Capitol Alert

Did money buy California ballot measure contests?

Bernie Sanders makes 2016 push for drug-pricing measure

U.S. Sen. Bernie Sanders made a stop in Sacramento to make a final push for Proposition 61 on the West steps of the state Capitol on Monday, November 7, 2016.
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U.S. Sen. Bernie Sanders made a stop in Sacramento to make a final push for Proposition 61 on the West steps of the state Capitol on Monday, November 7, 2016.

California voters passed a measure on Election Day urging state politicians to use their authority to limit corporate and special interest spending in elections.

Then they sided with the campaign that raised the most money on the majority of statewide ballot measure contests.

Proposition 59 was advisory-only, aimed at overturning a Supreme Court decision in an effort to rein in outside spending. It carries little weight. Nonetheless, the vote demonstrates Californians’ concern over the role of money in politics.

So, why did voters concede to deep pockets at the polls?

One reason: Money talks.

“Money makes a difference, particularly in ballot measure campaigns when you can’t look at a living, breathing candidate to evaluate them,” said Jessica Levinson, a professor at Loyola Law School in Los Angeles and the president of the Los Angeles Ethics Commission. “You’re going more on advertisements, mailers and information put out by the campaigns.”

Anyone can spearhead a ballot initiative in California, so long as they have or can raise enough money to pay workers to pound the pavement and obtain the voter signatures necessary to qualify. But it often takes more than signatures to secure a victory.

This year campaign committees supporting and opposing statewide measures collectively raised nearly $500 million through Nov. 8. The money pays for everything from office expenses to campaign-related travel, although much of it goes to advertising.

Proposition 61 is perhaps the best example of the benefits of a well-funded campaign.

On the eve of the election, Bernie Sanders stood on the steps of the Capitol in Sacramento and urged voters to stick it to Big Pharma. The drug industry had raised $109 million to beat the initiative, making it the most well-funded ballot measure campaign in the country, according to the National Institute on Money in State Politics.

It was the fifth time the Vermont senator stumped for Prop. 61, which would have prohibited the state from paying more for prescription drugs than the federal Department of Veterans Affairs. He separately appeared in “Yes on 61” commercials, a 30-minute “documentary” and advocated for the measure on Bill Maher’s HBO show.

The “Yes on 61” campaign, supported by activist Michael Weinstein of the AIDS Healthcare Foundation with support from nurses unions, viewed Sanders as a credible source known for speaking out against corporate greed. They hoped his star power would draw media attention to their message and help offset the pharmaceutical industry’s money, according to Roger Salazar, a spokesman for the campaign. Proponents operated with a campaign pot of $19 million.

A Field Poll released in early November put the two campaigns locked in a dead heat at 47 percent of California voters.

But Salazar believes the pharmaceutical industry’s financial advantage, and specifically an ad blitz leading up to the election, turned the tide.

Pharmaceutical companies spent more than $42 million on television advertising alone – with spots featuring veterans and doctors – from March through October 22, according to campaign reports filed with the state. The total doesn’t include the $2.4 million spent on Facebook advertising, the $1.7 million the campaign paid Google or any spending in the weeks running up to the election, which campaigns have yet to report.

Salazar said he couldn’t open Facebook, Twitter or YouTube without seeing a “No on 61” ad in the last three weeks before the election. “We were swamped.”

It didn’t help that critics of the measure said it was poorly written and the Legislative Analyst’s Office wrote an uncertain forecast about the effects of the measure for California.

In the end, voters rejected Prop. 61, 54 percent to 46 percent.

“If we had $20 million and they had $20 million, we would have won this thing,” Salazar said. “When you get outspent by $100 million, it’s hard to get your message across and counter the misinformation they put out so freely.”

Five winning campaigns – including Lt. Gov. Gavin Newsom’s gun control initiative (Proposition 63), the union-backed income tax extension on higher earners (Proposition 55) and Republican megadonor Charles Munger Jr.’s push to increase legislative transparency (Proposition 54) – prevailed over opponents that raised less than $1 million.

