Governor Arnold Schwarzenegger

U.S. legislators say criticism over funding is an attempt to deflect blame for state’s budget problems.

By Michael Rothfeld and Richard Simon

January 12, 2010

Reporting from Washington and Sacramento – For Gov. Arnold Schwarzenegger, blasting the federal government for California’s problems has become an oft-used routine since his first days in office. But in a new twist, federal officials are firing back.

The bicoastal fusillade, which continued Monday, began last week when Schwarzenegger attributed part of the state’s $20-billion deficit to what he called an unfair federal funding formula, criticized the national healthcare plan and included an implicit message of extortion for federal lawmakers in his budget: Come up with an extra $6.9 billion for California or share the blame for eliminating state programs for children, the elderly, the disabled and the poor.

This did not sit well with the state’s representatives in Congress, who felt unappreciated for helping win tens of billions of dollars in federal stimulus funds for the state last year and offering hope of more aid in a jobs bill now moving through Congress.

Most of those lawmakers are up for reelection and saw a governor with record low-approval ratings (and who doesn’t want financial crisis as his legacy) trying to deflect responsibility for a budget he hasn’t been able to control.

“The governor got himself into this mess,” said Rep. Devin Nunes (R-Tulare). “He wants everybody to like him instead of making the tough decisions. It’s kind of silly to come to the federal government.”

The dispute highlights the complexities of dealing with a recession that, although apparently receding, continues to batter state budgets nationwide. State and federal officials around the country are weighing the risk that these deficits may prolong the downturn against the political risks of pushing for a second federal stimulus package.

Schwarzenegger, who long ago dubbed himself “the Collectinator,” has highlighted what he says is a disparity in what California receives from Washington compared with other states. He eagerly accepted last year’s recovery package, putting him in the cross-hairs of fellow Republicans who portrayed it as excessive Democratic spending.

By now saying he wants what is owed, rather than a “bailout,” he can avoid appearing that he is going back to Washington with hat in hand.

In choosing to tell the public that his state’s budget problems are due to unfunded federal requirements on prisons, healthcare and in other areas, however, Schwarzenegger got a rare rebuke from U.S. Sen. Dianne Feinstein (D-California), often an ally, who said his behavior was “not constructive.”

Sen. Barbara Boxer (D-California), who is up for reelection this year, accused Schwarzenegger of distorting the facts by saying California gets only 78 cents back on the dollar, largely because he overlooked the effect of the federal stimulus.

On Monday morning, the governor struck back by saying Boxer has been less effective than Sen. Ben Nelson (D-Nebraska), who won extra funding under the healthcare plan.

“I think he did a great job fighting for his state,” Schwarzenegger said at an appearance in Torrance. “What I’m saying is, I wish that Sen. Barbara Boxer is fighting for the same deal for California and that our congressional delegation is fighting for the same thing. That’s what I’m complaining about.”

Plans are in the works for Schwarzenegger to travel to Washington next week with state legislative leaders.

But the Democrats in charge of the Legislature have been wary of going with him because of his criticism of the healthcare plan and the federal delegation. Assembly Speaker Karen Bass (D-Los Angeles) said she was “evaluating” whether to attend meetings with the governor in Washington.

“I’m very concerned with the tone that’s being set,” she said. “When you go and ask somebody for help, it’s not very constructive to attack them.”

Schwarzenegger, however, said that his efforts were already succeeding.

Over the weekend, he spoke about the funding problems with Kathleen Sebelius, the former Kansas governor who is President Obama’s secretary of Health and Human Services, and said he was told that “this all will change as we go forward.”

“I think we have made enough noise, even though they are complaining, even though the congressional delegation, you know, now feels guilty,” Schwarzenegger said. “The truth always hurts.”

Although experts say a solution that helps California at the expense of other states is unlikely, one that assists all states is possible.

Schwarzenegger is “certainly not going to be a lone voice,” said Marcia Howard, director of the Federal Funds Information for States, which studies how federal decisions affect states. “There are plenty of states that are in situations similar to, if not quite as dire, as California’s. I think there will certainly be a large number of people agreeing with the governor that Washington ought to give a second round of assistance to the states, but it will not be unanimous and will not be easily done.”

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