On Thursday, July 14, Fair Political Practices Commission Chair Jodi Remke and John Mayer, president and CEO of California Forward (a government and political reform advocacy group), will host a webinar to kick off the first of two rounds of public participation to create a comprehensive overhaul of the act.  

Incumbents and candidates complain of an overly complicated system. The FPPC receives between 15,000-to-20,000 requests every year for advice from candidates and public officials.

Numerous legislative and voter-approved updates have left an “overly complex, cumbersome and sometimes contradictory” law, Remke said.

“This process is designed to simplify and streamline the act without weakening it or losing any accountability,” Remke said.

Law students at UC Berkeley and UC Davis have also contributed to the process by reviewing the law and making recommendations to the FPPC. And California Forward will help raise public awareness of the coalition’s efforts.

The Political Reform Act was passed in 1974, just two months before President Richard Nixon resigned over the Watergate scandal, with the protracted scandal highlighting the need for political ethics legislation. 

The law created the FPPC and regulated campaign finance, among other things. The original ballot summary is here:

“Requires reports of receipts and expenditures in campaigns for state and local offices and ballot measures. Limits expenditures for statewide candidates and measures. Prohibits public officials from participating in governmental decisions affecting their ‘financial interests.’ Requires disclosure of certain assets and income by certain public officials. Requires ‘Lobbyists’ to register and file reports showing receipts and expenditures in lobbying activities. Creates fair political practices commission. Revises ballot pamphlet requirements. Provides criminal and civil sanctions for violations. Enacts and repeals statutes on other miscellaneous and above matters.”

The Legislature is interested in the fact that Prop. 30 will end, Yee said, and she preferred that a tax reform discussion take place within the halls of the Legislature. However, Yee admitted she did not know how to slow down the initiative process to conduct a long-term conversation. Because voters are familiar with Prop. 30, she said, and if the final initiative presented to the voters has a “temporary” tag on it, she predicted the measure would pass.

The Economic Summit is an ongoing program dedicated to creating a roadmap to build economic prosperity in California. This particular session was dedicated to finding keys to develop more skilled workers, more water and more housing in California.

How to fund California’s future was the subject of the panel Yee participated on along with Ana Motosantos, former California Director of Finance. She is now associated with Tom Steyer’s Fair Shake Commission. The moderator was California Forward’s Lenny Mendonca. Motosantos concurred with Yee’s predictions on the tax measures.

The Controller has put together an advisory group working on tax reform. She argued that while California’s economy is doing well, now is the time to move on reform. However, she acknowledged that a big education program is needed. It is a matter of how to talk about tax reform to legislators and to the public, she said. Yee suggested discussing comprehensive tax reform not in ways of who might be winners or losers in a changed tax system, but in the terms of economic opportunity for all.

Yee’s tax reform group will deliver its report in March.

Motosantos said the Fair Shake Commission would consider taxes in February. The Commission, set up to consider answers to income inequality, is the brain-child of billionaire Tom Steyer. Critics claim the Commission is an effort by Steyer to broaden his credentials on a number of issues in consideration of a gubernatorial run. In that respect, the Commission’s take on tax reform could prove informative.

By Dave Roberts

California’s governing process is broken. Just some of the maladies afflicting Sacramento: Perennial billion-dollar budget deficits. Endless tax hike demands. Hyper-partisan legislation and bickering. All-day and late-night sessions in which barely read gut-and-amend bills are rushed through on party line votes. And the perception that unions are actually calling the shots.

Proposition 31 doesn’t aim to be the cure-all, but it is a step in the right direction, according to Bill Hauck. He’s a board member of California Forward, the government reform organization sponsoring it. Prop. 31 is multi-faceted and complex, but it essentially takes some power away from the state Legislature and gives it to the governor and local governments, while also creating new regional quasi-governments. Hauck presented the case for Prop. 31 at a recent informational hearing of the Assembly Budget Committee.

“I don’t think it’s any secret to any of you that voters and citizens in California believe that Sacramento is broken, and in many instances badly broken,” said Hauck. “It’s not functioning in the best interests of all of our citizens. Proposition 31 is a modest but good first step toward bringing our state’s governmental functions back to a level of functionality that will work for our citizens.”

