Brown's Calif. tax initiative hit from both sides

October 11, 2012 - 3:35 PM

SACRAMENTO, Calif. (AP) — After returning to the governor's office, Jerry Brown criticized a political culture he said lacked a common purpose and warned of a "war of all against all" unless the sniping camps learned to compromise and fix California's persistent budget problems.

Those efforts failed, and now the Democratic governor finds himself fighting his own political battle as he tries to persuade voters to pass a $6 billion tax increase on the November ballot that he says is crucial for closing the state's deficit.

With the election just a month away, Brown's initiative to boost the statewide sales tax by a quarter-cent and income taxes for those earning $250,000 a year or more is in jeopardy, primarily due to a wealthy brother and sister who are at opposite ends of the political spectrum, and Brown's own missteps.

The political slugfest is bad news for Brown's Proposition 30 and a competing tax initiative from Molly Munger, a liberal-leaning Los Angeles civil rights attorney who is the daughter of a billionaire executive for Warren Buffett's Berkshire Hathaway.

She has spent $34 million so far in support of Proposition 38, which would raise about $10 billion a year through a broadly based income tax increase and send the revenue directly to school districts, bypassing the Legislature.

Her brother, Stanford physicist Charles Munger Jr., is a conservative who has poured more than $20 million of his fortune into a committee aimed at defeating Brown's ballot initiative and supporting a separate initiative targeting public employee unions.

The attacks from both Mungers have so angered Brown's Democratic allies that they issued a statement saying they would become known as "the millionaires who destroyed California's schools and universities."

California initiative campaigns are often exercises in excessive spending, but this fight is unusual because much of it is taking place between Democratically aligned interests seeking to accomplish essentially the same thing — restoring funding to California schools after years of budget cuts.

Teachers unions back Brown's initiative and the state PTA is aligned with Molly Munger.

The public sniping is erupting just as vote-by-mail ballots are being sent to California's 17 million registered voters.

"When California voters are in doubt, when they're confused about initiatives, they tend to vote no. What this direct hit by Munger on Prop. 30 can do is confuse voters. Perhaps both 30 and 38 go down," said Sherry Bebitch Jeffe, a senior fellow at the University of Southern California's School of Policy, Planning and Development.

Brown's tax initiative already faced an uphill struggle after a summer of unfavorable headlines and major spending decisions, including revelations that the state parks department was hiding $54 million and the Legislature had given out pay raises to staffers at a time of deep budget cuts.

Brown also approved plans for a $68 billion high-speed rail system with waning public support and promoted a $24 billion water tunnel project that has strong opposition in Northern California.

California also has one of the nation's highest unemployment rate and, recently, its highest gasoline prices.

The state budget Brown signed into law relies on the tax revenue that Proposition 30 will generate if voters approve it. Without it, Brown has warned California schools and colleges face $6 billion in automatic spending cuts.

Brown has also been largely absent from public view, despite saying that passing Proposition 30 is his top priority. His last public campaign event was Aug. 30. He did hold some separate gubernatorial events in September.

"He's got to explain it to people, because it's his measure. He needs to be out there explaining it," said Mark Baldassare, president of the Public Policy Institute of California.

The most recent public opinion polls have shown Proposition 30 with a slim majority of support before the attack ads began.

Molly Munger argues that taxpayers should be bailing out classrooms, not the state budget.

Her initiative was written so the tax revenue raised would avoid the Legislature and go directly to schools. In TV ads that began airing in September, her campaign has promoted its alternative to "Sacramento politicians," but polls show it has yet to persuade a majority of likely voters.

Brown's campaign waited until October to begin advertising on TV, then essentially adopted Proposition 38's tag line, saying "Sacramento politicians can't touch" the money. That claim is directly at odds with the independent legislative analysis of his initiative, statements the governor made this summer and his own description when he announced he had reach a compromise to put the initiative on the ballot.

"It's the tax program that balances the budget," he told The Associated Press in March. Brown declined to be interviewed about his initiative by the AP for this story.

Munger said she felt compelled to act after years of politicians failing to adequately fund California schools. She said her polling shows voters support more school spending, as long as the money doesn't go through the Legislature.

"It does seem to be a climate out there that is quite favorable for a message that the money will go directly to the schools and will skip Sacramento," Munger said in an interview last month.

Frustrated that Brown had co-opted her message, Munger began airing an attack ad this week that said, "Don't be misled by the politicians" showing a Proposition 30 sign crashing to the ground.