California Ballot Proposals Fail, Leaving Unions Wondering What's Next

Five of six budget proposals failed to pass on California's May 19 statewide ballot. The state’s unions lined up on both sides of the vote, and spent millions of dollars while sending members to knock on doors before the vote. The proposals were Governor Arnold Schwarzenegger’s proposed solution to a budget shortfall, which is now projected to reach $21 billion.

Unions were divided on the proposals, titled 1A through 1F, because they dangled short-term funding for some public services at the price of cutbacks later. Most of labor’s attention was fixed on 1A, which would have extended small income and sales tax increases through 2013 and expanded the state’s “reserve” fund by limiting yearly spending. Turnout for the special vote was low, but those who showed rejected the proposal overwhelmingly.

1B, which also failed, loomed especially large for teacher unions. It would have repaid schools $9.3 billion beginning in 2011—but only if 1A passed as well. The California Teachers Association (NEA) launched ads in favor, hoping to stem threats to lay off thousands of teachers.

A handful of CTA locals disagreed with their parent union, joining the state’s other teachers union, the California Federation of Teachers (AFT)—and SEIU, AFSCME, and the California Nurses Association—in opposition.

Public sector unions opposed a spending cap that would have prevented the creation of new jobs as demand for services grew. Health care unions worried that caps on funding would have prevented state medical programs from keeping up with rising costs.

"The bulk of the 'no' campaign came from public sector unions and their community allies determined to prevent further cuts to California's vital social services—the government programs that help make our society livable," said CFT President Marty Hittleman.

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In Oakland, Betty Olson-Jones, president of a CTA affiliate, criticized CTA for taking the short-term bait, which would've hooked the whole state into long-term austerity measures.

“By agreeing to support initiatives that would allow other services to be cut, CTA’s position unfortunately ignores a major truth of education: that schools are not islands, somehow separate from the rest of society,” she said.

The teachers unions joined forces earlier in the decade, winning a lawsuit against the state to secure education funding. The CFT says it could be done again, and advocated this route instead of supporting 1A.

Corporate loopholes and tax cuts have drained $12 billion a year in revenue from state coffers, and the resulting funding shortfalls have led Schwarzenegger to slash spending. Unions on both sides of the vote agree that the two-thirds requirement needed in the state legislature to pass budgets or raise taxes, has allowed a Republican minority to hold up negotiations—and must be abolished.

Once first in the country, California now ranks 45th in per-pupil funding for education. Steve Smith, spokesman for California’s Federation of Labor, which remained neutral before the vote, says the 1A proposals would've locked the state into impoverished budgets. The failure of these stop-gap measures, however, confronts Californians—11.2 percent of whom are unemployed—with intense cuts right away.

If approved, Schwarzenegger’s reductions to services would also jeopardize millions in federal aid to California. For states to receive stimulus funds, they’re required states to maintain a minimum level of funding for basic services, a level California is now approaching.

"The clearest lesson should be that the people of California did not support a state budget process that occurred behind closed doors, involving only the governor and the legislative leadership, who dumped a half-baked mess of virtually incomprehensible ideas on the voters," Hittleman wrote in an editorial the day after the vote.

"The governor and legislature should focus on progressive taxes to solve the budget problem. They should do it because it is their job to clearly explain the links between taxes and the important services they fund, and because it is the right thing to do."