Watch Out

Steve Lopez, a mischievous columnist for the Los Angeles Times, has already threatened to run as a Davis alternative. “I can probably scrape together $3,500 and I know where I can get some free media,” he wrote. The last time a state governor was ejected by a recall was in 1921 in North Dakota. With the recall election expected in November, it could be just a matter of weeks before Mr Lopez is in charge of a state economy that ranks as the fifth largest in the world, slightly bigger than France’s.

Even for California, the state that invented the Hollywood blockbuster and faces the constant threat of being turned into Arizona Bay by the next big earthquake, these are surreal times. For the state’s residents, a famously liberal bunch whose enthusiasm for universal healthcare, gay rights and environmentalism have made them largely irrelevant in President Bush’s America, the recall election is a thoroughly depressing prospect.

So far, no senior Democrats have said they will stand. That means that the only two realistic candidates are Mr Issa, who made his $100 million fortune in car alarms (and was also, fittingly, charged but not prosecuted with car theft in 1980), and Arnold Schwarzenegger, Hollywood action hero and former Mr Universe, who delivers scripted jokes in his campaign speeches with all the finesse of a reversing refuse lorry. Both are Republican, although Mr Issa is more conservative than Mr Schwarzenegger.

Although Mr Schwarzenegger, who presciently starred in a science-fiction film called Total Recall in 1990, has not yet said that he will run, he told Esquire magazine recently that he would take part in a recall “if the state needs me”.

At the moment the 56-year-old actor says that he is too busy with the launch of his latest blockbuster, Terminator 3: Rise of the Machines, to pay much attention to politics.

Many Californians are still asking themselves what went wrong. After all, California’s history of prosperity goes back to 1542, when a Spaniard called Juan Cabrillo first spotted San Diego harbour through the June gloom.

He named his discovery after a mystical island described in Las Sergas de Esplandían, a fantasy novel by García de Montalvo that was fashionable at the time. Montalvo described his California as “a fantastic island inhabited by Amazons of incalculable wealth”.

For the next 461 years, California’s separation from the rest of America by deserts, its tendency to attract fantasists from all over the world, and its agricultural and brief gold-based prosperity meant that the name continued to ring true. Even today, California ought to be richer than ever.

Since the Second World War, the state’s artificially irrigated desert farmlands have made it America’s biggest producer and exporter of fruits, vegetables and nuts.

Vintners have bought every last handful of soil in California’s fabled Napa Valley, whose cabernets now rival the best of Bordeaux. More obviously, California is also a world leader in media and technology, thanks to Hollywood and the other valley: Silicon Valley.

How could this state possibly be going bust? According to Mr Davis, it is all the Republicans’ fault. President Bush’s tax cuts blew a crater in California’s revenues, he says, and now Republicans are refusing to agree to a proposal to make up for the shortfall by increasing state taxes. This, he says, is a deliberate attempt to force a crisis and help the recall effort.

The Republicans insist that Mr Davis is a typical Democrat who keeps tipping cash into an ever expanding state government, without worrying about where it is all going.

More impartial analysts have other theories. They say that Mr Davis took for granted the $17 billion in taxes paid by Silicon Valley executives during the 1990s. When the high-tech industry crashed, tax collections fell to just $5 billion, leaving California with an unexpected $12 billion shortfall. California was also the victim of Enron’s illegal rigging of the Western electricity and natural gas markets, for which it has since had its licence revoked. Mr Davis claims that Enron’s market manipulation ultimately cost California about $9 billion.

Whatever the reason, all agree that something must be done, and fast. Analysts say that the Golden State’s financial implosion, if it comes, would make New York’s near-bankruptcy in 1975 look almost quaint.

Although Mr Issa is game to take on California, Mr Schwarzenegger may decide that he does not want to be the first Austrian-born action hero to declare California bankrupt.

For Republicans in Washington, the recall is equally worrisome. As much as they are enjoying watching Mr Davis’s discomfiture, they feel that it would be useful to have him around during the 2004 Presidential campaign as an example of what they see as Democratic incompetence.

If Mr Davis survives, however, the recall could backfire on the Republicans and make the Democrats even stronger. Some believe that this is the only proper outcome. “Californians should suffer Davis for three more years, voting like grown-ups not as penance for their mistake last year, but to uphold the principle that election results are final for a fixed term,” William Safire, a columnist for The New York Times, declared. “Officeholders should not be removed merely when ratings fall.”

DEBATE

What tarnished the Golden State?

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