No one came to bat against the campaign supporting the bilingual education measure (Proposition 58) or the builders behind the school bond initiative (Proposition 51), according to state filings.

Meanwhile, sides with less money prevailed on four measures.

After defeating calls to increase tobacco taxes in 2006 and 2012, cigarette-makers Philip Morris and R.J. Reynolds opened up their wallets again to the tune of $71.3 million to try to fend off a $2 tax hike under Proposition 56.

The tobacco industry lost, 64 percent to 36 percent, to a campaign with less than half as much money.

Outside factors, such as the Legislature’s recently approved anti-smoking laws and the small percentage of Californians who smoke at all, likely influenced the outcome.

Jim DeBoo, campaign manager for “Yes on 56,” credits the win, in part, to a stronger coalition than in past attempts to raise tobacco taxes, largely pushed by heart, lung and cancer associations. This time around the money collected from the tobacco tax is directed to Medi-Cal, bringing doctors, unions and other big donors on board.

Early on, proponents flipped the California NAACP, which had historically worked alongside tobacco to kill tax increases, to their side. Then the California Chamber of Commerce declined to take a stance at all, robbing tobacco of another powerful former ally and a credible endorsement to tout in advertisements.

DeBoo also believes the tobacco industry’s money worked against them in some ways.

His campaign released its first ad in August, and tobacco soon followed, launching an onslaught of commercials and advertisements featuring doctors, teachers and backyard gardeners labeling the measure “a special interest tax grab.”

DeBoo views his opponent’s early start as a miscalculation that gave his campaign time to debunk the claims and convince voters it was just another attempt by the tobacco industry to deceive voters.

Nearly every newspaper editorial board in the state told Californians to vote yes on Prop. 56. While early editorials said voters should support the tax because it would reduce smoking, publications that weighed in later also heavily criticized tobacco companies for misrepresenting information to voters, DeBoo said.

“They went up so early that it allowed us to have a discussion about what they were saying and that they were literally making (stuff) up,” DeBoo said. “That hurt them. As time went on, it almost became a joke to people.”

Voters also rejected Proposition 60, which would have required actors in pornographic films to wear condoms. Proponents, again led by the AIDS Healthcare Foundation, raised $4.6 million and lost to a campaign with $546,300, according to state filings.

The adult film industry and both major political parties in California opposed the measure. Critics said it was poorly written and, if passed, could lead to litigation.

On paper, the plastic bag law appeared to go the way of the lesser-funded campaign as well.

The plastic bag industry funded a referendum, Proposition 67, to halt a 2014 law banning single-use plastic bags from taking effect and allow voters to weigh in at the polls.

Operating under the American Progressive Bag Alliance, plastic bag companies also paid for a sister measure to land on the ballot. Proposition 65 directed the fees retailers collect from the sale of reusable or paper bag alternatives to an environmental fund.

Once the measures qualified, the plastic bag industry largely bowed out of the contest.

Roughly $5.2 million of $5.6 million the industry spent on the measures paid for signature-gathering efforts to qualify, according to state filings through Oct. 22.

Grocers and environmentalists raised $2 million to support the bag ban. They repeatedly suggested the referendum was a gross misuse of the state’s initiative process: a ploy by the plastic bag industry to postpone the ban and buy itself two additional years to sell more bags before voters weighed in on Election Day.

Law professor Levinson said it’s difficult to quantify the difference money makes in ballot measure contests. Nonetheless, the millions flowing into the measures contrasts with the intent of direct democracy, which is to serve as a safety valve against special interests and allow voters to make policy decisions without the control of the Legislature and the corporations that lobby them, she said.

“It’s terrifically sad that the ballot in many ways is a home for elected officials or well-funded special interests who can’t get their way through the Legislature,” she said.

Spending on state propositions

In the majority of statewide ballot measure contests in the 2016 election, California voters favored campaigns that raised the most money.

Note: Committees often raise money for more than one measure, but do not report the amount designated for each
Source: California secretary of state
NATHANIEL LEVINE nlevine@sacbee.com

Taryn Luna: 916-326-5545, @TarynLuna

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