Proposition 98 May Be 'Bad for Education'

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Many educators were vastly heartened by the California electorate's approval in November of Proposition 98, a constitutional initiative earmarking a large portion of the state's annual budget for public schools.

School advocates in other states that have absorbed an economic battering may be casting an opportunistic eye to see if a constitutional-guarantees strategy is appropriate for their states as well.

But such measures are likely to prove bad public policy and bad politics--and may ultimately be bad for education.

Proposition 98 in fact amounts to little more than a crude, protectionist Band-Aid. The original wound, a nagging fiscal shortfall for schools, resulted from a fundamental failure of the political process. The long-term cure, in California as elsewhere, is not populist-initiated constitutional earmarking but a return to responsible representative government.

Beginning in the early 1970's, a series of blows buffeted education in California. When the baby boom burst, budgets shrank and enrollments declined; school boards had to close buildings and lay off teachers. And when inflation skyrocketed, school revenues did not stay even.

In 1973, the judicial process declared that state funding formulas were unconstitutional. The budgets of high-spending districts were frozen while public officials scrambled to find funds to elevate low-wealth districts.

A collective-bargaining bill was passed in 1976, but school boards and teachers simply pummeled each other black and blue over a few fiscal scraps.

In 1978, California's voters reacted to the relentless rise in property taxes by approving Proposition 13. This constitutional amendment withdrew billions of dollars in revenues from the public sector. More important, local control over schools virtually ceased--an outcome unanticipated by many of the measure's supporters. California's school financing was now controlled almost totally by the ebb and flow of national economic currents and state-level partisan politics.

In 1979, again skirting conventional legislative procedures, the electorate enacted another populist initiative, the so-called "Gann Amendment." This constitutional provision used a complicated formula to place a ceiling on state spending.

Facing both local and state fiscal limitations, California's schools were caught in a constitutional clamp. This was populism gone crazy.

The recession of the early 1980's made tax revenues even harder to come by, and awesome federal budget deficits guaranteed that there would be no financial bailout from Washington for public schools.

Between 1978 and 1983, California lost $7,000 per classroom in purchasing power. Teachers particularly suffered. Because of enrollment declines, there were too many applicants chasing too few open positions. Teachers' salaries, measured against rises in the Consumer Price Index, dropped 15 percent.

Improvement of economic conditions in 1983 did not solve California's school problems. Enrollments began to burgeon, and the state had to spend more money to hire new teachers and build new schools. Simply staying even now required billions more each year. And with other political forces competing for scarce resources to build freeways, prisons, toxic-disposal sites, and dams, schools felt themselves squeezed ever tighter.

In 1985, California's citizens enacted a state lottery, with profits reserved for education. Opponents claimed that schooling was too important to be supported by chance and that lotteries had a poor long-term revenue-generating record.

When the dust settled, schools were in fact receiving only 3 percent of their financing from lottery profits. But the typical Californian thought he had voted himself a chance to grab life's brass ring and solved the school-funding problem in the process. It became even more difficult to gain the public's ear regarding school financing.

By 1988, the state's school advocates were intensely frustrated. Despite a record-breaking $22-billion education budget, school purchasing power had only barely been restored to 1978 levels. Per-pupil spending still lagged behind the national average--and well behind most industrial states'. Indeed, New York State spent a whopping $75,000 more per classroom than California. Class sizes were the second highest in the United States, and teachers' salaries, when adjusted for age of workforce and regional cost of living, were only average for the nation.

At this point, the California Teachers Association concluded that the only short-run solution was to go directly to the people: The electorate had locked the schools constitutionally in a fiscal straitjacket, and only the electorate could release the bindings. Opinion polls suggested that the public was now willing to spend more tax money, if it went to education. Hence, a constitutional initiative was carefully crafted to comply with the technical intricacies of Proposition 13 and the Gann Amendment.

Although the state school chief, Bill Honig, teachers, and their supporters committed $6 million and innumerable hours of personal time to the campaign, the initiative passed by a margin of less than 1 percent.

