I have been fascinated by the Governor’s insistence that Prop 1A will "solve" the problems that have led to the current budget crisis. As in Proposition 58, the Governor capitulated to the demands of the Democrats, gave them in this case their tax increase, and got nothing in return. The Democrats and their staff acted much like tailor in the Emperor’s New Clothes, and now the Governor is parading around the state showing them off. Just like the emperor in the story, this Governor is showing off just how little he got for his capitulation to the lefties in Sacramento.
I read Bill Leonard’s commentary on Prop 1A, and its flaws as a spending limit. His conclusion was that it would not be effective as a limit because of the loopholes. He did say it had a better reserve than the Gann limit, because Gann had no reserve, but remember, during all of the time that Gann was in effect, no reserve was necessary because Gann limited spending in the first instance, that is, when the money was first being spent, rather than after spending had ballooned. The salad days of the 80’s saw revenue grow as fast as it is now, but the state couldn’t spend the money, so the automatic spending requirements for future budgets never kicked in.
But I did want to add something to Bill’s commentary, with apologies to Bill. He said it, I just want to say it differently. There are three corrollaries to his theorem about the "loophole finding aptitude" of legislators and governors.
(1) Never underestimate the ability of legislators and staff to write loopholes into legislation supposedly intended to limit their ability to spend. Prop 1A was drafted by Democrat legislators and staff. The loopholes, as Bill has pointed out, are large and loose. We know they exist, and I can guarantee you the Legislature will exploit them.
(2) Never underestimate the ability of governors, legislators and their respective staffs to completely ignore any constitutional constraint on their desired exercise of power.
(3) Never underestimate the ability of courts to contort the plain language of the Constitution to justify unconstitutional legislative action, and where the language is unclear, it will be interpreted in the manner most likely to expand the power of the legislative and executive branches.
The evidence to support my corollaries to Bill’s theorem:
(1)As for their ability to draw up "fake" spending limits, witness Propositions 108 and 111 in the 1990 election, a tax increase on gas to provide for the construction of more freeways and a spending limit that was supposed to loosen Gann "a little." It was a spending limit drawn up by Democrats that was so loose that despite record spending increases, and several near collapses of the state government, spending never exceeded the limit. That is how Democrats draw up spending limits
(2) As for their ability to simply ignore clear constitutional restraints on their ability to act, look at their constant search for ways to raise taxes without a two-thirds vote. Start first with the fake "revenue-neutral" rule. According to the most absurd ruling ever made by Legislative Counsel, a tax increase on you and me is not a tax increase, if in the same bill, our neighbor (or most likely some large Democrat contributor) gets an tax cut in the same amount as the tax increase on you and me. This rule is the Legislature’s first line of attack when they want to raise taxes. Second, a tax is not a tax if they rule it a fee, even if it is a tax. Third, as they tried to do last year, a tax is not a tax if a majority of the Legislature and the Governor simply agree that it doesn’t need a two-thirds vote. Who cares about their oath of office? Promises are such silly things, only pragmatism reigns supreme in politics. And how about Governors? Gray Davis simply raised the car tax with a letter to DMV, not even an act of the Legislature. An unbelievable act of despotism that took a recall to reverse.
(3) As for the ability of courts to contort the Constitution, just two words-Sinclair Paint. That ruling that said a tax is a fee if the court says it is a fee, and the court will say it is a fee if the Legislature says it is a fee. Who cares about due process? Who cares about the plain language of the Constitution? Who cares about honesty in the courts and Legislature? We have a government to run and we cannot be constrained by trifles such as Constitutions, rules, and laws.
Why should we fear loopholes? Loopholes simply allow Governors and Legislators to cloak their desire to exercise power in the guise of some legitimacy. It is clear that it is legal, these Legislatures will say, the law allows it, even if the expenditure violates the spirit of the limit. We have countless numbers of examples of Legislatures and Governors simply ignoring the Constitution to achieve their desired goal, if a loophole gives their actions some Constitutional dressing, they will take it.
It is unfortunate that the Capitulator (he doesn’t terminate, he doesn’t compromise, he capitulates) has decided to become the mouthpiece for this travesty of public policy masquerading as good fiscal management, but it fits his pattern. Proposition 58, the budgets of 2005, 2006, 2007, and 2008 all represent this Governor’s capitulation to Democrats spending demands. He has reaped the penalties of his capitulation, and he is suffering the same fate as his predecessor, who did the same thing. Prop 1A is this Emperor’s new clothes