California's Failed Reform
Published on Wednesday, October 8, 2003 by the Boston Globe
California's Failed Reform
by Robert Kuttner

TRENDS AND FADS often start in California, and that thought should terrify anyone who cares about a functioning democracy. Yesterday's recall election is history's ironic revenge on a well-intentioned set of reforms championed by the Golden State's great progressive governor, Hiram Johnson. Johnson's Progressives, beginning in 1911, enacted the populist measures beloved by that generation of reformers -- the ballot initiative, the recall, and nonpartisan local elections. Johnson was a crusader against monopolies. He imagined that giving government back to the people would purge politics of the corruption of moneyed interests.

But in practice these reforms have paralyzed government, leading to cycles of ever-greater voter frustration and ever-nuttier remedies. Direct democracy has also enabled organized right-wingers to stampede a vulnerable middle class. In that respect, even the faintest Hitler reference is doubly chilling.

How to wreck democracy: Have voters choose among 130 candidates in a circus atmosphere, with the recalled loser very likely outpolling the winner. In this setting, anything is possible. A narcissistic body builder and recidivist groper of women can be viewed as a fiscal savior. Government itself becomes a sideshow.

The Great Recall of 2003 completes a cycle begun 25 years ago with the Great Tax Revolt, Proposition 13. Both Proposition 13 and the recall election illustrate the fatal flaws in direct democracy. Term limits, bestowed by another ballot initiative, have only made the state Legislature far more dependent on permanent lobbyists, who have no such limits.

The tax revolt of 1978 is often depicted as a rebellion against big government, but it didn't start out that way. Mainly, voters wanted fairer taxes. The inflation of the 1970s had produced rising property valubes. Those, in turn, spiked property taxes.

Because California has a complex system of special local taxing districts, it was hard to coordinate a cut in tax rates to offset the higher property values. Homeowners simply got socked with rising tax bills.

Only the governor and the Legislature could fix the problem, but then-Governor Jerry Brown dithered. Instead of changing the rules and keeping property taxes within reasonable bounds, Brown opportunistically used the tax windfall to reduce local aid and to bank a huge surplus. Instead of using that surplus for tax relief, he used it to burnish his reputation as a fiscal conservative, in anticipation of a presidential run.

The voters, disgusted with the political deadlock and worried about being taxed out of their homes, approved a radical and badly flawed remedy, Proposition 13. By drastically limiting the property tax and locking in low taxes for property owners as long as they didn't move, Proposition 13 both hamstrung government and worsened tax inequities. New homeowners in small bungalows often pay higher property taxes than millionaires who've lived in their mansions for three decades.

The passage of Proposition 13 set California on a long slide, from the state with the best public schools, community colleges, highway systems, and public health clinics, to the one with the worst. In the 1950s and 1960s, when its population was soaring, California was a showcase of public services. By the 1990s, thanks to Proposition 13, it ranked with Mississippi.

This was not the outcome voters wanted. Mainly, they wanted a fairer tax system. But Proposition 13 set in motion a vicious circle of deepening voter frustration and more drastic remedies that kept backfiring and worsening the discontent.

The raw voter frustrations had no coherent ideology. The same angry electorate that supported nativist initiatives could toss out a governor, Pete Wilson, for being anti-Hispanic. California's citizens could vote to hamstring tax collections, but also approve an expensive drug-treatment initiative.

Now we have come full circle. Gray Davis is a dismally inept politician, but no politician could have solved California's budget mess without grasping the nettle and repealing Proposition 13. It is also fitting that this mess happened on Davis's watch. Davis began his political career as chief of staff to the same Jerry Brown. He epitomizes the familiar blend of opportunism, smugness, and fatal caution that afflicted Brown. Just as Brown's failure of leadership made Proposition 13 inevitable, Davis's failure to tackle the deeper structural causes of California's budget crisis set up Davis as the scapegoat.

So, in a sense, Hiram Johnson had a point. If elected officials want to keep the confidence of voters, they had better get serious about addressing real problems.

Unfortunately, Johnson's remedy is allowing disgusted voters to wreck democracy itself. California will be a long time digging out. Neither party should take any comfort.

Robert Kuttner's is co-editor of The American Prospect.

Copyright 2003 Globe Newspaper Company.