Proposition 98 guarantees for schools either 39 percent of the state's general-fund budget, or the same amount they received the previous year after adjustments for inflation and enrollment increases, whichever is higher. Equally important, the Gann-imposed ceiling on state spending is shattered; a healthy proportion of added state dollars is now mandated exclusively to benefit schools.

In return, educators must provide additional accountability information--for example, test scores and dropout rates--to the public. To many, however, that seems like a small price for what is estimated to be $200 million more for schools in the initial academic year--and perhaps billions more subsequently. California's educators believe schools are at last receiving the public support they deserve.

But this end may not justify the public-policy distortions and political friction caused by constitutional earmarking.

When millions of votes, billions of dollars, and the public welfare are at stake, the "ready, fire, aim" mentality of many initiatives is not useful.

Using the initiative process to obtain a constitutionally protected funding base for education crudely circumvents the deliberative and balancing capacity of representative government. To attract voter support, ballot initiatives frequently must be framed in simple and boldly overstated terms. Such populist mechanisms seldom permit the careful crafting that can occur as a consequence of committee hearings, floor debates, lobbying, and thoughtful compromise.

It is said that one should never witness either sausage or legislation in the making. But both processes will likely appear tidy compared to the implementation of Proposition 98. By early this year, political actors were already jockeying in their attempts to determine exactly what Proposition 98 meant.

Initiative earmarking also invites governmental Balkanization and organizational inflexibility.

To be sure, education is a fundamental social undertaking--but some citizens feel that health, criminal justice, environmental protection, transportation, social welfare, and a host of other governmental services are also important. Should each of these interests also have its annual funding base secured by a constitutional provision?

If such an approach became the norm, there would be virtually no role for legislative and executive budgeting. Worse yet, organizational boundaries would become even less permeable, and cooperation across social sectors would be more difficult to induce.

In fact, Proposition 98 increases the likelihood of political conflict. The measure excludes the state's two university systems from its protective umbrella. Higher-education leaders, who are unhappy on the outside looking in, fear that Proposition 98 will intensify budget competition. Officials of county and municipal governments, which depend partly on the state for revenue, believe themselves disadvantaged by Proposition 98. And leaders in other public sectors, such as the state police, the criminal-justice system, and the health and transportation systems, are also expressing displeasure. Several agencies are considering lawsuits to challenge Proposition 98's constitutionality.

Earmarking not only triggers institutional rivalry, it also promotes personal political animosity. Gov. George Deukmejian openly opposed Proposition 98; it reduces his power. But Mr. Honig, the chief state school officer, spent a healthy hunk of his own campaign funds in support of the measure. He and the Governor have seldom been on friendly terms, and the proposition's enactment will do little to enhance their relationship.

In California's system, the governor holds many of the budgetary trump cards. He now may be substantially less predisposed to play them for education's benefit.

But won't the state legislature--dominated by Democrats--still be willing to battle the Republican Governor for education's benefit? The answer is not a clear "yes." Many lawmakers view earmarking as a threat to their power as well.

And legislators of all political stripes have other constituencies besides education. Now that school funding has a constitutionally privileged position, powerful legislators may be less eager to defend it--particularly if spending for one of their other favorite services has to be reduced as a consequence of Proposition 98's formula requirements. Politically, education may have lost by winning.

Indeed, there are some who hope that Proposition 98 will shortly create such political and budgetary chaos as to trigger an electoral undoing of the entire Proposition 13 and Gann-limit fiscal mess. Governor Deukmejian has already suggested that he now favors a modification of the Gann spending limit.

A measure some education advocates believe was justified by California's history is unlikely to be a practical solution for other states. Those who believe that schools in their state need more money should try to raise it in the old-fashioned political ways--through lobbying, campaign contributions, pressure groups, letters to the editor, petitioning, protesting, electioneering, and other methods.

But whatever the political tactic, school advocates must not bypass representative government. Even education as the end is unlikely to justify that means.

Vol. 08, Issue 26, Pages 25, 36

Published in Print: March 22, 1989, as Proposition 98 May Be 'Bad for Education'
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