The Ambivalent Legacy of California Proposition 13 (1978)
It was almost a cult of personality. Once you removed the personality, it was all over. He cited a number of factors that contributed to its demise. During the s the courts ruled that the city could no longer fire people for political reasons. Urban crime increased. Television also made a difference. Candidates could now communicate with voters directly instead of through a political organization. The key factor in the death of the machine was the rise of racial politics.
Machines work best in an issueless environment. Machine politicians are concerned with material resources, such as jobs, contracts, and benefits. Once divisions over issues emerge, groups begin to see one another as opponents rather than competitors. Their goals become mutually exclusive.
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The black-power movement introduced the politics of polarization into American cities during the s. That made it difficult for political machines to survive. Blacks could no longer be bought off. They challenged the machines that had excluded them from power, and whites responded fearfully and aggressively. In a polarized environment candidates typically win overwhelming majorities from one race and almost no votes from the other.
The days of across-the-board machine majorities are over. Racial politics destroyed the Chicago machine, and it endangers the presidential candidacies of both George Bush and Michael Dukakis. Neither is a particularly ideological politician, and so both ought to do well in Illinois.
But racial politics creates pitfalls for each of them. When Harold Washington was first elected mayor, in , Chicago experienced something new. Tom Roeser, who describes himself as a movement conservative, called it "movement politics. Washington's mobilization of black voters sparked a countermobilization of white ethnics, the people who had been the backbone of the Daley machine.
The symbol of their resentment was "Fast Eddie" Vrdolyak, the leader of the anti-Washington movement in the so-called council wars of Once the Cook County Democratic Party chairman, Vrdolyak left the party to run unsuccessfully against Washington for mayor in He has now joined the Republican Party, which nominated him for clerk of the Cook County circuit court this year, an important patronage position. Vrdolyak symbolizes the white-ethnic problem that Democrats have been having in cities all over the country for the past twenty years.
The rise of the black-power movement and the outbreak of urban violence in the late s stimulated a law-and-order backlash among urban working-class whites. While conservatives and racist whites were leaving the Democratic Party in the South, "urban populists" were drifting toward the Republican Party in the North: George Wallace, meet Archie Bunker. They saw it as strengthening their own hand.
The trend seems to be for white ethnics to vote Republican, particularly in national and statewide elections. But they rarely become Republicans, because the action in local races is still on the Democratic ballot. He noted that Vrdolyak did not bring any major white-ethnic committeemen with him into the Republican Party, even though Washington had cut off their patronage. They had their revenge, however, after Washington's death, last November.
Twenty-four white aldermen joined with five blacks to make Eugene Sawyer Chicago's acting mayor. Sawyer, a black, was a staunch ally of the Daley machine who sometimes consorted with Mayor Washington's enemies during the council wars. Sawyer is the kind of black politician white ethnics feel they can "deal with. Like Washington, Vrdolyak thrives on racial polarization. Republicans are actually of two minds about that.
Ed Murnane is a good example of white ethnic realignment.
- Unbound (The Bound Tetralogy Book 3);
- Blood Awakening: Book 1 of the Broken Lands Trilogy.
- California Proposition 13 - Wikipedia.
I'm an Irish Catholic. The first campaign I was ever involved in was in , when I delivered literature for Jack Kennedy. My family is an Irish, union, blue-collar family with a couple of priests and nuns, a typical Irish Catholic family. Everyone in my family, with the exception of my father, was an avid Ronald Reagan supporter in and again in I asked Murnane whether he considered Vrdolyak a racist. Then he said, "Even if he is a racist, I'm not sure it's a negative issue in the Republican Party, because there are a lot of other people who feel the same way. A lot of people who moved from Chicago out to the suburbs did it for that reason.
They see the city changing and they say, 'Let's move out. Is that going to hurt him in the Republican Party? Maybe not. In the end, the race issue works both ways for Republicans. According to Bruce DuMont, Republican leaders were a little nervous about putting a candidate like Vrdolyak on the party ticket. That will increase the likelihood of Democrats' carrying the state. The Bush people were not happy with Vrdolyak, because in their view, it will only ignite the black vote, and that will go against him.
Northern white ethnics and white southerners are the swing voters of American politics. People continue to vote Democratic in local elections, where ideological conflicts are muted. But they leave the Democratic Party in large numbers when they vote for higher offices, where ideology is more salient. DuMont predicted that "just as the southern swing voters of and '84 aren't ready to move back to the Democrats for President, you'll find the same pattern in Chicago. I think it will now move to Cook County.
It is spreading. It has already spread to presidential politics. Racial antagonism was very close to the surface in this year's Illinois Democratic presidential primary. Jackson voters were slightly positive toward Simon and slightly negative toward Dukakis. As in most of this year's Democratic primaries, the Illinois vote was deeply polarized along racial lines.
Jackson carried more than 90 percent of the black vote but only seven percent of the white vote in his home state. In fact, a pattern became evident in the Democratic primaries this year: the higher the percentage of blacks in a state, the worse Jackson did among white voters. Thus Jackson did better among white voters in Wisconsin than in Illinois; he did better among whites in Connecticut than in New York.
