Pete Rates the Propositions
Sensible opinions on the California ballot propositions      since 1980      by Pete Stahl

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Read the ratings:
Prop. 14 - NO
Prop. 15 - YES
Prop. 16 - YES
Prop. 17 - YES
Prop. 18 - YES
Prop. 19 - NO
Prop. 20 - NO
Prop. 21 - YES
Prop. 22 - NO
Prop. 23 - NO
Prop. 24 - NO
Prop. 25 - YES
 
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Pete Rates the Propositions
November 2020

Pete recommends:
14   NO   Stem Cell Research Bonds
15   YES   Increase Taxes on Commercial Property
16   YES   Restore Affirmative Action
17   YES   Allow Parolees to Vote
18   YES   Allow 17½-Year-Olds to Vote in Primaries
19   NO   Property Tax Relief for Older Homebuyers
20   NO   Harsher Parole Procedures
21   YES   Allow Rent Control on More Units
22   NO   Benefits for Uber & Lyft Drivers
23   NO   Regulation of Kidney Dialysis Clinics (Again)
24   NO   Consumer Privacy Rules
25   YES   Eliminate Bail
  My Semi-Biennial Lecture on Bonds

Download and print this handy printable version! (coming soon)



Proposition 14: Stem Cell Research Bonds – NO

Summary: $5.5 billion in bonds to fund research into medical uses of human stem cells. This is an expansion of a 2004 bond, which was needed at the time because a Republican administration had blocked federal funding of such research. The need to continue state funding is no longer so urgent, and in this crazy year there is too much uncertainty for the state to take on such a large financial commitment.

See My Semi-biennial Lecture on Bonds for my opinion of bonds in general.

Details: For my rating of this proposition, I was hoping simply to rerun my endorsement of its predecessor, Prop 71 of 2004. Wouldn’t that have been great? Less work for everybody!

But a lot has changed since 2004.

Prop 71 provided $2.7 billion in bond funding for scientific research into medical uses of human stem cells. The money was distributed to the University of California, other universities and nonprofit institutions, and for-profit biotech firms. Bond-funded research has resulted in 92 clinical trials of new treatments and 2,900 published studies.

Nearly all of the 2004 bond has been spent. Prop 14 on this ballot asks us to re-up for another $5.5 billion.

Human stem cells are unspecialized cells capable of transforming into specialized cells. Because stem cells can transform into any type of cell in the body, they are widely believed to hold the key to curing degenerative diseases such as diabetes, multiple sclerosis, Alzheimer's, and Parkinson's. They also hold great potential for treating trauma such as burns and spinal cord injuries.

The need for stem cell research hasn’t abated, but many of the other circumstances that led to a Yes rating then have changed.

In 2004, the G. W. Bush administration had blocked federal funding for research using new lines of embryonic stem cells. This left scientists with two inadequate options: a limited number of existing embryonic stem cell lines, or less-flexible adult stem cells. To move research forward effectively, California would have to backfill the missing federal money with its own funding.

Since then, the Obama administration lifted restrictions on federal funding, and the Trump administration has not reinstated them (although it has blocked funding of research that uses fetal tissue). Prop 71 has led to derivation of more than 20 new lines of embryonic stem cells. In addition, scientists have discovered how to induce adult stem cells to be “pluripotent” (give rise to any cell type in the body), like embryonic stem cells. These “have taken some of the heat off the embryonic stem cell research,” if not obviating the need for them entirely, according to Wisconsin researcher Timothy Kamp. So, if Prop 14 fails, access to adequate pluripotent stem cell lines won’t be the obstacle it was 16 years ago.

In 2004, there was limited infrastructure in place to support stem cell research. Since then, Prop 71 has helped build state-of-the-art stem cell labs at a dozen universities and nonprofits, five clinics, and three centers for researchers. These should provide a great platform for current and future research.

In 2004, I was willing to overlook the measure’s inappropriate use of bond funding. In my Semi-Biennial Lecture on Bonds, I assert that bonds are appropriate when you're paying for long-lived items like land, buildings and roads. But the proceeds of Prop 14, like Prop 71 before it, will be used for everything in a research lab. This includes such transient expenses as administration, researcher salaries, office supplies, travel, and chemicals.

Furthermore, although roughly half of Prop 71 funded research at the University of California, nearly $350 million was given as grants to for-profit biotech companies, which are essentially unaccountable to the public. Prop 71 requires these companies to negotiate with the state to share any future patents, royalties or licenses resulting from state-funded research. Maybe someday there will be a handsome windfall to public coffers, but so far we’ve earned only $350,000, or one-tenth of one percent return on our investment.

Finally, there’s the question of timing. In 2004, California was recovering from the dot-com bust. The General Fund wasn't exactly flush with cash, but it was rebounding nicely, and was forecast to set a new high the following fiscal year.

