Proposition 89: Take the “For Sale” sign off the State Capitol - California Progress Report

By Richard Holober, Executive Director
Consumer Federation of California

Since 2004, Chevron gave $3 million in political contributions in California. For a company that made a record $14 billion in profits last year, it was money well spent. Despite public indignation, big oil crushed a proposed state tax on windfall oil profits.

During one 18-month period, banks, insurance companies and other financial interests contributed $8.8 million to state politicians. They defeated financial privacy legislation that enjoyed the support of 90% of California voters.

Phone companies gave $20 million to the governor and Sacramento candidates since 2000. Their generosity bought them new Public Utilities Commissioners, which promptly buried telephone consumer protection regulations just after being adopted by their predecessors.

Our campaign finance system has produced the best government that money can buy.

State lawmakers of both parties salivate for assignments to “juice” committees such as insurance, banking, utilities, and government operations (which regulates gambling). These industries know that “money talks” in the capitol. Their checkbooks are always out to assist friendly lawmakers. Is it any surprise that elected officials end up as shills for the industries that they are supposed to regulate?

Gray Davis’ $30 million in fundraising in an election cycle seems a quaint reminder of a simpler time. Since 2003, Arnold Schwarzenegger has raised $100 million for his various campaign committees. The governor wields a steady veto pen when bills that upset his contributors survive the legislature and reach his desk.

Of course, there are principled elected officials who vote against these big money donors. Some even take the money, smile, and then vote their conscience. There are simply not enough of them to make a difference on issues that face major corporate opposition.

This November, we can take the “For Sale” sign off the state Capitol. The Consumer Federation of Californiasupports Proposition 89, the Clean Money Initiative, because we must change the rules of politics before ordinary Californians will have a chance to put our interests on an even footing with big corporate donors.

Prop 89 would create a Clean Money Election system similar to the ones that now exist in Arizona, Connecticut and Maine.

The Clean Money and Fair Elections Initiative allows candidates who run for state office, and who agree not to accept private contributions, to receive public campaign financing. The funding comes from a 0.2% increase in the corporate tax rate. That’s less than 20 cents for every $100 of profits. Personal income tax rates are not affected.

These funds are available to candidates who demonstrate widespread support. A “Clean Money” candidate for the State Assembly would have to collect 750 contributions of $5 each to qualify for the $250,000 in public financing to run in the primary election. If you won your party's primary election in June, you'd receive an additional $400,000 to run your general election campaign.

The initiative also dramatically reduces the amount that businesses and others can give to candidates who decide not to participate in the Clean Money system.

The real beauty of Proposition 89 is that it stops a candidate who takes special interest money from drowning out a Clean Money opponent. If a well-funded politician tries to buy the election by spending record amounts of PAC dollars, Proposition 89 increases the public financing of a Clean Money candidate by up to five times, keeping the playing field level.

Thanks to California Progress Report for this article.