One of the main reforms is two-year, performance-based budgeting with regular reviews of the effectiveness of state programs.

“If you hearken back to your discussion [earlier in the hearing] on Proposition 30, the entire discussion revolved around spending,” said Hauck. “There was absolutely no discussion about performance of programs. Nor was there any discussion about outcomes that generate from the billions that you all appropriate each year to all of these programs. And I would expect that you would appreciate sitting in budget committees here in Sacramento with the legislative analyst being able to speak to you about the performance of a program or outcome of a program in relation to your priorities.

“We could raise every single tax we could think of in California and reduce spending at a level that we would all agree we shouldn’t reduce it, and there would still be not enough resources for the legitimate demands that could be put in front of this Legislature and the governor. Even when the economy comes back, that will be true. So this Legislature has always and will continue to function in an environment where resources are scarce. As a consequence, you all need the best information you can get on which programs are working and where you are getting the kind of outcome for expenditures that you need in order to establish priorities each year. We believe you need to look at this issue on a longer term basis. You need to get yourselves out of the situation where you’re constantly trying to plug a deficit.”

Provisions

Prop. 31’s reforms also include:

* Local governments would be allowed to devise plans for providing services to the public, including economic development, education, public health and social services. About $200 million of state sales tax revenue would be transferred to local governments to pay for development and implementation of the plans.

* Local governments would be able to create functionally equivalent alternatives for administering state programs financed with state funds. The Legislature (in the case of laws) and the appropriate executive agency (in the case of regulations) could reject those alternative provisions. Otherwise, they would be in effect for four years.

* Pay-as-you-go (or pay-go) restrictions would require the Legislature to show how bills that increase spending or decrease revenues by $25 million or more in any year would be paid for with either spending reductions or revenue increases or a combination of both. Exemptions to pay-go include bills authorizing one-time expenditures and those that restore funding to a program or agency whose budget was cut in response to a budget shortfall.

* All bills and amendments to those bills would be made public for at least three days before voting on them.

* If the governor declares a fiscal emergency and the Legislature does not act to resolve the emergency in 45 days, the governor can reduce General Fund spending enough to balance the budget, provided he does not cut spending that is required by the state constitution or federal law. The Legislature could override the governor’s cuts with a two-thirds vote.

Prop. 31 “goes against many of the status quo interests that exist in Sacramento,” said Hauck. “As a consequence, it’s become controversial. But I would argue that you all would be in much better shape if you began to function in the way that Prop. 31 would start you. The measure is not perfect. I don’t know of any measure that is perfect. But I think it has all of the right ingredients to get you going in the right direction, and most importantly to begin to restore the trust of Californians and voters in their state government.”

Attacks from the Left

Much of the 90-minute hearing consisted of attacks from the Left by committee Chairman Bob Blumenfield, D-Los Angeles, and Lenny Goldberg, executive director of California Tax Reform Association, which advocates for increased business taxes.

“The intentions are all good, there’s no question about that,” said Goldberg. “We do have a mess of a budget process. We do have a mess of a governance process in California. [But] I would argue that if you think we’re tied in knots now, what Prop. 31 does is to add another layer of knots that ties up the process here in a way that makes it more difficult to function rather than less difficult to function. One of the questions about having a flawed document, is that you’re putting it in the constitution. You’re not allowing flexibility about a number of important areas. You’re making this hard and fast constitutional language.”

Goldberg is particularly concerned about the pay-go provision because it makes it easier for the Legislature to make budget cuts, which requires only a majority vote, in order to pay for a tax cut or a new program, than it does to increase taxes, which requires a two-thirds vote, to pay for a new program. He argued that providing $200 million from the state sales tax to local governments to better provide services violates pay-go because it’s not offset by a tax hike or budget cuts.

19th century

Blumenfield asked Hauck what the exact problem is that Prop. 31 is trying to solve and how does it solve it.

