With the gubernatorial election coming up, I also needed new political consultants. I turned to Maria for help. Finding talented people is one of her great skills—she inherited it from her father. And even though she was not as familiar with the talent on the Republican side, she worked behind the scenes to recruit high-powered Republicans who were comfortable with my often-unconventional views. We signed up Steve Schmidt, who had helped shape George W. Bush’s campaign for a second term, and Matthew Dowd, formerly the chief campaign strategist of George W. Bush. Schmidt was pretty blunt about my dismal reelection prospects. At one of the first meetings that we held to discuss them with the senior staff and Maria, he told me the polls showed the voters were mad. They didn’t think they had elected a partisan guy, and they certainly didn’t think they should be doing the deciding for me. But there was a bright spot to his message: people liked me. His advice was: “Be humble. Apologize for making a mistake and stop pulling political stunts like the thing with the wrecking ball.” When Schmidt finished talking, I took a few puffs on my cigar. I think in images, and I needed thirty seconds to visualize who that governor would be. Finally, I told him, “I can play that role perfectly.”
When I stepped to the podium in the statehouse on January 5, 2006, to deliver my State of the State speech, I was a better governor. I wasn’t the bullying, belligerent conservative I’d been portrayed as in the special election. I appeared pragmatic and earnest, and I wanted to make progress.
It made sense to start with an apology: “I’ve thought a lot about the last year and the mistakes I made and the lessons I’ve learned,” I said. “I was in too much of a hurry. I didn’t hear the majority of Californians when they were telling me they didn’t like the special election.
“I have absorbed my defeat, and I have learned my lesson. And the people, who always have the last word, sent a clear message: cut the warfare, cool the rhetoric, find common ground, and fix the problems together. So to my fellow Californians, I say: message received.”
I joked about my approval rating, which by now had sunk further, to the low thirties, and the fact that people had started asking, “Don’t you wish you were back in the movie business?” But I said that I still thought this was the best job I ever had, and that I now stood before them happy, hopeful—and wiser.
I bragged about things for which we all deserved credit, from balancing the budget without raising taxes, to banning soda and junk food in schools. I reminded them of the big things we had accomplished—the workers’ comp reform, the funding of stem-cell research, the refinancing of state debt, new laws to make government more transparent and accessible.
And then I laid out the big numbers: the hundreds of billions of dollars of investment that we would need in order to support California’s growth in the future. As a first step, I presented the ten-year plan my team had scrambled to refine. We’d named it the Strategic Growth Plan. I asked the legislature to put before the voters the $68 billion in bonds we would need.
The headlines in the newspapers the next day were perfect: the governor saying “Build It.” I’d taken a lot of lawmakers by surprise by proposing something so politically inclusive and big. Of course, there was skepticism on both sides, with Democrats saying, basically, “Yeah, sounds good, but show me,” and Republicans saying, “How are you going to pay for this?” Still, so many people from both parties and from labor came to me and said, “Okay, let’s get a fresh start,” I knew I was on the right track.
With the election approaching, we had three messages we wanted to send voters: Arnold is a public servant, not a party hack. He is not afraid to tackle big problems. You are better off today than you were under Gray Davis. We drove home those messages using one strategy: every time we get something passed, we go out and declare victory.
Behind the scenes, we were also doing an incredible amount of fence mending. We needed to make nice with the important groups that my special election had managed to alienate and that had just spent $160 million beating me. In her office, Susan put up a white board that listed all the groups, and Schmidt titled it “The Coalition of the Pissed Off.” It included all public-employee groups, of course: the teachers’ union, firefighters, nurses, and prison guards, as well as all the major Indian gaming tribes, and on and on. Also on the list were groups that usually lean Republican, such as police chiefs, sheriffs, manufacturers’ associations, and small business associations.
In fact, with the single exception of the California Chamber of Commerce, every important political interest group in California was planning to either not support me or work actively to defeat me. And, as I’d learned the hard way, they had the power to block initiatives and stop change. We needed to choose our battles and our opponents if we were to get anything done.