This year is a different story. It is impossible to predict, of course, but there is potential for an extended economic downturn, with concomitant state budget crises. It probably is the wrong time to commit to payments on a $5.5 billion loan. We may well need that money for basic economic relief over the next few years. I like to think that the sponsors of Prop 14, which qualified for the ballot long before the pandemic hit, would agree.



Proposition 15: Increase Taxes on Commercial Property – YES

Summary: Property taxes are based on a property’s assessed value. Currently, all land and buildings in California are assessed only when purchased, with a 2% maximum annual increase. If Prop 15 passes, commercial and industrial land and buildings will be reassessed at market rates every year: a huge increase for some. Smaller property owners (less than $3 million) are excluded. Business equipment is given a $500,000 exemption. Residential and agricultural assessments are not affected. Changes to be phased in gradually. This is a major step toward fair property taxation, and I’m thrilled to see it finally on the ballot.

Details: coming soon.



Proposition 16: Restore Affirmative Action – YES

Summary: Repeals the vile Prop 209 of 1996, which ended affirmative action programs for public employment, education, and contracts at the state and local level. Affirmative action helps reverse centuries of discriminatory practices that have resulted in the systemic oppression of minorities we see today.

Details: There are four measures on this ballot addressing systemic racism in our state laws. Prop 17 grants voting rights to felons who are reintegrating into society on parole. Prop 25 eliminates bail, ending a practice that disproportionately penalizes people of color. Prop 20, which I oppose, seeks a return to draconian mass incarceration. And this measure, Prop 16, restores affirmative action.

Affirmative action dates back to 1965, when President Lyndon Johnson issued an executive order requiring all government contractors and subcontractors to “take affirmative action” to expand job opportunities for minorities. Two years later, it was expanded to include women.

Over time, Supreme Court rulings have constrained what is allowable under affirmative action programs. In 1978, quotas and set-asides were disallowed. In 1989, governments were required to show a compelling interest and narrowly tailor programs to further that interest. In 1994, remedying past discrimination was allowed as a compelling interest. And in 2003, weighting candidates based on race was disallowed unless all candidates were reviewed in their entirety.

Earlier this year, Louis Menand made the case for affirmative action in The New Yorker far better than I ever could.

“[T]he reason we have affirmative action is that we once had slavery and Jim Crow and redlining and racial covenants, and that we once had all-white police forces and all-white union locals and all-white college campuses and all-white law firms. To paraphrase George Shultz, Nixon’s Secretary of Labor [and later Reagan’s Secretary of State]: for hundreds of years, the United States had a racial quota. It was zero. Affirmative action is an attempt to redress an injustice done to black people. The Fourteenth Amendment protects white people, too, but that is not why it needed to be written.

“It turns out that, when you remove enforcement mechanisms and remedial oversight, things tend to revert to the status quo ante. The whole history of affirmative action shows, ... that when the programs are shut down minority representation drops. Diversity, however we define it, is politically constructed and politically maintained. It doesn’t just happen. It’s a choice we make as a society.”

Evidence is now emerging to show Prop 209 has had measurable, negative impacts on minorities. In August, a comprehensive study by Berkeley economist Zachary Bleemer found that the ban has inflicted long-term harm on Black and Hispanic students, decreasing their number in the UC system, and reducing their likelihood of earning a degree, going to graduate school and earning a high salary. Columbia sociologist Jennifer Lee reports that reversing Prop 209 will actually help, not harm, Asian-Americans in employment, promotions, and earnings, while having no effect on college admissions.

Here’s what I wrote in opposition to Prop 209 in 1996.

“Let me clear up some common misconceptions about affirmative action. By law, all affirmative action plans must be remedial, not preventive. That is, they can only be remedies to well-documented discrimination by specific agencies against specific groups, not blanket policies to prevent future discrimination. Also, set-asides, such as reserving a certain number of places at a public medical school for some minority, are illegal; instead the school may consider race only as a factor to distinguish otherwise equally qualified applicants. Finally, state departments are merely ‘expected,’ not ‘required,’ to meet goals for awarding contracts to minority- and women-owned businesses. This allows the state much more flexibility than is commonly thought.

Given that it can be applied only as a remedy, that set-asides are illegal, and that contractor goals are not firm, affirmative action doesn't seem as diabolical as it has been portrayed. ... Affirmative action, limited as I've described, is the best way to deal with natural, institutionalized discrimination in public hiring, promotion, contracts and admissions.”

Prop 16 will restore an important, proven tool to address historic discrimination. If you support Black Lives Matter or related movements, voting for Prop 16 is a positive step you can take for social justice. This year it will be especially meaningful.



