Ted Simons: Good evening, and welcome to "Horizon," I'm Ted Simons. Joining me to talk about this week's top stories, Matt Benson of "The Arizona Republic," Jim Small from the "Arizona Capitol Times," and Howard Fischer of "Capitol Media Services." Lawmakers return to the Capitol this week to begin what they hoped would be a short special session to fix Arizona's budget crisis. Jim, did not quite turn out that way.
Jim Small: No, it's kind of a deja vu I think a little bit. This is not the first time this year's budget bills have been supposedly ready to go, have the votes, they get to the Senate and the wheels fall off and everything goes haywire. They call a quick adjournment and say, we'll be back in a couple of days to fix this.
Matt Benson: He had raised concerns earlier in the week for a bill about agencies having the ability to create their own fees. Some of these increases of 8,000% or more was proposed by dhs. Ron Gould and another senator wanted leave that with the legislature. When it came time to vote, he was nowhere at the capitol, they needed him for their 16th vote.
Howard Fischer: One of the interesting things about this, it was the legislature that directed the agencies to become self-sufficient. This whole flap over child care fees, they were bringing in $150,000 versus the $5 million they needed. You need a several thousand percent increase. Fine, then change the law. Say you don't want child care inspected. As long as there is the obligation to inspect, and you're not giving them the money to inspect, it's got to come from somewhere.
Jim Small: I think at the time on Thursday everyone -- at least observers, didn't really know what was going on. There were kind of interminable delays and they were waiting to come on. It became clear that the senator wasn't there. He had told a couple of other lawmakers that he wasn't going to vote on the budget. Because of this fee increase dispute he was off the budget completely. One of my colleagues at the "Arizona Capitol Times" talked 3 to him today. He said Senator Burns knew this, it was his fault for pushing it forward. Senate President Burns just didn't want to wait.
Matt Benson: The pattern here was the same as we have seen on a variety of budget bills. Republicans only have 18 votes in the Senate. They can only afford to lose two. With every Democrat voting against the bill, one Republican gone, Ron Gould generally a no on everything, it doesn't take much. You've only got 15 votes.
Jim Small: You have situations like this where one or two members will find an issue they really don't like and they see they have some leverage and they can dig their heels in.
Howard Fischer: This is where it's going to get interesting on Monday. Supposedly Barbara, the lawmaker on the cruise, is back. It'll provide the necessary 16th vote. It's Thanksgiving week, folks. Are we sure everyone else is going to show up?
Matt Benson: Carolyn Allen is who you're referencing, who was wheeled onto the floor of the Senate in a wheelchair. She's 72. She's had a whole bunch of health problems, knee surgery, looked quite frail this week. I'm told she won't be back next week. You're in the same boat if Goode and the other senator stay off the vote.
Howard Fischer: Okay, we will kill the increase proposal. Small problem, other than, A, it was already passed by the house. That raises somewhere close to $150 million. It's not a lot but in terms of getting to that goal that we're going to take three special sessions and a regular session to do, you need that money.
Ted Simons: Who looks worse in this scenario? The Senate president who didn't have things as organized as he thought, or the renegade senator not present when the vote was taken?
Howard Fischer: Bob Burns said in a press release that he didn't have the decency to show up. He said, wait a second. As Jim pointed out I told him I was a no, what's the point? Ron Gould showed up and said, I'm voting the way my constituents want. I think the problem is in Senate leadership for not being able to count to 16.
Ted Simons: Who looks worse?
Jim Small: Certainly there's a pattern in the Senate, things keep going awry. It certainly speaks to leadership problems over there. But at the same time I think the senator who was the 16th vote who didn't even show up. It wasn't just that he came and voted no. He didn't even show up and I think that reflects poorly.
Matt Benson: When you ask who looks worst between the Senate president and the individual senator, how about the governor? She's in Austin, Texas, at a meeting of the Republican Governors Association. This comes 24 hours after I was assured by lawmakers and legislative leaders and the governor's office that they were confident they had the votes and she could be away and everything would go like clockwork.
Howard Fischer: Nothing would have been different had Jan Brewer been on the 9th floor. If she had been here and said, Ron, old buddy, old pal, will you do it? Are you kidding? She put out a release calling him an extremist.
Jim Small: It's not like she has a history of getting votes at the capitol, anyway. But it feeds the public perception that she is away while things fall apart, that there's no captain to the ship and we are drifting.
Howard Fischer: Oh, no, I'll agree with you on that, but that perception was already there. It took this governor a couple of months to put out a five-point plan that was a shell, until June to put out a budget. There's no captain on this ship? Oh, that's already there.
