IS THE QUIETING of the "tax revolt" a symptom of its failure or its success? Some intriguing answers may be found in California, where Paul Gann, co-author of Proposition 13, is advancing another government-curbing initiative. This one, Proposition 4, would make the state and local governments get the voters' approval for nearly all future spending increases except adjustments for inflation and population growth. It is a strong plan -- and it is expected to pass with much less furor than Proposition 13 caused. -
Apparently the spending curb has caught on partly because some of Proposition 13's effects have been milder than many people hoped. Property taxes were cut by $7 billion -- but inflation is pushing real-estate assessments up again. Hopes of pruning government have also been somewhat frustrated. The state's large surplus, which intensified the "tax revolt," has helped many jurisdictions stave off deep budget cuts so far. A number of localities have also gotten around the tax restraints by levying user fees for recreational and other services.
All this makes direct curbs on spending more appealing -- and harder for California politicians to resist. Even in a season of restraint, many California governments are operating at levels that would be viewed as generous in many other states. Holding outlays to current levels is an immediate strain mainly for cities, such as San Francisco, with a declining population and rising demand for services.
A recession could quickly change that picture, of course -- and that points to one of the elementary defects of rigid spending curbs. They leave governments little flexibility to respond quickly to rising unemployment and other economic and social woes. Proposition 4 would also lock in one of Proposition 13's most controversial effects: the shift of more authority from the local level to the state. Finally, it would accelerate the trends toward policy-making by referendum -- and by the courts.
Will other states follow California down this path? A lot of pent-up pressures around the country were released during last year's "rebellion," so the passage of Proposition 4 may have much less explosive effects. But serious efforts to limit taxing and spending are being made in other states, including Virginia. Moreover, recent polls suggest that as state and local officials respond to public sourness, the unhappiness about government and taxation does not totally disappear. Some of it just gets redirected toward the federal level, where spending still seems relatively unrestrained.