|Sensible opinions on the California ballot propositions since 1980 by Pete Stahl|
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Prop. 68 - SOON
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Prop. 70 - SOON
Prop. 71 - SOON
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(Please see My semi-biennial lecture on bonds for my opinions on bonds in general.)
Following the 1989 Loma Prieta earthquake, Caltrans inspections revealed that one thousand highway bridges needed to be reinforced to withstand future quakes. The work would be expensive, but everyone agreed it had to be done. So in 1990 we voters approved Prop 111, jacking up the gasoline tax nine cents a gallon to fund the retrofit now under way. You've probably seen the work in progress as you motor up your favorite freeway.
After the 1994 Northridge earthquake, a more experienced Caltrans discovered an additional thousand bridges needing reinforcement, including the seven toll bridges in the San Francisco Bay Area. As before, no one disputes that this work must be done. If anything, there is now more confidence that seismic retrofit works: in the Northridge quake, none of the bridges that had been reinforced failed.
Prop 192 provides two billion dollars in bonds for the reinforcement of that second thousand highway bridges. One third of the money is earmarked for the Bay Area toll bridges, where the work on underwater pilings will be slow and expensive. But the bulk of the bond proceeds will be used for highway bridges all over the state.
We need this retrofit to begin sooner rather than later. Large earthquakes strike without warning, and it's a heck of a lot more expensive to rebuild destroyed bridges than to reinforce them now. Prop 192's bond funding is the way to go, for all the reasons I mention in my bond lecture (below).
Proposition 13 says that a property's "assessed value" can increase only 2% a year as long as the property isn't sold or significantly improved. So while your property may be worth twice what it was when you bought it, its assessed value will have barely changed. Since property taxes are based on assessed value instead of real value, the size of your property tax bill depends more on how long you've owned your property than how much it's really worth. It's sort of like paying income tax based on how long you've had your current job instead of how much money you make. It's ridiculous.
Since Prop 13 passed in 1978, we voters have approved about a zillion little exemptions to let special people avoid reassessment when they move or remodel: disaster victims, people who inherit property from their parents, people over 55 who move into cheaper homes, people who fire-proof or earthquake-proof their property, people who live in historic buildings. Prop 193 extends exemptions to people who inherit property from their grandparents if their parents are dead.
On the surface Prop 193 seems reasonable and innocuous. But every time we grant a reassessment exemption like 193 proposes, we make the lunacy I pointed out above more palatable, and thus postpone the day when California implements a more equitable property tax system. Prop 193 hopes to eliminate the complaints of yet another class of citizens upset with the system of "property tax based on length of ownership," and thus perpetuates a law that's fundamentally flawed.
I try not to recommend protest votes, but I make an exception for issues related to Prop 13. As California housing prices rebound, soon it won't be unusual for people who have just bought their property to pay ten times more property tax than their neighbors who have owned since 1978. It's as unfair and arbitrary to base taxation on length of ownership as it would be to base it on length of hair or length of name. Prop 193 will pass easily. Your "no" vote might just send a tiny message that we are unwilling to accept the inequity of Prop 13 any longer.
Since 1977 inmates who work in prison have been eligible for unemployment benefits upon their release. This helps prevent immediate relapse into criminal behavior by providing at least some income until the ex-cons can find work. After all, the job market isn't great to begin with, and it's even worse if you're just out of the slammer. A study has shown that paying unemployment benefits has significantly reduced the rate of new crimes committed by released prisoners.
In 1990 we voters approved Prop 139, allowing private manufacturers to employ inmates in state prisons. The manufacturers get below-market rental on space inside the prisons and a state income tax credit on the wages they pay. It's a pretty sweet deal for the employers. (So sweet, in fact, that I opposed 139, fearing that manufacturers would jettison their free employees in favor of cheaper convict labor.)
Unemployment benefits are funded by insurance premiums paid by employers. The more ex-workers an employer has collecting benefits, the higher the employer's premium. Since all prisoner-employees collect unemployment benefits after they're released, the in-prison manufacturers are finding their unemployment insurance premiums higher than they'd like.