Proposition 17: Allow Parolees to Vote – YES

Summary: Parole exists to help felons reestablish good citizenship behaviors. Voting is an essential part of citizenship. Yet people on parole cannot vote. The reason? To suppress the minority vote, of course. Prop 17 will repeal an outrageous, Jim Crow law that has no place in our state.

Details: Parole is supervised reentry into the community after release from state prison. Parolees agree to certain terms and conditions, such as living in a specified county, consenting to be searched at any time, and other, offense-specific conditions (e.g., no weapons, no internet, or no association with gang members). Average parole lasts three years; longer for more serious offenses.

Under current law, parolees cannot register or vote. Prop 17 would allow it.

The purpose of parole is to retrain offenders to be good citizens. As the Penal Code states,

“The Legislature finds and declares that the period immediately following incarceration is critical to successful reintegration of the offender into society and to positive citizenship.”

Voting is a fundamental expression of citizenship. It ought to be part of the parole program.

So, why is it illegal? I think you can guess the answer: to reduce voting by people of color. The current law is rooted in racist, Jim Crow tactics, surviving from over a century ago. According to a 2012 report in the Berkeley La Raza Law Journal,

“Since the passage of the [post-Civil War] Fourteenth and Fifteenth Amendments to the United States Constitution, felony disenfranchisement became one favored method utilized by 21 states in suppressing the African-American vote. After 1890, many states began enacting disenfranchisement statutes and constitutional provisions that listed crimes for which African-Americans were most often prosecuted—such as burglary, theft, perjury, and arson—as disqualifying offenses...

“No other country disenfranchises more of its citizens on a per capita basis than the United States. Many other democratic nations have ceased automatic disenfranchisement of criminal offenders.”

Today, an estimated six million parolees nationwide are unable to vote, approximately 50,000 of them in California. As of 2016, Blacks made up 26% of parolees but only 6% of California’s adult population, and Latinos accounted for 40% of parolees but only 35% of California adults. Disenfranchising parolees disproportionately suppresses voting by people of color.

We Californians like to think of ourselves as frontrunners on civil rights. After all, the first same-sex marriages happened here, and our elected representatives include a kaleidoscope of women and minorities. But on this issue we are sadly behind the curve. Parolees are currently allowed to vote in fourteen states, including deeply conservative states like Indiana, Utah, and North Dakota. Prop 17 will bring us closer to the vanguard.

One of the arguments against Prop 17 is that giving parolees a voice in elections will somehow imperil our communities. In fact, the opposite is true: denying voting to parolees actually is bad for public safety. Studies show when people feel connected to communities, they are less likely to be reincarcerated. Recidivism rates are lower in states that allow parolees to vote.

I’m afraid this this argument, that “crime victims deserve justice,” and that “criminals convicted of murder, rape, child molestation, and other serious and violent crimes” must be denied voting rights, is actually a racist dog whistle—a signal, using discredited tropes about the violent and depraved “other”, that we must use the criminal justice system to enforce continued oppression of Blacks and other minorities. I urge you to be conscious of these insinuations, and fight back wherever you can.



Proposition 18: Allow 17½-Year-Olds to Vote in Primaries – YES

Summary: Allows 17-year-olds to vote in primary elections if they will turn 18 by the November general election. This is perhaps the most inconsequential proposition I have seen in 40 years of rating. What a waste of our time. On the plus side, though, the Legislative Analyst displayed a wicked sense of humor, estimating “minor costs” to implement. Get it? Minor costs for 17-year-olds? Ha ha ha ha ha.

Details:
You are sixteen going on seventeen
Baby, you can’t vote yet.
Your aspiration’s pre-registration;
Later, you’ll be all set.
 
I am seventeen going on eighteen,
Eager to use my rights.
But I am banned from having a hand
In primary plebiscites.
 
Totally well-prepared am I
To choose who runs our state,
And if the law were changed then I
Could vote to nominate!
 
I will soon be older and wiser.
Why can’t I vote in June?
If my elders pass Prop Eighteen
I’ll be voting soon.



Proposition 19: Property Tax Relief for Older Homebuyers – NO

Summary: The latest attempt by the Association of Realtors to goose their profits from home sales by providing property tax discounts for older customers. This year’s measure allows homeowners over 55 to transfer their reassessment immunity when they move to a another house of any value, anywhere in the state, as many as three times. To compensate public coffers, it increases taxes on property that’s inherited, which, oddly enough, Realtors don’t make money on. This is less of a pure giveaway than the failed Prop 5 of 2018, but it will still exacerbate financial inequality and perpetuate inequitable property tax burdens.

Details: When you buy real estate, the purchase price becomes the assessed value upon which your property taxes are based. The assessed value then rises a maximum of 2% every year, regardless of how much the actual market value increases. Over time, the property’s actual value may double, triple, or more, but its assessed value will change only slightly.

