The voters in California have spoken. More accurately, they have shouted. They don't want to borrow $6 billion and pay the taxes required to pay back the money with interest.
The message could not have been more clear. California voters do not want to spend for earthquake rebuilding, college buildings, school classroom renovations, and parklans. Last Tuesday, they rejected four bond proposals that added up to $5.9 billion, the largest borrowing request ever presented to voters on a single ballot.
Last week's snubbing was not surprising. Two years ago, Californians defeated a $1 billion bond issue for rail transit expansion, and in 1990 they rejected nine out of 10 issues, or $2.5 billion out of $3.3 billion.
Conservatives look at the way Californians gave bonds the brush-off last week, and they smile, believing that growth of government has got out of hand and states and cities are incapable of giving taxpayers their money's worth. Better to keep them from borrowing the money in the first place.
Life in the United States late in the 20th century is not so simple, however. California did suffer a severe earthquake on Jan. 17, and the damage had to be repaired. Bridges ought to be seismically retrofitted, unless you think that major earthquakes won't happen again. These are capital outlays that should be financed with long-term capital, and bonds are the way to raise the money. California may be able to redirect some current tax income, but other transportation projects will suffer, and no government should be forced to limit itself to pay-as-you-go.
More disturbing, though, is the blanket knee-jerk rejection of bonds, a phenomenon not confined to California. It reflects an electorate angry at growth of government spending and taxes, and anger seldom moves the world ahead. Instead of borrowing wisely, voters have decided not to borrow at all.
Voter frustration may be understandable, but voting down bond issues en masse is not the answer. Capital needs will not go away. Californians cannot decide to close the state and let it crumble.
California often bills itself as a trend-setter. Go to the West Coast, it is said, if you want to see what the rest of the United States will do in three years. And that is what is so worrisome: If the state is indeed the financial leader, the municipal bond market seems likely to be underutilized for the next several years, and that would be a waste.