Ted Simons: Was it a wise move for her to go to this conference in Texas, designed to raise money for Republicans to get reelected? Was it wise for her to do that, knowing there was going to be a special session the day she was gone?
Howard Fischer: Public perception, it doesn't help. You're right, the public says, why is the governor in Austin hanging around with Republican governors so they can take a slap at the Obama plan, which is one of the things they did there. Was it meaningful? Did it make a difference? No. I think this was a blip. We already know one of the candidates put out a statement saying, oh, my God, she was absent. I don't know that -- look, she's got bigger problems.
Ted Simons: What about reaction from lawmakers down there, when they found out she was gone and just general reaction for the mess that's resulted from the special session so far?
Jim Small: I think it's been the typical reaction, to say that the governor should have been here because there's no one piloting the ship. I think relationship leadership said earlier, and Matt said they had assured her that they had the vote lined up. We've got our 16-31 so we can move ahead without any worry of something happening.
Howard Fischer: What makes the Democrats unhappy is not so much that she was absent, but they wanted a proposal to come forward that included some of their priorities, some borrowing, some tax increase, whether it's the temporary tax or expanding the tax base. The anger with Brewer is she just cut a deal with the Republicans for this first bite and that's the real anger.
Ted Simons: Will Republicans be a factor if things continue to go as they are?
Matt Benson: I think they are absolutely a factor. We understand after today bob burns said they are working to pick off a few Democrats next week. They may need a few, when it's entirely clear they have those without Democrats voting. Again, this is something we heard back when they were trying to get a tax referral three or four months ago.
Jim Small: What are they going to give the Democrats? What do they have to offer? If you take that to its end, what is the governor willing to give, as well? The Democrats have said consistently the Republican leadership and the governor weren't willing to give enough to entice them to vote for something.
Howard Fischer: What the Democrats want is losing Republicans. If you put even some of the barring in there, you lose Republicans. You may lose enough, that's the problem. You need this amorphous 16, this magic number.
Ted Simons: The governor was not there for the State loan commission. Dean Martin has opened up a line of credit with the Bank of America.
Howard Fischer: He announced back in August that he can figure out the cash flow. The first $500 million you can borrow internally. Other funds he has access to and he can borrow them at a turn rate. He knew we're going to go above that 500 million. He's got something tied to London Interbank, something, one of those things that makes all of our eyes glaze over. It's in the neighborhood of one percentage point APR, this is great. This is wonderful for the state Moody's said they might downgrade. If Moody's does downgrade the state's credit, you know the amount from the bank is going to go up.
Ted Simons: On Martin on this shore and other venues, this isn't the end of it. We will have to keep on this way.
Matt Benson: Which is expected, it's $700 million, another wakeup call for the folks at the legislature, whatever good that does.
Howard Fischer: This is short-term borrowing. There's more borrowing coming probably in December when they are talking about borrowing against lottery proceeds, tobacco proceeds and maybe borrowing against the sale tax measure on the ballot.
Ted Simons: Arizona's tax system needs to be changed. You got to do something. Is anything gaining traction?
Jim Small: I think ideas that are gaining practice are the House Republican caucus. They putting together a jobs program or the economic recovery plan they are holding out in the next couple of weeks. At least they announce it and wait until January to put it out there. It's going to be designed to do tax reforms, often times that's code for tax cuts to businesses, to attract them to come here.
Howard Fischer: There have been recommendations saying business taxes are high. Not only does the property tax raise pay on everything that's doubled. The Republicans trot that out and say under some curve somehow we'll agreed rich. The broadening of the sales tax base to services and things like that, that's where this thing falls apart. They only want to deal with their part of the problem.
Ted Simons: The bottom line, stop cutting, start finding new revenue. Is this getting any impact at all?
Matt Benson: I think so. Alternatives are going to be forced into action. John Cavanaugh said it's a no-brainer, they have to borrow against lottery revenues, for one. Some other stuff is more questionable, vehicle licensing tax, borrowing against that, rolling over more than stuff. They want to see a significant reduction in the services.
Ted Simons: Speaking of Democrats, there is a new Democrat on the horizon who apparently -- and a lot of folks weren't even aware -- in Tempe a city councilmember was a Republican who has now gone to the Democrats. Cahill says she's not running for reelection. In the grand scheme of things, what does this mean?
