I’ve spent a bunch of time in the last couple weeks learning about the statewide ballot initiatives in front of me for the November 6th election. These are my notes on how I’m thinking of voting, though I remain (evermore) open to compelling contrary arguments. Contact me up in person if you know me or on Twitter if you don’t. I’ll write something about local measures, candidates etc. later.

Before I dig into my thoughts on people and propositions, a word of framing. I think ballot initiatives are a sometimes useful but mostly destructive tool of excessive democracy in California. I know that this is not a very popular or populist opinion, but I believe history is on my side. Please read about Proposition 13 and the Gann limit if you think props are just a fun exercise in direct democracy. Also we are all busy people and mostly don’t have time to fully evaluate ballot propositions ourselves. There is a reason we elect representatives to run offices that do this for us. Nonetheless, we find ourselves with a crop of interesting and pretty strange initiatives and we gotta choose. My attitude is that the people who put the initiative on the ballot always want it to pass, so you should presumptively vote “no” if you reject the premise. In some cases I think the need is sufficiently compelling that I am gonna vote “yes”, but I’m always leaning “no” on these propositions.

An important caveat to the above - Props 1, 2 & 7 were put on the ballot by the state legislature, which makes me feel a little more positively disposed towards them - i.e. that they are products of research & representative democracy. All the other propositions on the ballot are voter initiated and, as such, deserve a very skeptical eye. It is very expensive to put a proposition on the statewide ballot and people/organization don’t spend that kind of money lightly.

Statewide Propositions

  • Proposition 1: Legislative Bond Measure 4 billion in bond funds for homeless and veteran’s housing - yes
  • Proposition 2: Legislative State Statute Authorize state use of mental health funds for housing - yes
  • Proposition 3: Almost 9 billion in bond funding for water projects - tentative no
  • Proposition 4: 1.5 billion in bond funding for Children’s hospitals - tentative yes
  • Proposition 5: Extension of tax transfer right for homeowners over 55 - strong no
  • Proposition 6: Repeal of last year’s gas tax increase, requires public vote on future increases - strong no
  • Proposition 7: Legislative State Statute Authorizes CA legislature to adopt permanent daylight savings time - tentative no
  • Proposition 8: Limits the profits of dialysis clinics - tentative no
  • Proposition 9: Split CA into 3, but No longer on the ballot!
  • Proposition 10: Costa-Hawkins repeal, rent control up to cities - tentative yes
  • Proposition 11: Allow ambulance workers to remain on call during paid breaks - no
  • Proposition 12: Ban sale of meat & eggs from animals grown in confined spaces with certain dimensions - yes

Proposition 1

Homelessness and rampant poverty are, to my mind, the core moral failures of contemporary California. There is some concern about how these bonds will be repaid (see below), how this money would be spent and how it would affect other forms of housing assistance. But there is now abundant and strong evidence for housing-first as a means of addressing many poverty-related ills. I am willing to overcome my general opposition to ballot propositions in favor of a strong ethical statement that the homeless should be housed - i.e. that we should live in a more giving society.

Proposition 2

See above - housing first is probably the most important tool we have in addressing homelessness and the mental health of homeless people. Also - CA was already spending mental health dollars on housing, but was challenged in the state courts. This proposition is a means of allowing California to finish construction on projects that have already begun.

Proposition 3

This proposition is designed to have wide popular appeal by attempting to address a problem dear to the hearts of Californians - water shortage. However, if you look at the list of supporters, it includes several agricultural lobbies. The sensible-sounding opposition to this proposal (e.g. from the Sierra Club and LA Times) argues that this proposition shifts the costs of building and maintaining water infrastructure from the major consumers (e.g. agriculture) onto taxpayers. I tend to agree that improvements to water infrastructure should be paid for by the companies that use the bulk of CA water (no individuals use a sizable fraction of CA water).

Proposition 4

Children’s hospitals are the de facto source of health care for many Californian children. This is not a good status quo - we should have a more comprehensive healthcare system in California and in the US - but we don’t. Most of the revenue from Prop 4 goes to non-profit and UC hospitals, though 10% goes to private hospitals with childrens units. The money is ostensibly for construction and improvement projects. I’m leaning “yes” on this one.

Proposition 5

Proposition 5 takes a big existing tax benefit for people older than 55 and makes it much bigger. The current state of affairs (as of prop 60 in 1986) is that Californians who are over 55 or severely disabled get to keep their current tax assessment when they move to a house of lesser or equal value in the same county. Proposition 5 removes both restrictions - allowing older and disabled Californians to transfer their tax assessment (using an updated formula) out of the county and to houses of greater value. This proposition is both a huge wealth transfer to wealthy older Californians and also phenomenally expensive - estimated to cost upwards of 1 BILLION DOLLAS PER YEAR. Vote no no no no. A thousand times no.

Proposition 6

Repeals the gas tax that was passed last year by ballot initiative. The gas tax is supposed fund improvements to California’s abysmall roads (have you ridden a bike in Oakland, friend?) and fund transit projects (including but not at all limited to high speed rail). Although gas taxes are regressive and affect the poor more than the rich in transit-poor California, we need the money for the roads and transit and it makes sense that drivers should shoulder some of that burden. Gas taxes are also on an item with negative externalities - gas makes CO2, driving is dangerous and commuting long distances is unhealthy. Vote “no” on prop 6 to keep the gas tax in place please.

