This is what we’ve all been waiting for. After weeks of wailing about how President Barack Obama’s budget “spends too much, taxes too much and borrows too much,” the House Republican Leadership, including Minority Leader John Boehner (left) and California’s own Kevin McCarthy and David Dreier, are finally out with a “road to recovery” that promises “less government, lower taxes and economic prosperity.”

The Republican plan looks strangely like a middle school science textbook, with its interconnected molecules and feel good boilerplate like “controls debt,” “creates jobs” and “lowers taxes,” especially the last one: lowering taxes. The GOP loves to lower taxes and their plan does so quite a bit, lowering marginal tax rates for those earning under $100,000 to 10 percent and 25 percent for those earning more. Of course, being the fiscal conservatives that they are, the Republicans surely crunched the numbers to make sure the lower taxes, less debt, more jobs formula is mathematically possible, right?

Well, not quite. In fact, the GOP plan does not contain any budget line items at all. But rest assured, “cutting waste, fraud and abuse” and enacting “common-sense reforms” will solve the problem. Some items on the Republican chopping block include the enormously popular and bipartisan Corporation for Public Broadcasting. And the party that had no problem spending untold billions on no-bid contracts in Iraq is now having fits over a modest request from the State Department to help rebuild the Gaza Strip, a proposal supported by Republican and Bush-holder Secretary of Defense Robert Gates.

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Congresswoman Ellen Tauscher (left) confirmed reports from late yesterday that she is accepting an appointment to the State Department and released the following statement:

"Last week, Secretary of State Hillary Rodham Clinton asked me to serve as Undersecretary of State for Arms Control and International Security. While her offer is both generous and flattering, I did not take the decision lightly. I accepted it after much soul searching and long discussions with my family and friends."

The appointment means Tauscher, a moderate and current chair of the House New Democrats, will vacate the East Bay House seat she has held since defeating a Republican incumbent in 1996. The district includes the Contra Costa County suburbs of Walnut Creek, Orinda, Lafayette, Moraga and Antioch and picks up Livermore in Alameda County and Fairfield, Dixon and Suisun City in Solano County as well. Demographic changes and redistricting have made it safely Democratic. While Al Gore carried District 11 with a comfortable 55 percent, Barack Obama took a decisive 65 percent, and the last Republican-held Assembly seat in the area flipped in November. In other words, Republicans shouldn't get their hopes up.

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Photo Courtesy of Yahoo News.

Has Tom McClintock finally wrapped it up? That's the question posed by the Los Angeles Times, with regard to the razor-thin Congressional race between Republican McClintock and Democrat Charlie Brown (left)  in a conservative Northern California district the GOP typically takes for granted. McClintock had a lead of about 1,700 according to the latest returns, which may be enough to put this to bed.

Governor Scharzenegger talks a lot about Republicans and Democrats "working together" in California, but that working relationship tends to exclude members of the GOP legislative caucus, according to the Sacramento Bee. Things have gotten so distant between Arnold and his own party that members suggested wearing name-tags when he stopped by one of the caucus meetings -- and we wonder why he can't deliver a single a vote on the budget.

Sure enough, faster than you can say "dig deeper," the California Republican passes a resolution condemning the Governor's proposed tax increases, according to the FlashReport.

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Photo courtesy of the Progressive Patriots Fund.

This job didn't work as well as he might have hoped, so Governor Schwarzenegger is already looking ahead, reportedly having conversations with Barack Obama's team about a potential appointment down the road, according to the Los Angeles Times. Obama told Arnold he was going to buff up at the White House and needed some help; the Governor responded that he wanted the President-elect to coach him in basketball.

According to the Sacramento Bee, another Arnold-ism emerged from the Governor's interview with Fox News as well. When discussing his future prospects, Arnold said his wife Maria is the boss. "Before I make any move, the next move that I make, I'm going to go to Maria and say, 'Maria,  you tell me what to do.'"

The workings of a deal on the budget are coming together, with Republicans prepared to vote for a tripling of the car tax in exchange for a ballot measure on spending limits, which Democrats will undoubtably fight to defeat, the LA Times reports.

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Proposition 8 was a "vote of the people," but at issue before the California Supreme Court is the question of whether the people can amend the State Constitution to take away fundamental rights. According to the Los Angeles Times, justices are feeling pressure from all sides, with socially conservative groups threatening recalls. Governor Schwarzenegger, for his part, has weighed in on the side of overturning the measure.

We've seen this movie before, and no, we're not talking about "The Terminator." The San Jose Mercury News reports that prospects for a budget deal this weekend are pretty dim. Sadly, it's due in part to the same problems that plagued our state during the last budget negotiations -- Arnold's lack of clout with Republicans and lack of effective communication with Democrats.

As legislators struggle with another round of painful cuts, the Southern California wildfires are eating up discretionary funds by the day, the Associated Press reports. The Schwarzenegger administation is proposing a surcharge for homeowners' insurance to cover at least part of the cost.

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California's budget deficit will reach $28 billion by 2010 unless legislators take decisive steps now to stop the bleeding. The Associated Press reports that the Legislative Analyst supports raising the car tax, while Republican Assembly Leader Mike Willines is howling about tax hikes and passing around a copy of "The End of Prosperity."

