California has been letting voters bypass the Legislature through the ballot initiative process since 1911, but it took decades before that power was used with any regularity. Since 1971, at least a handful of measures — and sometimes dozens — have qualified for petition signatures every single year, according to the Secretary of State’s office. The peak came in 2005, when 109 proposals cleared that first hurdle.
All told, 2,194 measures have been cleared for signature gathering since the system began. Of those, 410 made it onto the ballot, and only 141 ultimately became law — not counting this year’s results. That’s a success rate under 30%, yet the initiative process remains one of the most consequential tools in California politics. Even the mere threat of qualifying a measure has been enough, at times, to push lawmakers into action.
The clearest example of that influence remains Proposition 13, the 1978 measure that capped property taxes and made it far harder to raise new ones. This year, voters faced a proposal that could have rivaled Prop. 13 in long-term significance: Proposition 40, which would have imposed a 5% tax on the wealth of California’s billionaires.
As ballots continued to be counted this week, Prop. 40 was trailing by about five percentage points. That outcome tracks with late polling, which showed support for the measure sliding into negative territory after earlier enjoying broader public backing.
In hindsight, the apparent defeat isn’t entirely surprising. The measure was placed on the ballot by the Service Employees International Union-United Healthcare Workers West, with the goal of shoring up medical funding amid state and federal budget cuts. The union argued the tax could generate up to $100 billion, but its campaign in support of the measure was comparatively modest. Meanwhile, the billionaires who stood to be taxed poured hundreds of millions of dollars into an aggressive opposition campaign.
Prop. 40 also struggled because of internal disagreements among Democrats and within organized labor, since the bulk of the new revenue would have flowed specifically into healthcare rather than being distributed more broadly to areas like education.
Dave Regan, the outspoken head of SEIU-UHW, made clear the fight isn’t over. He said the union would push for another version of the tax if state lawmakers don’t come up with a serious plan to support healthcare funding.
“That’s not a hypothetical. That’s our plan,” Regan said.
Tuesday’s results dealt Regan a second setback. Voters also rejected Proposition 44 by a wide margin — a measure that would have required clinics serving low-income patients to direct 90% of their yearly revenue toward direct patient care.
At the same time, voters appear to have approved Proposition 42, which was placed on the ballot by wealthy opponents of the billionaire tax as a direct counter to Prop. 40. That measure adds a constitutional ban on taxing personal wealth in California — effectively a win for the state’s long-standing anti-tax coalition, the same political network that helped pass Prop. 13 nearly half a century ago.
Prop. 42’s passage partially balances out two other results from Tuesday: the rejection of Proposition 43, which would have made it harder for local governments to raise taxes, and the approval of Proposition 3, which permanently extends a temporary income tax increase on high earners that voters first approved back in 2012.
Taken together, this election cycle amounted to yet another chapter in California’s long-running tug-of-war between pro-tax and anti-tax forces — with the defeat of Prop. 40, by far the most consequential measure on the ballot, giving anti-tax advocates the upper hand this time around.
Had Prop. 40 passed, it likely would have triggered a national conversation about wealth taxation, much as Prop. 13 reshaped the debate over property taxes nearly 50 years ago. Taxing personal wealth remains a top priority for the progressive wing of the Democratic Party, and this fight is unlikely to be the last word on the subject.
Original source: CalMatters