Proposition 7

Having a hard time getting motivated about this one. Have read a lot of conflicting thoughts. Thinking of voting no on general opposition to ballot initiatives. Convince me this is important.

Proposition 8

Prop 8 is advanced by dialysis clinic staffers. This measure attempts to increase staffing and pay in dialysis clinics by limiting the profits of dialysis clinics to 15% above costs. Any profits above that would need to be refunded to patient insurance. On the one hand I am in favor of good working conditions and adequate staffind at all California businesses and medical institutions. On the other hand I am not sure that a specific remedy for dialysis clinics warrants another ballot prop. Leaning no on this one.

Proposition 10

Prop 10 repeals the 1995 Costa Hawkins law that prevented CA cities from making new rent control regulations. As a result of Costa Hawkins, rent control is restricted to older buildings in all CA cities. Voting yes on Prop 10 would enable CA cities to enact new rent control. Many cities would do this (e.g. Oakland, SF, Berkeley). There are strong arguments on economic grounds that rent control restricts housing supply, but these are quantitative arguments - i.e. it depends how strictly you control the rent, how much of the housing stock is under rent control and how much demand there is for housing. Some cities would no doubt enact highly restrictive rent control laws to discourage local development (e.g. Beverly Hills). Prop 10 also increases local control of housing by allowing individual cities to determine rent control rather than making policy at the state level. Many CA cities advance a philosophy of extreme local control to avoid building housing to regional or statewide targets, so you might reasonably be skeptical of prop 10 on those grounds. Still, considering all these factors, I think displacement in CA is so massive and the value of stability is so high that I support prop 10 and will probably vote yes.

Proposition 11

This is a small dispute wherein private ambulance companies are trying to pre-empt any future claims that ambulance workers should get breaks where they are off-call i.e. where their radios are off. Voting no is a win-win here - you can lodge a protest vote against piddling propositions and also support labor against management (if that’s your thing).

Proposition 12

Sale of meat and eggs that are the product of confinement was already illegal in CA as of prop 2 in 2008. This year Prop 12 gives those restrictions some teeth by providing numerical definitions of confinment and means of enforcement. Ballotopedia has a nice summary here. I am in favor of this change for two reasons. First, less suffering for living animals is clearly good. Second this will likely increase the price of meat and eggs in California, which should produce a reasonable reduction in overall meat consumption. Meat consumption in particular (not eggs) has been shown to be quite price-responsive (average elasticities of 0.8 if you know what I mean) and meat consumption is a very large source of greenhouse gas emissions. Beef alone is responsible for perhaps 20% of US emissions (CO2 equivalent units). I’m gonna vote yes.

A Word on Bond Measures and CA Taxes

There are 3 propositions on this ballot that authorize the state to sell new bonds (props 1, 3 & 4). Prop 2 authorizes the state to use funds that were generated by previous bond sales (Prop 63 in 2004) and Propositions 5-6 will affect property and gas tax revenue respectively if passed. In order to think about these measures, it’s important to understand how the CA tax system works, at least rudimentarily.

First - California is not a low tax state. California is has the 10th highest per-capita tax revenue of any state and generates about 20% more tax revenue per resident than the average state. This is no surprise - Calfornia has a big economy and a large fraction of America’s ultra-wealthy individuals. However, due to Proposition 13, California collects very little of its revenue as property taxes even though California property is among the most valuable in the US. Prop 13 was passed in 1978 and (1) capped annual increases in corporate and personal property taxes at 2%, (2) capped the total tax at 1% of the property value and (3) declared that property values are only reassessed at the time of sale.

Prop 13 has wrought several big and durable effects on CA tax revenue. First, local tax revenue immediately dropped after the introduction of Prop 13 and forced municipalities to adopt other tax measures to make up the difference. These sources of funding are often regressive taxes - i.e. taxes that affect the poor more than the rich - like sales taxes. Moreover, Prop 13 causes property tax revenue to decrease in time (in real dollars) because the 2% cap on property tax increases is less than the historical inflation rate in the US (long term average of about 3%). Rather than strictly “stabilizing” property tax, Prop 13 causes older people and companies (that hold onto property) to pay taxes that decrease over time. This essentially requires people who are young and/or don’t own property to pay more taxes to cover the difference in revenue. This is the state of affairs in California - we are a low property tax state on average. At the state level we make up the difference with a mixture of sales tax and progressive income taxes but at the local level we make up the difference with parcel taxes (taxes that are not pegged to the price of land) and sales taxes.

All of this to say that bond measures authorize the state to sell bonds to get money now. The bonds are a state obligation to repay the money at a fixed interest rate in the future. The future repayment comes out of tax revenue. So when we authorize new bonds we are often authorizing new taxes in the future. Because it is hard/impossible for California to raise property taxes right now, future revenue will likely come from sales and income tax increases. California is already a high sales tax state and high sales taxes are an unethical way of collecting tax revenue in my view because they disproportionately affect poor people. All this gives me some pause about bond measures even though I am generally in favor of well-managed state programs funded through taxation.