“At the state level, we are trying to bring you out of the 19th century when it comes to how you go about doing your budget,” responded Hauck. “I don’t know of any other organization in the world, government or private, that does its budget the same way California does today. You enact a budget, which you all know is not in balance when you enact it. This has been true now for many years. And about three to four months later you have to go at it again. And by six months you’ve enacted some changes in the budget, either revenues or deductions, that you then have to revisit six months from that point when you get into a new fiscal year and the governor proposes a new budget.

“The fact that you are not planning the budget out over a longer period of time, that you are not reviewing spending and revenue probably even quarterly and adjusting either spending or revenue in relation to funds that are coming in, is a practice that businesses and other governmental organizations follow on a regular basis. California hasn’t followed that system ever. Other states have enacted performance and outcomes measures for their budgets, and have been very successful in doing that.”

Goldberg said he’s concerned about providing the governor the power to cut the budget during fiscal emergencies. The voters twice have rejected that idea, he said, calling it “unilateral” and “non-transparent.”

Blumenfield agreed, asking, “Are we ceding too much authority to the governor? And is the public losing in that process in their ability to oversight and judgment that we have through the vetting process in the budget? There’s always going to be a governor that you like or don’t like. This newfound power might be quite frightening, depending on if you like or don’t like the governor.”

Hauck responded, “I would disagree with that. This is a modest authority for the governor, which the Legislature has the ability to over-ride. The governor would also not be able to cut constitutionally driven spending. So what we’re talking about here is a small percentage of the General Fund. The idea here is if there’s no action at all, why do you want to get yourself deeper and deeper into the hole? We just continue to dig ourselves in deeper and deeper over the last 12 years, defying the rule of holes: when you get in one, stop digging.”

Attacks from the Right

But Prop. 31 has also come in for criticism by some on the Right who fear that its local government provisions for strategic action plans would establish regional budgeting that would rip off suburbs to fund big city waste. “Prop. 31 would end up with regional proxy governments around California that would require sharing tax revenues between wealthy and ‘disadvantaged’ areas,” wrote CalWatchDog.com’s  Wayne Lusvardi in a recent article. “Strategic Action Plans is a term for regional government like the socialized European Union, not like county governments in the United States.

“Prop. 31 would authorize the formation of SAP committees to undertake regional projects and programs.  A SAP would be run by a committee appointed by a group of local governments that wanted to run their own programs by their own rules.

“Such committees would not be miniature legislatures that could pass their own laws, however.  They would still have to appeal to the union-controlled California Legislature to relax rules or pool revenues for joint programs.  This is where the Legislature would mandate that every local regional henhouse would have to include a fox.”

After several other objections were raised at the committee hearing, an exasperated Hauck said, “If you like the status quo, don’t vote for Proposition 31. If you think things are working very well today in California, you don’t need to vote for this. We concluded that that’s not the case, and it’s not been the case for some time. I concede that this is not a perfect measure. Lenny raises a lot of things that are not likely to occur. But I understand why he does that. But he also concedes that all of the provisions in the measure are well intended. The idea here is to make this work, not to find the nits and nats that may need correcting.”

A recent Field poll indicates that Prop. 31 will be a tough sell. Forty percent said they intend to vote no, 21 percent said yes and 39 percent were undecided.

By Wayne Lusvardi

Tom Elias’ Oct. 2 column in the Redding Record Searchlight newspaper inferred Proposition 31 is only being opposed by some right-wing crackpots. Actually, Prop. 31 is far from only a rightwing issue. It should be an left-wing issue as well. Perhaps the Occupy Movement will take it up.

Prop. 31 is another slush fund for billionaires to play with the public’s money in California. The sponsor of Prop 31 is California Forward, a political organization founded with $16 million in grants from foundations established by wealthy elites.  Nicolas Berggruen, a European billionaire, is the biggest sponsor of California Forward, with a $1 million donation to the pro-Prop. 31 campaign.  Berggruen owns the IEC vocational school chain, which could stand to benefit from Prop. 31.

Prop 31. creates unelected Strategic Action Plan committees that will add an unneeded layer of government between the state and local governments.  State gasoline taxes, property taxes for schools and junior colleges, and vehicle license fees can be diverted from cities and counties to these committees.

Billionaires are not supporting Prop. 31 only to bring about true “good government” reforms.

