Will Billionaire Nicolas Berggruen's Plan To Fix California From The Outside Work?
Can an investor with a net worth of more than $2 billion spend one percent of his wealth to suggest and force fixes upon a state government that nearly everyone in the state says is broken?
Nicolas Berggruen is a German born in France, unmarried and based out of New York City, though he spends much of his time jetting around the world in his private Gulfstream. He's donated to Democratic candidates such as President Barack Obama and Sen. Charles Schumer, and he invests in liberal causes such as green energy companies, tech firms and urban development. His family's wealth came through collecting art, a practice he's continued. He's a nomad who relishes the outdoors, loves working off of his Blackberry and lives mainly in hotel rooms.
The Wall Street Journal tell us the 49-year-old reads the works of Confucius and French philosophers Sartre and Camus. Berggruen's choice of subject in op-eds for national newspapers suggest an appreciation for the way government works in China ("a long-standing Confucian proclivity for order, respect for authority and a conformist notion of social harmony.").
Most of his previously published ideas for California's future are recycled--neither bold nor unique. The same problems that lead to the present gridlock in California's state government have prevented the solutions from taking hold.
Yet, Berggruen pledged $20 million on Wednesday to fund a group which wants to restructure the state's government, making it leaner, more flexible and more accountable. The timing of his announcement and the group's first meeting--six days before California will elect a new governor--contrast sharply with the promises of the gubernatorial candidates who are offering new visions for California's future by changing operations from within.
Democrat Jerry Brown would tighten the state's spending after an immediate review of the budget. Republican Meg Whitman wants to restore prosperity in California by cutting taxes and shuffling around state employees.
Berggruen's one innovative idea is borrowed from his study of China. He basically wants to add a fourth branch to California's government. A group he's called the "Long-Term California Council" would offer a new check in government, balancing "the short-term political impulses of the elected legislature" and keeping the state "focused on the challenges of the future: smart growth, smart energy grid, green jobs, information technology and biomedical innovation, Pacific trade." Where these trustees would come from and how exactly they would balance present problems with future fears remains unclear. That's the knot the diverse group he's assembled will have to untie.
The outsider Berggruen has teamed the think tank he oversees with a group of business executives, scholars and former politicians to go over the heads of Brown and Whitman, perhaps saying that who the next governor is won't matter as long as institutional barriers restrict their actions.
In an op-ed earlier this year, Berggruen reflected heavily on China, writing that the nation became committed to heavy-handed unified political control after a period of wars between rival states.
"The path to peace after the West’s religious wars led to the opposite ideals: tolerance and diversity," he said. "In the Confucian tradition, China has relied on ethics, including obligations of the ruler to the ruled, and education to keep its institutions responsive, fair and honest. The West has relied on the check of democracy."
To improve the West, he said, the U.S. needed "the type of long-term deliberation offered by bodies such as a meritocratic upper house and some entity with the responsibility for continuity of governance that stands as a unifying symbol in an ever more diverse society."
Berggruen's motivation appears to be both altrustic and capitalistic. For one, he stands to benefit from the opportunity to invest in green technology companies if California pushes ahead with its agenda to combat climate change. It's part of why he's donated a quarter of million dollars to the campaign to keep that agenda from being derailed by Propostion 23.
But Berggruen has said previously he wants to leave a legacy. If he can turn around bellwether California by finding a way for the government to be "responsive to the electorate while not sacrificing the long-term general interest," he'll chart a new course for the nation as a whole, he says. California's his laboratory. If the cure developed by him and the Think Long Committee succeeds, similar problems could be eradicated in countries across the world.
The Think Long group he's formed includes conservatices such as George Schultz and Condoleezza Rice, Democrats Willie Brown and Gray Davis, business executives Terry Semel and Eric Schmidt, labor leader Maria Elena Durazo, UC Berkley professor Laura Tyson and former State Assembly Speaker Robert Hertzberg.
Not all the names are suprising. Berggruen's shown a fascination with Google in his writings and he mentioned Willie Brown by name in an article as well. Brown was making a visit to where else but China.
"In a consumer democracy, where the feedback signals from politics, the media, and the market all steer society toward immediate self gratification, there is scarce political capacity for the kind of long-term thinking, planning, and continuity of governance which has so far been responsible for China’s rise," Berggruen wrote.
The other ideas he offered for California earlier this year: an open primary system, stricter term limits and pay-as-you-go spending for new intiatives. He also supports a budget cap and a rainy-day fund. And like every California politician or budding politician, he cites the need for "pension reform."
Under Berggruen's California, the three higher education systems would have endowment funds, local authorities would make more decisions than the state and all government programs would be subject to extinction if they don't outlive "performance and productivity" reviews.
But rehashing stale ideas seems to be part of the plan for the group's use of their $20 million in funding. Former governor Davis told the Sacramento Bee that the group will meet a handful of times during the next few months. He said the group would discuss ideas other groups have brought up, but couldn't get passed.
"Our goal is not to reinvent the wheel and insist that every idea is original, but we'll pick two or three and get Sacramento on track," Davis said.
The ideas mean even less coming from Berggruen's coalition than they do from politician beholden to special interests. How does Berggruen, with help from his fellow thinkers, plan to reform the state from the outside? Voter-led initiatives often succeed in California, but he's proposing a series of changes unlikely to pass as a package. The idea of a constitutional convention hasn't been received well; Berggruen himself called it an anathema. Despite this, the Bee speculates some of the present funding and future money other committee members may donate would go toward getting measures on a ballot.
The group Berggruen has brought together encompasses every major interest in the state except Joe Citizen, but why should we believe they will be able to reach agreements in this setting when they haven't agreed in backrooms before?
And Berggruen has clearly had his mind on California since at least February, so why didn't he donate to the campaigns for No on Proposition 26 and Yes on Proposition 25. Those votes would ease the state's budgetary process, helping end some of the mess that is passing a budget and keeping new restrictions from being tacked on.
Berggruen's colleague Nathan Gardels notes the biggest problem facing California and it's government, and it has nothing to do with the Legislature or the governor.
"California’s crisis," Gardels wrote, "reveals the delusions of a Diet-Coke civilization that wants sweetness without calories, consumption without savings, and modern infrastructure and good schools without taxes."