History Lesson Part 1979

I was born in 1964 and grew up in Southern California. Technically, I was born in the last year of the Baby Boom, although I think of the Boomers as people 15 or 20 years older than I, the ones who went through the sixties as young adults. I don’t have much in common with those people. We were the last of the real boom, though. All the way through school the class behind us was much smaller. As we left school, the world around us changed dramatically.

The infrastructure around me as I grew up was excellent. As real estate prices went up, so did property tax, which by law funded the schools, local emergency services, and a plethora of other basics. I received an excellent education in the public school system straight through high school. The roads were paved, the police and fire got there in 3 minutes, the county health care system hummed along without trouble. If you lived in suburbia and were at least holding on to the bottom rung of the middle class in the 1970s it was a good time.

In the late 1970s, the apartment owners’ association in California hired a man named Howard Jarvis as their lobbyist in Sacramento. His task was to help them with their taxes. He succeeded.

Jarvis and Paul Gann wrote an amendment to the state constitution. To pass it, they used a feature of California law in which the people may petition the state to put a constitutional change on the ballot for referendum. It can then be passed by popular vote. The constitutional change Jarvis wanted was a rollback in property taxes.

This was enthusiastically accepted as a tax revolt. Jarvis got people angry about their property taxes, and they demanded a reduction. Since California’s real estate prices are high and always going up, the taxes paid went up fast too, and he made a convincing case that the politicians in Sacto were taking all our money. The people enthusiastically supported Proposition 13, and passed it. Property taxes were reduced and fixed. The trick was to hold on to your property; if you bought or sold after 1978 you’d lose your exemption. This tremendously favored Jarvis’s employers, who rarely sell or buy their commercial real estate, and not so much homeowners, who traditionally trade up quite a bit in this state. New homeowners were S.O.L. This fact was pointed out but mainly ignored.

The day Proposition 13 passed, everything changed.

In one way, the change was obvious. Schools, law enforcement, fire & rescue, and health care services had been murdered but were still walking with the knives in their backs. As I was leaving high school in 1983 the educational system was starting to feel the stab. Most of the musical groups and the drivers education program got axed the next year, for example. While I was in college the trauma care system in Los Angeles County fell apart. Increased fees of all kinds appeared for local government services. After-school and summer-school programs for poor kids were shut down. Bit by bit, the mechanisms of government died off like Hal at the end of 2001.

The other change was bigger. Suddenly, government services were the enemy. It was time to cut taxes everywhere, because of the “fat” and the “politicians” as Jarvis and his friends artfully put it. Ronald Reagan was elected president in 1980 with the promise to go to Washington and shut down Big Government. Tax cuts everywhere were the rage. “Grass roots” movements funded by groups like Jarvis’s employers sprung up in many states. And any program with social, medical, or educational function was a target. Mental health programs, preschools, the arts, all got axed.

Things got stuck this way, and haven’t gotten unstuck. To this day, politicians must promise tax cuts to be elected. “Tax and spend liberalism” is a surefire way to tag your opponent as a loser. The ratchet goes one way: toward less tax. Restore a tax or raise one and you’ll lose an election. And in California especially, anyone with the money to buy TV time had a good chance of changing the constitution by popular vote.

The result in California has been schools without pencils, prosecutors who can only afford to pursue felonies, closed hospitals, and bankrupt municipalities. Upon being hired as Arnold Schwarzenegger’s finance consultant during the last gubernatorial election, Republican billionaire investor Warren Buffett pointed out that he paid less tax on his house in California that his house in Omaha, and suggested repealing Proposition 13. He was shut up instantly by panicked political consultants. He had touched kryptonite.

The passage of Proposition 13 for me marks the end of an era of well-funded infrastructure and the beginning of the new populist demagoguery, which is now at its greatest extreme yet. The talk-radio epidemic of the 1990s made extreme right-wing ideology respectable. The craziness of Ross Perot and Tim McVeigh is now available 24 hours a day on FOX News, and the President is a folksy idiot who never met a tax he liked. Since there’s no more need for the fig leaf of a balanced budget, the government just spends on deficit. The mad as hell media crowd ran out the Governor of California Proposition 13 style, with a petition and a charismatic celebrity. Reaching directly to the people with television, as both Jarvis and Ronald Reagan did, the moneyed establishment could get us to act against our interests by pushing a button or two.

In true cryptofascist style, our new masters spend only on war and subsidies to their friends. They grandstand on issues of “moral” significance, and promise to beat up those “people in Washington”, who are of course not them. Their constant weapon is mass media, especially talk radio and conservative “news” television.

And the worst possible insult, the executioner’s brand and mark of shame, is “liberal”.

I am a liberal because I remember a time before Jarvis, before President Reagan, before Rush Limbaugh and Ann Coulter, before Homeland Security, before any of the splendid little wars in Grenada and Nicaragua and Iraq, before all of this. i remember a time when I was in school and we had pencils and books and art supplies and an orchestra to play in and 25 students per class or less, and summer school every summer, and a free breakfast if your parents were broke, and a school nurse, and a school psychologist. I remember when it only cost $430 a quarter to go to UCLA. I remember a time before libraries were shut down. I remember health care when we had an operative trauma network. I remember when welfare was a safety net and not a punishment. I am, in fact, a tax and spend liberal because that’s what government does. It taxes and spends because we ask it to. The only questions are whom to tax and on what to spend, and anyone who says otherwise is a liar.

