Editorial: Californians beware. Industry is using our ballot system for blackmail

California’s direct democracy system’s glaring if unavoidable flaw is that it allows any person, industry or special interest with a few million dollars to spare to propose new laws that serve their own needs, whims and interests. For example, Mercury Insurance and other auto insurers tried — and failed — twice to trick voters into thinking an industry-sponsored measure to change how premiums were set was for the benefit of drivers. (It wasn’t.)

For the most part voters have not been fooled, rejecting the worst and most self-serving measures once their origins were revealed. This makes using the citizen initiative process to bypass the Legislature an expensive and dicey proposition, as it should be.

But one industry figured out an easier — and cheaper — way to use the initiative process that doesn’t rely on the whims of voters: Propose a measure so odious to lawmakers that they’ll agree to lesser demands to make it go away.

Call it ballot blackmail. As the soda industry found last week, it can really pay out.

Here’s what happened: Soda manufacturers including the Coca-Cola Company and PepsiCo funded a statewide ballot measure that would make it harder for local governments to raise taxes. Why would they care? Because it could slow the spread of soda taxes, which are having an effect on their sales. It was brilliant strategy because the initiative appeared to have nothing to do with soda; instead, it appeared to be an effort to protect voters from higher local taxes by requiring a two-thirds majority vote to approve them.

As was surely intended, the measure raised alarms up and down the state when elected officials realized their ability to pass new taxes might be hampered by the measure — permanently. Laws passed by a statewide vote can’t be undone or changed by the Legislature. Gov. Jerry Brown called the measure “an abomination.”

Only days before the deadline for finalizing the November ballot lineup, business groups and labor organizations worked out a backroom deal that banned local taxes on “groceries” for 12 years, though it was only one grocery item they had in mind — soda. In return, the initiative’s sponsors agreed to withdraw it from the ballot. Legislators knew they were being gamed, but many said they felt they had no choice but to give into what one lawmaker called a “political Sophie’s choice.” The Legislature passed the deal with just hours to spare before the Thursday deadline to finalize the November statewide ballot measure lineup.

A few years ago this couldn’t have happened, but a provision in a 2014 package of ballot initiative reforms allowed proponents to yank a measure after it has already qualified. The reforms were designed to give the Legislature the chance to resolve policy disputes that didn’t belong on the ballot, and in two cases this year, they worked exactly as intended. In one, legislators were able craft a compromise on internet privacy that led the sponsor of a related initiative to pull it from the ballot. In another, they convinced paint companies to drop a deceptive lead paint cleanup measure by moving legislation that would have exposed the companies to more lawsuits and higher costs.

Still, in retrospect, allowing sponsors to withdraw qualified initiatives practically guaranteed the type of exploitation practiced by the soda makers. That’s because it gave special interests a new opportunity to extract concessions from lawmakers after qualifying an initiative for the ballot, but before running the costly, lengthy and risky campaign to win voter approval.

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If the experience with the soda ballot measure proves to be just an aberration, we can chalk it up to “stuff happens.” But it seems likely that the strategy will employed again by a person, industry or other special interest hoping to extort its own self-serving deal out of the Legislature. (Though in the case of the soda industry, the victory may be short-lived; days after the governor signed the soda tax ban deal, healthcare groups launched an effort to qualify a statewide soda tax on the 2020 ballot.)

Given the outcomes on privacy legislation and lead-paint cleanups, the 2014 reforms were positive on net for state residents. That said, legislators could have handled the soda tax deal better by not waiting to the last minute and subverting the normal lawmaking process to get it passed.

This year’s experience is a warning for what may come in future elections. It’s also a reminder that the state’s initiative process is an active system that may need tweaking from time to time to make sure it’s not hijacked by those serving something other than the public interest.

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