We only need to look at Proposition 71 from 2004. It granted $3 billion to  a new state stem cell research agency. Where did the money go?

Stem Cell Initiative as Forerunner of Prop. 31

The sponsor of Prop. 71 was Robert Klein, a wealthy real estate developer who donated $3 million to its election campaign. Upon approval by the voters, Klein installed himself as the Stem Cell Institute’s top paid officer, making $150,000 a year for half-time work. In 2008, Klein had to step down as president of the stem cell lobbying group Americans for Cures as a potential conflict of interest with his serving as board chairman of the stem cell agency.

The Sacramento Bee recently exposed that 90 percent of the monies granted thus far by the stem cell agency — $1.5 billion — went to research organizations of past and present board members of the agency.  In 2008, even the prestigious journal “Nature” opposed the incestuous cronyism at the stem cell agency.

Occupy Should Join Republicans in Opposing Prop. 31

The phrase “government by crony” is defined in Safire’s Political Dictionary: “An administration in which advisers qualify not by experience or talent but by their longtime friendship with the Chief Executive.”  Prop. 31 would expand this definition to include actual agency heads and government boards, not just advisers.

William Safire notes that most of the “government of” phrases of the last century (e.g., “government by organized money”) were probably coined to compare unfavorably with the phrase President Lincoln popularized: “government of the people, by the people, for the people.”

Said Gary Aminoff, president of the San Fernando Valley Republican Club, “The CRP at the convention voted Yes on 31. After the meeting, several people pointed out to the Board of CRP the reasons not to have endorsed it. They all said they didn’t catch it and if they had to do it over they would not support Prop.  31. It was too late to change it because it was voted on at the convention and would take another convention to undo it. I have since suggested they send out a statement stating this and I am still awaiting it.”

Both the left and the should understand that Prop. 31 will undermine representative government and would lead to crony revenue sharing in California.

By Wayne Lusvardi

Carles B. Warren, a real estate economist and appraiser in Pleasant Hill, California, asks: “In the Los Angeles region, who will be Greece and who Germany” if California voters approve Proposition 31 on the November ballot?

Warren once was a visiting professor at Istanbul Technical University in Turkey. He was referring to the European Union, where solvent Germany has been bailing out the overspending of Greece, Italy and other countries.  After more than a dozen years of regionalized money and shared taxes, the European Union is coming apart. Many countries are going bankrupt.

Something similar would eventually happen in California under Prop. 31, where the regionalization of taxes would just postpone the inevitable.

Prop. 31 is a Coercive Tax-Sharing Scheme

Prop. 31 is apparently intended for large public works projects such as the California Bullet Train.  Under Prop. 31, taxes could be pooled regionally to help fund large public works projects.  Under Prop. 31, environmental regulations and clearances could be drastically reduced or circumvented to overcome delays, lawsuits, and obstructionism.  But Prop. 31 could also be used for smaller local projects or the bailouts of insolvent cities or school districts.

Under the tax-sharing provisions of Prop. 31, suburbs could be coerced to “voluntarily” share a portion of their state road, school, and vehicle license tag revenues or forfeit them.  Unelected regional committees called Strategic Area Plans could divert the shared or forfeited taxes to plug budget and pension deficits in big cities and big school districts.

SAP committees would add an extra layer of government and its members would not be elected. They would not be authorized to raise new taxes. But they could shake down wealthy suburbs to pay for financially strapped cities and school districts.  And they could pledge confiscated tax revenues to pay for bond issues for public projects.

City councils, county boards of supervisors, and school districts mostly in the suburbs would lose home rule over zoning, transportation, housing, and even a portion of their property and income taxes for public schools. Unelected committees would determine spending priorities and how much money would be spent on affordable housing and where.

Additionally, such super committees could recapture a portion of property and income taxes from wealthy school districts that approved supplemental school parcel taxes and divert them to struggling school districts. A prime example would be wealthy school districts in Carlsbad or La Jolla in San Diego County sharing their property taxes with the Poway Unified School District and its $1 billion deferred interest on “capital appreciation bonds.”

