Associates Breakfast with Bill Lockyer, California State Treasurer

July 14, 2009

Santa Monica


California State Treasurer Bill Lockyer says lawmakers in Sacramento have to face up to necessary budget cuts and "just get it done."

"Here we go again," said California State Treasurer Bill Lockyer, summing up the recurring partisan gridlock that produced a 2009 budget impasse of epic proportions.

At a private breakfast briefing with Milken Institute Associates, Lockyer reminded the attendees that Sacramento didn't always work that way. During his tenure in the state legislature, budget negotiations were marked by discipline and compromise. But in recent years, the state increasingly relied on deferrals, gimmicks and borrowing. When revenues tumbled in the wake of the economic downturn, the day of reckoning finally arrived, he said.

Lockyer believes that term limits have worsened the stalemate, as freshman legislators are more focused on their donors and more rigid in their ideology. He feels that mediating skills are learned over time, and the constant churning of the legislature produces increased polarization.

"It's the Hollywood effect. Sacramento has become about fluff and PR, not the day-to-day grind of governing," Lockyer lamented. He called for policy to be driven by facts, not polls. "The plural of anecdote is not evidence."

While he supports the notion of removing the legislature's two-thirds majority rule for passing the annual budget, he feels it should be kept in place for approving new taxes. "I think we've bumped the ceiling of potential levies in California."

Tax increases just aren't going to get through, Lockyer observed. "It's going to have to be cuts," he said. "My message is to just get it done. We have to be responsible and reconcile these accounts."

His guiding principles are to make government more efficient, fix K-12 education and "don't chase business out of the state." Lockyer is particularly concerned that the state is cannibalizing higher education, a trend he referred to as "eating our seed corn."

This event was open only to members of the Milken Institute Associates. To join, please contact Mindy Silverstein, director of Milken Institute Associates, at (310) 570-4634 or