California’s Awful Prop. 31: Is This Your Future?

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Wake up Cal­i­for­nia. You are per­ilous­ly close to rat­i­fy­ing Propo­si­tion 31, a sweep­ing­ly redis­tri­b­u­tion­ist and pro­found­ly unde­mo­c­ra­t­ic trans­for­ma­tion of your way of life, and you don’t even know what’s at stake. Sub­ur­ban­ites of Cal­i­for­nia, you are the spe­cial tar­gets of Prop. 31. Act now, or be turned into sec­ond-class cit­i­zens in your own state.

Wake up Amer­i­ca. Look toward the region­al­ist rev­o­lu­tion on California’s hori­zon. In an era of loom­ing munic­i­pal bank­rupt­cies, this could be your fate: rob­bing the sub­urbs to pay for the cities. The region­al­ist trans­for­ma­tion now being qui­et­ly pressed on Cal­i­for­nia is exact­ly the sort of change Pres­i­dent Oba­ma has in mind for Amer­i­ca should he win a sec­ond term. In Cal­i­for­nia and Amer­i­ca both, the 2012 elec­tion could open the door for a region­al­ist move­ment in hot pur­suit of a redis­tri­b­u­tion­ist remak­ing of Amer­i­can life.

California’s Propo­si­tion 31 is the project of a col­lec­tion of “good gov­ern­ment” groups, in par­tic­u­lar, Cal­i­for­nia For­ward. Cal­i­for­nia For­ward says its goal is “fun­da­men­tal change.” They’re right about that. The change they have in mind, unfor­tu­nate­ly, is cre­at­ing a col­lec­tion of de fac­to region­al super-gov­ern­ments designed to under­cut the polit­i­cal and eco­nom­ic inde­pen­dence of California’s sub­urbs. The goal is to redis­trib­ute sub­ur­ban tax mon­ey to California’s fail­ing cities. Instead of tak­ing on the mis­man­age­ment that is break­ing California’s cities, Prop. 31 lets fail­ing cities bail them­selves out by raid­ing the pock­et­books of California’s sub­ur­ban­ites. In the process, Prop. 31 will kill off the sys­tem of local gov­ern­ment at the root of Amer­i­can liberty.

How does Prop. 31 work? It allows local gov­ern­ments to join togeth­er to form “Strate­gic Action Plans.” Sup­pos­ed­ly, this pool­ing of local munic­i­pal ser­vices into a kind of de fac­to col­lec­tive region­al super-gov­ern­ment would be vol­un­tary. In fact, Prop. 31 deploys pow­er­ful incen­tives to effec­tive­ly force the cre­ation of these region­al super-gov­ern­ments. To begin with, munic­i­pal­i­ties that join region­al collectives–and only those municipalities–can effec­tive­ly waive oner­ous state laws and reg­u­la­tions by cre­at­ing their own more lax ver­sions of those rules. Next, Prop. 31 chan­nels a por­tion of state sales tax rev­enue to munic­i­pal­i­ties that join region­al gov­ern­ing collectives–and only those munic­i­pal­i­ties. Final­ly, Prop. 31 autho­rizes local gov­ern­ments par­tic­i­pat­ing in the region­al col­lec­tives to pool their prop­er­ty-tax receipts.

The result will be the effec­tive redis­tri­b­u­tion of sub­ur­ban tax mon­ey to the cities, and sec­ond-class cit­i­zen­ship for Cal­i­for­ni­ans who live in munic­i­pal­i­ties that refuse to pool their tax mon­ey by join­ing region­al collectives.

If you under­stand the goals and tac­tics of the region­al­ist move­ment that cre­at­ed Prop. 31, it’s easy enough to see what Cal­i­for­nia For­ward hopes to achieve. In the begin­ning, California’s cities will join togeth­er with a few only-mod­er­ate­ly-well-off near­by sub­urbs to form a de fac­to region­al gov­ern­ment with pooled tax receipts. Although some of the sub­urbs that join up will expe­ri­ence a net tax loss, this will be off­set by the addi­tion­al sales tax rev­enue pref­er­en­tial­ly fun­neled to region­al gov­ern­ing con­sor­tia by the state. Relief from oner­ous state reg­u­la­tions will be anoth­er com­pen­sato­ry advan­tage of tax-sharing.

