AT LEAST IN CALIFORNIA it was a proposition that people voted on. Here in the District of Columbia, the fiscal arrangements are being drastically altered by congressional fiat - a command to the colony from its congressional overseers. Asking no one in particular, the House Appropriations subcommittee on the Distict, firmly guided by its chairman, Rep. William H. Natcher (D-Ky.), has just shredded the District's budget request for the coming fiscal year and decided that the annual federal payment recommended by President Carter for the District should be clipped by nearly 17 percent.And thanks to the fiscal controls retained by Congress, Mr. Natcher & Co. could - and did - go a step further, proceeding to tell the District exactly what it should or shouldn't do with all the money available to it - and never mind that this includes that part of the District's revenue that is extracted from the local taxpayers.

What a convenient, reckless way for a member of Congress to show the folks back home that he's caught the spirit of Proposition you-know-what. In the case of Mr. Natcher, it was also an apportunity to demonstrate in no uncertain terms that he hasn't gone soft on the city - an allegation that had been kicking around over since he went to bat for the city government's initial $27-million request for a downtown convention center. Clearly, Chairman Natcher has no regard for the District's locally elected government - nor for the process by which the mayor and City Council reach decisions of such importance. Indeed, even Del. Walter E. Fauntroy, the District's lone emissary to Congress, was surprised by the cuts - which says something about Mr. Natcher's respect for a colleague with no floor votes to trade. Instead, he and the members of his subcommittee went ahead and voted to impose, among other things, a freeze on all new hiring by local government and a hold order on any new programs.

Now, one needn't support every last budget item to realize that this is a godawful way to try to run a city. It also a powerful argument not only for local control of local money, but also for full-fledged District representatives in Congress who might merit at least some small measure of respect from Mr. Natcher and his members. In the meantime, every member of the House and Senate who does see some merit in allowing the democratic process to work in the nation's capital should work to undo the damage by voting to overturn the actions of Mr. Natcher and his subcommittee.