California: More Than $120 Million Spent On Initiatives

From Big Government:

Over $120 Million Spent on California Initiativesby Chuck DeVore


California’s progressive-era experiment in direct democracy was supposed to elevate the voters above the special interests, allowing voters make law themselves through the statewide initiative process. That this process is now virtually owned by the special interests is yet another example of the immutable Law of Unintended Consequences in government.



A brief perusal of the California Secretary of State’s initiative campaign finance disclosure website shows that some $120 million dollars has been raised by 53 groups supporting or opposing California’s nine November ballot initiatives. By comparison, California’s two major candidates for governor have raised or given to their campaigns $176 million to date, exclusive of independent expenditures and political party spending on both sides.





Initiative spending



What’s common about most of this spending is that it is fairly transparent in that we know the identities of the people, the labor unions and the companies writing the checks. Sure, there are cut-out committees that ship money to each other in an attempt to obfuscate their spending, but, with a spreadsheet and enough patience, a person can figure out who is funding whom.



For instance, you can crack open the disclosure page for the biggest No on Prop. 23 committee and see that they’ve raised more than $23 million. This includes $1 million from Hollywood director James Cameron, $700,000 from America’s richest man, Bill Gates, millions more from rent-seeking Silicon Valley venture capitalists who hope to grow wealthier off the economic pain of average Californians. You can also see that the National Wildlife Federation gave $3 million. Sadly, here is where campaign disclosure gets weak, because the National Wildlife Federation doesn’t have to disclose its donors since contributions on an initiative are considered nonpartisan and thus, not subject to the stringent disclosure rules as money destined to directly influence a partisan campaign.



This oversight is especially egregious when it comes to Prop. 22, a densely written amendment to the California constitution (already the third-largest in the world) that consumes eight pages of fine print to accomplish its purpose: constitutionally lock in redevelopment agency protections to protect them from pressure to reform.



California’s redevelopment agencies are supposed to target so-called “blight.” What they often do instead is use eminent domain to take property from one set of owners and give it to another so as to increase the tax base for a city.





Redevelopment abuse is rampant. It has also resulted in some $100 billion of bonds being issued in California without a vote of the people consuming 12 percent of property tax revenue that’s being diverted from local schools to pay the principal and interest on the development debt.



With so much money and power at stake over the passage of a proposition, it would be nice if the voters and the press could understand who is supporting and opposing the measure. The opposition is easy enough to determine. There is only one committee opposed to Prop. 22. They’ve raised a little over $1 million and their donors are readily seen online.



In distinction, the supporters of Prop. 22 present an opaque picture. Their one committee has raised almost $4 million. Of their 425 contributors, one can see quite a few developers (as one would expect with redevelopment) and bond underwriters and attorneys (debt is big business, after all) – but the largest share of money, $1.67 million, comes from something called the “League of California Cities (Non-Public Funds)” account. The trouble with this account is that we know nothing of where the money originates. The League also gave another roughly half-million dollars for Prop. 22 from their PAC. At least the origins of much of that money is known: mostly trash haulers and other municipal services providers – although I’m sure it was a pure “coincidence” that PG&E donated $150,000 to the League’s political fund on the same day as their deadly San Bruno pipeline explosion.



The League of California Cities is a statewide lobbying group that many California cities pay dues to. As a lawmaker, I’ve tangled with them before, once having one of their lobbyists flat out lie to kill one of my bills (I came back the second year and got my bill to reform local licensing of family daycare centers passed.) After the League killed my bill for a year, I became more curious about where and how the League of Cities got its money to lobby, after all, it’s not like individual mayors and city council members were opening their own wallets to fund expensive Sacramento lobbying operations. This leaves one logical conclusion, the League of Cities mainly uses taxpayer dollars to lobby government – in other words, government lobbying government.



For that reason, I authored AB 1992 in 2008. AB 1992 would have made it abundantly clear that taxpayer funds were not to be used for political purposes. The League of Cities killed the bill in committee. During the hearing on AB 1992, League representatives explained that money for their “Non-Public Funds” account came from things like advertising in their magazine, Western City, as well as conference sponsorships and the like. But, the leaves open the question: who is paying the $1.67 million of freight on the League’s effort to pass Prop. 22?



Restrictions on campaign finance are contrary to our First Amendment free speech rights – that said, we should know who’s paying for the speech. California needs to amend its campaign disclosure laws so we know the origin of the money used to influence the voters in what remains America’s largest and most powerful state. We also need to tighten up the laws governing the ability of government to lobby government using taxpayer dollars.