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The State Worker: What happens if Prop. 32 passes?

Published: Thursday, Sep. 20, 2012 - 12:00 am | Page 3A
Last Modified: Tuesday, Feb. 26, 2013 - 8:13 pm

Imagine it's Nov. 7, 2012.

Yesterday, California voters approved Proposition 32, ending payroll- deducted funds for politics and eliminating union and corporate contributions directly to candidates.

So now what?

Here come the lawyers. Attorneys live to probe ballot measures for legal loopholes and constitutional conflicts. In this case, Proposition 32 bans "unions" and "corporations" from using payroll-deducted funds for "political purposes." Government contractors also are banned from giving to candidates or their committees.

But what do those words mean? What about non-corporate business entities, such as limited liability companies? What about contributions from Indian tribes? What's a political purpose, anyway?

Ultimately, the courts will decide.

Less dough for Dems. Public- and private-sector unions gave a combined $74.7 million in political donations to state campaigns in 2010, according to the National Institute on Money in State Politics.

The money came from payroll deductions and went mostly to support Democrats and union causes.

That compares with $95.4 million doled out that year by the top three business interest groups – utilities, insurance companies and investment firms.

Until Proposition 32, business groups spread their money on both sides of the aisle, in part to counter labor's donations to the Democratic side.

Now voters have OK'd the measure and unions have lost their set-it-and-forget-it political funding source. Business interests come under the same payroll ban, but it's no biggie – they get most of their money from executive contributions and their companies' resources.

The result: Unions' political juice – and a prime source of Democratic campaign money – will dry up.

Meanwhile, business interests' political cash will keep flowing. They'll simply channel the money to constitutionally protected independent expenditure campaigns. In an ironic example last week, an opaque IE with Republican ties kicked in $4 million to support Proposition 32.

If unions lose, so do their traditional allies, Democrats.

Unions go to Plan B. While it will take some time to see the full impact of Proposition 32's passage, one thing is certain: Employers will no longer double as political-money collection agents for unions.

Labor groups had a nice ride for nearly 70 years, when payroll-deducted dues payments started bringing in money predictably and cheaply.

With Proposition 32's passage, labor groups will have to fundraise like everyone else. Some are already thinking about using text messaging to collect political contributions.

The lesson here is that political cash, like sewage, flows around reform obstacles. In the era of PayPal, Facebook and electronic funds transfers, the unions will adapt to Proposition 32. But they'll have to spend more money to take in less.

© Copyright The Sacramento Bee. All rights reserved.

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About The State Worker

Jon Ortiz The Author

Jon Ortiz launched The State Worker blog and a companion column in 2008 to cover state government from the perspective of California government employees. Every day he filters the news through a single question: "What does this mean for state workers?" Join Ortiz for updates and debate on state pay, benefits, pensions, contracts and jobs. Contact him at (916) 321-1043 and at jortiz@sacbee.com.

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Note: The State Worker blog switched blog platforms in October 2013. All posts after the switch are found here. Older posts are available using the list below.


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