Gov feels ‘street heat’

SAN FRANCISCO — In a surprise announcement April 7, California Gov. Arnold Schwarzenegger said he is delaying until June 2006 a controversial ballot initiative to change state workers’ pensions from public, guaranteed-benefit programs to privatized 401(k)-like pensions.

“The governor’s retreat on the pensions initiative is a huge defeat for the corporate special interest agenda,” Jim Farrell, spokesperson for the 2-million-member Alliance for a Better California, said in a telephone interview.

“But,” he warned, “the fight isn’t over. The governor has broken past promises.”

For weeks Schwarzenegger has encountered large and vocal picket lines at most major appearances. In San Francisco last week some 3,000 labor and community activists “welcomed” the governor as he attended a fundraiser at the swanky Ritz Carlton Hotel.

Taken together with other recent setbacks, withdrawal of the pension measure was seen by many as an important but temporary victory. Labor and community leaders warned that Schwarzenegger is still backing other destructive measures, including one that would virtually bar public workers from participating in political activity.

Though an official announcement has yet to be made, Schwarzenegger is still pursuing a special election next November that would cost taxpayers over $70 million.

“Schwarzenegger hasn’t backed away at all; he’s just delaying a faulty initiative,” Willie Pelote, AFSCME California’s political and legislative director, told the World.

“He still plans to take away the pension money of California workers and give it to Wall Street. That won’t save the state money, and people may never be able to retire.”

The corporations involved in private pensions “may be no better than Enron,” he added.

“He’s lost one big bargaining chip,” said Fred Glass, communications director for the California Federation of Teachers. “His failure to move the pension initiative means he needs to think more clearly what to do about the others.”

“Unfortunately, he is still pushing several other seriously flawed initiatives toward a wasteful, unnecessary special election next November,” Dave Lowe, chair of California Families against Privatizing Retirement, said in a statement.

“And now he’s raising more corporate special-interest money for his half-baked initiative ideas than any governor in history.”

The $30 million Schwarzenegger has taken in so far is twice that raised by former Gov. Gray Davis, who was pilloried by the corporate press for his fundraising.

The struggle over California’s public pensions has national implications. Labor observers have remarked on its links to the Bush administration’s drive to privatize Social Security, as well as to efforts in other states to privatize public workers’ pensions.

While broad opposition has been building to the concept of privatizing pensions, the final straw was the initiative’s denial of survivors’ benefits to families of firefighters, police and other public workers killed or disabled on the job.

Schwarzenegger has aroused popular ire by calling teachers, nurses, firefighters and police “special interests.”

“We are glad that Gov. Schwarzenegger has admitted that the pension initiative was a mistake,” said Low. “Now he needs to admit that the entire $70 million special election is a mistake. Instead of moving forward with flawed initiatives he should get to work on fixing the state budget and taking care of the people’s business.”

Even Republican political gurus are becoming uneasy about the fate of the program the governor unveiled with such fanfare in his January State of the State address.

“The whole special election … and direct democracy is looking more complicated to his people than maybe a few months ago,” Republican political consultant Dave Gilliard told the Los Angeles Times.

L.A. County Sheriff Lee Baca, another Republican, has said he cannot accept his employees being “tossed to the winds of uncertainty” if pension benefits are not guaranteed.

Even Schwarzenegger’s much vaunted proposal to cap spending across the board if it exceeds revenue, and his effort to move redistricting out of the Legislature, are now said to be subject to negotiation. Some commentators speculate that the education proposals — merit pay for teachers and lengthening the time needed for tenure — may end up being dropped as well.

A poll released April 7 by a research institute at San Jose State University showed the governor’s approval ratings continue to slip, with only 43 percent of all adults now agreeing that he is doing a good job, down from 59 percent in January. Some 49 percent now think the state is on the wrong track, up from 35 percent in January.

“People are finally getting it,” observed AFSCME’s Pelote. “People expected something more, but this isn’t reform. He’s putting the welfare of the public at risk and protecting those the Chamber of Commerce says to protect. That’s not someone coming in to clean up a mess.”

In another setback to Schwarzenegger’s agenda, the state Senate last week rejected the governor’s nominee for the state teachers’ retirement board, in response to his earlier action revoking nominations of four potential board members who opposed pension privatization.