But faster than you can say "no tax pledge," at least one lame duck, termed-out Republican legislator has "sold out" and embraced the possibility of new revenues. Senator Bob Margett of Claremont is reportedly open to reinstating the car tax, as well as an alcohol tax, according to the Inland Valley Daily Bulletin. The article is quick to point out the Margett will return to private life in a matter of weeks.

Among those we know are interesting in replacing Arnold in 2010, Dianne Feinstein pulls in the highest favorables, but John Garamendi does well among Republicans, according to Capitol Alert. Meg Whitman, a potential GOP contender, barely registers among members of her own party.

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In his search for top Cabinet talent, Barack Obama will do a lot of plucking from California, and even more from the Bay Area, the San Francisco Chronicle reports. Some names being floated include former eBAy exec and gubernatorial candidate Steve Westly (left) for energy secretary, former Clinton labor secretary Robert Reich and Haas Business School dean Laura Tyson.

Governor Schwarzenegger is upbeat about mid-year budget negotiations, according to the Sacramento Bee, but the trouble is his proposals are re-runs of failed items earlier in the season: the sales tax hike, oil production tax and increased taxes on alcohol. Some hope lame duck Republicans like Bonnie Garcia and Guy Houston will come on board -- in fact, that might be the only hope.

I couldn't possibly count the number of "what the GOP should do next" headlines I have seen in the past few days, and the FlashReport is playing to host to quite a few of them. According to this piece by California Republican Party Chair Ron Nehring, Republicans need to channel Ronald Reagan and not do what the "liberal media" tells them to do. Does that sound like a winning strategy? To be fair, Nehring does deserve credit for the damage control his party was able to do in California, holding their Assembly losses to a net of two, with the possibility of dragging Tom McClintock to the finish line.

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Photo courtesy of Dow Jones.

All of us who opposed Proposition 8, still heartbroken from Tuesday's result, are unsure of what is happening next, as many couples wonder whether marriages performed several months ago will be nullified, the Associated Press reports. There is also the possibility that Prop 8 went beyond a constitutional amendment, and was in fact a constitutional revision and in need of legislative approval. That will be a decision for the courts.

California's budget crisis just got worse, with Governor Schwarzenegger proposing a temporary 1.5 percent sales tax increase and deep spending cuts to make up some of the difference, the Sacramento Bee reports. Arnold understands the solutions involves the revenue and spending side of the equation -- will the GOP caucus agree?

Some analyists, especially in Republican circles, are already questioning whether it would be wise for California to raise taxes in a near-recession. The San Jose Mercury News asked around and didn't get a positive response. But with the deficit as deep as it is, one wonders whether we have a choice.

To his credit, one tenet of Arnold's proposal is a 9.9 percent tax on every barrel of crude oil pumped out of the state's ground, a long overdue revenue that would align California with practically every other oil producing state. Not surprisingly, the Los Angeles Times reports that oil companies are preparing to fight the Governor tooth and nail, with an all-out lobbying battle likely to keep legislative Republicans in line.

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There are sure to be many election recaps in the coming days, but let's start with some of the basic, at least of what we know.

First, the good news: not only was Barack Obama elected president of the United States, but he enters the office with a commanding 6-point popular vote lead and at least 349 electoral votes, and he is expected to pick up Republican-leaning North Carolina as well. Obama crushed McCain in our homestate of California, clocking it at over 61 percent, vastly outperforming John Kerry's 54 percent four years ago.

Despite Obama's historic victory, today is bittersweet for many California progressives, as millions watched as a state known for being ahead of the curb just took a step backwards by seeming to pass a constitutional amendment to ban same-sex marriage. The San Jose Mercury News reports that Proposition 8's early lead is likely to hold, due in part to its expectedly strong showing in Los Angeles.

With three million ballots left to be counted, Prop 8 could turn around, but it isn't likely. There is another path though: San Francisco City Attorney Dennis Herrara has already filed a legal challenge to the amendment, arguing that it would be a unconstitutional revision.

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Even and especially if the presidential contest ends early in the evening, or is at least conclusive, the fate of Proposition 8 could receive a significant chunk of attention on Tuesday. The San Francisco Chronicle reports that last-minute contributions are flowing in from across the country, with both sides predicting a shift in the so-called "culture war" whatever the outcome. On Prop 8 supporter even went so far as to say that if gay marriage is approved in Califronia, the culture war is lost.

Faster than you can say "tax-exempt status," the Yes on 8 campaign is reportedly banking on a last-minute "Sunday surge" of support from anti-gay ministers to help get-out-the-vote, according to Matier and Ross. I actually was (un)fortunate enough to run into a Yes on 8 captain the other day while dropping lit for Assembly candidate Joan Buchanan in Walnut Creek. The man said he was there with his "blessed army" and offered me bagels -- I declined.

A second battleground in the culture war has been lost in the shuffle, but remains of enormous importance. Prop 4 marks the third time ant-choice activists have put a parental notification law on the ballot and we cannot take defeat for granted. With high public awareness of the issues, polling for both sides has been in the high 40s since the initiative was announced and remains that way according to the Los Angeles Times -- let's finish it off.

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