But those voters will be watching very carefully to see how his relationship with Jesse Jackson develops, especially at the Democratic National convention. I asked the New York political consultant David Garth whether as a result of the tax-reform bill and the Wall Street crash, the Reagan Administration could be portrayed as anti-New York. The question provoked him. You understand? We are not one of these small states. We're the power boys. We can't be hurt by some schmuck actor from California. We were not threatened by Jimmy Carter.
We're New York. Hey, New York's got big balls. Koch has a big pair and so does Mario. I started to smile when you talked about Ronald Reagan hurting New York. That old fart's not going to hurt New York. He can't do a thing to us. Any way he turns, he needs us. No one would deny that New York is still the money center of the United States. But it is hard to argue that New York is what it once was, the imperial center of American culture and politics.
Not after the narrowly averted fiscal collapse of New York City in the mids. Most revealing, perhaps, is what has happened to the Republican Party of New York. As the political consultant David Sawyer observed, "The Republican Party in this state was for generations the leader of the moderate establishment wing of the national Republican Party. That position has eroded completely. Nelson Rockefeller, who dominated New York politics for thirty years, is gone. So is Jacob Javits, the U. And almost gone is the kind of moderate Republican politics they represented.
But then, so has George Bush. There was no great mystery to how Nelson Rockefeller dominated the Republican Party. He did it with money. Many were on the public payroll, but a lot of them were in other things that the Rockefeller family had control of. He owned the Republican Party. Did he leave a political legacy? Timothy Russert, a former aide to Senator Daniel Patrick Moynihan and Governor Mario Cuomo, said, "Rockefeller probably extended the run of moderate Republicanism in New York and other places, and for that he deserves credit.
Could he have stopped the tidal wave of conservatism? There's no way. There are two Republican parties in New York now. One is the legislative party that controls the state senate in Albany, which has its base in the rural areas of upstate New York. The state senate is the last refuge of Rockefeller Republicanism. Who passes tax increases? Who passes school aid every year? They're really not a Reagan party. The other is the Republican Party in the New York suburbs, which is far more ethnic and conservative and activist.
That is the Reagan party. Richard Rosenbaum, the state party chairman from to and one of Rockefeller's chief lieutenants, acknowledged that since the days of Nelson Rockefeller "there has been an erosion of the center of the party and a movement to the right," although, he added, the right-wing social issues like abortion and school prayer which "are near and dear to the hearts of true conservatives are not really part of the dogma of the Republican Party of this state.
They were like myself--younger, brighter, more educated, more concerned about the issues. Auletta observed that politicians who were regarded as right-wingers twenty years ago--John Marchi, who beat John Lindsay in the Republican primary for mayor of New York in , and Alfonse D'Amato, who beat Javits in are seen as moderate Republicans today.
D'Amato's election seemed to signal a sharp shift of the Republican Party to the right. But D'Amato moved quickly to the center and became a pragmatist. But the inexorable logic of New York politics pulls those Republicans who get elected back to the center. The new forces are mostly white-ethnic voters.
Russert remarked that "all the ethnics who fled [Buffalo] and went to the suburbs became Republican. Among white Catholics, however, the trend is clear. They tend to dominate the party in the New York suburbs. In several interviews I advanced the hypothesis that Italian voters are now a core Republican constituency, just as Jewish voters are a core Democratic group.
Auletta agreed with me, but Russert, who is a close observer of the polls in New York, cautioned that Italian voters are still split fifty-fifty in party registration, whereas Jews remain overwhelmingly Democratic. Nonetheless, he agreed that it is "becoming more and more true that Italian ethnics are likely to vote Republican.
Mario Cuomo clearly cuts into the Republicans' Italian vote. But it took some time even for him to establish his base.
In his first race for governor, in , Cuomo lost the white Catholic vote to the Republican Lewis Lehrman, who was Jewish at that time he has since converted to Roman Catholicism. Cuomo carried Italian voters only narrowly that year. As Auletta recalled, Lehrman sent out millions of pieces of direct mail on the subjects of the death penalty and abortion during the last few days of the campaign.
The Ambivalent Legacy of California Proposition 13 () by Renard Teipelke | Waterstones
He was scared, literally scared, that the Lehrman thing would shift the tide and he could lose the race. Clearly, it was moving. The polls the previous week indicated a huge gap. No one expected Lehrman to do as well as he did. The only thing that would account for it was those mailings. The Republican primary, in which Marchi defeated Lindsay for mayor, turned out to be prophetic. When Lindsay eventually ran for President, in , it was as a Democrat.
I asked Richard Rosenbaum whom else he would associate with the liberal wing of the Republican Party. Kemp Hannon insisted that the Republicans' success with ethnic voters has more to do with economic than with social issues. In fact, his advice to Republicans was "Avoid social issues. I have not seen that. I pointed out that most of the Republicans I had spoken to insisted that Republican gains in New York were due more to economics than to race.
