Ballot Measures: Voters Say No to Changes in State Spending

The message of change may have worked for the president-elect, but it didn’t trickle through to the states.

Americans worried about high home heating bills and plummeting 401(k)s rejected any change in state government spending on Tuesday. Even popular new programs to boost health care and renewable energy fell victim as voters nixed new taxes to fund them. At the same time, citizens in two states rejected measures to cut state income taxes.

“Right now, its hard to ask people to make tax changes just because the whole financial situation is so uncertain,” says Darrell West, vice president and director of Governance Studies at the Brookings Institution in Washington. “People are under pressure, and they are waiting to see what’s going to happen.”

Voters, for example, in North Dakota and Massachusetts rejected moves to repeal state income taxes.

“While this seems contradictory, it is not,” says Jennie Drage Bowser, a senior election policy analyst with the Washington-based National Conference of State Legislatures (NCSL). “Voters realized they would have been trading off a small decrease in their income taxes with major cuts in state services.”

People are hurting, says Robert Blendon, professor of health policy and political analysis at Harvard University. “They really do want help from government and services, but they really don’t want to pay taxes.”

Given a long-term economic retrenchment and cuts in federal aid, he says, there will be huge pressures on states to provide services, “but governments are not going to be able—easily—to raise money for them.”

“If we are going to have new expenditures, the real debate is going to be, are there savings somewhere that can be spent?” Blendon adds.

Voters in 36 states contended with some 153 ballot initiatives and referendums that took on issues that included improving home care for older people and stricter regulation of payday lending. The ballot issues—proposed by legislators, citizen petitions or special interest groups—numbered slightly less than in years past.

While ballot issues often dominate local news coverage, voters and reporters had other things on their minds this year: wild fluctuations of a worsening stock market, a steady stream of foreclosures, and the news that stalwart U.S. companies faced bankruptcy. That made it rough for ballot proponents.

“In a situation where there is a lot of discontent, it is easier to get people to vote no, then yes,” West says.

Dan Keyserling, a deputy director of communications at the University of Virginia Center for Politics, says voters have reacted to the troubling news by turning inward, controlling consumer and government spending.

“Baby boomers grew up in a time of growth,” he says. “The promise that the U.S. economy would grow every year went without saying. Stocks were a sure thing, in the long run. But there’s a global sense that these things are not assured.”

“People are going to expect accountability from government, and we are going to have to cut programs,” he says. “There will be a noticeable and fundamental shift in American fiscal policy. You will see state budget cuts; the burden will be shared.”

Voters tended to look to the presidential candidates for answers to health care cost problems. So state health care issues reflected social concerns. In Washington state, voters affirmed terminally ill patients’ right to end their lives; in Michigan they expanded stem cell research.

“A lot of these referendums really reflect the state’s cultures,” Harvard’s Blendon says. He cautioned not to expect any national mandate on socially progressive, or conservative, health care issues.

Massachusetts—income tax repeal

Failed: With workers spending less and government reeling from shrinking revenues, Massachusetts Question 1 would have repealed state income taxes. The 5.3 percent personal income tax would have been halved next year and eliminated by 2010. At stake was about 40 percent of the state’s $28 billion annual budget. Supporters, including the Committee for Small Government, said consumers needed the relief and the measure would force lawmakers to cut waste. Opponents, including AARP Massachusetts, teachers, firefighters and many community service organizations, said the cuts would be felt across the state, from public school budgets to day-care programs, prescription drugs and 911 support. Further, such cuts would lead to higher property taxes.

North Dakota—income and corporate tax cuts

Failed: In a state that expects a $1 billion surplus from oil and gas revenues this year, Measure 2 would have reduced individual income taxes by 50 percent and sliced corporate tax rates by 15 percent. State tax collections would have fallen by $414 million every two years, cutting about 25 percent of the state budget. Supporters said that in a time of prosperity, some of the state’s budget surplus should go back to citizens. Opponents, including AARP North Dakota, education and public employees associations, said spending on education and human services would suffer.