Mostly wealthy school districts in Northern California that approved school parcel taxes could likely have an offsetting share of their property and income taxes diverted to “poor” school districts in Southern California.  Northern Californians that don’t like their water flowing to Southern California would end up having their share of school taxes flow south, too.

The above is not far-fetched speculation and hysteria. Former State Assembly Speaker Robert Hertzberg is the co-chairperson of California Forward, the sponsor of Prop. 31. In 2002, Hertzberg spearheaded a study, “The New California Dream: Regional Solutions for 21st Century Challenges,” proposing the financial regionalization of local governments by way of a voter-approved constitutional amendment.  Prop. 31 is the culmination of what that report inferred was Hertzberg’s “dream.”

Diluted Government and Voting

As Warren puts it, Prop. 31 would result in the “dilution of representative government, the dilution of voter power, decisions made regionally rather than locally, and the redistribution of tax revenue beyond what is already built into the system.”

Why? “Because some cities and school districts, usually in older central areas, can’t control spending, pensions being a salient example. Prop. 31 is basically a covert bailout initiative.”

Warren points out that this problem has been around for decades.  He says, “Even before President Lyndon B. Johnson’s War on Poverty in the 1960’s, government has attempted to solve problems in central cities without success, but at great expense.  The literature promoting regional government goes back at least to the 1950s. Greater expense is unlikely to yield greater success. In fact history suggests that top-down decision making is more likely to spread high priced failure.”

Numbers Transposed: Prop. 31 is Prop. 13 in Reverse

Proposition 13, the 1978 tax limitation initiative, has served as a circuit breaker against both monetary inflation and falling property values. Warren points out that, under Prop. 13, property tax revenues have grown faster than inflation.  Moreover, since the 2008 Mortgage Market Meltdown and Bank Panic, property tax revenue has fallen more slowly than property values.

But Prop. 31 would be Prop. 13 in reverse, both numerically and fiscally.  This is because Prop. 31 would circumvent the supermajority vote requirements of Prop. 13 by tapping taxes from other cities without any requirement for voter approval.  No new taxes would be raised. Suburbs would just have a share of their existing taxes siphoned elsewhere.

Suppose Santa Monica Thinks It Will Be Switzerland

Like Prop. 31, the European Union involves fiscal regionalization, while leaving existing political boundaries and governments in place.

According to Warren, it is the opinion of the Economist magazine that the weakness of the European Union has been the enforcement of fiscal discipline on the Southern and other high-spending governments.  That is because fiscal regionalization — tax sharing — creates what is called the “free rider” problem, where weaker economies have no incentive to grow and only want to live off the wealthier economies.

The way Warren puts it: “Voila! — Greece.” In the pre-European Union era, the Drachma, Greece’s currency, had higher interest rates than the German currency, the Deutsche mark, to capitalize currency depreciation. The same things happened with Italy and, to an extent, France.  Locking them all together without enforceable means of controlling their taxation and spending only worked in good economic times, however. We’re now seeing the consequences.

Warren adds: “To an extent our federate system shares the same problem.  State by state and region-by-region, some gain and some lose by participating in the American Union. That is not what the European Union said it intended, but it’s what it’s getting.”

California cities, counties and school districts would be subject under Prop. 31 to the same predations and free riding as those in the European Union.

Some cities might think they can remain neutral like Switzerland, which is not part of the European Union. But under Prop. 31, a city such as Santa Monica or San Francisco could opt out of regionalized “Strategic Area Plans,” but at a price. They would likely have to forfeit a share of their road revenues.  Or wealthy school districts with supplemental school parcel taxes might have to forfeit an offsetting share of their school property taxes.

This is how revenue sharing of H.U.D. Community Development Block Grant funds works now in California.  Those cities that do not meet their affordable housing quotas have their share of Block Grant funds diverted to less wealthy areas. The mechanism the state uses to confiscate such funds is the Housing Element of a city’s General Plan.

So there would be no escaping the confiscatory policies of Prop. 31 by voluntarily opting out of a Strategic Area Plan. There would be no equivalent to a neutral Switzerland in the European Union under Prop. 31.

Once again, which California cities will be Greece and which Germany under Prop. 31?

