Reigning in Government Spending - Arizona's Proposed Prop 105

October 26, 2008

Like many western states which gained statehood status in the late nineteenth and early twentieth centuries, Arizona's Constitution makes it easy for citizens to bypass the legislature and propose laws and amendments to the state constitution directly to their fellow citizens through the ballot process. This method of legislating through ballot inititative traces its roots to the so called Progressive Movement which was dominant in the late nineteenth and early twentieth centuries and was responsible for laying the foundation for the big government that we have today.

Like their descendants, today's liberal activists, the Progressives felt that they had the answers to what ailed society and were eager to use the coercive power of government to impose their solutions on society as well as force society as a whole to finance their solutions. The progressive income tax, which gave government the opportunity to tap into the fruits of their citizens' labor and take whatever amount they wanted, is one of the legacies of the Progressive Movement.

The Progressives were an impatient bunch who not only saw government as the guiding light in society but also distrusted the democratic process which they viewed as a slow and cumbersome process which blocked and delayed their efforts to build their vision of Utopia. It was the Progressives who pushed for a civil service system to run the bureaucracy. There were many problems with the spoils system in which government jobs were filled by friends and supporters of the victors in an election, not the least of which were incompetence and corruption. However, when voters threw out the party in power, the bureaucrats exited with the politicians. While inefficient, this system not only made the bureaucrats accountable but also tended to place limits on the growth of government. In addition to a civil service system which not only opened the door to a career in government with guaranteed job security and little or no accountability on the part of bureaucrats, the Progressives were also responsible for the growth of all the alphabet soup agencies (FDA, SEC, FCC, etc) which are not only staffed by career bureaucrats but are managed by boards whose staggered terms extend beyond the length of Presidential terms of office. By requiring that members of these boards serve staggered terms and be divided between Democrats and Republicans, they not only limited Presidential control over them but also helped to prevent the development of additional political parties. As a result, like Presidential candidates before them, Senators McCain and Obama may sincerely intend to change things in Washington if elected but, once elected, will find the task nearly impossible.

It may seem odd that the Progressives, who distrusted democracy, would also favor an exercise in direct democracy in which the people, through the initiative process, could enact laws directly. But they saw the initiative process as a short cut around the existing constitutional processes which would allow them to quickly implement their programs. They probably also calculated, correctly, that the average citizen is too busy earning a living, supporting a family and serving their communities in more constructive ways outside of government to be able to devote much time running government. This left the door open to special interest activists, to enact their own agendas. And special interests have used the initiative process very effectively in getting laws passed in elections that have stood little chance of being passed by legislatures.

It is easy to understand why the initiative process works so well for special interests once one does the math. While everyone has to pay taxes, not everyone can vote. In order to vote one must be of legal voting age, be a citizen, be a resident of the state or locality and not be an un-pardoned felon (in many states the civil rights, including the right to vote, of felons, are not automatically restored after they have served their sentences and returned to society - and, thanks to the plethora of laws on the books, close to 20% of our population now have a felony on their records). This tends to limit the pool of voters.

Further restricting the pool is the fact that one must first register to vote and many people fail to do this. Then there is the fact that not all who are registered bother to vote. Finally, of those who vote there are some who only cast ballots for major candidates - President, Senator, Representative, Governor, Mayor and possibly state or local legislative candidates (news organizations periodically ask people on the street to name government officials and while most know the President, the number admitting they don't know or guess wrong begins with the Vice President and increases as one goes down the list) - and do not cast ballots for minor offices or ballot propositions. The result is that the number of people voting for ballot propositions is usually a very small portion of the registered voters and minuscule percentage of tax payers. This can make it rather easy for supporters of a proposition to rally their supporters and get the proposition passed.

However, the national tax revolt, which began with the victorious 1978 passage of the famous Proposition 13 in California which put a halt to California's ever increasing property taxes, is still alive and well despite the best efforts of liberal politicians and their leftist allies in the media to dismiss Proposition 13 as an aberration. Actually, the tax revolt began in 1773 with the Boston Tea Party and it is the first three quarters of the twentieth century, a period in which citizens were nearly smothered under the crushing burden of taxation, that is the aberration. With the successful passage of California Prop 13, conservatives are demonstrating that the same tools used to construct big government can also be used to dismantle it.

