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The Voters Who Did Show Up Got It Right

June 17th, 2010

Editorial, THE VALLEJO TIMES HERALD (CALIFORNIA)

One of the most puzzling and troubling aspects of California elections is the abysmally low voter turnout even when voters have an opportunity to directly make important public policy decisions through ballot measures.

In last week’s primary, only 24.8 percent of registered voters participated, which translates to an even lower 18.3 percent of all Californians who are eligible to vote.

Low turnouts can produce odd results that are not representative of the state as a whole and can establish harmful policies. Fortunately, that was not the case last week, when two misleading ballot measures designed to benefit special interests at the expense of the public narrowly failed.

Propositions 16 and 17 each were heavily funded primarily by two corporations solely for their own financial benefit.

Proposition 16 had a single purpose — to protect Pacific Gas and Electric Co.’s financial interests against competition from publicly-owned electric service providers.

Had Proposition 16 passed, local governments would have had to get a difficult-to-achieve two-thirds vote to create a publicly owned and operated utility.

The super-majority vote would be even harder to get if PG&E funded the opposition, which it has in the past.

PG&E spent at least $45 million of ratepayer and investor money on ads and mailers to promote its self-serving measure.

The utility tried to fool people into thinking Prop. 16 was a pro-voter initiative instead of a means of thwarting cities and counties from combining to contract with an electricity provider other than PG&E.

To their credit, a majority of those who did participate in last week’s primary were not taken in. In fact, Prop. 16 lost by a wide margin inside the PG&E service area and won narrowly outside the utility’s service region.

This says much about what customers think about PG&E. One also has to wonder why PG&E is so fearful of competition from publicly owned utilities that it would spend tens of millions of dollars to prevent their growth.

Proposition 17 was the other self-serving measure that was defeated last week. It was almost entirely funded by Mercury Insurance. It hoped to fool voters into thinking it was just a change in the law that would allow insurers to offer “continuous coverage” discounts on policies to new customers who changed auto insurance companies.

That was only half the story. Insurance companies also would have been allowed to increase the cost of insurance to drivers who dropped their car insurance for 91 days or more in the past half-decade.

Evidently, voters figured out that no insurance company was going to spend millions of dollars just to save its customers’ money.

While both of these harmful ballot measures failed, they did so by disturbingly small margins. Prop. 16 was defeated 52.5 to 47.5 percent, and Proposition 17 lost by a 52.1 to 47.9 percent margin. Both were winning early in the vote count.

Had either of these ballot measures passed, a far-reaching and dangerous precedent would have been set, severely undermining the entire initiative process.

If a single well-heeled company can pay signature gatherers to place a self-serving measure on the ballot and then successfully finance a misleading campaign to pass it, public policy could be distorted for the benefit of any number of special interests.

No doubt there will be future attempts by individual companies to fool the public with dishonest initiative campaigns.

We can only hope voters will continue to be vigilant enough to see through the propaganda and reject initiatives that are not in the public interest, as they did with Propositions 16 and 17 last week.

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Props 16 and 17: The Defeat of Corporate Politics

June 16th, 2010

By Robert Gammon, EAST BAY EXPRESS

The voters’ rejection of two statewide ballot measures might convince large corporations to think twice before attempting to game California’s initiative process.

Meg Whitman, Carly Fiorina, and Jerry Brown may have garnered the most attention, but the June 2010 California Primary could go down as the election in which voters rejected dishonest corporate politics and disingenuous ads. The defeat of Propositions 16 and 17 also may convince large corporations that attempts to game California’s initiative process are extremely risky, and, ultimately, very costly endeavors.

No one knows that better than PG&E. In the weeks leading up to June 8, Pacific Gas and Electric Company blanketed the airwaves, the Internet, and newspapers with ads touting Prop. 16 as the “Taxpayers Right to Vote Act.” PG&E boasted in advertisements and on its web site that a wide range of groups had endorsed Prop. 16. But while many groups voiced their support of the measure, only one of them — the California Chamber of Commerce — donated any money to the cause, and its relatively small contribution of $91,258 appears to have originated with PG&E. According to campaign finance reports, the chamber’s donation came right around the same time that PG&E contributed $250,000 to the chamber’s political action committee. Thus, the only real donor to the campaign appears to have been PG&E itself, which contributed a whopping $44.1 million, according to the latest campaign finance reports. No other taxpayer, consumer, or voters’ rights group appears to have donated a single dime to getting the measure passed.