One by one, we set out to work with our friends and neutralize our opposition. It helped enormously that California’s economy was finally growing again, so billions in tax revenues were unexpectedly swelling the treasury. We settled an old lawsuit with the teachers, and we met repeatedly with the fire chiefs, police chiefs, and sheriffs to ease their concerns about pensions. In some cases, the fence mending took months. Key unions had contracts coming due, so we took our time with negotiations, knowing that the unions would watch my growing strength in the opinion polls and decide that there was a good chance I’d be reelected, and that they might have to deal with me for four more years.
As always, the biggest challenge was winning the cooperation of the Democratic majority in the statehouse. We did that by taking on the issues that Democrats couldn’t oppose, such as infrastructure investment and the environment. The approach gave them a bitingly clear choice: they could fight me and be seen as obstructionist while I tried to move the state forward. Or they could work with me and make progress on issues dear to the hearts of their constituents. They realized that having a Republican governor lead on big issues was a “Nixon goes to China” moment they couldn’t afford to pass up.
After months of hard negotiations, the Democrats chose the path of cooperation. In May we achieved the two-thirds majority required to put through the bond package. My $68 billion proposal had gotten reworked and resized and came out as $42 billion. It took us two more years to negotiate funding for the prison and water proposals, but we got it all eventually. By far, this was the most ambitious infrastructure package of its kind in California history. The press called it “historic.” Now the package would have to go before the voters for approval in November, but its passage in the legislature alone—the fact that California had gotten its act together on a major issue confronting every state—made national news.
I knew exactly how to sell something that sounds as boring as “infrastructure” to the voters. We presented it on the personal level. We didn’t just harp on infrastructure and bond amounts. Instead, I talked to voters up and down the state about how angry they were at always being stuck in traffic, about how they were missing their kids’ soccer games or dinner with the family. I talked to them about how frustrated they were with the crowded and temporary classrooms where many of their kids went to school.
After Hurricane Katrina in 2005, it was easier for me to make people aware of how vulnerable California’s old levees were. In prehistoric times, the whole middle part of the state had been a vast inland sea, and now it was a little like Holland. Except for the levees and flood control, the waters could come back and turn us into the Louisiana of the West Coast. One bad earthquake could destroy the system and flood the interior valley, wiping out the source of drinking water for tens of millions of people in the southern part of the state.
I also had big plans to complete the state’s plumbing: a canal to ensure the flow of water from the North, where it is abundant, to the South, where it is not. In the early 1960s, Governor Pat Brown, Jerry’s father, had begun the project with ambitions to make the system so monumental that water would never be fought over again. But Ronald Reagan had put a stop to the construction when he came into office in 1967, and the issue continued to cause battles between Californians, as it had through most of their history.
To sell the package to voters, I invited legislative leaders of both parties to travel with me around the state. It was the weirdest thing: Democrats and Republicans had done something together! The fact that Democratic legislators were campaigning with a Republican governor who was running for reelection made it all the more stunning to see us together on the trail. And it drove my Democratic opponent, Phil Angelides, crazy. But the legislators were able to declare victory, and they saw how positively the people responded. They were so used to hearing “Your poll numbers are in the toilet, no one likes you, you’re wasting money, you’re a self-serving bastard, you’re in cahoots with labor, you’re in cahoots with business …” Now all of a sudden they felt like winners. They’d passed these bonds, and the public was saying, “Wow that is really great, Republicans and Democrats working together—finally!”
So the logjam broke. The momentum from the bond package propelled us into a very productive year. That summer, we passed a $128 billion budget for 2006–07 that included a big increase in funding for schools plus $2 billion in debt repayment. We did so without the perennial delays and fights, making it the first on-time budget in years. After some wrangling, we negotiated a long-overdue increase in the minimum wage. My Million Solar Roofs