The reality, he said, was more complicated. In his opinion, Republicans are beneficiaries of racial tensions within the Democratic Party. In his view, "For Republicans to run a campaign that was anti-black would be a terrible error. The point is, they don't have to. In Presidential elections New York is still more Democratic than most states Democrats have averaged 46 percent of the New York vote in the past five presidential elections, compared with 44 percent for Illinois and 42 percent for the nation as a whole. As Tim Russert observed, "New York is disposed to vote for a moderate or even a moderately liberal Democrat, but not a liberal Democrat.
If candidates are viewed as isolationist in foreign policy, soft on crime, big spenders on domestic programs, and activist liberals on social issues, they're dead. They may lose New York by only ten points, as opposed to thirty points in Utah, but they lose. And that is where liberal Democrats have been most vulnerable. In fact, this spring the polls showed Dukakis leading Bush by six to eight points. In Manhattan ideology is everything. If you went around here and asked people what kind of Democrat they are, they'd say, 'What do you mean?
I'm a Democrat. Upstate New York in many ways resembles downstate Illinois. They are economically distressed regions Crangle remarked that Buffalo has never climbed out of the recession. They are insulated from the racial and ideological conflicts of New York City and Chicago. And the Democrats continue to do pretty well in both places, particularly in comparison with the suburbs. The problem is that these areas are declining in population and remain largely outside the mainstream of Democratic Party debate.
Crangle told me with some pride that in general elections upstate New York now casts slightly more votes on the Democratic line than New York City does. But he acknowledged that 70 percent of the state's Democratic primary vote still comes from the New York City area. The reason is turnout.
New York City still has basically a one-party system, and so Democratic primaries are where the action is. New York City still chooses the candidates. Upstate "unhyphenated" Democrats have no choice but to vote for them. In New York, unlike Illinois, race is an issue that people seemed uncomfortable dealing with--at least on the record. Off the record, however, they discussed the race issue as if it were a dirty secret.
A disillusioned liberal I met with brought up "a central fact about American politics that is like having an elephant in the room. He explained that Democrats began to lose people's trust "in the late sixties and seventies, when we were pretending that the riots weren't really going on, that people weren't really getting hit over the head. You look at the slide in the Democratic vote. It is directly correlated with the crime indices. In his view, the Republicans don't even have to talk about "the social issue.
Edward Koch has been elected and re-elected mayor of New York by appealing to racial resentment. Mario Cuomo also has gotten elected and re-elected, and so has Senator Daniel Patrick Moynihan, although neither has made an explicit appeal to racial resentment. They have managed to hold on to the support of white middle-class voters who have otherwise been drifting away from the Democratic Party. Have they all done it the same way, or in different ways?
I asked a New York political consultant if he had ever worked for or against Mario Cuomo in a political campaign. Cuomo does not present the conventional image of a liberal. In fact, Joe Crangle remarked to me that one reason the governor's race between Cuomo and Lehrman was so close was that the voters really didn't know much about Cuomo.
Governor Cuomo will never have that kind of a close race again. He projects a sense of values shared with middle-class voters. Ken Auletta told me about the time he invited Cuomo to attend the course he was giving on the Cuomo governorship. You've experimented with support services and other programs, but they haven't had an appreciable effect. What do you do about this problem? On some issues, of course, the governor's views are a little "advanced"- notably abortion and the death penalty.
He defuses his vulnerability on these issues, however, by analyzing them publicly as moral and intellectual problems and as matters of conscience. Cuomo's keynote speech to the Democratic National Convention was a ringing affirmation of Democratic values. As Laurence Kirwan, the state's Democratic Party chairman, put it, "When people ask what the Democratic Party stands for, you can turn right to Mario's speech.
Auletta, one of the leading experts on the Cuomo record, calls him an "incrementalist" and a "tinkerer. Moreover, in his dealings with the state legislature "he has been more conciliatory than combative. Tim Russert, who worked as Governor Cuomo's general counsel, agrees that "when national Democrats heard the keynote speech, they believed it was a call to arms.
But when Cuomo quells a prison riot, when he refuses to raise broad-based taxes, he is the quintessential centrist to New Yorkers. The liberal Manhattan Democrat is not tolerant and is not understanding of a person's social and cultural background. Many liberal Democrats think that if you don't agree with their viewpoint, you're not a Democrat. Then "there's the person who goes into politics because he really wants to help people, he gets turned on by people"--in other words, a pragmatist.
In Crangle's view, "Carter didn't really enjoy people. Kennedy enjoyed people. Governor Cuomo enjoys people. Mayor Koch is much more of a controversialist. According to Auletta, "Koch personalizes things to a great extent. He is a hater" That is one reason why Koch got into trouble with corruption, Auletta believes. Koch's behavior in this year's New York Democratic presidential primary was widely criticized as disgraceful.
In his attacks on Jesse Jackson he deliberately stirred up tensions between blacks and Jews. But there was one big difference: Democrats in New York responded negatively to Koch's confrontationalism. His candidate, Senator Albert Gore, Jr. New Yorkers gave a decisive victory to Dukakis, who stayed as far away from racial politics as possible.
