SACRAMENTO, CA - Proposition 89, slated for the November 7 ballot, claims that a 'crisis of corruption'' assails California and that public funding will make election campaigns cleaner, fairer, and more competitive. That claim can be tested by the experience in other states where taxpayer funding already exists, such as Arizona, which passed the Clean Elections Act in 1998.

A study of six years under Arizona's law reveals little evidence that the statute has helped minor or third-party candidates. The actual number of candidates has fallen and the data reveal no trend of greater political participation.

In Arizona, the Green Party no longer fields candidates and is no longer officially recognized. Recall that in 1999 Audie Bock, a Green Party candidate, gained election to the California Assembly under supposedly tainted conditions of privately funded campaigns.

In the election of 2002 in Arizona, 50 percent of legislative candidates and all but six major party candidates campaigned with public funds. The public funding had no significant impact on voter turnout or the level of campaign discourse. The publicly funded candidates elected in 2000 voted no differently than their privately funded colleagues in the same party.

In 1996, Maine passed the Maine Clean Election Act with the expectation that it would enhance electoral competition. Ten years after, the results imply the opposite.

"Maine's lesson for other states and for national politicians," write scholars Patrick Basham and Martin Zelder, "is that a government trying to foster more competitive elections through taxpayer financing will be disappointed with the results and taxpayers will be discomforted by the costs."

Proposition 89, The California Clean Money and Fair Elections Act of 2006, calls for "public" funding of candidates, who must gather a number of $5 contributions known as "qualifying contributions." These contributions must be handed over to the state, along with signatures. A candidate for the Assembly needs 750 $5 contributions with a $10,000 maximum, and may receive public financing of $250,000 for a primary and $400,000 for a general election. Proposition 89 allots a full $15 million for a governor in a general election, with $10 million for a primary. The measure covers the Senate, Lt. Governor, Attorney General, Secretary of State, Treasurer, Controller, Insurance Commissioner, Superintendent of Public Instruction, and members of the Board of Equalization.

When privately funded candidates spend more than the amount of public funds Proposition 89 makes available, the "public" candidate, gets more money on a dollar-for-dollar basis. The measure is generous with one side, punitive with the other. Proposition 89 limits not only large players but restricts corporations large and small. In California, election contributions are already limited by Proposition 34.

Vermont imposed limits on elections contributions and expenditures in 1997. Last June, the United States Supreme Court struck down those limits as restricting free-speech rights. The limits imposed by Proposition 89 are not as draconian on their face but, as Peter Schrag of the Sacramento Bee observes, they are far smaller relative to the number of voters that California candidates have to reach. The constitutionality of Proposition 89 is dubious, and it bears other problems and costs.

Under Proposition 89, attack ads and political junk mail will still abound, with a difference. These will now be funded by taxpayers, who in some cases will be subsidizing material they not only find offensive but with which they do not agree.

The measure advances a "modest" increase in corporate taxes but fails to inform voters that such taxes are already high. California's corporate rate of 8.84 percent is the highest in the west and only 11 states maintain a higher corporate rate. Proposition 89 also hikes taxes on financial institutions, already in double figures, from 10.84 to a full 11.04 percent. The ultimate burden of corporate taxes is borne by workers, shareholders, and consumers.

Meanwhile, Massachusetts also has public funding of elections. Thomas Finneran, Speaker of the Massachusetts House from 1996-2004, observes that "Taxpayer funds spent on political campaigns - to buy balloons, bumper stickers, and buttons - are taxes diverted from other public policy initiatives." In California, those would include such public safety measures as the rebuilding of levees around the capital of Sacramento to avert a New Orleans-style catastrophe.

California voters will ultimately decide if they want to extend welfare to politicians but Proposition 89 does have one feature worthy of adoption in principle, on a broader basis. The measure wants total public spending on campaigns not to exceed the money from revenues. Limiting spending to revenues on hand would be a good rule for all California government and perhaps worthy of a ballot measure.

K. Lloyd Billingsley is Editorial Director at the Pacific Research Institute. He can be reached via email at
lbillingsley@pacificresearch.org.