Q&A on Golf & Governmental Affairs
IN SOUTHERN CALIFORNIA By Craig Kessler, SCGA Director of Governmental Affairs
What is different in California than most states? First, California is the nation’s largest and most diverse state in the Union, and it is considerably larger and more diverse than the 2nd largest. Second, California is at least two states, perhaps three in the opinion of those who would separate the inland agricultural valleys from the North and South coasts. Third, California has the largest governing and regulatory scheme in the Union; in comparison the 2nd largest state has a part-time legislature that meets every other year. Fourth, if California were a separate nation, it would be the 7th largest economy in the world. Finally, and perhaps most importantly, California is probably the most financially troubled state in the Union. Yes, the state’s budget is finally balanced after years of record deficits, but that does not mean that long-term fiscal stability has been restored to the California body politic; it www.scpga.com
just means that compared to the last few years, the rapid descent into the abyss has been abated. Just as a bountiful winter rainfall relieves short-term pressure but does nothing to alter the long-term realities of chronic water shortages, a chastened legislature in combination with an electorate disposed to raise a few taxes upon itself has done nothing more than relieve short-term pressure on a long-term fiscal situation that is but one shock, one downturn, one unexpected occurrence from again descending into free fall. How do those differences alter the way the industry handles itself in the public arena? The bottom line, the common denominator in any answer to that question is: We have to recognize that we are always in possession of a weak hand and play it accordingly. Given the enormity of the state, the enormity and diversity of its economy, and the scope of its long-term fiscal problems, the biggest mistake we could make would be to overplay our hand. What seems so large and important to us is miniscule to most policy-makers. That doesn’t mean we don’t have the capacity to affect outcomes in the cauldron of public policy making; it only means that we have to use great imagination and creativity in developing alliances, the more counter intuitive the better, in making common cause with similarly situated industries and in recognizing that our “pitch” must at all times be calibrated to appeal to the dominant political majority in this huge state, which is Democratic, liberal, environmentally sensitive, majority minority, and urban. What is different in Southern California than most regions? Southern California shares with its Southwest neighbors the same overriding problem of too many persons chasing too little water. It’s just that in Southern California there are a whole lot more persons chasing that precious water. That is why every water provider in the state is mandated by current law to reduce water consumption a minimum
of 20% by the year 2020; many, including the state’s largest municipal provider, Los Angeles Water & Power, have already adopted measures to meet that dictate. The rest are in the process of doing so right now. While we can have some confidence that the state solves its fiscal problems, the national economy rebounds more robustly sometime soon and our Growth of the Game programs (2.0 and others) bear fruit in the coming years, there is no way of getting around the hard fact that water is going to become harder to get and considerably more expensive to purchase with each passing year. There is no end in sight to that conundrum. It’s the game’s central challenge at the moment here in Southern California. What are the most pressing issues for the game at the dawn of 2013? I’ve already discussed many of them, particularly water. For reasons too complicated to explain in a Q & A format, the service tax we’ve all feared in recent years has moved to the very back of the burner of our things to worry about. The one issue I have not discussed, one that tends to get short shrift in the industry’s conversations, involves another matter over which we have little capacity to affect but we do need to take into careful consideration as we project future business/growth plans. It’s the combination of a shrinking middle class and the escalating expense of the game. Golf prospered in its glory days (19501999) when the price of golf at all levels was flat in real dollars but median/average incomes steadily rose, the defined benefit pension was the norm, the one income family was not an oddity, the cost of a college education didn’t require the assumption of burdensome debt, and the social safety net (both societal and governmental) was considerably more stable. Those days are gone, likely not to return in our lifetimes – a disturbing conclusion for an activity wholly dependent upon a healthy disposable income and the economic security to spend it, but a reality that the industry has to come to grips with if it expects to reposition itself for growth. PROGRAM MAGAZINE JANUARY/FEBRUARY 2013
GOVERNMENTAFFAIRS
What is the importance of keeping your constituency informed? Tip O’Neil famously intoned that “all politics are local.” To that I would add, “all politics are personal.” That’s why I spend a considerable amount of my time keeping as many sectors of the golf industry informed of the issues affecting them as will listen to me. Without an educated and engaged constituency, my efforts are reduced to a top-down endeavor in an arena that depends upon a bottom-up effort to reach the credibility quotient necessary just to get an audience with the regulators, legislators and opinion-makers that control our industry’s fate. And nothing elicits a legislator or commissioner’s interest more than the knowledge that his/her constituency is filled with golfers, golf courses, golf businesses, golf workers, and golf dependent businesses that are educated about the issues, politically savvy, active, loud, and demanding of a fair shake.
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