With referendums today in the land of fruit and nuts I thought this was timely.... let's remember that this is a G8 economy that ranks 50th in education and bond ratings....
OTB
California The ungovernable state
May 14th 2009 | LOS ANGELES, SACRAMENTO AND SAN FRANCISCO
From The Economist print edition
As California ceases to function like a sensible state, a new constitution looks both necessary and likely
ON MAY 19th Californians will go to the polls to vote on six ballot measures that are as important as they are confusing. If these measures fail, America’s biggest state will enter a full-blown financial crisis that will require excruciating cuts in public services. If the measures succeed, the crisis will be only a little less acute. Recent polls suggest that voters are planning to vote most of them down.
The occasion has thus become an ugly summary of all that is wrong with California’s governance, and that list is long. This special election, the sixth in 36 years, came about because the state’s elected politicians once again—for the system virtually assures as much—could not agree on a budget in time and had to cobble together a compromise in February to fill a $42 billion gap between revenue and spending. But that compromise required extending some temporary taxes, shifting spending around and borrowing against future lottery profits. These are among the steps that voters must now approve, thanks to California’s brand of direct democracy, which is unique in extent, complexity and misuse.
A good outcome is no longer possible. California now has the worst bond rating among the 50 states. Income-tax receipts are coming in far below expectations. On May 11th Arnold Schwarzenegger, the governor, sent a letter to the legislature warning it that, by his latest estimates, the state will face a budget gap of $15.4 billion if the ballot measures pass, $21.3 billion if they fail. Prisoners will have to be released, firefighters fired, and other services cut or eliminated. One way or the other, on May 20th Californians will have to begin discussing how to fix their broken state.
California has a unique combination of features which, individually, are shared by other states but collectively cause dysfunction. These begin with the requirement that any budget pass both houses of the legislature with a two-thirds majority. Two other states, Rhode Island and Arkansas, have such a law. But California, where taxation and budgets are determined separately, also requires two-thirds majorities for any tax increase. Twelve other states demand this. Only California, however, has both requirements.
If its representative democracy functioned well, that might not be so debilitating. But it does not. Only a minority of Californians bother to vote, and those voters tend to be older, whiter and richer than the state’s younger, browner and poorer population, says Steven Hill at the New America Foundation, a think-tank that is analysing the options for reform.
Those voters, moreover, have over time “self-sorted” themselves into highly partisan districts: loony left in Berkeley or Santa Monica, for instance; rabid right in Orange County or parts of the Central Valley. Politicians have done the rest by gerrymandering bizarre boundaries around their supporters. The result is that elections are won during the Republican or Democratic primaries, rather than in run-offs between the two parties. This makes for a state legislature full of mad-eyed extremists in a state that otherwise has surprising numbers of reasonable citizens.
And that is why sensible and timely budgets have become almost impossible, says Jim Wunderman, president of the Bay Area Council, an association of corporate bosses. Because the Republicans are in a minority in the legislature, they have no sway until budget time, when they suddenly hold veto power thanks to the two-thirds requirement. Because in the primaries they have run on extremist platforms against other Republicans, they have no incentive to be pragmatic or moderate, and tend simply to balk.
What was unusual about this year’s deadlock was only its “record lateness”, says Mr Wunderman, which amounted to an “anti-stimulus” that negated much of the economic-recovery plan coming from Washington, DC. “No real conversation is possible on anything that matters,” he says, whether it be California’s fraught water supply, its barbaric prison conditions or its teetering public education.
Representative democracy is only one half of California’s peculiar governance system. The other half, direct democracy, fails just as badly. California is one of 24 states that allow referendums, recalls and voter initiatives. But it is the only state that does not allow its legislature to override successful initiatives (called “propositions”) and has no sunset clauses that let them expire. It also uses initiatives far more, and more irresponsibly, than any other state.
Direct democracy in America originated, largely in the Western states, during the Populist and then Progressive eras of the late 19th and early 20th century. It came to California in 1911, when Governor Hiram Johnson introduced it. At first, it made sense. The Southern Pacific Railroad dominated politics, society and the courts in the young frontier state, and direct democracy would be a welcome check and balance. The state in 1910 had only 2.4m residents, and 95% of them were white. (Today it has about 37m residents, and less than half are white.) A small, homogenous and informed electorate was to make sparing and disciplined use of the ballot to keep the legislature honest, rather as in Switzerland.