The solution proposed by Prop 194 is to make ex-prisoners ineligible for unemployment benefits. This would not just bring the employers' insurance premiums back down to their initial levels, it would eliminate the premiums entirely. Quite a windfall.
Bully for the employers, but what about the released prisoners? They've paid their debt to society, held down productive jobs, and been effectively "laid off" through no fault of their own. (In fact, chances are they've lost their prison jobs because good behavior has led to parole.) Isn't that enough? Or do we have to keep holding these people down, denying them any income at all, ensuring them lives of poverty and increasing the danger that they'll commit more crimes?
Prop 194 is overkill, like using an atomic bomb to swat a fly. Yes, it's a shame that the employers of prison inmates are being charged too much for unemployment insurance. But the solution proposed here gives the employers an undeserved windfall while compromising everybody's safety. And it crushes the hopes of the ex-cons just as they're beginning to piece their lives back together. The employers could have asked simply to have their premiums reduced to what they would be without the "layoffs." But no, they had to get greedy, at all Californians' expense. Let's not indulge their selfishness.
Props 195 and 196 allow the state to execute people who murder jurors or commit murder during a carjacking or drive-by shooting. If you favor the death penalty, stop here and vote YES on both. If you oppose the death penalty, stop here and vote NO.
A side issue: Both these propositions will surely pass by huge margins. Everyone who votes for 195 and 196 will feel like he or she has done something real to fight violent crime. Of course, the ultimate effect of 195 and 196 will be nearly nil, except to provide a bogus, hot-button issue for the bills' sponsors to use in their quests for reëlection (or, in this era of term limits, election to higher office). These useless, feel-good bills find their way onto every ballot (remember Prop 187?), and I hate to see it. It's a cynical abuse of our initiative system. But we must look past the immediate political goals of the sponsors to the laws as proposed, because propositions we pass will be law long after their sponsors have passed into oblivion. So even though we may dislike the way a proposition gets on our ballot, we must consider each bill on its own merits, and try to ignore any short-term political overtones.
In June 1990 we passed Prop 117, which outlawed the sport hunting of mountain lions. Killing mountain lions in the defense of humans, pets or livestock was not outlawed; nor was relocating lions which become dangerous. Prop 197 will eliminate the mountain lion's status as a protected species, giving the hunter-friendly Department of Fish and Game authority to regulate mountain lion killing.
As I wrote in 1990: Mountain lions are the only remaining large predators in most of the state, since wolves and grizzly bears have been exterminated by hunters and ranchers. Mountain lions must be preserved if our ecosystem is to endure. Without them the top of the food chain would become vacant, causing havoc below: prey herbivores would first multiply uncontrollably, feeding until the land became barren (and exacerbating soil erosion); then they would starve in massive, pathetic famines. No one wants to see that.
Unfortunately there are no reliable studies to show whether the mountain lion is actually endangered. But you can be sure that there will be no mountain lion population explosion if Prop 197 fails. The mountain lion population is self-regulating. The creatures are solitary and very territorial, so the population grows only until the available habitat is filled. If mountain lions try to expand their territory beyond that habitat, into populated areas, existing laws are sufficient to protect the public; Prop 197 won't appreciably enhance our safety.
In addition to my beloved propositions, your ballot for this election also has some candidates for obscure public offices. You know, President, Member of Congress, Assembly, stuff like that. You will notice that the candidates on your ballot are all members of your political party. (Unless, of course, you're registered "Independent," in which case you won't see any candidates.) This is what's called a "closed primary." Democrats choose the Democratic nominees, Republicans choose the Republican nominees, and so forth.
Prop 198 proposes "open primaries." Instead of seeing only the candidates of your party, under 198 you'll see all of the candidates of all parties, jumbled together (albeit identified by party). You'll still vote for just one candidate, but that can be a candidate of any party. If you're a Republican but like a Democrat better, you can vote to make that candidate the Democratic nominee. If you're a Democrat but want to sabotage the Republicans' chances in November, you can vote to make a terrible candidate the Republican nominee.