To sum up, the Prop. 16 campaign was about one company — PG&E — trying to protect its monopoly by sponsoring and bankrolling a measure that would have made it nearly impossible for cities and counties to jump into the power market and increase their renewable energy use. It wasn’t the Taxpayers Right to Vote Act. It was PG&E’s Attempt to Keep Its Monopoly Act. And it lost by nearly 200,000 votes — 52 to 48 percent.

Similarly, the Prop. 17 campaign referred to itself as “Californians for Fair Auto Insurance Rates,” but a more accurate name would have been: “Mercury Insurance for Unfair Profits.” That’s because the only “Californian” who donated any significant amount of money to the campaign was Mercury Insurance Company, the sponsor of the initiative. According to the latest campaign finance reports, the state’s third-largest auto insurer donated $13.84 million to the campaign — representing 99.5 percent of the contributions received. The Prop. 17 campaign also could have billed itself as “Elect Republicans for Higher Mercury Profits.” Public records show that the Yes on 17 campaign helped finance at least seven Republican voter guides, most of them in Southern California. The GOP guides included “Continuing the Republican Revolution,” “Republican Woman’s Voice,” and “Orange County Republican Leadership Voters Guide.” In all, the Yes on 17 campaign donated $35,000 to mailers designed to boost Republicans and Prop. 17.

Republicans did just fine, but voters apparently saw through Prop. 17. It would have allowed Mercury to attract more customers with offers of discounts, while leading to higher rates for low-income motorists, more uninsured drivers, and, eventually, higher insurance rates for everyone else. It lost 52 to 48 percent as well.

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Perspectives: Mercury General, Poizner Make Millions Disappear in Primary Election

June 14th, 2010

By Sean P. Carr, BESTWIRE

WASHINGTON, DC — In the end, the insurance giant just couldn’t convince Californians it had their interests at heart.

Despite $16 million in campaign spending by Mercury General, a controversial automobile insurance ballot question lost at the ballot box. The Mercury-founded and funded Californians for Fair Auto Insurance Rates sought to convince voters that under Proposition 17 some 80% of them would save money on their car insurance by becoming eligible for longevity discounts even if they switch insurers. Extending those discounts is now illegal under Proposition 103 for a reason, opponents argued, saying the effect would have been to necessitate discriminatory higher rates against drivers with any gap in their coverage, including the poor and military personnel.

Faced with a more than 15:1 spending disadvantage, foes including the Campaign for Consumer Rights adopted the slogan, “When was the last time an insurance company spent millions to save you money?”

That catchy bit of politics may have had an impact, said Samuel Sorich, president of the Association of California Insurance Companies, who supported Prop 17. “It did tap into what is an inherent skepticism,” he said.

As Prop 17 opponents raised Mercury’s history with regulators as an issue, the Department of Insurance made fresh allegations of wrongdoing by the insurer, including the overcharging of customers. The Yes on 17 campaign sought to separate the merits of the question from Mercury’s regulatory issues — even while Mercury continued to fund virtually the entire enterprise.

Mercury “got taken for a ride” by political consultants, said Jamie Court, president and chairman of Consumer Watchdog and a board member of its CCR affiliate. Prop 17, which lost by a 4% margin, was never going to pass, he said.

“The entire coalition is disappointed with the outcome, as we all believe California consumers will ultimately end up losing as a result,” Mercury said in a company statement.

With the same amount of money, Mercury could have given $250 rebates to 64,000 new policyholders. Because the company claims a better-than-96% renewal rate, that might have given the insurer’s customer rolls a nice boost — which wouldn’t hurt. Mercury General Group’s share of the California private passenger vehicle insurance market slipped from 9.4% to 8.7% from 2008 to 2009. It dropped from being the third-largest such carrier to fifth-largest, according to BestLink, which provides online access to A.M. Best’s Global Insurance & Banking Database.

In the California scheme of things, perhaps Mercury General’s losses don’t amount to much. Sitting Insurance Commissioner Steve Poizner spent approximately $25 million of his own money on a race for governor, only to be crushed by Meg Whitman in both spending — who spent three times that just from her own eBay fortune — and in the vote — where she doubled his total. At least he covered the spread.