Citizen-power gone mad
Sparing and disciplined it stayed until the 1970s. But then came a decade of polarisation and voter mistrust. In 1978 Californians sparked a nationwide “tax revolt” by passing Proposition 13, which drastically limited property taxes and placed a permanent straitjacket on state revenues. That launched an entire industry of signature-gatherers and marketing strategists that now puts an average of ten initiatives a year on the ballot, as Mark Baldassare, the boss of the non-partisan Public Policy Institute of California, has calculated. In 2003 direct democracy reached a new zenith—or nadir, some might say—when Californians “recalled” their elected and sitting governor, Gray Davis, and replaced him with Mr Schwarzenegger.
The minority of eligible Californians who vote not only send extremists to Sacramento, but also circumscribe what those representatives can do by deciding many policies directly. It is the voters who decide, for instance, to limit legislators’ terms in office, to mandate prison terms for criminals, to withdraw benefits from undocumented immigrants, to spend money on trains or sewers, or to let Indian tribes run casinos.
Through such “ballot-box budgeting”, a large share of the state’s revenues is spoken for before budget negotiations even begin. “The voters get mad when they vote to spend a ton of money and the legislature can’t then find the money,” says Jean Ross of the California Budget Project, a research outfit in Sacramento. Indeed, voters being mad is the one constant; the only proposition that appears certain to pass on May 19th would punish legislators with pay freezes in budget-deficit years.
More than half of the initiatives don’t pass, and some that do are sensible. But much of the system has been perverted into the opposite of what Hiram Johnson intended. It is not ordinary citizens but rich tycoons from Hollywood or Silicon Valley, or special interests such as unions for prison guards, teachers or nurses, that bankroll most initiatives onto the ballots.
Then comes a barrage of television commercials, junk mail and robo-calls that leave no Californian home unmolested and the great majority confused. Propositions tend to be badly worded, with double negatives that leave some voters thinking they voted for something when they really voted against. One eloquent English teacher in Los Angeles recently called a radio show complaining that, after extensive study, she could not understand the ballot measures on grounds of syntax.
cont...
OTB
California The ungovernable state
May 14th 2009 | LOS ANGELES, SACRAMENTO AND SAN FRANCISCO
From The Economist print edition
As California ceases to function like a sensible state, a new constitution looks both necessary and likely
ON MAY 19th Californians will go to the polls to vote on six ballot measures that are as important as they are confusing. If these measures fail, America’s biggest state will enter a full-blown financial crisis that will require excruciating cuts in public services. If the measures succeed, the crisis will be only a little less acute. Recent polls suggest that voters are planning to vote most of them down.
The occasion has thus become an ugly summary of all that is wrong with California’s governance, and that list is long. This special election, the sixth in 36 years, came about because the state’s elected politicians once again—for the system virtually assures as much—could not agree on a budget in time and had to cobble together a compromise in February to fill a $42 billion gap between revenue and spending. But that compromise required extending some temporary taxes, shifting spending around and borrowing against future lottery profits. These are among the steps that voters must now approve, thanks to California’s brand of direct democracy, which is unique in extent, complexity and misuse.
A good outcome is no longer possible. California now has the worst bond rating among the 50 states. Income-tax receipts are coming in far below expectations. On May 11th Arnold Schwarzenegger, the governor, sent a letter to the legislature warning it that, by his latest estimates, the state will face a budget gap of $15.4 billion if the ballot measures pass, $21.3 billion if they fail. Prisoners will have to be released, firefighters fired, and other services cut or eliminated. One way or the other, on May 20th Californians will have to begin discussing how to fix their broken state.
California has a unique combination of features which, individually, are shared by other states but collectively cause dysfunction. These begin with the requirement that any budget pass both houses of the legislature with a two-thirds majority. Two other states, Rhode Island and Arkansas, have such a law. But California, where taxation and budgets are determined separately, also requires two-thirds majorities for any tax increase. Twelve other states demand this. Only California, however, has both requirements.
If its representative democracy functioned well, that might not be so debilitating. But it does not. Only a minority of Californians bother to vote, and those voters tend to be older, whiter and richer than the state’s younger, browner and poorer population, says Steven Hill at the New America Foundation, a think-tank that is analysing the options for reform.