Under current law, homeowners who are over 55 or severely disabled, or whose property has been damaged by a natural disaster or contamination, can transfer their artificially low property assessments when they purchase homes of equal or lesser value. They can do this once in their lifetimes. Both homes must be in the same county (or in one of ten counties that allow intercounty transfers).

Prop 19 would extend this assessed-value transfer scheme to homes of any value, anyplace in California, up to three times. This provision will reduce overall property tax revenues for state and local governments, because fewer homes will be assessed at full value.

Also under current law, a parent’s primary residence is not reassessed when the children inherit it (regardless of whether the children then use it as their primary residence). Consequently, a home that’s been passed down from generation to generation over decades may have an assessed value today that is a small fraction of its actual value. In addition, people may inherit without reassessment up to $1 million worth of property other than the primary residence (e.g., a second home, business, or farm). In 2017, the Legislative Analyst estimated that these artificially suppressed property taxes due to inheritance exemptions cost state and local governments around $1.5 billion a year.

Prop 19 would require inheritors of their parents’ homes to use those homes as their primary residences in order to claim exemption from reassessment. This is intended to restore the original spirit of Prop 13 of 1978, which was about preventing people from being taxed out of their residences. Under Prop 19, the exemption for homes would be limited to $1 million, the same as it is for farms. This means that a mansion that has appreciated by many millions of dollars will be taxed based on all but one of those millions. And Prop 19 would completely eliminate the $1 million exemption on all other inherited property, such as second homes and businesses. The effect of these provisions will be to increase overall property tax revenues.

The authors of Prop 19 believe its two main provisions will offset, making the measure essentially revenue-neutral, with perhaps an eventual increase of less than $1 billion. (Some of that increase will be dedicated to fire protection, but I consider that irrelevant. The funding will be unreliable, and in any event, the Legislature is free to allocate money for that purpose anytime it wishes. Sadly, this part of Prop 19 is merely a ruse to mislead you into believing that the measure will increase public safety.)

“All right,” you may muse, “so Prop 19 won’t gut public budgets the way Prop 5 threatened two years ago. You still haven’t given me a reason to vote for it.” This is true. The backers of Prop 19 want you to focus on the outrage of overprivileged heirs paying virtually no property tax on inherited mansions they rent out for hefty sums while lolling on their private islands in the Caribbean. And on the frankly meaningless, feel-good provisions that purport to help fire crews and victims, the disabled, and dear, old Aunt Bertha, who can’t afford to downsize and move closer to her grandchildren in Grizzly Flats because El Dorado County hasn’t enabled intercounty transfers.

“But Prop 19 also gives reassessment immunity to middle-aged people who upsize,” you point out. “I don’t see that justified anywhere. Level with us: what’s really going on?” Here’s your clue: follow the money. Prop 19 achieves its revenue neutrality by reducing tax bills for people who buy, and increasing them for people who inherit. Who makes money when real estate is sold, but not when it’s inherited?

If you said “real estate brokers and agents,” give yourself a gold star! Prop 19 began life as a self-serving initiative from the Realtors Association, along the lines of Prop 5 from two years ago, but not quite so egregious. After some last-minute wheeling and dealing in the Capitol, in late June the Realtors pulled their initiative in favor of the legislative amendment you see today, giving up the $1 million exclusion but adding the endorsement of the powerful Professional Firefighters union (which had opposed Prop 5). The original equation remains: lower property tax bills equals more real estate transactions equals higher real estate broker commissions. Prop 19 exists, first and foremost, to stimulate real estate sales and increase real estate industry profits.

The official argument in favor of Prop 19 focuses on the frail elderly and severely disabled. It could conceivably merit your support if those were truly the primary beneficiaries of the measure. But let’s get real. Fifty-five is the new forty. These are not feeble empty-nesters looking to downsize; they’re energetic high-earners looking to move up. Prop 19 has nothing to do freeing seniors of limited means from oppressive tax bills, and everything to do with freeing large paychecks to pay bigger mortgages.

By granting this tax break to property owners, Prop 19 will also exacerbate financial inequality. And by dropping the lower-value restriction, it will defeat the intent of the original law: to encourage older empty-nesters to downsize, making their larger houses available for younger, growing families.

The Realtors have funded the Yes on 19 campaign to the tune of $35 million, which is a tiny fraction of what their brokers and agents will reap if it passes. At its core, Prop 19 is just another cynical, self-benefiting buy-a-law. Do not encourage this behavior by voting for it.