Senator Moynihan's appeal is based on something quite different--more like stature. Kirwan called him "a world-class senator and one of the most significant thinkers in Congress. Moynihan is one of them. Cuomo, Koch, and Moynihan appear to have solved the problem that looms largest over the national Democratic Party--holding on to the white middle class. Russert said, "There is a middle class that was part of the New Deal Democratic coalition. These are people who moved to the suburbs and became moderately affluent, whose hearts are Democratic but whose minds have become Republican.
But they can return to the Democratic fold. But economics is real too. They're on the margins. They take care of their mothers and fathers who still live in the city, and they're paying for their kids' going to college. They don't want to be hurt in their pocketbooks. If they have a sense that someone's too radical, liberal, or conservative, they punish him.
All other things being equal, their instincts are to vote Democratic, but in most presidential races all things haven't been equal. They saw no equality between Reagan and Mondale. Cuomo, Koch, and Moynihan appeal to this constituency in different ways. As one Democrat put it to me, "Cuomo appeals to their hopes and Koch appeals to their fears. Not only do the three different approaches work but they work with the same voters. And the national Democratic Party has been unable to use any of them. David Garth told me the story of a "big money guy" from the South with whom he was discussing politicians.
Why do you want a liberal from New York? Ordinary people can't relate to them. Mario, with the big nose and the big chest, even when he talks big words, he's talking to us. He's one of them. They can relate to him. How much of the appeal that these men hold for white middle-class voters has to do with race? A lot, clearly, in Koch's case.
He'll fight with them, and they like it, because they figure it's not pandering. Many observers surmised that Koch's attacks on Jackson in the primary this year represented a calculated shift in tactics. His objective might have been to provoke the black community into running a Jackson-endorsed black candidate against him for mayor next year. Koch may be betting that he could win a straightforward racial contest--but at the possible cost of turning New York City into Chicago.
Moynihan was widely criticized in the black community twenty years ago, when he published his views on the breakdown of the black family, and even more when, as an adviser to President Nixon, he remarked that blacks might benefit from a period of "benign neglect. Cuomo initially made his reputation resolving a racial dispute over a public-housing project in Queens. He has acted as a moderator and a conciliator on racial issues.
But, my disillusioned liberal said, "Ask people what policy in Cuomo's six years in office has been addressed directly to the problems of black people. You can't find any. The first year he was governor, Mario announced that they would provide five million dollars for a study. That's it. They flee, as from the plague, from any suggestion that racial problems should be addressed. What they are in fact fleeing from is the lesson of John Lindsay.
Lindsay polarized the city in the late s by appearing to cave in to black demands. It all comes down to values. Lindsay's values were those of a cosmopolitan WASP elite. Cuomo and Koch are definitely not of that persuasion. The values question seems to be what Joe Crangle was talking about when he complained about the Manhattanization of the New York Democratic Party. I asked him whether he felt the same thing was true of the national Democratic Party--that its image has been Manhattanized.
David Sawyer asserted that New Yorkers would also feel comfortable with Michael Dukakis, because he shares some of Cuomo's appeal. And he has the Massachusetts model. We're comfortable with him. Sawyer said that Dukakis was a "consensus-type character," as opposed to an adversarial figure, like Cuomo. He felt this could be a problem for Dukakis. That's a huge weakness Mike Dukakis has.
They lose when they nominate "soft liberals" like Adlai Stevenson, Hubert Humphrey, George McGovern, and Walter Mondale, each of whom might have been a preacher if he hadn't gone into politics. It is impossible to imagine Truman, Kennedy, or Johnson as a preacher. The Democrats won just once, in , when they nominated a preacher for President. That was because after Watergate the voters wanted someone of unimpeachable character and integrity who would never lie to them.
The experience with Jimmy Carter seemed to many to prove the rule: If you elect a preacher, you will probably get someone who isn't tough enough for the job. Cuomo appears to have the requisite toughness, although he also has a monkish streak he keeps introspective diaries and a more than casual interest in religion he argues theology with archbishops. Dukakis's toughness is not so readily apparent. Like Cuomo's, it has never really been tested. The two politicians seem more similar when it comes to values. Both hold traditional ones--what Sawyer calls "the immigrant saga, better future for my kids, my father working his way up.
That is the Democratic Party's old-time religion, and Cuomo gives a terrific revival speech. Dukakis cannot give that revival speech. Jesse Jackson can, which is one reason why he gave Dukakis trouble in the early primaries and caucuses. In the end, however, Dukakis's pragmatism could be a great advantage. Dukakis is not tied to the old politics as firmly as Cuomo is, and so he is less likely to frighten voters who think the old-time religion sounds like taxing, spending, and inflation.
