California dream deferred

California dream deferred
- August 12, 2009
- Political scientist Carole Uhlaner discusses how the two-thirds vote requirement, term limits and ballot propositions have made the state difficult to govern
California lawmakers approved a budget plan after weeks of debate over how to close
a staggering $26 billion deficit. Under the deal, schools and healthcare programs
will take big hits, but these short-term cuts are expected to leave the state vulnerable
to future budget woes.
The fiscal crisis and a fractious Legislature have led many to ask: What's wrong with
California? Why was it so difficult for this state to hammer out a workable budget?
According to UC Irvine's Carole Uhlaner, political science associate professor, challenges
include legislative term limits and the two-thirds vote requirement for taxing and
spending.
Here, Uhlaner discusses California's budget woes and why other states - indeed the
world - should care.
Q: What do you think of the budget plan passed by lawmakers in Sacramento?
A: It has many problems, but given California's financial condition, almost any budget
is better than none because it allows the state to stop issuing IOUs and begin repairing
its credit rating. Californians, however, should be aware that when the state balances
its budget by reducing funds to cities, counties and school districts, cuts in services
are masked, not avoided.
Q: What is to blame for California's fiscal meltdown?
A: The financial crisis has many authors, but a few aspects of our state government's
structure deserve much of the blame. These include requiring a two-thirds vote of
the Legislature to pass a budget and raise taxes; term limits that guarantee inexperienced
lawmakers who have only a few years to work together; and ballot propositions that
tie the Legislature's hands and restrict budget flexibility.
Q: Can we change the state constitution to address these problems?
A: The state constitution can be revised in three ways: an amendment approved by two-thirds
of the Legislature and by the electorate; a ballot initiative approved by voters;
or a constitutional convention (a meeting to revise the state constitution) proposed
through a two-thirds vote of the Legislature and approved by voters. Ballot initiatives
are limited to one subject, so it's hard to enact a compromise - and almost every
structural change involves compromise.
Q: What's the role of Proposition 13 in the state's fiscal crisis?
A: The direct effect of Proposition 13 has been to make it harder to raise taxes at
any level of California government, by both restricting property tax revenue and requiring
two-thirds approval for most tax and bond revenue. It also fueled future tax opposition
by creating great tax rate inequities between longtime homeowners and more recent
purchasers. One of Proposition 13's original objectives was to make it possible for
older people to remain in their homes without being bankrupted by taxes on unrealized
home price increases. This can be addressed by letting people postpone payment of
property taxes, as already permitted in the state constitution (Article 13, Section
8.5) for some citizens.
Q: Why should people outside California be concerned about its budget woes?
A: California is the world's eighth-largest economy. Financial commentators everywhere
are worried about the impact of California's fiscal problems on the world's economic
recovery. If state residents spend less, this affects sales and profits around the
globe.
-Laura Rico, University Communications
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