Proposition 20: Harsher Parole Procedures – NO

Summary: Rolls back some of the sensible reforms that voters recently approved in Props 47 and 57. Makes it much harder for felons to qualify for parole after serving the term for their primary offense. Reclassifies as “violent” (for parole purposes) dozens of felonies, including robbery, extortion, and elder abuse. Requires parole/probation officers to request harsher parole terms after a third parole or probation violation. Requires police to collect DNA from adults convicted of misdemeanors such as shoplifting and non-felony domestic violence. Creates new “mini-three strikes” theft crimes, allowing repeat shoplifting or petty theft to result in a felony charge. There is no compelling reason to do any of these things. Prop 20 is an attempt by the Correctional Officers Association to keep convicts in prison longer so there will be more work for officers. That’s a horrible and pathetic rationale.

Details: coming soon.



Proposition 21: Allow Rent Control on More Units – YES

Summary: Under current state law, local rent control laws cannot apply to units built after 1995 or to single-family houses or condos, nor can they limit rent increases when a new renter moves in. Prop 21 would allow (but not require) local rent control to cover any units more than 15 years old and most houses and condos, and it could limit rent increases when a new renter moves in. Prop 21 is much narrower than the failed Prop 10 from two years ago. Mostly, it brings two arbitrary limitations in the original law into line with a newer state law. Consider it a bit of legal hygiene.

Details: This is not a replay of Prop 10 from two years ago. That proposition, which failed by a colossal 2.3 million votes, would have authorized cities and counties with local rent control to expand it dramatically: it would have allowed rent restrictions on units of any age, even including new construction; on “mom-and-pop” single-family homes; and when new tenants move in without limitation. Prop 21, in contrast, is modest in its aspirations.

Fifteen cities and Los Angeles County currently have local rent control ordinances. These ordinances must conform to rules laid out in the Costa-Hawkins Rental Housing Act, a state law passed in 1995. Under Costa-Hawkins, local rent control cannot apply to single-family homes or condominiums, nor to any units built after 1995 (or the date of the ordinance if it was enacted earlier); and it cannot implement vacancy control, which would limit rent increases between tenants. The localities with rent control contain about one-fifth of California’s population; they are all located in the Bay Area or Los Angeles County, plus Palm Springs and Thousand Oaks.

Everyplace else in California is covered by a new, statewide rent control law that went into effect on January 1, 2020. Under this new law, named the California Tenant Protection Act, landlords cannot increase rent by more than 5 percent plus inflation in a year (or 10 percent if that’s lower). This prevents renters from being suddenly priced out of their homes. Also, instead of the fixed Costa-Hawkins built-before date of 1995 (or earlier in some cities), the new law uses a rolling date of 15 years before the present. This allows more properties eventually to fall under rent control, while still providing a sufficient market-rate window to reward developers for building much-needed housing. Lastly, the Tenant Protection Act applies to single-family homes and condominiums owned by trusts and corporations. This recognizes the reality that these types of homes are now an essential component of rental stock. The new law is temporary; it expires January 1, 2030.

Funny thing. Because the Tenant Protection Act applies only where there is no local rent control, renters in places that never enacted local rent control are now protected more strongly than in those that did. A unit built in 2004 is rent controlled in San Diego, which doesn’t have a local ordinance, but not in Los Angeles or Oakland, which do. A corporate-owned condominium is rent controlled in Fresno, which doesn’t have an ordinance, but not in Berkeley, which does. Ironic, isn’t it?

Prop 21 amends Costa-Hawkins to bring it into line with the Tenant Protection Act. There are three main provisions. First, Prop 21 will change the built-before date for local ordinances from a fixed date of 1995 (or earlier) to a rolling date of 15 years ago. This is identical to the Tenant Protection Act.

Second, Prop 21 will allow local ordinances to apply to single-family homes and condominiums, except those owned by “mom-and-pop” landlords who have only one or two properties. While not identical to the Tenant Protection Act, it’s a reasonable approximation. This provision is aimed at corporations that have been buying up single-family houses in high-demand areas and renting them out for outrageous sums. (If you live in Silicon Valley you probably know what I’m talking about.) As single-family homes become a larger portion of rental stock, it makes sense for them to be treated like other rental units. The exception for mom and pop will ensure that families can rent out a second home or half of a duplex without worrying about bureaucratic red tape.

The third provision of Prop 21 may give you pause. It allows cities and counties to enact vacancy control. Under current law, after tenants move out, landlords can charge new tenants whatever the market will bear. In areas where market rates are jumping (i.e., most of the state), this gives landlords of rent-controlled buildings a strong incentive to push out longtime tenants so they can collect much higher rents from new ones. It can result in delayed repairs, harassment, and other misbehavior.

To prevent this scenario, Prop 21 would allow vacancy control. Cities and counties would be permitted to clamp the same limitations on vacant units as on occupied ones, as long as they allow a three-year, 15% temporary increase to fund repairs and upgrades. Under Prop 21, a city could enact regulations to ensure units more than 15 years old never float to market rate.

