The tax-cutting movement, which dominated state politics in the late 1970s, has roared back this year with a spate of proposals that would require voters to approve any increase in state and local taxes.
Political leaders in Michigan, Nevada and California are mounting expensive campaigns to defeat the antitax initiatives on their ballots next month, all of which would bar state legislatures from raising taxes without either a public referendum or an overwhelming majority vote. But most polls show the ballot measures ahead in all three states.
"It's a repudiation of representative government," said John Shannon, assistant director of the Advisory Commission on Intergovernmental Relations. "It says that we no longer trust our representatives for the real important fiscal decisions. It would be a vote of no confidence."
Few states need to be reminded of the tax revolt that caught fire with California's Proposition 13 in 1978. Eighteen states responded with some form of spending limitation.
The tax-cutting fever cooled during the 1981-82 recession, which depleted state treasuries and forced more than 40 states to raise taxes.
Even as the economic recovery picked up steam, the states continued to plot a conservative course. Most have held down spending, nearly a dozen have rolled back taxes and half have set up "rainy-day funds" to weather the next economic downturn.
This cautious approach, fueled by a strong economy, has allowed many states to pile up large budget surpluses, the same inviting target that triggered the 1970s rebellion. So the antitax forces have been gathering signatures again, but this time with a far more ambitious goal.
"We are going to seize control of taxation," said James DeMar, who is running the Michigan antitax campaign out of his suburban Detroit barbershop.
In California, Howard Jarvis, the 81-year-old father of Proposition 13, is heading the drive to extend his initiative, prompting Standard & Poor's Corp. to place the state's bonds on its "credit watch" list.
Nevada's initiative is so restrictive that eight state senators would be able to block any tax increase. And Oregon is voting on a strict property tax cap that would cut some cities' revenue by 40 percent.
Nowhere are the battle lines more clearly drawn than in recession-scarred Michigan, where Democratic Gov. James J. Blanchard says the Voters Choice initiative would bring back the days when his state was "the credit deadbeat of the nation."
When Blanchard took office in 1982, Michigan was so broke that it had to borrow money from Japanese banks to keep its schools open. But Blanchard's solution, which included a 38 percent income tax increase, touched off a voter backlash. Two Democratic state senators who backed the tax rise were recalled last year, giving Republicans control of the state Senate.
Still, Republican John Engler, who became Senate majority leader, is opposing the initiative. So are the Big Three auto makers, the AFL-CIO, teachers' unions, leading retailers, state church groups and former GOP governors William Milliken and George Romney.
"If the public can't trust the legislature with the power of taxation, the appropriate remedy is to remove the legislators," Engler said. "This would reduce us to an advisory body."
The legislature already has rolled back part of the income tax increase, with the rest scheduled to expire in 1987. But conservative activists became impatient and gathered 352,000 signatures for a ballot measure that would kill all of Blanchard's tax increases immediately.
The initiative also would require a referendum on any new tax boost, and would force state and local governing bodies to muster a four-fifths majority to pass any licensing fees, tuition increases or other levies.
A coalition of political, business and union leaders is mounting an expensive counterattack, fueled by donations from such backers as General Motors and Ford. The media campaign is warning voters that the $1 billion in tax cuts would slash state spending in such areas as public schools, toxic waste cleanup and efforts to attract business.
"It's a dagger to the heart of higher education . . . a constitutional nuclear bomb," said Blanchard spokesman Richard Cole. "The issue here is the fiscal survival of the state."
The campaign has begun to mirror last year's battle in Ohio, where an initiative to overturn Democratic Gov. Richard F. Celeste's income tax increase had a huge lead in the polls but lost badly after the political establishment warned of deep service cutbacks.
Just last week, Michigan officials announced that 11,000 teachers will be laid off if the initiative passes. Opponents scoff at such predictions in light of an anticipated state surplus of up to $600 million.
"They're marching out a bunch of shills who feed at the public trough to try to scare people," said Richard Headlee, the Republican candidate for governor in 1982. "Are they going to lay off all those teachers and throw the mentally retarded out in the streets before they spend the $600 million surplus?"
DeMar of Voters Choice denied that the ballot measure would bring an end to tax increases, saying that Michigan voters have a track record of approving most local tax measures.
In California, Jarvis' measure would require a two-thirds majority in the legislature to raise state taxes and a two-thirds popular vote for any increase in local taxes and fees. Jarvis said his proposal is designed to "close the holes" that court decisions have ripped in Proposition 13's property tax cap, such as allowing communities to fund pension plans through tax increases.
But Jarvis' 1,000-word measure lacks the simplicity of Proposition 13. Its $1.7 billion in tax rebates, for example, would go only to those who bought their homes before March 1977, while those who made purchases after that date would face a tax increase.
The opposition, ranging from the Chamber of Commerce to the AFL-CIO, said the measure would cost the state nearly $3 billion over two years, make local bond issues impossible and restrict even utility rate increases.
In Nevada, college officials are leading the campaign against an initiative that would require a two-thirds vote by legislators and the public before taxes could be raised. The measure also would cap local property taxes.