Prop 10

Want more proof that the initiative process is too powerful in California? All the recent talk about lawmakers reaching a budget deal is bunk. The deal, even if it passes, requires the voters to sign off on multiple ballot measures later this year. That's right -- California simply can't handle a budget emergency without a vote of the people.

Details have not been released, but I count at least five separate ballot measures that would be needed to complete this deal: 1. a measure authorizing the modernizing of the lottery and borrowing against future funds. 2. the approval of some sort of new spending limit that Republicans insisted upon in negotiations. 3. Changes to the state's education funding formula. 4. A measure permitting the state to raid money that voters approved for early childhood programs and 5. A measure permitting the state to raid money that voters approved for mental health programs.

Given the extreme costs of delays by the legislature, and their inability to do much without the voters OK, the real question is: why bother having a legislature at all?

It has become obvious that Gov. Schwarzenegger and legislative leaders of both parties simply won't be able to reach a compromise that comes anywhere close to closing California's rapidly growing budget deficit, now estimated at some $40 billion over two years. The state government is running low on cash. Within weeks, it may have to start paying people in IOUs.

Democrats simply won't agree to enough cuts. Republicans won't agree to tax increases, and they can block that because of the state's requirement for a two-thirds vote. The Democrats' convoluted (if politically smart) attempt to do an end run around two thirds and raise taxes by majority vote isn't going anywhere; even if it's revived and signed into law, it's all but certain to get struck down in the courts or overturned by referendum. The governor you ask? Schwarzenegger has little credibility with lawmakers of either party. When it comes to big deals, he simply can't close.

Marty Wilson, a leading Sacramento political consultant who is a favorite of your blogger, managed the campaign in favor of Prop 10, the T. Boone Pickens-backed $5 billion general obligation bond to fund alternative fuels. Prop 10 lost badly, despite the fact that it had overwhelming financial support and an opposition with little funding.

Wilson, a good-natured sort, asks himself the following question: at Fox & Hounds Daily: “Marty, how the Hell did you lose the Proposition 10 campaign when you were funded and your opposition had no money?” To which I answer, “It was harder than you think.” The rest of the story is here. His explanation of why the measure went down -- the cost, the size of the state's budget crisis -- matches the political problems I discussed earlier this fall in the Scientific American.

There isn't much of a campaign against Prop 10, the California initiative, strongly backed by a company of oilman T. Boone Pickens, to sell $5 billion in general obligation bonds to subsidize alternative fuels, mainly through direct to buyer rebates on certain kinds of vehicles. I was assured for months that the No campaign would find money to launch ads, but that kind of money never materialized. In the meantime a nasty, personal fight has broken out over the measure. At the center is Anthony Rubenstein, a consultant who is working for No on 10. Capitol Weekly has details.

Here's my piece, just now posted on the Scientific American web site, that looks at the poltical prospects of Propositions 7 and 10, two initiatives on the November ballot in California.

Today's LA Times story by my longtime colleague Evan Halper makes one thing painfully clear. California's Republican legislative leaders, for all their championing of direct democracy and the rule of the people when it comes to subjects such as Prop 13 (property taxes) and Prop 22 (same-sex marriage ban), are prepared to violate all sorts of voter-approved initiatives to get a budget deal and avoid a tax increase.

Halper got his hands on a memo that details what Republicans are talking about. As Halper recounts the memo's contents, the Republican proposals involve "diverting money specifically set aside by voters for local governments, road and other transportation projects, mental health programs and early childhood education." To give a little history, voters set aside money for transportation via ballot initiative with Prop 42 (2002), for local government with Prop 1A (2004), mental health programs with Prop 63 (2004), and early childhood with Prop 10 (1998). For Republicans to want to raid such funds is hypocrisy. To borrow against such funds in the name of opposing tax increases is dishonest. The act of raiding such funds creates a debt for the state that must be paid back. The very act of raiding the funds is thus a tax increase in disguise.