And that, my friends, is what will happen under Prop 198. Imagine you're a Democrat, with Bill Clinton as your party's certain nominee. If you want to help Clinton get reëlected, your most effective vote is for Republican Robert Dornan (or Alan Keyes or whomever you believe Clinton would defeat most easily). A vote for Clinton would be merely redundant, but sabotaging the Republican nomination would really help your candidate. Under current law you'd have to reregister Republican to vote this way, but under 198 you could simply punch Dornan's number. If you think the Democratic Party would be shy about encouraging you to do this, you're more naïve than you look.
It's sad that the parties are becoming more polarized. Most of us are frustrated by far-right vs. far-left choices like Bruce Herschensohn vs. Barbara Boxer for U. S. Senate. And it's distressing to see candidates of both parties cater to extremist factions during the nominating process, then veer back to the middle of the road after the nomination is sewn up. But open primaries would not solve these problems. Instead, Prop 198 would unleash a new era of skullduggery, Trojan-horse candidates and chaos into our political process. Yikes.
About a hundred California cities and counties have laws limiting rent increases for spaces in mobile home parks. These laws cover about one third of the spaces in the state. The laws act just like rent control laws for apartments. The idea is to preserve at least some affordable housing for those with limited incomes. Landlords, protected from property tax increases by Prop 13, are usually allowed to increase rents just to keep up with inflation.
Prop 199 proposes to eliminate all rent controls in mobile home parks. There are some cosmetic provisions for gradual phase-out of current controls and a paltry 10% rent discount for up to a tenth of the tenants, but the eventual effect of 199 will be to eliminate controls entirely.
Mobile homes ain't really mobile. It costs a lot of money to move 'em, more than the typical low- or fixed-income mobile homeowner can afford. So when rents go up, the owners are usually forced to pay or sell. To this extent, mobile homes are just like other rental property, and the same principles should apply. Prop 199 covers only one part of the housing market, and helps landlords only. Any limits on rent control laws should be comprehensive, covering the rental housing market as a whole, and both landlords and tenants. 199 will remove over a hundred thousand units from California's pool of affordable housing, without offering us any meaningful compensation.
1/3 cup unsalted, softened butter
Combine butter, sugar and chocolate in a mixing bowl. Add egg yolks; when mixed well, stir in flour until smooth. Beat egg whites until stiff (but not dry), and gently fold into batter until completely mixed. Pour into a greased, lightly floured eight-inch spring-form pan. Bake at 325 degrees for one hour, fifteen minutes. Let cool for at least twenty minutes. Spread jam evenly over top of cake. Serves eight.
Wait. What's that you say? Tort, not torte? Ohhhhh, that's different. Never mind.
A tort case occurs when someone sues to collect compensation for property loss, injury or death. For example, you might sue a driver for medical payments when his car injures you. Or you might sue a corporation for the money you lose when its misconduct makes your stock worthless. These are typical tort cases. When you hear people complain about our "overly litigious society," these are the kind of cases they want to reduce.
Props 200, 201 and 202 aim to do just that. Prop 200 will make it impossible to sue a driver for medical payments (unless alcohol or a felony is involved). Prop 201 will make it harder to sue misbehaving corporations for lost investments. And Prop 202 will limit what plaintiffs' attorneys can charge in such cases, making it harder for victims to hire competent lawyers.
As you might expect, powerful special interests are involved in tort reform. Backing Props 200, 201 and 202 are the corporations and executives who are defendants in so many tort actions. If these propositions pass they (and their insurers) save a lot of money. Opposing 200, 201 and 202 are trial lawyers and consumer groups, the former because these propositions threaten their livelihood and the latter because they would limit common folks' access to the courts.