But the June 8 primary wasn’t all about money. While as surprised as anyone, 16-year Department of Insurance enforcement attorney Brian FitzGerald holds a tenuous lead over veteran Assemblyman Mike Villines, despite investing in little more than the filing fee, a blog and a Facebook page. Counting of outstanding mail-in votes, provisional ballots and damaged ballots could go on for weeks, according to the Secretary of State’s office.

Meanwhile, FitzGerald is back at work — though maybe with a closer eye on the corner office.

Contact the author, Sean P. Carr, Washington Correspondent at: sean.carr@ambest.com

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California Voters Defeat Two Threats to Good Public Policy, Initiative Process

June 13th, 2010

Editorial, THE OAKLAND TRIBUNE

One of the most puzzling and troubling aspects of California elections is the abysmally low voter turnout even when voters have an opportunity to directly make important public policy decisions through ballot measures.

In Tuesday’s primary, only 24.8 percent of registered voters participated, which translates to an even lower 18.3 percent of all Californians who are eligible to vote.

Low turnouts can produce odd results that are not representative of the state as a whole and can establish harmful policies. Fortunately, that was not the case on Tuesday, when two misleading ballot measures designed to benefit special interests at the expense of the public narrowly failed.

Propositions 16 and 17 each were heavily funded primarily by two corporations solely for their own financial benefit.

Proposition 16 had a single purpose   to protect Pacific Gas and Electric Co.’s financial interests against competition from publicly-owned electric service providers.

Had Proposition 16 passed, local governments would have had to get a difficult-to-achieve two-thirds vote to create a publicly owned and operated utility.

The supermajority vote would be even harder to get if PG&E funded the opposition, which it has in the past.

PG&E spent at least $45 million of ratepayer and investor money on ads and mailers to promote its self-serving measure.

The utility tried to fool people into thinking Prop. 16 was a pro-voter initiative instead of a means of thwarting cities and counties from combining to contract with an electricity provider other than PG&E.

To their credit, a majority of those who did participate in Tuesday’s primary were not taken in. In fact, Prop. 16 lost by a wide margin inside the PG&E service area and won narrowly outside the utility’s service region.

This says much about what customers think about PG&E. One also has to wonder why PG&E is so fearful of competition from publicly owned utilities that it would spend tens of millions of dollars to prevent their growth.

Proposition 17 was the other self-serving measure that was defeated on Tuesday. It was almost entirely funded by Mercury Insurance. It hoped to fool voters into thinking it was just a change in the law that would allow insurers to offer “continuous coverage” discounts on policies to new customers who changed auto insurance companies.

That was only half the story. Insurance companies also would have been allowed to increase the cost of insurance to drivers who dropped their car insurance for 91 days or more in the past half-decade.

Evidently, voters figured out that no insurance company was going to spend millions of dollars just to save its customers’ money.

While both of these harmful ballot measures failed, they did so by disturbingly small margins. Prop. 16 was defeated 52.5 to 47.5 percent, and Proposition 17 lost by a 52.1 to 47.9 percent margin. Both were winning early in the vote count.

Had either of these ballot measures passed, a far-reaching and dangerous precedent would have been set, severely undermining the entire initiative process.

If a single well-heeled company can pay signature gatherers to place a self-serving measure on the ballot and then successfully finance a misleading campaign to pass it, public policy could be distorted for the benefit of any number of special interests.

No doubt there will be future attempts by individual companies to fool the public with dishonest initiative campaigns.

We can only hope voters will continue to be vigilant enough to see through the propaganda and reject initiatives that are not in the public interest, as they did with Propositions 16 and 17 on Tuesday.

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Power Grabs Hit a Wall

June 13th, 2010

By Michael Hiltzik, THE LOS ANGELES TIMES

We may finally have discovered a remedy for corporate executives with more greed than brains: Let them invest corporate funds by the millions in California ballot initiatives, then vote the things down.

Isn’t that the lesson of Tuesday’s balloting on Propositions 16 and 17, those majestically cynical initiatives sponsored by Pacific Gas & Electric Co. and Mercury Insurance Group?

To recap for the 82% of eligible voters statewide who didn’t bother to vote last week, Proposition 16 was an initiative concocted by PG&E, the state’s biggest private utility, to hamstring the public power agencies that are its chief competitors — pretty much its only competitors. Of the $46 million in cash contributions raised to pass the initiative, $46 million, or 100%, came from PG&E.