Sawyer zeroed in on this difference when he observed that "the Democrat has got to have the overlay of the more pragmatic, sensible, and even-handed approach--not New Deal spending or deficits. He combines traditional Democratic values with modern, technocratic abilities and with pragmatism--the ability to get government, business, and labor to work together and solve problems. The exit polls from the New York primary showed that most Democrats who really wanted to vote for Cuomo ended up supporting Dukakis for President.
Sawyer warned that pragmatism and consensus politics can be taken too far. Nevertheless, he said, "that kind of thing is exactly the right position for this part of the country. But first the democrats are going to have to figure out what to do about Texas. Since Texas became a state, in , no Democrat has won the presidency without carrying it. Since Texas has gone Democratic four times, , , and It obviously helped that Lyndon Johnson was on the ticket in and Johnson's influence, along with that of his then-Democratic ally Governor John Connally, probably made the difference in as well, when Hubert Humphrey carried the state by a narrow margin.
What will not help the Democrats this year is George Bush at the top of the Republican ticket. Texas is one of the states that Bush claims as his home he maintains an address at a Houston hotel. Until he won this year's Republican presidential primary, Bush on his own had been on a losing streak in Texas. He was rejected in three statewide elections: for senator in and , and the Republican presidential primary. Like thousands of others, Bush came to Texas to make his fortune in the oil business.
He ended up representing a Houston district in Congress for two terms. In Texas, where chauvinism is a time-honored tradition, that may be enough to qualify him as a favorite son. What do the Democrats have to compete with that? The fact that Michael Dukakis speaks Spanish, for one thing. And something else: an oil bust that has nearly caused the collapse of the Texas economy. Banks are failing, or teetering on the brink. Great fortunes have disappeared. Austin, Houston, and other Texas cities, overdeveloped in the s and early s, have the highest office-vacancy rates in the country.
Unemployment in Texas has been at recession levels since High oil prices in the s and early s created a boom in Texas but threw the nation's economy into turmoil. The process reversed in As oil prices collapsed, Texas went into a dizzying tailspin. The effect of the oil bust on politics has been confused. Back in Texas Republicans scored a big breakthrough when they elected William Clements, the first Republican governor since Reconstruction by a margin of eight tenths of one percent , and re-elected U.
Senator John Tower by a margin of one half of one percent. The Democrats came back in , when Mark White defeated Clements for the governorship and a whole slate of progressive Democrats was elected to statewide office. Then, in and , in the teeth of the oil bust, it was the Republicans who made the big gains. Texas was one of the few states where Reagan had strong coattails in The party picked up five congressional seats, made significant gains in the state legislature, and increased its share of county-level offices by half.
Two years later, in one of the great grudge matches of Texas history, Clements came back to defeat White and regain the governorship for the Republicans. The Republicans have not exactly had an easy time of it, however. Last year the Texas legislature passed the largest tax increase in Texas history. In fact, it is reported to be the largest tax increase in any state's history. Governor Clements, who was already in trouble because of his involvement in a Southern Methodist University football scandal, infuriated Republicans by signing off on the tax bill, thereby violating his campaign pledge not to raise taxes.
Dugger called it "a Mecham problem," referring to the ex governor of Arizona who was impeached and removed from office this year. Virtually every Republican I spoke to talked about the falloff in Republican fund-raising. Texas used to be an abundant source of support for right-wing campaigns all over the country--sort of the Republican Party's Malibu. No more.
John Kelsey, a key operative in Texas Republican politics, explained that the oil bust hurt Republicans in two ways. Wealth has been eroded, which cuts down on discretionary political giving. For years now the Texas Republican Party has been making spectacular gains. Texas voted for Eisenhower in and The Republicans gained a U. Senate seat in and have held it ever since. From to the number of Republican congressional seats rose from four to ten.
The party's holdings have grown from four to six state senate seats, from twenty-two to fifty-six state house seats, and from eighty-seven to county offices. Lance Tarrance, a Houston Republican pollster, noted that Texas Republicans have done particularly well with two constituencies. One is young voters. According to Tarrance, about a quarter of Texas voters have moved to the state since His polls show that native Texans now compose less than half the electorate. It's a media state. It's a no-party state. In Tarrance's view, the oil recession has ended the Republican surge, at least for the time being.
What is over, he argued, is the bandwagon effect: "People said, 'The economy's great, Reagan's great, the Democrats are in bad shape. Maybe we ought to get on the bandwagon. This is not to say that Reagan--or Bush--is in deep trouble in Texas. As George Christian, formerly Lyndon Johnson's press secretary and now a political consultant in Austin, observed, "People don't really blame Reagan. They blame Saudi Arabia.
The amount of taxes available to the municipality in any given year largely depends on the number of property transfers taking place. However, since existing property owners have an incentive to remain in their property and not sell, there are fewer property transfers under this type of property tax system. California also has high rates of migrants from other countries and states,  which has contributed to more demand for housing, and it has low amounts of moderately priced housing due to the increased property tax liability after a sale.
Owners of commercial real estate benefited under the original rules of Proposition If a corporation owning commercial property such as a shopping mall was sold or merged, but the property stayed technically deeded to the corporation, ownership of the property could effectively have changed without triggering Proposition 13's provisions.