Those voters, moreover, have over time “self-sorted” themselves into highly partisan districts: loony left in Berkeley or Santa Monica, for instance; rabid right in Orange County or parts of the Central Valley. Politicians have done the rest by gerrymandering bizarre boundaries around their supporters. The result is that elections are won during the Republican or Democratic primaries, rather than in run-offs between the two parties. This makes for a state legislature full of mad-eyed extremists in a state that otherwise has surprising numbers of reasonable citizens.
And that is why sensible and timely budgets have become almost impossible, says Jim Wunderman, president of the Bay Area Council, an association of corporate bosses. Because the Republicans are in a minority in the legislature, they have no sway until budget time, when they suddenly hold veto power thanks to the two-thirds requirement. Because in the primaries they have run on extremist platforms against other Republicans, they have no incentive to be pragmatic or moderate, and tend simply to balk.
What was unusual about this year’s deadlock was only its “record lateness”, says Mr Wunderman, which amounted to an “anti-stimulus” that negated much of the economic-recovery plan coming from Washington, DC. “No real conversation is possible on anything that matters,” he says, whether it be California’s fraught water supply, its barbaric prison conditions or its teetering public education.
Representative democracy is only one half of California’s peculiar governance system. The other half, direct democracy, fails just as badly. California is one of 24 states that allow referendums, recalls and voter initiatives. But it is the only state that does not allow its legislature to override successful initiatives (called “propositions”) and has no sunset clauses that let them expire. It also uses initiatives far more, and more irresponsibly, than any other state.
Direct democracy in America originated, largely in the Western states, during the Populist and then Progressive eras of the late 19th and early 20th century. It came to California in 1911, when Governor Hiram Johnson introduced it. At first, it made sense. The Southern Pacific Railroad dominated politics, society and the courts in the young frontier state, and direct democracy would be a welcome check and balance. The state in 1910 had only 2.4m residents, and 95% of them were white. (Today it has about 37m residents, and less than half are white.) A small, homogenous and informed electorate was to make sparing and disciplined use of the ballot to keep the legislature honest, rather as in Switzerland.
Citizen-power gone mad
Sparing and disciplined it stayed until the 1970s. But then came a decade of polarisation and voter mistrust. In 1978 Californians sparked a nationwide “tax revolt” by passing Proposition 13, which drastically limited property taxes and placed a permanent straitjacket on state revenues. That launched an entire industry of signature-gatherers and marketing strategists that now puts an average of ten initiatives a year on the ballot, as Mark Baldassare, the boss of the non-partisan Public Policy Institute of California, has calculated. In 2003 direct democracy reached a new zenith—or nadir, some might say—when Californians “recalled” their elected and sitting governor, Gray Davis, and replaced him with Mr Schwarzenegger.
The minority of eligible Californians who vote not only send extremists to Sacramento, but also circumscribe what those representatives can do by deciding many policies directly. It is the voters who decide, for instance, to limit legislators’ terms in office, to mandate prison terms for criminals, to withdraw benefits from undocumented immigrants, to spend money on trains or sewers, or to let Indian tribes run casinos.
Through such “ballot-box budgeting”, a large share of the state’s revenues is spoken for before budget negotiations even begin. “The voters get mad when they vote to spend a ton of money and the legislature can’t then find the money,” says Jean Ross of the California Budget Project, a research outfit in Sacramento. Indeed, voters being mad is the one constant; the only proposition that appears certain to pass on May 19th would punish legislators with pay freezes in budget-deficit years.
More than half of the initiatives don’t pass, and some that do are sensible. But much of the system has been perverted into the opposite of what Hiram Johnson intended. It is not ordinary citizens but rich tycoons from Hollywood or Silicon Valley, or special interests such as unions for prison guards, teachers or nurses, that bankroll most initiatives onto the ballots.
Then comes a barrage of television commercials, junk mail and robo-calls that leave no Californian home unmolested and the great majority confused. Propositions tend to be badly worded, with double negatives that leave some voters thinking they voted for something when they really voted against. One eloquent English teacher in Los Angeles recently called a radio show complaining that, after extensive study, she could not understand the ballot measures on grounds of syntax.
cont...