By Wayne Lusvardi

Despite regionalization failing miserably in the European Union, California is proposing to adopt it as a tax-sharing policy for distributing state funds to local governments if voters approve Proposition 31 on the November ballot.

Prop. 31 is a combined new law and state constitutional amendment sponsored by the California Forward political action group.  Nicolas Berggruen, a European billionaire, is the biggest sponsor of California Forward with a $1 million donation to the pro-Prop. 31 Campaign.  Berggruen owns the IEC College of vocation schools in California and is a registered Democrat in Florida.  He founded the Council for the Future of Europe, which has proposed “fiscal federalism and coordinated economic policy” to rescue the European Union from its debts.

Regionalism Will SAP Revenues from Suburbs to Cities

Urbanologist Wendell Cox writes that “regionalism” is an emerging policy of the Obama administration, as described in Stanley Kurtz’s new book, “Spreading the Wealth: How Obama is Robbing the Suburbs to Pay for the Cities.” Kurtz is a social anthropologist from Harvard.

Prop. 31 will not result in new regionalized governments. Rather, it will end up in what Cox calls “fiscal regionalism” run by a committee.  The tax-sharing facets of Prop. 31 are:

1. “Granting counties, cities, and schools the authority to develop, through a public process, a Community Strategic Action Plan for advancing community priorities that they cannot achieve by themselves.”
2. “Granting local governments that approve an Action Plan the ability to identify state statutes or regulations that impede progress and a process for crafting a local rule for achieving a state requirement.”
3. “Providing some state funds as an incentive to local governments to develop Action Plans.”
4. “Implement the budget reforms herein using existing resources currently dedicated to the budget processes of the State and its political subdivisions without significant additional funds. Further, establish the Performance and Accountability Trust Fund from existing tax bases and revenues. No provision herein shall require an increase in any taxes or modification of any tax rate or base.”

According to Cox, regionalization strategies are “aimed at transferring tax funding from suburban local governments to larger core area governments.”  The Prop. 31 version of regionalization would not amalgamate city, county, special district and school district governments. Nor would it create new taxes. But it could authorize the state to withhold or divert taxes from local governments unless those governments adopted a “Strategic Action Plan” to distribute the revenues from the suburbs to the large urban cities.

In essence, a Strategic Action Plan, or SAP for short, would sap the wealth out of suburbs. SAPS might also sap the bond ratings from suburban communities.

Governor Would Become “Emergency” Czar

Probably one of the most controversial provisions of Prop. 31 would grant the governor the power to cut or eliminate any existing program during a “fiscal emergency.”  In essence, the governor could usurp local government decisions on where to spend state funds.

Budgets for local public schools, community colleges or cities could be cut at the whim of the governor and the funds diverted elsewhere.  The governor could conceivably use new emergency powers to divert state funds to his choice of regional Strategic Action Plans.

Why Democrats and Unions Oppose Prop. 31

Public unions have historically been concerned about granting the governor broader emergency powers.  On July 11, 1999, the Gov. Gray Davis administration called legislative committee chairpersons to inform them that the governor intended to direct the outcomes of selected funding bills without consulting their authors or the legislature.  The leaders of the legislature at that time — Assembly Speaker Antonio Villaraigosa, D-Los Angeles and Senate President Pro Tem John Burton, D-San Francisco — called Davis’ actions a “totally improper intrusion into the legislative process.” The concern was that Davis was going to kill a bill sought by labor unions to increase workers’ compensation benefits.

This explains why the Democratic Party is currently opposed to Prop. 31 giving the governor emergency powers over the budget. Also, any consolidation or revenue sharing arrangement of local governments might lead to the heads of local unions losing their jobs if absorbed into a larger union.

Why Republican Party Wrongly Endorses Prop. 31

Oddly, the California Republican Party supports Prop. 31. This is because Prop. 31 is being misleadingly advertised as a government budgetary efficiency measure.  But a two-year budget and performance budgeting do not need the approval of voters to be implemented.