Corporations often avoid reassessment by limiting portion of ownership by purchasing in groups where no single party owns more than 50 percent. For example: "In But the deal avoided a reassessment, because 12 Gallo family members individually obtained minority interests. Proposition 13 sets the assessed value of properties at the time of purchase known as an acquisition value system , with a possible 2 percent annual assessment increase. As a result, properties of equal value can have a great amount of variation in their assessed value, even if they are next to each other.
The Case-Shiller housing index shows prices in Los Angeles , San Diego , and San Francisco appreciated percent from the start of available data to while the 2 percent cap only allowed a 67 percent increase in taxes on homes that were not sold during this year period. Local governments in California now use imaginative strategies to maintain or increase revenue due to Proposition 13 and the attendant loss of property tax revenue which formerly went to cities, counties, and other local agencies. For instance, many California local governments have recently sought voter approval for special taxes such as parcel taxes for public services that used to be paid for entirely or partially from property taxes imposed before Proposition 13 became law.
These public services include: streets, water, sewer , electricity, infrastructure, schools, parks, police protection, firefighting units, and penitentiary facilities. Sales tax rates have also increased from 6 percent pre-Proposition 13 level to 8. This subsequently led to the passage of California Proposition in "Right to Vote on Taxes Act" that constitutionally requires voter approval for local government taxes and some nontax levies such as benefit assessments on real property and certain property-related fees and charges.
Proposition 13 disproportionately affects coastal metropolitan areas, such as San Francisco and Los Angeles , where housing prices are higher, relative to inland communities with lower housing prices.
Logic and Propositions
According to the National Bureau of Economic Research , more research would show whether benefits of Proposition 13 outweigh the redistribution of tax base and overall cost in lost tax revenue. Local governments have become more dependent on state funds, which has increased state power over local communities. Due to the reduction in revenue generated from property tax, local governments have become more dependent on sales taxes for general revenue funds, which some maintain has resulted in the "fiscalization of land use".
The fiscalization of land use means that land use decisions are influenced by the ability of a new development to generate revenue. Proposition 13 has increased the incentive for local governments to attract new commercial developments such as big box retailers and car dealerships instead of residential housing developments. This is the result of commercial development's ability to generate revenue for the general fund through sales tax and business licenses tax.
California public schools, which during the s had been ranked nationally as among the best, have deteriorated substantially in many surveys of student achievement. Priest , and Proposition 13 was then passed partially as a result of that case. Prior to implementation of Proposition 13, the state of California saw significant increases in property tax revenue collection "with the share of state and local revenues derived from property taxes increasing from 34 percent at the turn of the decade to 44 percent in Schwartz One measure of K public school spending is the percentage of personal income that a state spends on education.
From a peak of about 4. UCSD Economics professor Julian Betts states: "What all this means for spending is that starting around we saw a sharp reduction in spending on schools. We fell compared to other states dramatically, and we still haven't really caught up to other states.
During the s, school spending per student was almost equal to the national average. Bureau of Economic Analysis and by the Public Policy Institute of California  This has resulted in increased pupil-to-teacher ratios in K public schools in California. Professor Betts observes that "pupil-teacher ratios start to skyrocket in the years immediately after , and a huge gap opens up between pupil-teacher ratios here and in the rest of the country, and we still haven't recovered from that. In spite of California's rank in K education spending, the state has been and remains a global center of innovation and advanced industry which requires many workers with an advanced education.
The commercial success of Silicon Valley occurred after Proposition 13 was enacted. There are currently five California universities in the U. Most of these universities are public. Proposition 13 is consistently popular among California's likely voters, 64 percent of whom were homeowners as of The only demographic group for which less than 50 percent said that Prop 13 was mostly a good thing was African Americans, at 39 percent.
The above-mentioned survey also found that 40 percent of Californians, and 50 percent of likely voters said that Prop 13's supermajority requirement for new special taxes has had a good effect on local government services provided to residents, while 20 percent of both Californians and likely voters said it had a bad effect, and the remainder felt it had no effect. At the same time, a majority of both Californians 55 percent and likely voters 56 percent oppose lowering the supermajority threshold for local special taxes. Hahn , that Proposition 13 was constitutional. Justice Harry Blackmun , writing the majority opinion, noted that California had a "legitimate interest in local neighborhood preservation, continuity, and stability" and that it was acceptable to treat owners who have invested for some time in property differently from new owners.
If one objected to the rules, they could choose not to buy. Nordlinger purchased a property in the Los Angeles area and, under the provisions of Proposition 13, was required to have the property reassessed at a new value. The reassessed value of Nordlinger's property raised her tax rates by 36 percent, while her neighbors continued to pay significantly lower rates on their property.
Disheartened by the disparity in taxation, Nordlinger viewed this reassessment as favoritism in the eyes of the law and elected to bring charges up on the Los Angeles County Tax Assessment office and its primary assessor, Kenneth Hahn. The court ruled in favor of Hahn, affirming Proposition 13 as constitutional. In the California recall election in which Arnold Schwarzenegger was elected governor, his advisor Warren Buffett suggested that Proposition 13 be repealed or changed as a method of balancing the state's budget.