Proposition 17 was an initiative concocted by Mercury to undermine the insurance consumer protection system put into place by Proposition 103 of 1988. Of the $13.56 million in cash raised to promote Prop. 17, $13.5 million came from Mercury, whose founder and chairman, George Joseph, has turned the punching of holes in Prop. 103 into a personal obsession. That spending may make Mercury a cheapskate by PG&E standards, but by any rational standard of democratic process, the scale of it was obscene.

Yet these initiatives went down in defeat by almost identical margins, losing about 52%-48%.

That doesn’t speak well of the management prowess of the executives in charge. PG&E Chairman Peter Darbee walked his company down a $46-million plank to secure it nothing but a permanent place in the corporate citizenship hall of shame. He collected $10.6 million in compensation last year.

Do the PG&E directors really believe that the outcome of Tuesday’s vote is the sort of performance they’ve so lavishly paid Darbee to achieve? If they do, I have a follow-up question: What makes them qualified to serve on a corporate board?

Considering that the U.S. Supreme Court has given the green light to almost limitless political spending by corporate interests, it’s worth pondering how the initiatives lost, the better to deal with the oil slick of electoral cash sure to be heading our way on the next tide.

The most striking statistic that emerges from Tuesday’s results, as my colleagues Marc Lifsher and Dianne Klein have observed, is the margin by which Proposition 16 got beaten within PG&E’s service area in Northern and Central California — a “no” vote of more than 60% in much of the region.

The measure lost by narrower margins in many Southern California counties, where there wasn’t enough familiarity with PG&E to breed that much contempt.

The “no” vote on Mercury’s Proposition 17 followed a similar pattern, which suggests that the proximity on the ballot of the two corporate power grabs made anti-PG&E sentiment infectious.

That indicates that the antidote to unrestrained corporate political spending is to make sure that voters know that a corporate interest is behind an ad, an issue campaign or a candidate.

As it happens, that’s the approach chosen by Sen. Chuck Schumer (D-N.Y.) and Rep. Chris Van Hollen (D-Md.) in their Disclose Act, which would require CEOs to appear on camera to endorse any ad or commercial their companies fund, as candidates do. (The act has recently run into opposition from the National Rifle Assn. and the AFL-CIO, which don’t care to be held to the same rules.)

That the proposed disclosure rules would likely have a disinfecting influence follows from a very interesting pattern discernable in the corporate initiative campaigns in this state — along with Props. 16 and 17, let’s throw in the attempt by the oil company Venoco to cripple the municipal planning process in the city of Carpinteria (slaughtered Tuesday 70%-30%), and the oil industry’s developing campaign to suspend the state’s emissions limits (due for a vote in November).

The pattern is that the companies and industries most willing to subvert democracy by turbo-funding deceitful initiative campaigns are those with already dodgy records of corporate citizenship.

PG&E’s reputation for customer service and its compliance record on regulatory directives are unremittingly foul — so much so that the Public Utilities Commission had to issue a four-page letter last month explaining to the company, in terms even a 4-year-old could understand, how its machinations against Marin County’s renewable energy initiative violated the law.

Mercury has been repeatedly accused by regulators of dealing with the state’s rules on insurance underwriting by simply ignoring them. Occasionally the company has agreed to rectify illicit practices, according to a complaint filed in April by the Department of Insurance, and then failed to do so.

“Ultimately, Mercury does not believe that we have the authority to require them to change … their business practices,” observed a 2004 agency memo, which is as concise a description of this company’s attitude as you could wish.

As for the oil industry, the evidence of its concern for the public interest has been washing up on the beaches of the Gulf of Mexico every day for a month and a half.

One lesson of the Proposition 16 and 17 campaigns may be that PG&E and Mercury, as regulated companies, have been treated far too indulgently by government overseers. The regulators plainly have allowed both companies to overcharge their customers so much that the excess cash has been burning a hole in their pockets.

Take PG&E, which currently has an application before the PUC for a multibillion-dollar rate hike. The utility maintains that the $46 million it spent on Proposition 16 belongs to its shareholders, not ratepayers, but that’s a typically neat piece of deception. The truth is that every penny PG&E has comes from its customers’ pockets; it’s possible that eventually the firm will have to cut shareholder returns to cover the Prop. 16 campaign, but it won’t have to document for the PUC how it accounted for those expenditures until years have passed. In the meantime, it was able to use the customers’ money, essentially for free, against those customers’ interests.