Note, however, that Prop 21 does not require cities to enact maximum vacancy control, or any vacancy control at all. And there are good reasons to assume that most cities won’t. For one thing, removing the market-rate bump between tenants might reduce profitability enough to have a chilling effect on construction of new housing. And requiring vacant units to be priced below market means there will be fierce competition for those units, which can easily lead to bribery, off-the-books surcharges, and other hanky-panky. Realistically, the only cities to enact vacancy control will be those fighting gentrification in order to preserve their diversity and protect the character of special neighborhoods. Maybe a few cities will do this, but only a few.

Prop 21 requires that local rent control laws allow landlords a fair rate of return on their properties, consistent with past court rulings. If owners can show that local ordinances constrict their income unfairly, Prop 21 mandates that controls be loosened.

I should point out, as I did two years ago, that there is no case for rent control in economic theory. Economists across the political spectrum are virtually unanimous on this, from Paul Krugman on the left to Thomas Sowell on the right to Milton Friedman wherever he fits. Rent control contorts markets, causes perverse behaviors, and degrades the quality and quantity of rental properties. It frequently achieves the very opposite of its stated goals. You can read about it in any economics textbook.

If you want to apply the theory, then go ahead and vote against Prop 21. But here in the real world, skyrocketing market-rate rents have forced families from their longtime homes, torn apart communities, and intensified poverty and homelessness. You have witnessed it. Judiciously applied rent control, by moderating increases, can stem the human cost while still providing owners a fair rate of return.



Proposition 22: Benefits for Uber & Lyft Drivers – NO

Summary: A breathtakingly self-serving buy-a-law from (and for) ridesharing corporations Uber and Lyft. Prop 22 would deny their drivers the usual benefits of employment, such as minimum wage, overtime, health insurance, unemployment insurance, and workers’ compensation. Instead, the corporations offer a wretched assortment of inadequate crumbs, such as hourly pay slightly above minimum wage (but only while actually driving passengers), a health insurance subsidy that’s slashed in half if a driver misses an engaged-hours target, partial wages if injured on the job, and a 12-hour-per-day work limit. This proposition is utterly Dickensian. It’s as brazen as it gets.

Details: coming soon.



Proposition 23: Regulation of Kidney Dialysis Clinics (Again) – NO

Summary: Another attempt by United Healthcare Workers union to inflict damage on dialysis giants Fresenius and DaVita in retaliation for their resistance to unionization. It actually contains one good idea, which the Legislature enacted last year, making this proposition unnecessary.

Details: Here’s the latest chapter in the titanic struggle between the enormous United Healthcare Workers union and the giant Fresenius & DaVita dialysis clinic chains. Fans will recall that two years ago, in Prop 8, the union failed in its attempt to drop the hammer on the chains by limiting their revenue and compelling them to spend more on workers and supplies. Apparently their earnest claim that the clinics were crawling with hideous vermin didn’t resonate with voters.

In this year’s installation, Prop 23, the union tries mightily to force the chains to (1) get state permission before reducing or eliminating services at any clinics; (2) accept all patients regardless of insurance; and (3) post a doctor or nurse practitioner on site whenever patients are being treated. The chains bellow in response that this would cost too much and have no effect on patient care.

The second of these is actually a great idea. In fact, it’s such a fine idea that the Legislature went ahead and enacted it late last year.

You see, in 2019, the chains were caught running a scam involving the American Kidney Fund, a nonprofit that receives over 80% of its money from Fresenius and DaVita. The chains pushed Medicare dialysis patients to drop Medicare and enroll in private insurance instead, with premiums paid by AKF. The chains then charged private insurance companies four times as much for the same services. California shut down the scam with a new law signed last October, despite a $2.5 million full-court press from Fresenius and DaVita.

The upshot for Prop 23 is that its thunder has been stolen by the Legislature. I can’t recommend the measure if all it will do is require a bureaucrat to okay service changes and mandate the presence of an extra medical professional; I’m not convinced either of these is necessary.

Will the union ever exact its revenge on the chains for resisting unionization of clinic workers? Will the chains ever stop their unethical patient manipulation? Well, probably not this year. But stay tuned—more titanic chapters await!



Proposition 24: Consumer Privacy Rules – NO

Summary: California already has a consumer privacy law, passed by the Legislature in 2018. It went into effect earlier this year, and has been enforced with fines only since June. Prop 24 asks us to make sweeping changes to the new law. This is obviously premature. Factor in the mixed-to-negative reviews the proposed changes have received from consumer rights advocates such as the ACLU, Electronic Frontier Foundation, and Consumer Federation, and it adds up to a “no” vote.

Details: coming soon.



