The Right Coast

March 05, 2004
Direct Democracy Protects Supermajority Rule
By Mike Rappaport

California’s election this week involved some significant issues regarding the budget. Californians had to decide on Propositions 56, 57, and 58. Happily, a majority of voters agreed with me in each case. You gotta love direct democracy.

Proposition 57 and 58, which were supported by Government Schwarzenegger (don’t you just like the way that sounds!), authorized significant borrowing to finance Gray Davis’s economic catastrophe and substantially tightened the constitutional requirement of a balanced budget. Although I was not enthusiastic about the borrowing, I voted for both propositions. Borrowing seemed better than taxing at this point, especially if the new balanced budget rule has some bite to constrain further borrowing.

More important in my opinion, though, was the voters’ big rejection of Proposition 56. Gail beat to me to the punch on this one, but let me add my two cents anyway. Under the California Constitution, budget and tax bills must pass with a two-thirds supermajority of both houses. In my view, this supermajority rule is important as a check on excessive and imprudent spending. By requiring additional votes to pass spending measures, it should filter out, on average, lower quality spending.

Supermajority rules do have costs. One problem, especially with a supermajority rule that applies to spending laws, is that they can cause delays in the passage of budgets and leave the government with funds to spend on programs that citizens rely upon.

But there is a way to address this problem. One solution that I have proposed in my work with John McGinnis is to use a 90 percent rule. Such a rule would allow a majority of both houses to pass spending that is no more than 90 percent of the previous year’s amount. This would allow a majority to pass stop-gap spending to prevent a government shut down while the larger budget is being negotiated. It would also enhance the leverage of those who want to spend less. Under an ordinary supermajority rule, big spenders have the same leverage in negotiating a budget agreement as smaller spenders. Under the 90 percent rule, however, the small spenders would have more leverage, since they would be more willing to live with spending of only 90 percent of the previous year’s amount. Small spenders could simply refuse to compromise, knowing that the stop gap spending that had been passed, was more to their tastes than to those of the big spenders.

Despite the lack of a 90 percent rule, the existing supermajority rule is still far superior to majority rule in the area of spending. And therefore I was overjoyed that the California Voters overwhelmingly refused to weaken the supermajority rule.