As for Mercury, it reported that it spent well below 70% of its collected premiums on claims last year. Even health insurers typically pay out more than that.

Both firms have proved that they can’t be trusted to use their spare cash for their shareholders’ good, much less the public interest. The PUC and Insurance Department should take the evidence to heart: Give companies like this too big an allowance, and they’ll only use the money to cause trouble.

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Michael Hiltzik’s column appears Sundays and Wednesdays. Reach him at mhiltzik@latimes.com, read past columns at www.latimes.com/hiltzik, check out www.facebook.com/hiltzik, and follow @latimeshiltzik on Twitter.

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Californians Turn Back PG&E and Mercury’s Attempt to Rewrite Laws for Their Own Profit

June 12th, 2010

By David M. Greenwald, THE PEOPLE’S VANGUARD OF DAVIS

A lot of people I think took for granted that given the amount of money that PG&E spent on Proposition 16, to essentially put public power out of business, that it would prevail.  In fact, PG&E was not alone.  Mercury Insurance also spent about $16 million to pass Proposition 17.  PG&E spent $44 million.

Given the fact that PG&E’s deceptive ads were on TV every day, every hour, heck every minute, I will fully admit I had no faith that the average person would be able to see through the rhetoric.  And yet somehow just enough people did.

Jack Pitney, a political science professor from Claremont McKenna College, said Wednesday, the lesson is that “if you’re going to win a special-interest initiative, you need a better disguise. The link was too obvious, and the voters smelled a rat.”   He continued, “People like the idea of free enterprise, but in (Propositions 16 and 17) people sensed that one specific corporation was seeking a benefit for (itself).”

We have discussed Proposition 16 on these pages a few times, it was known as the “Taxpayers Right to Vote Act,” a deceptive title given the fact that taxpayers already have the right to vote, but this would actually make their voice worth a good deal less as it would require a two-thirds vote before a public utility could extend service to new customers or new territories.  It was a naked power play intended to make service expansions such as the proposed expansion of SMUD into Yolo County from four years ago an impossibility.

PG&E was able to defeat that effort, but it cost them $10 million.  They obviously felt the threat and sought to avoid such a fate in the future.

Proposition 17 was placed on the ballot by Mercury Insurance and it would have overturned state law prohibiting insurance companies from considering a driver’s insurance history to set rates.

Los Angeles Times analysis found that in counties served by PG&E, voters rejected the measure by large margins while counties less familiar with PG&E supported it.  Writes the LA Times on June 10, “Fed up with big bills, distrustful of new meters that show higher usage and chagrined by power shutoffs when payments are late, PG&E’s customers sent a vote of no-confidence to the giant utility this week when they rejected the utility-sponsored Proposition 16.”

According to the San Francisco Chronicle on June 10, “Prop. 16’s strongest showing came in Southern California, which gets its electricity from other utility companies. The measure fared worst in the Bay Area, PG&E’s home. San Francisco, site of the company’s headquarters, voted 67.8 percent against the measure. A majority of voters in every Bay Area county rejected the measure.”

“It shows that the more people know about PG&E, the less popular it is,” said Mark Toney, one of the leaders of the campaign against Prop. 16. “That’s a problem for any company.”

“It sends a message to corporate America that it doesn’t matter how much money they put into this,” said Toney, executive director of The Utility Reform Network, a consumer watchdog group.

Well not exactly.

According to Gale Kaufman, a campaign consultant to the No on 16 effort, the opposition only spent about $100,000 with nearly one-third of that going to an early poll.  She told the Sacramento Bee that the poll showed that Proposition would lose convincingly from the start.

“Kaufman said voters didn’t see Proposition 16 as a citizen-empowerment measure, but as a cleverly worded ploy of a single for-profit utility.  ”(PG&E’s) biggest miscalculation, besides spending all that money, was that they really thought they could trick people by the phrasing they used on that initiative,” she said.”

That is one way to look at it, the other way to look at it is that PG&E took a convincing defeat and turned it into a narrow loss with their heavy spending.

Nevertheless, it would seem that questions about PG&E and the accuracy of their new SmartMeters along with rate increases which drew angry protests last year swayed key areas.  These rate increases hit hardest in normally conservative enclaves in Fresno and Kern counties.  And so for one of the few times, conservative Fresno and Kern counties joined with liberal portions of the state like San Francisco to vote against Proposition 16.