Proposition 25: Eliminate Bail – YES

Summary: California’s criminal justice system relies on cash bail, so poor people awaiting trial must stay in jail while the well-off get out. It’s fundamentally unjust. Prop 25 will eliminate bail in California, moving us closer to equal protection under the law. Its replacement, though, is far from perfect: an AI algorithm that calculates a person’s risk of committing a new crime or failing to appear in court, based on personal and demographic data. The potential for bias is great. However, Prop 25 requires the state to adjust the algorithm regularly, and I’m optimistic we can find fair and safe parameters. In any event, it’s a great improvement over bail.

Details: The United States imprisons more people than any other country: 2.3 million, or one-quarter of all prisoners in the world. Our rate of prisoners per capita is five times as high as the UK, six times as high as Canada, and twelve times as high as the Netherlands.

Here in California, 239,000 people are incarcerated in jails, prisons, and other facilities (as of 2018). Of those in local jails, 60%—about 50,000 people—are pretrial detainees who have not been convicted of any crime. Many are only there because they cannot afford bail.

Bail is constitutional by definition; it is part of the Eighth Amendment. It’s pretty simple in concept. When you’re arrested, the court will set you free, as long as you promise to appear in court when required, and you provide something of value (i.e., bail) as collateral. If you appear as required, the bail is returned to you; if you skip your court appearance, the state keeps the bail and may re-arrest you.

Each county maintains a schedule listing the amount of bail required for each crime. For example, bail is $10,000 for domestic assault in Mendocino County, $100,000 for mayhem in Los Angeles County, and so on. (Judges can adjust these figures at arraignment—more on that later.) If you happen to have that kind of cash, you provide it to the court and go on your merry way. If you don’t, you call a bail agent and arrange for a loan, known as a bail bond. The nonrefundable premium for this service is generally 10-15% of the bail amount. And if you cannot afford even that, you are stuck in jail until your trial.

As you can see, your net worth determines your treatment—cash, bail bond, or jail. The fact that the criminal justice system treats you differently depending on how much money you have is, to put it bluntly, asinine. It has led to tens of thousands being incarcerated in our state, awaiting trial, simply because they are poor. And since racial minorities are overrepresented in the lowest economic tiers, they are overrepresented in this unfairly jailed group, making bail an important racial justice issue. Jay A. Fernandez describes the impact in ACLU Magazine:

“Both court-assigned bail amounts and bail premiums are applied unevenly across race—studies have shown that Black and Latino men are on average assigned substantively higher amounts than white men for similar crimes—and those who cannot afford either land in jail. Trapped there, they are subject to a system that perpetuates negative outcomes: Defendants are four times more likely to be sentenced to prison if they spend their pretrial time in jail; they are more likely to take guilty plea deals for lesser charges to obtain release, even if they are innocent; they suffer the psychological trauma of being cut off from family and friends for weeks, months, or even years; they are exposed to violence, abuse, and poor health conditions; and they risk losing homes, jobs, and custody of their children.”

Prop 25 will eliminate bail in California. It will require release within 12 hours of arrest for most misdemeanors. For more serious misdemeanors and felonies, arrestees will be categorized for risk. Those deemed low- or medium-risk must be released within 36 hours, with possible supervision for medium-risk people. High-risk arrestees and those accused of severe felonies would remain in jail. At arraignment, Prop 25 will generally require release until trial, unless prosecutors can show high likelihood the accused might commit a new crime or fail to appear in court.

Under Prop 25, your net worth will no longer determine how much time you spend in jail. Far fewer people will be jailed until arraignment and trial, and those who are jailed will be there for the right reasons: risk of criminal behavior, not indigence. It’s a great step toward a more just system.

But Prop 25 is not perfect. Placing arrestees into those three risk categories is a tall order. Here’s some background.

Today, courts have latitude to change bail at arraignment, based on the seriousness of the crime, prior record, and the risk of a new crime or skipped court dates. Determining that risk is obviously difficult, and can be quite subjective, making it susceptible to conscious or unconscious bias. To mitigate that bias, most courts today use pretrial risk assessment tools. These are computer programs that analyze an arrestee’s personal history (e.g., prior record) and demographic data (e.g., age), compare it with historical data, and make a recommendation. The tool does not replace the judge’s discretion, but it provides a useful, objective assessment.

Prop 25 will elevate these tools to be a primary determinant of pretrial risk. In essence, an AI algorithm will categorize people as low, medium, or high risk, with the consequences outlined above. The assessment staff is also directed to collect additional information, such as the particulars of the crime and extenuating circumstances, but the pretrial risk assessment tool’s score will be critical.