California—redrawing the lines

Passed: The partisan divide in the California legislature is so deep that lawmakers couldn’t agree on this year’s budget or last year’s health care reform. But it’s difficult to protest the stalemate by voting out entrenched politicians. That’s because districts have been carefully drawn to favor incumbents. After five failed tries at redistricting, Proposition 11 succeeded. It creates a bipartisan citizens commission to redraw boundaries for legislative districts. Members are chosen at random off a list. Gov. Arnold Schwarzenegger, R, California AARP and others supported this measure as a way to make the legislature more responsive to voters’ concerns.

Ohio—capping payday lending interest rates

Passed: Issue 5 asked voters whether they wanted to keep a state law that caps interest rates at 28 percent, mandates a 30-day payment period and limits loan size to $500. This effectively puts payday lenders out of business, since they rely on charging average annual rates of 391 percent. Proponents said the law protects consumers caught in a downward spiral of expensive borrowing. Opponents, funded by the loan industry, said payday loans serve customers who otherwise would not get credit and that the law would put them out of business.

Arizona—protecting payday lending

Failed: Proposition 200 would have permitted payday lenders to do business in the state indefinitely under their current business model of charging triple-digit interest rates. It also would have stopped lenders from making new loans to customers with outstanding loans. Supporters said the loans serve customers with bad credit, who have nowhere else to turn. Opponents, including Arizona AARP and the state’s attorney general, contended payday loans can lead to perpetual debt traps for inexperienced borrowers.

“People seem to be clearheaded, particularly with the Ohio vote,” said NCSL’s Drage Bowser, “because those popular referenda are so confusing.”

Michigan—stem cell research

Passed: The Michigan Stem Cell Initiative allows scientists to use embryos donated after fertility treatments—embryos that would otherwise be thrown away—to create stem cell lines for research. The new law further strengthens bans on human cloning. Supporters, including science foundations, argued that embryonic stem cells hold the potential to cure many diseases. Opponents, including Right to Life Michigan and the Michigan Catholic Conference, objected to the destruction of human embryos on religious grounds. Further, they said the law did not adequately safeguard against cloning.

“In most states where there have been votes on stem cell research, the pro-stem cell people win the debates,” says Blendon. “You have a mix of people fearful about terrible diseases that might be cured, and then you have the business-entrepreneurial class that feels this could be the science of the next 50 years and that their state is going to miss out.”

Missouri and Washington—rules for home health aides

Passed: Regulating home health care workers was an issue on the ballot for voters in Missouri and Washington state, which each had a proposal backed by the Service Employees International Union. Proposition B in Missouri establishes a commission to recruit, train and stabilize the home care workforce hired under Medicaid. In Washington, I-1029 requires people who work with older and disabled people to receive 75 hours of training, take a written exam and undergo increased criminal background checks to be certified. Supporters included the Alzheimer’s Association and Gov. Chris Gregoire, D. Opponents of I-1029, including a governor’s task force that reviewed the proposal, said the training and extra checks would cost the state millions of dollars at a time when big budget shortfalls are projected.

Arizona—health care choice

Still Undecided: Arizona’s Proposition 101 would make it illegal to penalize people who decline to participate in a health care system, effectively banning Massachusetts-style health care reform with its coverage mandates. The vote is still too close to call on this measure that would enshrine in law people’s right to pay directly for medical services and to choose which health plan to participate in. Supporters, including some physician, dentist and chiropractor groups, say proposals to expand health care coverage tend to limit individual choice. Opponents, including Arizona AARP, Gov. Janet Napolitano, D, and numerous chambers of commerce, say the measure would hamper moves toward universal coverage. It might also cause residents who rely on Medicare and Medicaid to lose coverage.

Washington—death with dignity

Passed: In Washington state, voters approved I-1000, an initiative on doctor-assisted dying that supporters say mirrors the well-known Oregon law. The measure permits competent, terminally ill adult residents—whose doctors have predicted they have six months or less to live—to request and self-administer lethal medication prescribed by a doctor. Politicians and medical groups lined up on both sides of this highly emotional issue. The Washington Medical Association opposed the measure, for example, while the American Medical Student Association supported it and the Washington State Psychology Association remained neutral.

Rachel Brand is a freelance writer in Denver.