“When does the Central Valley ever vote with the coast?” asked Bill McEwen, columnist for the Fresno Bee. “The SmartMeter thing really eroded the trust between PG&E and its customers.”

State Sen. Mark Leno a strong opponent of Proposition 16 said on Tuesday night, “I think [Prop 16] represents the epidemic of corporate greed that is so challenging in this country right now, whether its banking or the oil industry.  I think a victory tonight would really speak to California voters rebuking the lies and the deceit spread by PG&E.”

Mark Toney made the comment early on, “PG&E has one thing, and one thing only on their side, which is money.  The fact that were so close is amazing, given that they’ve outspent us 500 to 1.”

Unfortunately it appears that PG&E even in defeat did not get it.

Greg Pruett, senior vice president of corporate affairs for PG&E, issued a statement that said, in part: “While the election outcome hasn’t diminished our steadfast belief that citizens should have a vote in local government efforts to enter the electric utility business, we respect the decision voters made on this initiative.”

He continued to spew the same rhetoric even as it was their own customers that ultimately rejected their efforts.  That had to be a stinging blow.

Mercury Insurance’s statement was equally obtuse, as they continued to play it as a blow to consumers.  The company issued a statement Tuesday night which read in part, “Proposition 17 was a pro-consumer initiative that would have lowered auto insurance rates for millions of California drivers.”

California survived two insidious propositions by the skin of their teeth.  But more and more I believe this is a flawed process.  The original initiative system was supposed to free Californians from the stranglehold that moneyed interests had on the legislature.  The legislature certainly remains strangled, but unfortunately, companies and backers with deep pocket books are generally able to get measures on the ballot, back them with tens of millions, and usually they are able to pass them.  A lot of factors played a role in the defeat, many of them had less to do with the measure and more to do with the messenger.

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Take a Breath; November is Coming

June 11th, 2010

Editorial, THE CHICO ENTERPRISE-RECORD

Our view: There were a number of interesting elements to this primary election season.

Some random thoughts on the election just completed: This was an unusual election in that there seemed to be a number of races in which the voters really couldn’t lose. Either candidate would have been just fine. However there were a number of races where one candidate was great and the other was a disaster. It’s usually a lot more nuanced than that.

* All candidates can tell you who they claim to be, but a better indicator is how quickly they get their campaign signs down. The visual pollution is bad enough during the election, and those who really care about us and our area will prove it now by cleaning up after themselves, win or lose. Kudos to those who are doing it themselves. Larry Wahl was out collecting his election night, and when we reached Maureen Kirk Thursday morning for a post-election comment, she was doing the same.

* Speaking of Wahl, you have to give him the prize for election tactics. By filing for election at the last minute he guaranteed there would be just two candidates in the race for the 2nd Supervisorial District.

That meant the decision would be in June, when the students are out of Chico, rather than in a runoff in November, when they’d be back. Student support is a big reason Jane Dolan has held that job for 32 years. There are a lot of votes yet to be counted and the decision is uncertain, but you have to admit it was a pretty clever move by Wahl, who told the editorial board he’d be quietly planning for the race for 14 months.

* Mail-in voting appears to be the way we’re headed, as a majority of the votes in Butte County weren’t cast in a voting booth Tuesday. There are a number of good things about this. In the comfort of your home, you usually have the resources to check up on issues you aren’t sure of, and the time to make sure you get your vote right.

And almost as important, this trend pretty well kills the last-minute “hit pieces” that used to fill mail boxes the weekend before voting day. Most of the votes were already cast by then. There were a few nasty mailers earlier in the campaign, but their impact was diluted as their targets had time to respond.

* The biggest scammers in this race weren’t candidates, but rather the companies that sold “robocalls” to office seekers. Really, does anyone listen after picking up the phone and hearing, “Hi this is Meg Whitman …” These calls don’t sway voters, they annoy us. How the candidates can’t seem to understand that and keep forking over good money for such a bad idea is a puzzler.

* Californians seem to be catching on to corporations using the initiative process for their own gain, as two such measures went down in flames. PG&E’s Proposition 16 and Mercury Insurance’s Proposition 17 both went down by nearly identical 52-48 percent margins.

All we can say is what were that 48 percent thinking?