Depending on whose ads you listen to, Props 200, 201 and 202 will either eliminate frivolous nuisance suits and discourage ambulance chasers (supporters), or prevent the little guy from suing for legitimate damages (opponents). This election I'm siding with the opponents, not out of any love for the trial lawyers, but because I feel it's wrong to deprive ordinary people the right to sue, leaving them with no recourse at all. We'll see which side I'm on this November when, I'm told, tort reform initiatives from the lawyers will appear. What fun that will be.
Car insurance in California works on an "at-fault" basis. In an accident, whichever driver is at fault (and/or his insurer) pays for all resulting damage and injuries for everyone involved. Prop 200 will replace this at-fault system with a "no-fault" system for personal injuries. Under no-fault, each driver in an accident will pay for the injuries of everyone in his own car, regardless of which driver caused the accident.
(Note that Prop 200 addresses injuries only. If 200 passes, all repairs to cars and other property will still be paid for by the driver at fault. Also, if a driver is drunk, leaves the scene or commits a felony he becomes liable for everyone's injuries as well.)
There are some very attractive arguments in favor of Prop 200. First, 200 would reduce the number of lawsuits stemming from traffic accidents. Under the current system, if all parties agree on who is at fault and how much should be paid, things go smoothly. If there are disagreements, often an arbitrator can settle things. But if no agreement can be reached, people sue. Drivers sue, claiming they weren't at fault. Victims sue, claiming the driver's insurance company isn't paying enough. And insurance companies sue, claiming the victims' doctors charge too much or perform unnecessary procedures. What a lot of torts.
Under 200, the question of who caused an accident will be largely irrelevant, so fewer drivers will sue to contest finding of fault. Health care providers will only be allowed to charge fees predetermined by the state, so fewer victims will sue insurers to pay high medical bills. And insurers will be able to conduct their own physical examinations of victims, submit the results to a "Peer Review Organization" and get a binding decision on whether a treatment is necessary, so fewer suits contesting the appropriateness of treatments will occur.
Second, Prop 200 will reduce the number of uninsured motorists on our roads. Currently every driver is required to carry insurance, but enforcement is a joke, so there are literally millions of uninsured drivers in California. Prop 200 requires proof of insurance for people to register their vehicles. This won't solve the problem entirely, but it should improve it a lot.
Third, Prop 200 abolishes the tort liability of drivers involved in accidents. This means the end of those outrageous "pain and suffering" awards you read so much about, and makes life harder for those "ambulance chasing lawyers" you hear so much about. Any compensation for pain and suffering will come from supplemental pain-and-suffering insurance that drivers will buy for themselves.
Finally, there is a certain philosophical appeal to the concept of no-fault insurance. Under the current system, when you're injured in an accident, you start praying: praying that the guy who hit you has insurance. If your injuries are serious, you pray he's got a gold mine. Because how much compensation a victim can collect often depends more on how well-insured and wealthy the at-fault driver is than how much insurance the victim himself carries. Under no-fault, every driver gets to choose how much compensation he'll receive if, God forbid, he's injured in an accident. No-fault lets each driver be sure of what coverage he'll get, instead of leaving it to divine providence. This seems fairer.
"Okay, I'm convinced" you blurt. "But, wait, don't you oppose Prop 200?" Yes, I oppose it. Here's why:
Prop 200's reduction in lawsuits will save a big pile of money for the insurance industry. So will 200's limits on medical fees and procedures, and its elimination of those darned pain and suffering awards. And 200's requirement of proof of insurance to register will mean fewer uninsured drivers, saving even more money for insurers on "uninsured motorist" claims. This all might be good if Prop 200 contained some provision requiring insurers to pass the savings on to you and me, but it doesn't. Do you think your friendly insurance company, still smarting from the regulations imposed by Prop 103, will voluntarily reduce its rates? Really?
Without mandatory rate reductions, the only changes we'll see from Prop 200 are the restrictions it places on us. Prop 200 will restrict our choice of the kinds of treatment we may seek for injuries to those approved by the Peer Review Organization. It will restrict our choice of doctors to those willing to work for state-mandated fees. It will restrict our ability to seek compensation from truly negligent drivers. It will restrict the privacy of our persons (with its requirement that we submit to a physical examination at an insurance company's request). And it will eliminate our ability to collect reasonable, legitimate pain-and-suffering compensation unless we had the means and foresight to buy a supplemental policy.