In January , California Governor Jerry Brown was quoted as saying that it wasn't Proposition 13 that was the problem, but "It was what the Legislature did after 13, it was what happened after 13 was passed" because the legislature reduced local authorities' power. In an interview in , California Governor Jerry Brown lamented that he hadn't built up a "war chest" with which to campaign for an alternative to Proposition Governor Brown said he'd learned from his failure in the mids to build a war chest that he could have used to push an alternative to Proposition Governor Brown was definitive that he would not seek to change the law, a third rail in California politics.
This does not imply Palo Alto contributes less property tax per parcel than the rest of the state; in fact, the volume of high-value and recent real estate transactions in the Bay Area due to the success of the technology industry means the median property tax amount per parcel for many Bay Area counties is above the median of the state as a whole.
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- The Lock-in Effect of California's Proposition 13;
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- 1. Introduction.
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San Francisco , in , had the highest density of billionaires of any major city in the world 1 out of every 11, residents for a total of Proposition 8 allowed for a reassessment of real property values in a declining market. It passed with 76 percent of the vote. Between Proposition 58 and Proposition , which extends Proposition 58 to grandparents, a report from California's Legislative Analyst Office found that about 60, inherited properties were exempted from re-assessment in , or 10 percent of all properties transferred that year.
These taxes would always be collected: California taxes all income relevant to the state regardless of where the individual resides. Had this income tax revenue been considered by the Los Angeles Times article, there could potentially be significantly less of a net tax revenue difference in total revenue collected per parcel by both county and state governments combined between a reassessed owner-occupied house and a rented-out property paying below-market property tax but significant income tax.
Proposition 60 allowed homeowners over the age of 55 to transfer the assessed value of their present home to a replacement home if the replacement home is located in the same county, is of equal or lesser value, and purchased within 2 years of sale. Proposition 90 is similar to Proposition 60 in that it allowed homeowners over the age of 55 to transfer the assessed value of their present home to a replacement home if the replacement home is located in a different county, provided the incoming county allows the transfer.
It passed with 67 percent of the vote. Proposition "Right to Vote on Taxes Act" was an initiative constitutional amendment approved by California voters on November 5, The proposition established strict constitutional limits on the ability of local governments to levy benefit assessments on real property and property-related fees and charges such as those for utility services to property.
It also requires voter approval before a local government, including a charter city , may impose, increase, or extend any local tax. Proposition 26 added a constitutional definition of "tax" for purposes of the two-thirds legislative vote requirement for state taxes under Proposition Proposition 5 would have extended California Proposition 60 and California Proposition 90 by providing property tax savings to all homeowners who are over age 55 or who meet other qualifications when they move to a different home.
The California Schools and Local Communities Funding Act of  is an initiative constitutional amendment eligible to appear on the November California statewide ballot  that would amend Proposition 13 to require the reassessment of commercial and industrial properties at market value, including commercial and industrial property owned by a natural person.
Residential properties are excluded from this potential policy, and would continue to be reassessed under the original requirements of Proposition 13 when property ownership changes or when new construction is done. Property tax rates would not change, and there would be a qualified exception for some small businesses.
This initiative, often referred to as "split roll", was created in part to address the practice of businesses exploiting a loophole in Proposition 13 implementing statutes  that define what constitutes a change in property ownership for purposes of the required property reassessment under Proposition This loophole arises from Proposition 13 implementing statutes enacted by the California Legislature that define a change in ownership as a partnership that takes more than 50 percent control of the ownership of a piece of property.
This would therefore entail an additional 2. Some supporters of the initiative point out that most states in the U. Some opponents of the initiative, such as former California State Senator and current Board of Equalization member George Runner , argue that the initiative would harm consumers and the economy by significantly increasing business owners' operating costs, which would be passed on to customers. An opponent of the measure, Jon Coupal, president of the Howard Jarvis Taxpayers Association, noted that: "California has the highest income tax rate in America, we have the highest sales tax in America, we have the highest gas tax in America.
Some people contend that this is a way for state and local governments to pay off their unfunded pension liabilities rather than reforming the generous pension systems adopted not because of market necessity, but because of unions' political power and bad legislative choices by reducing payouts and making employees pay a larger share toward their pensions. Priest , 5 Cal. Since this initiative is such a buzzword in politics, the media, and academia, I will show why Proposition 13 has been both the darling of California citizens and the scapegoat for everything that has presumably gone wrong in the state.
I will do so by presenting my findings in three parts:. With respect to the political impact of the initiative, I will show that the. I will underscore the relation between direct democracy and Proposition 13 and identify possible positive results and repercussions of the initiative process as it is used in California. By analyzing Proposition 13 along this tripartite structure, I will indirectly use a chronological approach, starting with the ballot success and then turning to the developments over time. In order to understand why Proposition 13 was so overwhelmingly approved by California voters in , one must look at the years preceding the initiative.
