulators in Sacramento.=20

More than any other group, union leaders can quickly churn out busloads of protestors, as they demonstrated throughout 2003 when they stopped the legislature from making significant budget cuts by filling the halls with angry, tee-shirt coordinated groups and people in wheelchairs. The union leaders are no slouches when it comes to strategic thinking and the use of raw power, either.

So the psychological game is afoot. But unlike Davis, who trembled at the sight of union buses in the capital and feared any sort of battle with the legislature, this governor clearly will play hard if he must.

The question is whether Schwarzenegger can use the tools he has already quickly displayed in his repertoire - carrot vs. stick, personal charm vs. executive authority, bending vs. toughness - to crack open a system hard-wired to resist tampering.

Gray Davis, the fearful one, would have created fiscal disaster. Arnold Schwarzenegger, strategic thinker, has a chance.

Copyright 2006 Joe Shea The American Reporter. All Rights Reserved.

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