Yes, if 200 passes our courtrooms may be less crowded and some sleazy lawyers may be put out of business. But this won't affect most people. Without any mandate to pass insurance company savings to consumers, Prop 200's cost controls amount to special interest legislation for the insurance industry, and will be of no benefit to you and me.
Imagine you're the president of a company whose stock is traded publicly. As president, you have access to inside information, like sales figures, merger negotiations and impending layoffs, that will affect the stock's price when it becomes known to the general public. It's illegal for you to misrepresent or leak this information to manipulate the stock's price. But, hey, the laws are vague, and you could really profit, so you might find yourself doing something "a little borderline." After all, the "victims" from whom you'd reap your huge profits are faceless and diffuse; they'd probably never even notice.
More and more often, however, savvy stockholders do notice. And what do these stockholders do if they believe your misconduct has reduced the value of their stock? All together now: They sue!
This is bad news for President You. If you lose or settle the case it will cost your company a kazillion dollars. But win or lose, your legal costs will be high, the case will be a distraction, and you'll be branded a swindler. Worst of all, any Yahoo out there can buy your stock, claim you've misbehaved, hire a lawyer on contingency (see Prop 202), and give you a big headache. Isn't there something you can do to avoid this kind of nuisance?
Prop 201 is your answer. Prop 201 will prevent most shareholder lawsuits by making the plaintiffs (those who sue) pay the corporation's legal costs if the plaintiffs lose the case. To ensure they can pay, the plaintiffs can be required to post bonds for millions of dollars up front. This will freeze out nearly all lawsuits from small investors and many from larger ones. Prop 201 will require shareholders to be much more certain of victory before they sue.
This is good news for President You. Fewer lawsuits will be filed. Those shareholders who do file suits will be more willing to settle for smaller amounts, since they'll have more at stake. From your perspective, Prop 201 levels the playing field and makes you less vulnerable.
But what about the perspective of Joe Stockholder? Unless Joe is a large investor (like a pension fund), he won't be able to post the bond for the corporation's legal costs. So even if Joe has a slam-dunk case against the corporation, Prop 201 may prevent him from suing. The corporation may have deliberately violated the Corporations Code, but Joe will never recover his lost investment. Traditionally the courts have been the only place in our country where the little guy has a chance against big business. Prop 201 takes that chance away.
Yes, Prop 201 contains mitigating provisions. Courts are not required to make plaintiffs post bonds for corporations' legal fees. The court may reduce or even eliminate the losers' payment if the lawsuit was "substantially justified." And if the suit is successful, the corporations must pay the plaintiffs' legal fees. All well and good. But none of these is guaranteed to happen, so small-time plaintiffs will still risk financial ruin when they sue. Prop 201 will seriously erode shareholders' ability to sue corporations that don't play fair. I feel sorry for executives who must endure frivolous lawsuits from mercenary attorneys, but Prop 201 is too strong; it throws out the baby with the bath water.
"The first thing we do, let's kill all the lawyers."
Lawyers hired by individuals to pursue tort cases are usually paid on a "contingency" basis, receiving a percentage of the award if the case is won or settled, but little or nothing if the case is lost. This arrangement is the only way most people can afford to try to recover damages from well-funded corporate defendants. Generally the lawyer's take is between 25 and 40 percent of the award. If this seems high to you, remember that (1) lawyers collect it only when they win; otherwise their take is zero, so the actual average is much lower, (2) most people couldn't afford a lawyer's regular rate (nearly always over $100/hour), and (3) judges are currently allowed to reduce contingent fees if they are too high.
Prop 202 will impose a hard limit of 15% on contingency fees that plaintiffs' attorneys can collect in most tort cases. To make the limit kick in, a defendant must offer to settle the case out of court within sixty days of the plaintiff's original demand for compensation. If the plaintiff agrees to settle, his lawyer will be limited to 15% of the settlement. If the case goes to trial and the plaintiff wins, his lawyer will be limited to 15% of the amount that was offered in settlement, but not limited on any award above that.