Mean­while, the bulk of California’s more pros­per­ous sub­urbs will decline to pool their tax mon­ey with the cities, and so will retain their inde­pen­dence by stand­ing out­side of the col­lec­tives. Yet that won’t be the end of it. For one thing, just by stay­ing out of the region­al gov­ern­ing col­lec­tives, the pref­er­en­tial fun­nel­ing of state sales tax rev­enue to the region­al con­sor­tia will effec­tive­ly redis­trib­ute mon­ey from the sub­urbs to the cities.

Also, the abil­i­ty of the region­al gov­ern­ing col­lec­tives to effec­tive­ly waive oner­ous state laws and reg­u­la­tions will dis­ad­van­tage the sub­urbs. A leg­is­la­tor from a city in one of the region­al con­sor­tia could vote for unpop­u­lar reg­u­la­to­ry bills, know­ing that his own con­stituents could exempt them­selves from the harsh­est effects of those laws. Increas­ing­ly, cities will rule the sub­urbs, impos­ing laws and penal­ties from which they them­selves would be exempt.

The only way out for the sub­urbs would be to join the near­est tax-pool­ing region­al gov­ern­ing con­sor­tium, effec­tive­ly redis­trib­ut­ing a huge share of their tax mon­ey to the cities. Any way you look at it, the sub­urbs lose. Under Prop. 31, some com­bi­na­tion of redis­tri­b­u­tion and sec­ond-class cit­i­zen­ship will be their fate.

Propo­si­tion 31 is an offense against America’s most fun­da­men­tal con­cepts of lib­er­ty and self-gov­ern­ment. Yet the out­rages don’t end there. The rev­o­lu­tion­ary region­al­ism that is the bold­est and most sig­nif­i­cant change con­tained in Prop. 31 has played almost no role in the pub­lic debate over this bal­lot ini­tia­tive. Instead, when Prop. 31 is debat­ed, the focus has large­ly been on its far less con­se­quen­tial “good gov­ern­ment” pro­vi­sion man­dat­ing that bills in the Cal­i­for­nia leg­is­la­ture be pub­lished at least three days pri­or to passage.

The irony here is that a propo­si­tion sup­pos­ed­ly designed to fur­ther gov­ern­ment trans­paren­cy now threat­ens to impose a region­al­ist rev­o­lu­tion on California’s cit­i­zens with bare­ly any debate. Prop. 31 pro­po­nents are vast­ly out­spend­ing oppo­nents. Their cam­paign, more­over, great­ly under­plays the region­al­ist rev­o­lu­tion hid­den in the text. Nor has the press come close to grasp­ing what the region­al­ist pro­vi­sions of Prop. 31 would actu­al­ly do. Nev­er has so great a gov­ern­men­tal change come so close to suc­cess, with so lit­tle debate.

The state of Cal­i­for­nia owes a debt of grat­i­tude to Wayne Lus­var­di. So far as I know, Lus­var­di is the first ana­lyst to uncov­er and pub­li­cize the region­al­ist impli­ca­tions of Propo­si­tion 31. Lus­var­di also per­sua­sive­ly shows that the pub­lic debate over Prop. 31 has entire­ly missed the point.

If you want to under­stand the polit­i­cal and pol­i­cy roots of Propo­si­tion 31, the best place to turn is the Cal­i­for­nia Speak­ers Com­mis­sion on Region­al­ism. (You can read a con­densed ver­sion of the Commission’s 2002 report here.) This report was pre­pared for then-Speak­er of the Cal­i­for­nia Assem­bly, Robert Hertzberg. Hertzberg now serves as co-chair of Cal­i­for­nia For­ward, the key spon­sor of Propo­si­tion 31.

The report of the Cal­i­for­nia Speak­ers Com­mis­sion on Region­al­ism is a pure prod­uct of the region­al­ist move­ment, the goals of which I describe in my book, Spread­ing the Wealth: How Oba­ma is Rob­bing the Sub­urbs to Pay for the Cities. Oba­ma, too, is a prod­uct of the region­al­ist move­ment, and the region­al­ist pro­vi­sions of Prop. 31 are pro­to­types of poli­cies the pres­i­dent hopes to press on the coun­try should he secure re-elec­tion. Sad to say, Oba­ma is being every bit as open about all this as the pro­po­nents of Prop. 31 have been about their bal­lot initiative’s real goals, which is to say, not very open at all.

I’ll have more to say about Propo­si­tion 31 in the com­ing days.


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