May 6, 2009
Deal-making Behind Byzantine Ballot Measures
On May 19, California voters will be asked to vote on a package of six ballot measures. What’s a voter to do? What’s a Jewish voter to do?
In the face of complex propositions most voters look to individuals or organizations whose opinions they respect. In my experience, Jewish voters have given some deference to the Los Angeles Times editorials, the recommendations of the League of Women Voters, the Chamber of Commerce and various labor unions. For Valley Jews, the Daily News, more attuned than the Times to challenging government, may be a voice.
Major political figures like Gov. Arnold Schwarzenegger and L.A. Mayor Antonio Villaraigosa are influential. If it is a matter of partisanship, Jewish voters are more likely to listen to the official views of the Democratic than the Republican Party.
Were it only so simple.
The pro side for the measures includes the Los Angeles Times, Gov. Schwarzenegger, Mayor Villaraigosa, the California Chamber of Commerce, the Democratic leadership of the State Legislature and the California teachers union. On the con side we have the state Republican Party and on four of the measures, the League of Women Voters and a number of unions other than the teachers. These unions prevented the state Democratic Party from getting the 60 percent support necessary to officially endorse Proposition 1A. This is a partisan and ideological jumble.
So let me try to shed some light on what I think is happening and why. In early 2009, faced with a massive budget hole of more than $40 billion, the governor and the Democratic and Republican leadership in the Legislature worked furiously to craft a package of spending cuts and tax hikes.
The leaders managed to come up with a package that took care of the budget hole through the next fiscal year. By the time the budget was done, however, bad news was arriving on the economy and federal aid, and the state is already $8 billion short even with the budget. This did not help the prospects for the ballot package because the appeal that voter passage would solve the problem was now gone.
The leadership still had to find a way to win three Republican votes in the Assembly and three in the Senate because of the remarkable requirement that budgets and new taxes must have a two-thirds vote in each house. To win Republican votes, they had to design the package with great concern for the minority party. This included large tax breaks for wealthy corporations, for example, even before the ballot measures were crafted.
The Republicans were able to demand that Democrats give up money from two cherished programs that had voter-approved funding, for mental health and preschool. One had been championed by director Rob Reiner and the other by Senate President Pro Tem Darrell Steinberg. These became Propositions 1D and 1E, and would temporarily move several hundred million dollars from these programs into the General Fund. Proposition 1C would reform the state lottery to provide higher payouts to winners, but would also allow the state to borrow $5 billion against future profits.
Republicans have long wanted to have more ways to limit spending in good economic years through a tightly guarded “rainy day” fund. Proposition 1A realizes their dream, along with enhanced power for the governor’s finance director to make mid-year budget reductions. Democrats deeply dislike this proposal. So that Democrats would not revolt, Proposition 1A allows the temporary taxes in the budget deal to be continued for an extra one or two years. Proposition 1A would give Republicans a permanent thing they want in exchange for a temporary thing Democrats want.
Proposition 1B, which makes the teachers happy, would allow some of that rainy-day money to be used to steadily pay back the schools for money the state has borrowed from education. Proposition 1B can only take effect if Proposition 1A passes. Proposition 1A can pass without 1B passing.
Propositions 1C, 1D and 1E are actually parts of the original budget deal that required voter approval. Proposition 1D, embarrassingly, did not even bring the vote of the Republican, Dave Cox, who had demanded it as one reason for his vote for the overall legislative budget package. At the height of the negotiations, Senate Republicans overthrew their leader, Dave Cogdill, for having negotiated the package. It then passed with the bare minimum of votes.
Proposition 1F was put in to placate the last Republican vote, Abel Maldonado, and is one of the most ridiculous ideas ever to make a state ballot. It states that in any year the state is about to run a deficit, the commission that determines salaries may not grant a pay raise to state elected officials. This juvenile piece of work is about as reasonable as having the weather determine salaries.
So to summarize, Republicans got a budget that leaned toward tax breaks for business and tax hikes for average people. They got a tightened rainy-day fund. They forced Democrats to give up money from two favored programs for which they had won voter support. And they got to poke a finger in the eye of politicians through Proposition 1F.