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The Real Ballot Initiatives Are Coming Up

June 11th, 2010

By Tom Elias, THE SAN GABRIEL VALLEY TRIBUNE (CALIFORNIA)

In the realm of California ballot initiatives, the preliminaries are over.

Yes, some people cared deeply about the recently-passed Proposition 14 and its effort to change state government via an open primary election system. Two big companies cared enough to invest more than $70 million in their own pet initiatives, designed to feather their nests a bit more. Both lost.

But when it comes to influencing the future lives of Californians, three measures either on or about to come onto the November ballot have far greater potential than anything on the primary election ballot. These propositions do not yet have numbers, but one is an effort to legalize marijuana, another would rescind the landmark 2006 anti-greenhouse gas law known as AB32 and the third is an $11 billion water bond.

If passed, all could have major lifestyle effects. More than four months before the fall vote, the one with the least chance of success appears to be the effort to stymie AB32. But that could change because of the cash being put behind it by two major Texas oil companies which operate refineries here. They’ve spent about $1 million so far on the drive to qualify this measure for the ballot, which appears likely to succeed.

It’s impossible to say which of these measures might have the most impact. For sure, legalizing pot would affect millions of people and might have surprising and unpredictable effects on the economies of several counties. Because most of those who want to use the weed can already find all they want, it might not have much effect on automobile accident rates, academic performance or general alertness. And it might free up police to fight other crimes now back-burnered at times while cops chase pot growers.

Why does the effort to dump AB32 have the least chance of passage, at least at first glance? One reason is that voters who want to say no to AB32 will have to vote yes on this proposition. That kind of confusion never bodes well for ballot measures. Another is that while Mercury Insurance and Pacific Gas & Electric Co. outspent opponents of their pet propositions this spring by a margin of about 500-1 – and still lost – the oil companies and others who oppose limiting greenhouse gases will not be alone in the financial field.

Forces wanting to preserve AB32 and its requirement for cutting carbon dioxide emissions to 1990 levels by 2020 have their own campaign committee, dubbed Californians for Clean Energy and Jobs, co-chaired by former Secretary of State George Shultz, who often backs conservative politicians and policies. Among its members are the League of Women Voters, Google, the Audubon Society, labor unions including the Teamsters and the California Nurses Assn., Levi Strauss and the Silicon Valley Leadership Group.

So this will be a two-sided campaign, with one faction calling AB32 the ultimate in job-killing regulations and maintaining it has already caused many businesses to leave California and the other dubbing the anti-32 proposition the “Dirty Energy Initiative” and claiming AB32 will create far more jobs by promoting “green” energy than it will cost. One way or the other, this one will likely affect the lives of millions of Californians.

The campaign over the water bond proposition will also not be one-sided. This measure – not an initiative because the Legislature put it on the ballot – draws large-scale support from the state’s huge agriculture industry and water agencies from Sacramento south. It’s opposed by some environmental groups and by conservatives who don’t like the idea of issuing more bonds at a time of financial crisis.

The pro-water bond side says the measure recognizes today’s tight budget problems by requiring bonds to be sold slowly, with no more than half the $11 billion to be issued before the end of 2015. They argue that the well-documented water shortages of the past two years, which caused several Central California farming counties to make one list of the 20 most troubled counties in America, dictate creation of new reservoirs and dams. They also claim that without quick fixups, a Hurricane Katrina-like calamity could befall residential areas that now stand beneath levees along the Sacramento River and other mid-state waterways.

Meanwhile, opponents argue the bill creates a new state water commission made up entirely of the governor’s appointees and that conservation is the answer to water problems. Some in the North State insist the measure would inevitably lead to construction of a Peripheral Canal to bring Northern California water south around the delta of the Sacramento and San Joaquin rivers, something that’s anathema to many in the north.

Again, whichever way this goes, it will have a massive effect on lifestyles. If the proponents are right, and defeat leads to perpetual water rationing, lawns will change, showers will be shorter and restaurants will go back to serving water only on demand, as they did during a long drought in the 1970s.

And if it wins, there could be both new state budget troubles and more water for farms.

It’s almost as if the spring campaign was a form of spring training, with the real season for initiative politics coming right up.

tdelias@aol.com

Thomas Elias is a syndicated columnist who covers California issues. He lives in Santa Monica. His book, “The Burzynski Breakthrough,” is now available in a softcover fourth edition.

