The California Future?


Tom Gallagher

The ancient Greeks searched for glimpses of
their future in the innards of butchered pigs and oxen; modern
Americans tend to look west to California and its famous and
numerous ballot initiatives.

California did not disappoint this year.
The state’s approval of both the Medical Marijuana
Initiative and the California Civil Rights Initiative sent a
clear message of a future of getting high with your own kind. But
just as no serious entrails reading relied on the condition of a
single organ, looking at only the ballot questions covered in
"Doonesbury" will not suffice for the contemporary
soothsayer. One must probe deep into the viscera of the
California ballot, down to Propositions 217 and 218.

Taxation has long been a California ballot
preoccupation. Since 1980’s Proposition 13 property tax
limitation cemented the state’s reputation as a forerunner
of national trends, the permanent local government funding crisis
that ensued has been something of a continual cat and mouse chase
of local officials scrambling to utilize new revenue sources
before a ballot question targets them and dries them up.

Proposition 217 would have eased that chase
by earmarking the proceeds of the two highest state income tax
brackets for local government use. They were otherwise scheduled
to expire via a sunset provision five years after the state
budget crisis that prompted their creation. Since their demise
would result in a $700 million windfall for only the wealthiest
1.2 percent of the state’s taxpayers, supporters of making
the top brackets permanent were hopeful for broad general
support. Some went so far as to predict there would be no
organized opposition (or at least none where it counts) from the
business community, since the tax in questions was personal, not
corporate.

But while class consciousness may be
lagging at the bottom and middle of American society, it is in
good health at the top. In the closing days of the campaign the
committee to defeat Proposition 211, an initiative allowing
securities fraud lawsuits against corporate executives, found
itself so far ahead in the polls and so awash in Silicon Valley
money that it siphoned some off to its comrades in the anti-217
campaign. This influx of cash allowed opponents to buy TV time
which proponents couldn’t afford.

The gesture of class solidarity proved
decisive–the measure failed by less than 1 percent, lending
weight to the belief that in the current state of American
politics a contest pitting the interests of the lower 99 percent
against those of the wealthiest 1 percent must be considered no
better than a toss-up.

But even if we can sadly rationalize the
defeat of 217 as just business as usual, 218 broke new ground.
The proposition, sponsored by the authors of Proposition 13,
targeted the use of assessments levied for purposes ranging from
parks to paving. In recent years local officials increasingly
utilized such benefit assessments which could be enacted by a
local governing body and did not need the approval of the
electorate now required for most "general" and
"special" tax options.

Proposition 218 was a constitutional
amendment aimed to close that option by requiring a mail-in vote
for any new special assessment. Supporters of government spending
therefore found themselves in the uncomfortable but,
unfortunately, not unaccustomed position of appearing to oppose
majority rule. And, not surprisingly, they found themselves in
the not unaccustomed position of losing–handily.

Since the proposition was but one of
fifteen on the state-wide ballot there were few who got to the
small print describing just how these mail-in votes were to be
conducted. First off, only property owners in the affected area
will vote, disenfranchising any tenants and removing taxing power
from its traditional locus in the general electorate or its
chosen representatives. Then "in tabulating the ballots, the
ballots shall be weighted according to the proportional financial
obligation of the affected property." In other words, one
vote per one dollar of assessed valuation.

If there are any principles still held
sacred in American politics, "one person-one vote "must
surely be among them. Previously, the "one dollar-one
vote" standard had only been seen in the quasi-governmental
"Business Improvement Districts" sprouting up across
the nation. Now it has gained a toe-hold in the California
constitution. As of this writing, there are no known legal
challenges to the measure.

Whether or not we believe that California
is an accurate predictor of national trends, its recent election
should serve as a warning that unless we take up the issues of
progressive taxation seriously and aggressively there are few
limits to what the wealthy can accomplish.