You want to know how we got in this terrible mess? Consider the sage words of P. T. Barnum, “There’s a sucker born every minute,” an old saw that has no attribution, “The easiest person to con is a con,” and Walt Kelly’s Pogo announcement that “We have met the enemy, and he is us.”
When I moved from Michigan to California in the late spring of 1972, no country, state, region, nor municipality had an education system equal to that of the Golden State. Tuition for residents at UC – Berkley, the home of more Nobel laureates than any other on earth and one of the world’s truly premier schools, was about the same as the resident tuition at Henry Ford Community College. In fact, technically California’s university system and state college system were tuition free. The $45 I paid per quarter, the sum that entitled me to take as many class-hours as I could handle, was a “registration fee,” not tuition. I won’t quibble over the nuances.
Whether it was the 49er miners, or the WWII and Korean War GIs returning stateside from duty in the Pacific, or Boomers lured to the state by The Beach Boys, The Surfaries, and Jan and Dean, trend-setting California was a magnet that resulted in explosive population growth.
As the population expanded so did the state’s economy. From sprawling housing developments to auto assembly plants to high-tech campuses in Silicon Valley to city-size shopping malls, the real estate craze went crazy. The number of times I was lectured by real estate agents on the absolute certainty that values could only continue to escalate because “They’re not making any more land, ya know,” and the number of times home owners verily button-busting boasted on their investment prowess, “Yup, bought this fer $42,000 a couple years back an’ now it’s worth at least $225,000 — yup: gonna ride this all the way to retirement. Then it’s down to Costa Rica or Mexico,” I can’t begin to sum.
Everyone was giddy over the money that was growing out back, all just for them, waiting to be picked when they were ready to do the picking. Their giddiness over their building wealth, however, was exceeded only by the level of their resentment that their assessed property taxes were passengers on the same bus to those untold riches that lay ahead.
Governor Ronald Reagan had advertised to the citizens of the state, how they could get something for nothing, and that their paying for what they could have free was an outrage they had every right to be outraged over; the state hospitals. He was right when he postured how private enterprise could treat the housed patients much more efficiently and effectively than could the state. But like any shell game, it was essential that the suckers’ follow the directions to “Look here, not over there.” The ‘there’ was the private enterprise profit motive, and, as treating the indigents who were being treated in the taxpayer supported state facilities would be profit loosing, it was never, ever going to happen.
So the hospitals were closed, and the patients who overwhelmingly suffered all varieties of psychological disorders were sent to the streets where they have been thereafter routinely swept up by local law enforcement agencies and whisked off to the county jails and state prisons, none of which were intended or staffed to deal with them.
That the cost of housing and treatment in state hospitals, at taxpayer expense, has been replaced, even amplified by housing in the much more expensive county jails and state prisons was just one of the get something for nothing myths promulgated by the conservative Republicans. Proposition 13 was another.
All of us have been listening to that Top-40s hit for decades: “Waste, fraud and abuse.” According to the melody, “There’s so much waste, fraud and abuse in the system that you can cut taxes in half and have more than enough left over.” Whenever I heard someone singing that melody I’d ask for specifics, like specifically what the components composing the waste were, and specifically what were the names of those committing the fraud and abuse? Excepting the $200 billion taxpayer bailout of the Republican owned and managed S & Ls that took place under Reagan, and the Republican owned and managed Enron and Halliburton under Bush, no one was ever able to provide a single specific. But, as it is with religion, belief in the tenet was all that was necessary for it to be true to all who believed it was, or could be.
So it was with Proposition 13 (Article XIIIA in the State Constitution), authored and pushed to voter approval by the ultra-conservative Republicans Paul Gann and Howard Jarvis. Property assessments would be capped and increases severely limited, until the property was sold. Upon sale, the new, higher sale price would compose the newly established assessed value. According to the advertising, in addition to forcing the state to eliminate all that waste fraud and abuse, the difference to state coffers would be nonexistent because, eventually all those new homebuyers would be paying 70 to 80 times in property taxes what their stay-put neighbors were paying.
So, see: “You can get everything you moved here to get . . . for free! Just look ‘here,’ not ‘there!’” The “there” were the facts that the proposition was never intended to provide any relief whatsoever to homeowners, it was to the truly moneyed corporate interests. Standard of California saved $78 million the first year. Furthermore, consider that huge real estate owning entities such as railroads, Lockheed, and IBM, and major shopping malls rarely sell their realty. But, as Milo reminded Yossarian in Joseph Heller’s Catch-22, “Everybody gets a share,” and because everybody got a share, Proposition 13 passed overwhelmingly. Talk about going retro-70s.
Every particular within the state has been utterly, savagely affected by the corporate and generational greed and naivety. The wealth of California property that had provided all its residents with affordable world class educational opportunities is now the sole province of the wealthiest of the wealthy, and of those who willing and able to borrow the fortunes necessary to attend those institutions. The per-pupil funding for a system that was once in the top-5 of all the states has sunk to the bottom-5. (I’ve often kidded that Californians ought to send thank you cards to Alabama: Otherwise the state would assume the ignominy of being last on that ignominious pole.)
But hey! We bought the “You can have it all, and almost for free” snake oil. Just look ‘here,’ not ‘there,’ at that $40 billion deficit.
Five years ago, I was renting a home at the south end of Tampa Bay. The home’s owner called, to let me know he was refinancing, and that an appraiser would be stopping by within the next few days. I learned he was getting a 100% loan. I also learned that, through the country, folks were getting not just zero-down loans, they were getting loans that exceeded the purchase prices and market values.
Paying attention to what was going on in real estate hadn’t been my bailiwick since I had departed the vocation in 1995. So, upon being made aware of those schemes, I exclaimed to the lady I was living with that, “This is completely nuts, there is going to be a CRASH!” You just can’t continue to think you’re really going to get something for nothing, or next to it, that you can avoid paying for maintaining services at constant levels and ignore maintenance of constantly deteriorating infrastructure, that you can throw wars the way you’d throw birthday parties and reduce the income required to pay for them, and that you can lend money on values that don’t exist to people with incomes that don’t cover the bets, on the wings and prayers that, because “they’re not making any more land” and the “market is self-correcting” everything will just keep going up and up and up like the Fifth Dimensions’ “Beautiful Balloon” and that no one is ever going to come calling, to tell you the party is over and the bills are due.
It isn’t necessary that one be Nostradamus prescient, or even especially bright, to utter the kind of forecast I did. All that is necessary is that one not be completely daft. Then again, ol’ PT and Pogo were so right on, weren’t they?