In the spirit of Howard Jarvis, the man behind the successful passage of California's Proposition 13, a citizen initiative known as Proposition 105 has been placed on the November 2008 ballot in the state of Arizona. The official language of the proposition states:

To protect the will of the people of Arizona for fiscal responsibility through true majority rule, any initiative that imposes additional taxes or spending must have support from a majority of qualified electors in Arizona. Currently, initiatives that increase taxes or spending can pass with approval from only a minority of qualified electors. In the past, big money, special interest groups have pushed higher spending and taxes. Arizona now faces one of the largest deficits of any state in the country. We must protect the will of the people and let a true majority of the voters decide. (Source: BallotPedia.org)

The measure is rather limited in scope in that it only applies to ballot initiative proposals that either add new taxes, increase existing taxes or mandate spending that will have to be paid with new taxes and does nothing about taxes or spending passed by the legislature. It doesn't forbid initiatives calling for new taxes or spending, it simply requires that a simple majority (50% + 1) of registered voters approve such initiatives. If Proposition 105 passes, those wishing to impose new taxes or spending on their fellow citizens will only have to convince a majority of those currently registered to vote to come out and vote for it. Those who fail to register or who are ineligible to vote will continue to have no say in the matter and will still have to pay any taxes imposed by this larger minority since a simple majority of all registered voters will almost certainly still be a minority of the total number of taxpayers affected.

However, baby step that it is, passage of this Proposition will still be a step forward in our efforts to free our wallets from the clutches of special interests. According to BallotPedia.org, of the five ballot initiatives that involved raising taxes and/or spending which passed in Arizona since 1998 by majorities ranging from 50.8% to 62.9% of the ballots cast, none would have met the Proposition 105 threshold of 50% + 1 approval of all registered voters.

While this may seem radical to some, I have had personal experience with this type of system as this is the system that is enshrined in the CC&Rs (covenants, conditions and restrictions) that govern the homeowners association in which my home is located. Common in the west and newer suburban developments in other parts of the nation, homeowners associations are basically an attempt to preserve property values in an area by creating deed restrictions which limit the uses of property in an area. Unlike the older method of government run zoning in which government appointed zoning boards issue such rules which then tend to be modified over time based upon political pressures, homeowners associations are more democratic in that the rule making power is vested in the owners of the properties in the small section of the community covered by a specific homeowners association. The downside of both systems is that they attempt to freeze the uses of real estate property as well as setting maintenance and and landscaping requirements that owners are obligated to follow. The rules governing the use and other restrictions are not set in stone in either system and both have processes by which the rules can be changed. In the case of zoning it is the political process by which the rules can be changed while with homeowners associations the property owners themselves can vote to change the rules. One of the advantages of the homeowners system is that a person can view the rules up front before deciding to purchase a property and it is the individual owners who vote on changes to the rules.

Like any organization, the boards of homeowners associations often attract activist types with visions as to how things should be run. In the case of the association in which my household is a member, and I am sure this is true of many others, it is relatively easy to get elected to the board as generally few people want the job. Like the larger society around us, the number of people who show up at the annual homeowners association meeting is small as is the number of members who bother to read, let alone check the yes or no box and return ballots mailed to them. However, to protect homeowners' pocketbooks from the expensive schemes of their more activist neighbors, builders, in my area at least, usually insert a clause in the CC&Rs requiring the affirmative approval of a majority of homeowners before fees can be raised by more than the current rate of inflation. For these elections, not voting is the same as casting a no vote which has the effect of killing any spending proposal not supported by an absolute majority of the member homeowners. While living here I have seen a number of proposed spending projects die on the vine because, except for the few pushing the projects, the vast majority of owners saw no value or benefit in them. The only projects that have a chance of seeing the light of day are those for which a majority of the whole are willing to support. If Prop 105 is successful every taxpayer in the state of Arizona will enjoy the same protection from being forced to pay for pet projects benefiting small groups of fellow citizens as those of us living in neighborhoods governed by homeowners associations enjoy from not being forced to see our association dues raised to fund the pet projects of ambitious neighbors.