Revolt of the Haves:
Clark, Jack
Books: DEEP IN THE HEART OF TAXES IN the opening chapters of Revolt of the Haves, one occasionally needs reminding that this compelling and well-written history of the California tax revolt...
...Ironies, sometimes amusing, more often bitter, abound...
...As Kuttner forcefully argues, that does not mean that money has been lavished on the poor...
...Books: DEEP IN THE HEART OF TAXES IN the opening chapters of Revolt of the Haves, one occasionally needs reminding that this compelling and well-written history of the California tax revolt represents fact not fiction...
...Proposition 13 threw the liberals into self-doubt and persuaded legions of conservative ideologues and corporate lobbyists that public opinion and even history were on their side...
...Diverging from those who see the tax revolt as the majoritarian wave of right-wing populism, Kuttner concludes that voting tax revolters have cast ballots primarily against high taxes, secondarily against politicians and only against government a distant third...
...And he looks at the National Tax Payers Union and National Tax Limitation Committee, rival organizations of reactionaries boosted by Proposition 13...
...The details of what happened in California are crucial, and Kuttner masterfully lays them out...
...Unlike these ideological groups, most voters who supported tax limitation were not committed to dismantling social programs...
...In 1965, the San Francisco newspapers exposed the questionable assessment practices of Russell Wolden, the "crooked assessor," who rebated business property taxes for a consulting fee...
...To be sure the atmosphere around the tax revolt has supplied a hothouse culture for the growth of right-wing populism and just plain right-wing crankiness...
...Spending less, however, provides only leaner guarantees...
...no novel could hold up under the strain of incredible characters like Jerry Brown and Howard Jarvis and the strained plot leading to passage of Proposition 13...
...Of course, because the value of BETOLT Or THE HATES Robert Kuttner Simon and Schuster, $13.95, 384 pp...
...Getting back to the housing analysis, one example he cites is the anti-redlining legislation passed by many states...
...With the easy answer of "spend more" cut out as an option, he sees the possibility of liberal policy turning toward less expensive, more effective structural reforms...
...Certainly spending more money per se fails to address, much less solve, the problems of maldistribution and corporate domination...
...That all makes eminent sense, and yet something remains unsatisfying in Kuttner's conclusion...
...Yet it cannot really be doubted that the tax revolt has had conservative, anti-government consequences...
...Jack Clark the property was appreciating tax receipts were climbing astronomically...
...California was the starting point, and it is there that the list of victims is clearest: welfare recipients...
...the mentally ill and devel-opmentally disabled...
...The rate at which people were being taxed may well have dropped ten percent...
...In both cases he argues convincingly that the monies spent enriched private and affluent providers (real estate hustlers, insurance companies, doctors) while providing minimal services and sometimes even disrupting the lives of the poor...
...A wave of reform swept through the state, and the practices of other crooked assessors were halted...
...The result: the low property taxes paid by homeowners soared and business property taxes declined to levels far below Wolden's corrupt deals as uniform property assessments became the rule of law...
...It may cost us a smaller percentage of GNP than we currently spend on health care, but the financing will shift from private to public spheres...
...No great bureaucracy was created, but banks were required to disclose where their monies were going and to reinvest in the neighborhoods their savings came from...
...Particularly now, with the Republican landslide and the endless punditry about the nation's turn to the right, understanding what went into and what came out of the tax revolt is essential...
...Even with strict cost controls, that will cost public money...
...The bright glimmers of tax reform seen in the late sixties faded as the corporations won the upper hand in Congress...
...Through the late 1960s and 1970s, with much fanfare by local officials, tax rates in many communities actually declined...
...For every cent expended to benefit the poor, more money must be spent to buy in various interest groups...
...Opposed by business and sponsored by landlords, Proposition 13 ended up rewarding business with about two-thirds of the property tax savings and landlords with a subsequently successful rent-control drive...
...The answers to those questions will affect the possibilities for a more decentralized and democratic society envisioned by Kuttner...
...Kuttner cites the work of Massachusetts Fair Snare and the Ohio Public Interest Campaign in turning the tax issue around as an organizing tool for the populist left...
...But we also require a recognition that the class struggle politics we see unfolding deal not only with retrenchment and anti-statism but with expenditures of hundreds of millions.hundreds of millions...
...The reminders come quickly...
...More insidious has been the pork barrel structure of our welfare state subsidies...
...Since the New Deal, the liberal response to almost any problem has been to spend more...
...stuaents, teachers and public employees in general...
...Some of it has been absorbed in various layers of government bureaucracy required by our federalist structure (for a number of programs we have federal, state and local civil servants...
...In one of the areas he covers in detail, housing, there is a possibility that the government can provide incentives and disincentives to a market which really functions...
...Heralding other examples such as the Coop Bank, encouragement of Health Maintenance organizations and a program called Neighborhood Housing Services, Kuttner calls for a "leaner populism...
...Similarly in energy, in transportation, in job creation and in that great catch-all category, reindustrialization, demands from all sides call for more government involvement and spending, not less...
...but if the assessed value of the property rose twenty-five percent, the local government was collecting more and hustling voters with talk of a tax cut...
...Liberalism found itself defenseless in Proposition 13's wake because the tax revolt hit where it hurt hardest: in the purse strings...
...Many in fact formed the core of support for traditional New Deal liberalism...
...He meticulously analyzes the welfare state, American-style, and concludes, correctly in my view, that its purposes are structurally undermined by subservience to the corporate rich...
...But the significance of the tax revolt and the spread of anti-government right-wing populism extends far beyond California's politics...
...Questions remain about what role the government will play, in whose interest it will act and who will control its actions...
...Liberals must turn toward structural reforms and a leaner populism, by all means...
...Yet the mainstream liberal response to the shortcomings of such programs remained a desire to increase their budgets...
...Even more pervasive, Kuttner sees the tax-cut momentum redefining American liberalism...
...Of course, there were other trends as well...
...The politics of tax-cutting spawned other state and local initiatives and the national debate around capital formation and supply-side economics...
...members of minority groups who depended heavily on human services that were cut and who were beginning the climb through public employment...
...Kuttner recounts his experience as chief investigator of the State Banking Committee, and he focuses his analysis on housing and health care subsidies...
...Wolden was tried and convicted, despite a large defense fund raised by municipal business leaders and testimony on his behalf by the most respectable property-holders in the city...
...In health care, the other policy area he probes, we must really at some point join the rest of the industrialized world in enacting a comprehensive national health care system...
...Kuttner argues for structural reforms...
...While resentments about escalating property taxes were boiling over, the state treasury held a bountiful surplus which Governor Jerry Brown used to promote his image as a fiscal conservative and hoped to use for a Golden State space program...
...Kuttner examines initiatives imitating Jarvis in Oregon, Michigan, Washington State and elsewhere, always with an eye on the fringe right (after 1978 with corporate blessings) promoting the efforts...
...He carefully dissects the tax revolt and concludes that the rich are reaping the greater part of the savings...
Vol. 108 • March 1981 • No. 6