I remember the world before Californians voted for Proposition 13 in June 1978. That’s why I’m a liberal, and that’s why I gave you today’s history lesson. Thanks for listening.

23 thoughts on “History Lesson Part 1979

  1. spend, then let someone else tax
    Restore a tax or raise one and you’ll lose an election.
    This was (at least part of) the problem with Adlai Stevenson, wasn’t it? Even if it’s a legitimate plan to fix the country, no taxing will be accepted.
    Why doesn’t the government run on magic baby farts or something?

  2. You’re right: it’s not a question on whether to tax. That is a given. The question is whether to spend the money on your cronies, or back on the people who have ponied up. I say bring it back home with services. We’re going to have a country full of psycho Iraqi vets wandering the streets. Most of them are going to end up in California. What are we going to do about that? Arm them?

  3. I was 36 the year Prop. 13 passed and I learned a lot–none of it encouraging–from my futile efforts to persuade my fellow-railroad workers it was a bad idea.
    Longtime Sacramento Bee reporter Peter Schrag wrote a fine book, Paradise Lost, about how the consequences of 13 have affected California.
    One completely unanticipated consequence (by 13’s opponents and its supporters) was that local governments, no longer able to impose taxes on property, began relying increasingly on revenue from sales taxes. These, like all consumption taxes, are inherently regressive–that is, they fall most heavily on those least able to pay. But this also has led to the insane competition between municipalities to attract malls, outlet centers, big box stores etc.–sources of sales tax revenue–which in turn fosters the growth of the low-wage discount retail sector, the Wal-Marts and Home Depots etc. whose workers literally can’t survive on their wages and thus must rely on public assistance–which keeps shrinking (see Prop. 13 above.) Nice cycle…

    1. good point
      My first job, in 1983, was at a small store in a strip mall. The manager and the full-timers made a living there.
      That store’s function is now taken up by Best Buy, where everyone is a hapless yellow-shirted part-time drone.

      1. Re: good point
        Thanks. I’ve just added you to my Friends list–I’d be pleased if you’d do likewise. I mean, not to get all reductionist or anything, but we sure do tend to underestimate the effects of boring ol’ fiscal policy.

  4. followed this from defenestr8r’s journal. I’ve heard about prop 13, but only in passing conversation. It was two years before I was born and I’ve only been in Cali for the last 5.
    Thanks very much for the history lesson. I’ve passed it onto some folks.

  5. I was born the year Reagan was elected, and I’ve often heard that there was in fact a time when the public mental health care system consisted of more than a bottle of wild turkey and a doorway. Thank you for the history lesson, it is much appreciated.

  6. Very good post. But I do wonder how much of a chance well-intentioned tax increases have to succeed when politicians are so busy with their gamesmanship. For instance, I know that up here, in Oregon, some of my least-favorite elected officials use a financial instrument known as a TIF (tax-increment financing), which basically seems like a legal, albeit ethically questionable, way for elected officials to distribute favors to their developer/contractor buddies and various fetish projects. My understanding is that certain TIF manipulations in Portland have diverted funds from schools and other deserving sources to nominally “green” projects w/dubious environmental benefits or worse, gimmicky, “cool” infrastructure. If that’s occurring in California too, and I suspect it is, then it would be hard to determine which tax increases are worth implementing and which ones are worthless. At that point, everything seems fucked.

  7. You’re right. One problem is that cycling back and forth between tax cutting and more spending and tax increases is that administrative and graft losses increase each time in each direction. The funding for California schools came back, but by then the infrastructure was trashed and all the money went to administrative garbage.

  8. Tax Increment Financing. No more of that in Cali. All Redevelopment Agencies (RDA) were mandated by a recently passed law to disband by 2/1/12. 5 billion dollars will be shifted to state coffers from City coffers. No prop tax, no sales tax, and no TIF. Expect more City layoffs, less City services and more user fees. Much of the funds will be shifted to schools, perhaps to pay teachers more or to pay for their insurance or other entitlements – I doubt our kids will see much value from it.

    1. I doubt we’ll get more teachers, whether or not the ones currently working will get paid more. The system breeds administrators who make six figures, and will never have less of them. It’s a spiral and I have no hope.

      1. Thanks for the post Conrad. Born in ’64 in CALI and I relate to your recollections of a time faded into history. Like riding just in front of a crashing wave.

      2. Thanks back to you. I always thought of it like the collapsing temple in the Indiana Jones movie, but your image is better.

      3. Did you see the grand opening of Indiana at the Chinese with me. My friend Juan was really irate with me when I crumpled the brochure they handed out. Anyway, I diverge and need to go back to work Take care fellow Bruin.

  9. Wow, thank you for this, Conrad. It explains what seem like confusing happenings to someone outside the US at the time.

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