The main idea behind 202 is to reduce the number of pesky tort cases by making it pay less for the lawyers. And that it will. But do you know who will really suffer when it becomes harder to sue for damages? We will. You and I. Ordinary folks, unexpectedly victimized by a manufacturer, insurer or motorist, only seeking reasonable compensation. Prop 202 will tilt the tables against us, not just our lawyers. Prop 202 will make our lives less fair.
Remember the old Looney Tunes cartoon where Tweety points out a fly on Sylvester's forehead? Sylvester grabs a huge mallet and whacks himself silly, resulting in the usual circling stars and six-inch-high welt. Yes, bounty-hunting, ambulance-chasing lawyers are de-thpicable. But if we try to swat them, we'll only be hurting ourselves by limiting our own access to the courts.
(Please see My semi-biennial lecture on bonds for my opinions on bonds in general.)
Prop 203 will provide $2 billion for construction and renovation of elementary, junior high and high schools. It will also provide $1 billion for construction and renovation of community colleges and public university campuses. The rules for spending most of Prop 203's funds emphasize safety. The priorities include earthquake safety, lead and asbestos abatement and school security. Also on the list are air conditioning/insulation to allow money-saving year-round school sessions, classrooms for severely handicapped pupils, and wiring for computer networks.
Before Proposition 13, most school districts funded their own construction. But local districts can no longer afford this, so the state has taken over. Between 1982 and 1992, voters approved about four billions dollars in school construction bonds. That money has all been used. Since then all school construction bond measures have been defeated, leaving the state essentially without any money to build or modernize school buildings. There are $6.6 billion worth of school and college construction projects that need funding in the next five years. Prop 203 is a chance for us to meet at least part of that need, and stop California's education systems from falling deeper into the abyss into which they have been sliding since Prop 13 was passed.
When California wants to finance a large project, it asks the voters for permission to take out a loan. Props 192 and 203 are just such requests. If the voters approve, the legislature may take out loans for the projects by selling general obligation bonds, which are paid back with interest over 20 or 25 years. The bond payments come out of the state's main budget, the General Fund. So when we vote on the bonds, we are really voting on whether the project in question ought to be added to the state's budget.
"Wait a minute!" I hear you cry. "What about those interest payments? Won't we end up paying more for interest than for the bonds themselves?" This used to be the case, but with today's low interest rates each dollar of bond money will cost only twenty-five cents in interest, accounting for inflation. (See page 54 of your first ballot pamphlet for details.)
"Okay," you admit, "but loans are still more expensive than pay-as-you-go." It's true, they are. But loans are the only way to buy a house, or a car, or anything else that you need immediately but can't pay for yet. It's worth paying the premium of interest to get the funding now.
"Well and good," you continue, "but there are five billion dollars in bonds on this ballot. Isn't that too much to borrow?" For you, yes, but the State of California can handle it. Current bond payments total about 5.1% of the General Fund; this ballot's bonds would raise it to just 5.3%, still within reasonable limits. We had a budget surplus this year, remember, so this is hardly a budget buster.
Props 192 and 203 will fund only long-lived, tangible acquisitions, like school buildings and highway bridges. It's sensible to make extended payments for items which will be used far into the future. Remember, too, that California's population continues to grow by hundreds of thousands of people a year. Borrowing makes particular sense if you know your income will go up in the future. As the state grows and the economy recovers, the General Fund will certainly grow too.
There is one last reason to vote for a bond measure. In addition to being formal requests for permission to take out "loans," bond measures are also looked upon as referenda on the merits of the proposed projects. If a bond measure fails, legislators are likely to believe that the public feels the project is not worthy of receiving any state funding. You may have meant, "yes on the project but no on the bonds," but your message to Sacramento will read, "no on the project." So if you vote down a bond measure just because you don't like bonds, you may well have killed forever the project the bonds were to have funded.