On the one side, California became the model for the United States offering Americans and foreigners plenty of economic opportunities in a relatively liberal social life. Reagan serving as Governor of California during the Bloody Thursday at the University of California in Berkeley , the Golden State also showed its other, conflict-ridden side. But first, one must understand the causes of the tax revolt which are rooted in three major aspects: the modernization of the property tax system, an escalating property tax through a housing boom and high inflation, and the political inaction in dealing with this pressing problem.
The ad valorem property tax system in California underwent an important change in the s reference for the following paragraph: Martin In the previous, highly fragmented system, local tax assessors set property tax rates at a fraction of the actual market value and used this assessment as a political tool for votes or sometimes bribes. This resulted in strong inequities in and between districts with corruption and favoritism damaging both the property tax system and the eventual revenues for local treasuries.
On the other side, the assessment of property taxes below statutory requirements was an indirect social policy that provided affordable dwellings for senior citizens, subsidized homeownership, and protected homeowners from sharply rising property taxes Martin Eventually, this system underwent a modernization in the mids when the property tax assessment was professionalized, centralized, and standardized.
This was the end to the indirect social policy, and the s brought an escalation to this new setting. More and more people were moving into the state, which resulted in a shortage of housing and a real estate boom — both increasing property values and, thus, corresponding taxes Hoene 53; Citrin, Introduction One should keep in mind that homeowners were facing abrupt and huge tax hikes with a re-assessment made only every three to four years, property tax bills being paid each year in a lump sum, and a housing price inflation which, in some cases, jumped from 5 percent yearly to 5 percent monthly Haveman and Sexton 3.
Less mobile residents on fixed incomes were especially at risk of being forced from their homes Hoene Turning to another feature, the inactive and unresponsive state, one must underscore that California citizens, while easily perceiving their rising property taxes and even faster increasing state revenues cf.
Haveman and Sexton 3 , were facing a state government that was not enacting a substantial property tax relief and was stuck in a gridlock caused by the budgetary two-thirds supermajority requirement Allswang ; Kirlin The modernized property tax system finally proved its efficiency with all its repercussions on homeowners in the case of the newly-appointed Los Angeles County assessor who announced skyrocketing re-assessments for homes Hawkins Aiming for a reform of the property tax system in California was not solely part of a right-wing agenda, but fiscal conservatives as well as progressive liberals pushed for a change in favor of the people.
The picture given by Isaac William Martin about George Whiley as the spokesperson for the poor and militant on the one side, and Howard Jarvis as the spokesperson against big government and wasteful programs on the other side shows how the topic was addressed from both left and right since it concerned so many people Eventually, Howard Jarvis took up the issue, and Daniel A. Smith , Smith underscores:.
Jarvis successfully detected the widespread, albeit diffuse, public mood and crafted a ballot initiative enabling citizens to vent their collective anger. Being put on the ballot as Proposition 8 it was backed by the majority of politicians on the state and local level amongst others: Governor Brown, the Speaker of the Assembly, prominent Republicans, and most city and county officials , labor unions, public service officials, big newspapers, most business lobbies and large corporations, the Chamber of Commerce, as well as liberal and conservative taxpayer unions Martin, The Permanent Tax Revolt 94; Hawkins 18; Schrag Despite these vocal warnings and the broad-based elite support for Proposition 8, the anti-Proposition 13 campaign lacked popular support and suffered under disorganization and disagreement Schrag Eventually, Proposition 13 was approved by 65 percent while Proposition 8 only gained 37 percent of support.
The Field Institute California Polls have been the major source most scholars used to analyze the voting coalition in favor and against Proposition Among others, Allswang has concluded that the breadth of support for the initiative was the most striking result A number of demographic variables for instance education, region, and income showed so little differences between supporters and opponents that they did not even play a role in describing the voting majority Allswang It is not surprising that families of modest incomes and senior citizens were more favorable since they were the hardest hit by the property tax hikes Sobel Likewise, African-Americans, public employees and very liberal constituencies rather opposed Proposition 13 because they had hardly anything to gain from the tax relief and were more affected by possible cutbacks in public programs and services Allswang ; Martin, The Permanent Tax Revolt Concerning the tax relief motivation, homeowners were more supportive than renters Citrin, Introduction 5.
Nevertheless, the initiative eventually gained a majority in nearly every possible constituency Smith This tax revolt was politically and geographically diverse, and besides requesting a tax relief, the protestors had very little in common Martin, The Permanent Tax Revolt With this picture of a diversely mixed coalition in mind, I will test three motivations often brought forward in the discussion about why voters overwhelmingly approved Proposition William A.
Fischel describes how during the highly contested campaign, voters could rely on the tax bill as an accurate source of information about the reason for their troubles After Proposition 13, the certainty in property taxes belongs to the taxpayer. If one looks at the actual numbers, this assumption hits the right point: a majority of Californians enjoyed an immediate and substantial property tax relief Hoene The study by Citrin and Green cf.