Budget analyst John Decker in his book, “California in the Balance: Why Budgets Matter,” draws on an example from the Schwarzenegger administration to explain why a voter initiative is not needed for Prop. 31, except for the tax sharing provisions:

“Amid much fanfare the year after his election, Governor Schwarzenegger announced the results of a year long internal effort to find efficiencies in government known as the California Performance Review.  Though most of the recommendations made could be implemented administratively, few were actually taken in the form proposed.”

Local governments can form “joint powers authorities” in California without Prop. 31 and make their own decisions about revenue sharing.  In an email to this writer about Prop. 31, Wendell Cox stated: “State law permits Joint Powers Authorities and this is all that is needed.”

Tea Party Rightly Opposes Prop. 31 Despite Paranoia

The proponents of Prop. 31 may say that the Tea Party and those opposed to fiscal regionalism are over-reacting to its provisions.  But why are the proponents trying so hard to sell Prop. 31 as a budget reform and government performance measure with little mention of its tax-sharing provisions?

The East Bay Tea Party has more accurately perceived the dangers with Prop. 31 as the creation of a “super” layer of government that cannot be held accountable by local government elections.  Unfortunately, the paranoid Tea Party also fears that Prop. 31 would measure the “performance and accountability” of local governments by United Nations Agenda 21.

No doubt this sort of paranoia reflects the powerlessness and political marginalization of the Tea Party’s members in California. But such paranoia gives the opponents of the Tea Party reasons to discount them as “wing nuts” not to be taken seriously.

California Forward Hides Tax Sharing Part of Prop. 31

California Forward is selling Prop. 31 to the public as “trustworthy, accountable for results, cost-effective, transparent, focused on results, cooperative, closer to the people, supportive of regional job generation, willing to listen, thrifty and prudent.” The touted provisions of Prop. 31 call for a “two-year budget cycle” and for “performance budgeting.” Prop. 31 is officially titled “The Government Performance and Accountability Act.

California Forward makes no mention in its filing or in its official ballot argument in favor of it that Prop. 31 will socialize state revenue sharing.  And the analysis of the California Legislative Analyst is so neutral and narrowly focused that it is does not help the public understand the importance of the tax-sharing aspects. The ballot arguments in favor and against Prop. 31 also ignore that it would socialize local government taxes by regions.

Commentariat Mislead About Prop. 31

It is amazing that California’s journalistic commentariat has, thus far, only been concerned that Prop. 31:

* Is a Trojan horse that would result in “tweaking” environmental regulations;

* Prescribes an “aspirin” instead of “surgery”;

* Is a “virtuous budget reform package that falls short;” but

* Would “restore our state to greatness.”

Wendell Cox is one of the few that has caught the magnitude of the problem of regionalism to our democratic form of government when he wrote, “[D]emocracy is a timeless value. If people lose control of their governments to special interests, then democracy is lost, though the word will still be invoked.”

In an email, Cox further wrote:

“In general, the idea of tax sharing is negative. This breaks the connection between local governments and taxpayers, as tax sharing governments are, by definition, not accountable to the taxpayers of jurisdiction with which they share taxes. Milton Friedman was right in saying something to the effect that people are more careful about with their own money than they are with other people’s money. This would be a very bad step for California, which already is suffering significant ill effects from insufficient fiscal responsibility.” 

Prop. 31 is Ripe for Abuse 

Safires’ Political Dictionary defines “tax sharing” as “collection of revenues by the (state) government, returned directly to the (local) governments without (state) control of expenditures.”  Prop. 31 would go beyond merely returning tax revenues to local governments without controls and conditions attached.  It would be prone to abuse for funding political cronies and political earmarks.

When former President Clinton proposed a form of revenue sharing in an economic stimulus bill, Republicans described it as political pork and successfully blocked it.  But in the California Legislature, the Republican Party no longer has any blocking power.  Prop. 31 would be prone to abuse because there are few checks and balances anymore in California’s new “Fusion Party.”

History indicates bureaucratic agencies have a way of not ending up as policy makers intended. There is no way of knowing whether Prop. 31 would end up as some form of “Tennessee Valley Authority” that would usurp local governments and would be self-perpetuating without any sunset provisions.

Voters on both sides of the political spectrum should be concerned about the implications of Prop. 31.