And what do we find? Most of the ballot measures were drafted to please Republican legislators who were reluctant to vote for the compromise budget package. But polls by the Public Policy Institute of California (PPIC) and the Field organization show strong opposition to all but one of the measures from Republican voters.
Proposition 1F has majority support. Democrats are the main base of support for the other measures, providing twice as much support as Republicans to Proposition 1A in the PPIC poll. A new Field Poll shows that likely voters lean heavily Republican and they loathe the ballot measures. In the PPIC poll, the only demographic group that favors all six measures is Latinos. The only measure with majority support is Proposition 1F, the one that has the least relevance to the budget crisis. Fifty percent of likely Republican voters have already decided to vote against Proposi tions 1A-1E, according to the Field Poll.
The reason for these counterintuitive findings is that the budget deal itself, although heavily skewed toward Republican priorities, is something that Democrats value much more than Republicans. The role of government has increasingly polarized the two parties. Republicans in the Legislature talked openly about letting the state go down, in some kind of moral cleansing. Those who broke from the party consensus were demonized. The inclusion of temporary tax increases in Proposition 1A has mobilized the Republican grass roots, which in any case detested the budget deal itself. Since they never liked the budget deal in the first place, rank and file Republicans feel comfortable opposing ballot measures that were crafted to win the votes of Republicans they consider sellouts. Why not just let the whole thing go down?
For Democrats, there is considerable ambivalence about voting for measures that were crafted to win the votes of Republicans, whether or not those Republicans are considered sellouts by their own party. On the other hand, it is unthinkable on the Democratic side to let the whole thing go down, to squander a hard-won budget deal that kept public services from total collapse. So in the end, the votes for these Republican-oriented measures will come from Democrats who want the system of public services to survive while the money for the campaign comes from their political adversaries in the Chamber of Commerce. But Democrats are not happy, and the party activists and some union members believe that it would be better to give up and start again.
Polls have shown that Latinos are the most optimistic Californians and strongly favor investment in the public sector. Jewish voters tend to also be on the side of public services and the public sector. Compared to white non-Jews, especially Republicans, Jews support ballot measures for education and other public services. While this same tendency may lead a number of Jewish voters to oppose the ballot measures from the left, it is likely that Jews will vote more closely to Latinos toward the favorable end on May 19 than to white non-Jewish Republicans. You don’t hear a lot of Jewish voters saying that we should just let the whole government ship go down. At the end of the day, the ballot measures will depend on a strong Democratic turnout on May 19.
The question then is, where do we go from here? If the measures all pass, the state still has its work cut out but at least it will only be an $8 billion hole. If Proposition 1C, the lottery measure, fails, then the main fiscal damage will have been done to the budget deal, since it is the source of nearly one-eighth of the budget hole. If Proposition 1A goes down, the tax hikes will end after next year, extending the budget crisis.
If Propositions 1C-1E all lose, the gap will be $14 billion. The problem for Republicans will be that if they succeed in defeating these measures, they will have eliminated the model for how Democrats and Gov. Schwarzenegger can negotiate for their support. Then the question will be whether a whole new approach is needed, including a battle to eliminate the two-thirds requirement or an agreement between the governor and the Democratic majority to pursue measures that will not require two-thirds even at the risk of a court challenge. It is hard to see how a new deal can be crafted using the ballot when the Republican base is so opposed. So it will have to be done “in house,” without voter approval.
Ultimately, the real issue is one that Republicans have to resolve among themselves. With the governor and the Chamber on one side, and the Republican Party on the other, who will prevail? The two-thirds rule gives the Republican Party the power over the Republican governor. With majority rule on the budget, the ability to win a statewide race, which favors moderate Republicans, will still give them a veto over the budget (and the requirement of a two-thirds legislative override) but without the blackmail that happened this year. It is interesting that two of the three leading contenders for the 2010 Republican gubernatorial nomination, Meg Whitman and Steve Poizner, have opposed Proposition 1A to please the party base, while moderate Tom Campbell has risked the ire of the right by joining Schwarzenegger in support. In this particular debate, Jews will probably be on the sidelines. But out of this mess, we can hope and pray, will come a system of government worthy of the nation’s largest state.
Raphael J. Sonenshein is chair of the Division of Politics, Administration and Justice at Cal State Fullerton.