Jim Small: The Democrats are certainly serious about keeping their house seat in District 17. He's been on the Tempe School District for 10 or 15 years, certainly has name I.D. He said he was taken by surprise by what happened by Aridando switching parties. His big thing was that he was going to run as an independent, because he felt that would really queasy out everybody.
Ted Simons: Is this a surprise to Republicans that he went ahead and went Democrat?
Matt Benson: Yeah, I think that's a surprise. In 2009 going into the 2010 years, when most people think he's going to have a good year, that's always a surprise.
Ted Simons: Is that unique here because it's their district, which is kind of old Democrat? Or is this a bad sign in general for the GOP?
Matt Benson: I would caution against looking at this as a sign the Democrats will sweep up in 2010.
Howard Fischer: Local issues are zoning and sidewalks and the Tempe street fair and things like that and people getting their trash picked up. Those are not Democrat or Republican issues. We have Democrats that are fairly conservative in business. Somebody like Ken Chevron who owns a restaurant and bar and looks at cutting taxes for business. It's hard to know how he will come out assuming he gets to the legislature.
Ted Simons: Let's talk about the Rasmussen poll to start with. Local GOP primary voters, John McCain essentially tied with J.D. Haywood who has kind of a motley crew of guests, including you, Howie, today. You went down and interviewed him.
Howard Fischer: Gee, I'm shocked to know that I might be considered for this. J.D. has kept his hand in Republican politics. He's actively involved in doing stuff on anti-immigration, particularly Joe Arpaio. These are the Rush Limbaugh frequently. There is a lot of anti-McCain sentiment. They remember his work in terms of immigration reform, which they consider a sellout. If you ask people blindly, who do you support, they may know John McCain but they -- What that is.
Ted Simons: And yet, McCain has stronger ratings than even J.D. in this same poll. Could this really happen here or just numbers suggest something?
Jim Small: We were talking about this a little bit before the show. You can never necessarily count out the ego factors in politics. He certainly knows how to run a campaign, he knows what it's like in D.C. If he decides that's worth giving up certainly a very successful local career, maybe trying to get syndicated and work with other platforms, I think that's something he's going to have to decide.
Ted Simons: Back to switching over to the Republican Party, don't look too much into it. Everyone sees these particular tea leaves, primarily voters are definitely going right.
Matt Benson: We're less than a year out from the election, showing Hayworth down only two points. Simcox, the other Republican in the vote, if you figure those people who were also border hawks are going to land with Hayworth, in theoretical he has more supporters than John McCain.
Howard Fischer: That's where are the full campaign ten when you get out and press a lot of flesh. J.D. -- I don't know how much J.D. even liked being in Congress. The first couple of days I think he slept in his office because of the cost and everything else. That's got to weigh on him. Having teenaged children weighs on him. I don't know. We're back to what Jim mentioned. You've got the logical reason, why he wouldn't but he's been to the Potomac, he's drunk from the water.
Ted Simons: J.D. Hayworth.
Howard Fischer: 75.
Ted Simons: That much?
Jim Small: I'd say coin flip, but Howard's the one who talked to him. Anything's possible at this point.
Ted Simons: I didn't get a number off Jim, how about you?
Matt Benson: Based on polls like this, I'd say 80.
Ted Simons: This is like The Price is Right.
Matt Benson: You have politics in your blood and you want to serve in the Senate, how can you look at this kind of timing coming off the loss in the election? How can you not say, I'm going to give it a go?
Ted Simons: Let's get another prognostication. What's going to happen next week in the legislature?
Howard Fischer: I'll know as soon as I see how many Republicans are on the floor. That's what it really comes down to. If there are 16 Republicans on the Senate floor, we'll be out of there by the afternoon. If they are not there, we may be out of there by 2:00 but without the budget fixed.
Ted Simons: Why should anyone expect anything different?
Jim Small: That's kind of the point where I think most of the press Corps is. Well, no, they are not, because everything blew up. I agree with Howie, I'm not going to expect anything that we've said before, really, until it happens.
Matt Benson: If this things blows up, that is really going to be a bad sign for the next session, the regular session and dealing with the broader budget issues. Especially a special second session on a tax increase. If they can't get this stuff done, there's no way it's happening.
Ted Simons: Does he have any plans that you know of, regarding future required system? Does this affect him at all, the AWOL incident?
Matt Benson: I think there are a lot of folks within this caucus who would have accepted him voting no.
Howard Fischer: And he's been in leadership. One of the things people in leadership quickly find out is they have to vote for all the crapola that comes across that they don't particularly believe in.
Ted Simons: And we will stop it there. Guys, thanks a lot, appreciate it.