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Voters Get Wise To Sly Corporate Power Plays

June 10th, 2010

By Dan Morain, THE SACRAMENTO BEE

Once again, California voters delivered a two-edged message, or so it seems.

Republicans nominated two deep-pocketed former chief executives who had spent heavily on their campaigns to be their standard bearers for governor and U.S. Senate.

At the same time, Californians sent two heavily funded initiatives backed by individual corporations down to ignominious defeat.

Proposition 16, backed by PG&E’s $47 million to the opponents’ $90,000, and Proposition 17, backed by Mercury Insurance’s $16 million to less than $1 million for its foes, lost by nearly identical margins.

PG&E and Mercury join a select few corporations that came up with way-too-clever concepts, then tried to sell them to a supposedly disengaged electorate notorious for deciding weighty issues based on 30-second television ads, only to find out that we Californians aren’t so gullible after all.

Both initiatives had powerful themes. PG&E was promising Californians the right to vote on issues related to government expansion into power generation. Mercury promised most auto insurance customers a break on their rates.

But once voters scratched below the surface, they were able to sniff out the true intent – corporate grabs to solidify and expand their markets.

“It’s hard to con voters into voting yes,” said Robert Stern, an initiative expert and president of the Center for Governmental Studies in Los Angeles. “The default position is ‘no.’ If voters are confused, they will vote ‘no.’ ”

Gale Kaufman helped organize the No-on-16 campaign by using $90,000 to pay for a poll and consumer activists. She didn’t have money for television, and instead bought Internet ads.

“There is a growing anger and huge skepticism about who is paying for what goes on the ballot,” Kaufman said. That attitude seems to be growing, especially as initiative promoters devise ideas that clearly benefit a particular company or industry.

Chris Lehane, who helped run the campaign against Proposition 17, said a change is taking place in the world of initiatives. Voters are relying less on traditional television advertising about ballot measures and are looking elsewhere for information, including news accounts and editorials in mainstream publications.

Voters also are becoming more attuned to bogus endorsements, he believes. In PG&E’s case, the company touted the endorsement of an entity that called itself a consumer alliance. But no one from established consumer groups had ever heard of it.

So what does all this mean for former eBay CEO Meg Whitman and former Hewlett-Packard chief Carly Fiorina? It might not be a good sign.

Whitman and Fiorina won in a closed Republican primary in which 1.7 million Republicans voted.

A far larger group of roughly 4 million voters including Republicans, Democrats and people who state no party preference voted down Propositions 16 and 17.

A look at how counties voted sheds more light. Propositions 16 and 17 lost big in Democratic parts of the state. In San Francisco and Yolo counties, for example, the initiatives were trounced by 2-to-1 ratios. Proposition 16 lost by 42 percent to 58 percent in Sacramento County, another Democratic bastion.

In the Republican areas of the state, including Orange, Riverside, San Bernardino and San Diego counties, both measures won by significant margins. The pattern played out in much of the rest of the state, where counties that have Democratic majorities opposed the measures and voters in Republican-leaning counties approved them.

Republicans have nominated Whitman and Fiorina, but neither has won office in an election that includes Democratic voters and people who decline to state party preferences.

The general election campaign is now in its second day, way too early to gauge who will win. But at least on primary election day, voters took a very dim view of corporate interests.

dmorain@sacbee.com

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Where Greed Lost

June 10th, 2010

Editorial, THE SAN FRANCISCO CHRONICLE

Pacific Gas & Electric Co. dumped $46 million into Proposition 16, the initiative that would have blocked cities from offering a public energy alternative without a two-thirds voter approval. Mercury Insurance poured more than $15 million into Proposition 17, which would have allowed them to raise car insurance rates for people who had had gaps in coverage.

Both measures failed.

It’s a David and Goliath tale for the ages. Editorial boards and consumer groups chastised both measures as blatant attempts by businesses to gain competitive advantage via the ballot box. Opponents had no money to counter the barrage of advertisements. Still, voters were not fooled.

What happened? Rule 1: If you want to have your way at the ballot box, show your corporate citizenship. Mercury was under fire from the state for gouging customers and PG&E was drawing complaints for its not-so-smart meters and for unfairly stifling Marin County’s public power plan. Whatever the reason, corporate greed lost big on Tuesday night. Any companies that believe they can try the same thing in November had better pay attention.

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