As California continues to teeter on insolvency, Republican legislators have proposed a budget amendment that transfers some funds from two health-care programs that are in surplus!
Surplus? How the heck did that happen? The funds in question are for mental health and early childhood development (health and education). They are in “silos” because they were approved by voters in propositions. So, to “break the bank” the Republican proposal has to go back to voters this spring via another proposition.
Fair enough, I suppose, to deal with the state’s short-term fiscal crisis. However, the fact that these two funds are in surplus invites the question of whether taxing and spending should be done via direct democracy.
Don’t get me wrong! I’m all in favor of using direct democracy to limit the state’s power to tax, borrow, and spend. (Like we did many years ago via Prop 13, the first great taxpayer rebellion.)
The two funds in this case arise from tax hikes. Unsurprisingly, they whacked unpopular minorities to fund “feel-good” health-care goals. In 1998, Prop 10 approved a tobacco tax-hike to fund health and education programs for kids up to five years old. In 2004, Prop 63 approved a surtax on Californians who earn over one million dollars annually, to fund mental-health services.
Politically, these are no-brainers. However, Prop 10 takes in about nine million dollars more annually than it can spend. Prop 63 takes in about $600 million more a year than it can spend.
So, Republican legislators want $2.1 billion from Prop 10’s surplus over the next two years, and $2.9 from Prop 63’s surplus.
Like I said: That’s fine to plug a short-term budget problem. Looking long term, I’ve gotta wonder if these surpluses mean that propositions make it too darn easy to confiscate tax-dollars from persecuted minorities, in order to fund causes that resonates with the majority’s sympathetic emotions.