If you’re thinking, “I’ve seen this movie before – it had Tom Cruise and a lot of holographs,” you’re right. The movie is “Minority Report” (2002), based on a story by Philip K. Dick. In it, oracles predict who will commit crimes in the future, and hunky Tom arrests them before they get the chance. Crime is virtually eliminated. Prop 25’s use of AI tools to determine who must remain jailed is not unlike that. The difference is that Dick’s oracles are miraculous and inscrutable, while our tool is well-understood and under our control. Still, some skepticism is understandable.

As you might imagine, Prop 25 is fiercely opposed by the bail bond industry. A collection of bail bond insurers with bland names like Triton, AIA Holdings, Seaview, and American Surety, have poured over $5 million into the “No” campaign as of early September; expect more soon. Their main argument (aside from “we’re not really parasites!”) is that defendants will simply stop showing up for court dates if they have no bail money at stake. This is a genuine risk, but a small one compared with the horrendous inequity of wealth-based justice. I’m willing to tolerate a few more court no-shows if I can make the system fairer.

A more serious objection is that the AI algorithm replacing bail will always be inherently unfair, because it is based on prior data from a system that has historically mistreated minorities. This is essentially the position of Human Rights Watch, which argues that Prop 25 “...exchanges money bail for a system that uses racially biased risk assessment tools, [and] gives judges nearly unlimited discretion to incarcerate.” HRW proposes that California should adopt “cite and release” instead of arrests for non-serious and non-violent felonies; require courts to dig into facts and context when considering release; and require release in all cases “absent significant proof of a specific danger.”

This may well be a superior system, but it’s not on the ballot. Prop 25 is, and the only choices are yes and no; there is no essay section. If Prop 25 fails, the message received in Sacramento won’t be that voters hate bail but are suspicious of the AI pretrial risk assessment tool; it will be that they want to preserve bail. In that scenario, the likelihood of the Legislature passing an even stronger proposal, such as HRW’s, is nil.

Prop 25 will require the state Judicial Council to identify and mitigate any implicit bias in the tool at regular intervals. Will they get it right the first time? Doubtful. But it’s reasonable to assume they will keep at it. There’s a whole industry dedicated to improving these tools continuously. I’m optimistic they and the Council will gradually devise a fair way to determine who must remain behind bars.



My Semi-Biennial Lecture on Bonds

[This year’s lecture departs from my usual spiel in two places. They’re in brackets below.]

When California wants to finance a large project, it asks the voters for permission to take out a loan. Prop 14 on this ballot is just such a request. If voters approve, the state may take out a loan for the project by selling general obligation bonds, which are paid back with interest over 30 or 40 years. The bond payments come out of the state’s main budget, the General Fund. So when we vote on bond measures, we are really voting on whether the project in question ought to be added to the state’s budget.

“Wait a minute!” I hear you cry. “What about those interest payments? Won’t we end up paying more for interest than for the bonds themselves?” This may once have been so, but with today’s low interest rates, each dollar of bond money will cost only 40 cents in interest, accounting for inflation. (See details on p. 78 of your ballot pamphlet.)

“Okay,” you admit, “but loans are still more expensive than pay-as-you-go.” This is true. Still, loans are the only way to buy a house, or a car, or anything else that you need immediately but can’t pay for yet. It’s worth paying the premium of interest to get the funding now.

“Well and good,” you continue. “But there are $5.5 billion in bonds on this ballot. Isn’t that too much to borrow?” For you, yes, but the State of California can handle it. Bond payments today amount to just over 4% (and shrinking) of the General Fund, down from a high of nearly 6% ten years ago. Prop 14 won’t appreciably increase that figure. Accounting for Prop 14 and all bonds previously authorized by voters, the Legislative Analyst predicts the debt ratio still won’t top 5%.

[However, in the current period of deep uncertainty, it’s possible we’ll be facing years of state budget crises, as mass unemployment and unpredictable markets potentially slash the state’s income. So I’m advising extreme prudence this election.]

Most bonds fund long-lived, tangible acquisitions, such as laboratory buildings and equipment. It’s sensible to make extended payments for things that will be used far into the future.

[It's not sensible, however, for bonds to fund transient items such as administration, research staff salaries, consumable goods, and other indirect costs, as Prop 14 proposes. This is a flagrant violation of this point. For this reason and others, I oppose Prop 14.]

Remember, too, that California’s population continues to grow by millions every decade. Borrowing makes particular sense if you know your income will go up in the future. As the state grows, over time the General Fund will grow too.

There is one last reason to vote for a bond measure. In addition to being formal requests for permission to take out loans, bond measures are also looked upon as referenda on the merits of the proposed projects. If a bond measure fails, legislators are likely to believe that the public feels the project is not worthy of receiving state funding. By voting no, you may have meant, “Yes on the project but no on the bonds,” but your message to Sacramento will read, “No on the project.” So if you vote down a bond measure just because you don’t like bonds, you may well have killed forever the project the bonds were to have funded.



 
 
 
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