The state that once boasted the best public schools, colleges and highways in America now has some of the worst. Its healthcare is ranked lowest of all the 50 states by the Commonwealth Fund, a respected thinktank; its prisons are overflowing; the energy-guzzling way it meets its water needs takes a staggering 19% of the state's now expensive electricity; it has six of the 10 worst cities in the US for air pollution; its public finances are a disaster. Year after year, its legislature has failed to agree a budget. Its deficits make Italy look like a paragon of fiscal prudence. And this summer, it generated incredulous headlines around the world when the state started issuing IOUs. The government of one of the most richly endowed territories on earth, home to Hollywood and Silicon Valley, a crucible of innovation and the eighth largest economy in the world, was broke.
Why has California got into such a mess? Some analysts say: "Too much democracy!" In California's eccentric version of direct democracy, all kinds of extravagant public spending are mandated by so-called initiatives, proposed by anyone who can gather enough signatures, and passed by a simple majority of those who bother to vote on them, while the state's revenue-gathering possibilities are curbed by the same method. The most famous example was Proposition 13, passed in 1978, which drastically capped property taxes while making California the only state in the union that requires a two-thirds majority in the legislature not just to pass a budget but also to increase taxes.
So extensive is this "ballot-box budgeting " that legislators estimate they control only some 7% to 17% of the state's spending. Troy Senik, author of a new book on the woes of the golden state, says Californians have been living with the delusion that they could be taxed like libertarians and subsidised like socialists.
Yet it's not fair to blame all this on government of the people by the people. Rather, California shows how such experiments in direct democracy can be perverted – and how the road to hell is paved with good intentions. For this framework of initiatives and referendums was established by self-styled progressives in the early 20th century to curb the power of the railway bosses and bring power to the people. A hundred years later, it is today's more diverse special-interest groups – not just billionaires and businesses but also powerful public service unions, especially those representing teachers and prison guards – who play the system to feather their own nests or further their own fads. They hire hands to collect signatures on their chosen initiative, and use advertising muscle to whip in the votes.
The supposedly representative side of California's democracy doesn't work well, either. Electoral districts have been so shamelessly gerrymandered that most voters, most of the time, have no choice. In 2004, for example, 153 state or federal seats were up for election: not one went to another party. As a result, the real political competition occurs in Democrat and Republican primaries, producing politicians whose future depends on pandering to the ideological extremes of their own parties. No wonder it proves impossible to get the bipartisan two-thirds majority needed to pass a budget.
The initiatives have also added to and changed California's constitution, which is now said to be the third longest in the world – outdone only by India and Alabama. If the American constitutional tradition is distinguished by checks and balances, California has a tangle of checks and balances worthy of Lewis Carroll's Alice in Wonderland. It has also created a bureaucratic nightmare of multiple, overlapping and conflicting agencies and competencies. California has been the state where no agency ever dies, and truly a golden dream for special-interest groups. Until, that is, the gold ran out.
Perhaps California's deepest problem is that it has been so superabundantly endowed with both natural and human resources, so blessed by the huge contracts that the second world war and the cold war brought to its industries, so fortunate in the inflow of brilliant innovators, dynamic entrepreneurs and industrious workers from Hitler's Germany, rainy Britain, Vietnam, India, China, Mexico and everywhere else, who have moved here, wooed by its matchless charms and opportunities. A poorer place could not have sustained such an idiotic system for so long.
Imagine a bicycle with brakes permanently biting, gears that make it more difficult, rather than easier, to go uphill and the front wheel permanently askew – and it gets worse every time you take it to the repair shop. Only a giant could keep such a bicycle moving forwards. For more than 30 years, California has done just that. Now even this most dynamic of human societies can't keep the crazy bike on the road. So they need to do a proper repair – or, better still, make a new bike.
That is what Californians are now mobilising to do. A group called California Forward proposes piecemeal repairs; another, though called Repair California, aims to build a whole new bike. In the next fortnight, Repair California is due to announce the proposed wording of two initiatives: one to change the state's constitution to allow the people to call a constitutional convention, the other to have the people actually call that convention. According to its own polling, 71% of Californians support the idea. