Joel Fox, the amiable former president of the Howard Jarvis Taxpayers Association, used to complain vociferously about people who he thought blamed too many of California’s problems on Proposition 13, the landmark property tax limitation measure that voters passed on June 6, 1978.
Fox, no fuming curmudgeon like Jarvis, who was the prime author of Proposition 13, was partially right. Proposition 13 did not cause every public service calamity of the last 30 years, much less the Northridge earthquake or the San Diego County wildfires.
But in the years since Proposition 13’s passage, it has compounded California’s governmental and fiscal mess something awful.
California’s per pupil school spending, which was among the top 10 states in the 1960s, is now among the bottom 10. Proposition 13 alone is not responsible, but along with two major court decisions that preceded it, it helped decouple school funding from the local tax base and thus undercut voter incentives to fund education generously, as it had been in the generation after World War II. Our roads, once a national model, are an embarrassment.
More certainly it entangled state and local accountability to the point where it became increasingly hard even for diligent voters to understand who was responsible for what. When streets didn’t get paved, was it City Hall that was wasting money or was it state government, which now controlled the local property tax and wasn’t providing enough of it?
Worse, Proposition 13 reinforced the distrust of representative government that helped bring it on and vastly increased reliance on the initiative process and the sway of what became known as the initiative-industrial complex, the network of lawyers, consultants, petition circulators, pollsters, direct-mail operatives and the various outsiders attached to them.
It brought the gush of “auto-pilot” ballot-box budget measures that’s both driven and restricted state spending and otherwise limited elected government. Here’s a partial list:
• Proposition 4 in 1979, Paul Gann’s state and local spending limits measure, later revised and Jarvis’ Propositions 5, 6 and 7 in 1982 eliminating the inheritance tax and indexing the state income tax.
• Proposition 98, the constitutional school spending formula passed in 1988 in response to the effects on school funding of the Gann limit. It’s a formula that hardly anyone understands and that continues to bedevil the system without measurably raising school funding.
• Legislative term limits in 1990.
• A string of multimillion-dollar wildlife conservation and public transit bonds proposed by the Planning and Conservation League and enacted in the late 1980s and early 1990s.
• Proposition 187, the “three strikes” sentencing initiative of 1994 that’s relentlessly driven up prison costs and is now helping to put the state and its prison system into a crippling fiscal bind with the federal courts.
• Proposition 218, enacted in 1996, to close various local attempts to skirt property tax limitation with fees and other charges.
• Proposition 49 in 2002, Arnold Schwarzenegger’s initiative to provide an additional $500 million annually for before-and-after school programs.
• Proposition 71, the $3 billion stem cell research bond backed by the governor that, with interest, will cost the state $6 billion to repay.
Proposition 13 also helped spark a national tax revolt that continues to this day. Never before in history has the federal government cut taxes in wartime. And while the nation began with a sort of tax revolt, never before has no-new-taxes become so rigid a piece of political orthodoxy as it is now.
Schwarzenegger, who now as governor complains loudly about the budgetary mess he’s in, contributed himself to the creation of the mess, not only through his support of ballot-box budgeting measures but through his first-day cut of the state’s vehicle license fee, the car tax – and his general embrace of that tax-cut mantra.
Loss of the car-tax now costs the state the $6 billion a year that local governments had been getting from it. That appears on the books as spending, but it’s a tax cut.
Fox, like other defenders of Proposition 13, argues that the measure helped save the homes of thousands of people facing escalating, inflation-driven property tax bills they couldn’t afford to pay.
Sacramento diddled in its futile effort to provide relief. But it’s inconceivable that had there been no initiative process in California and no Howard Jarvis, Gov. Jerry Brown and the Legislature wouldn’t have gotten the message in the 1978 general election and offered a more workable solution, even if it had taken legions of geezers with pitchforks to deliver it.
Instead we borrow and fudge and struggle with a policy-making process that’s little more than a string of ad-hoc votes driven by deep-pocket interest groups – public-sector unions, railroads, insurance companies, real-estate groups, Indian casinos, oil and tobacco corporations, among others – the very groups whose influence the initiative process was once designed to check.
California once had a communitarian ethic. That’s been turned into a market ethic. It once did serious planning for the future. For now, that’s a nearly forgotten hope.
Peter Schrag is the former editorial page editor of the Sacramento Bee. This article is published with his permission.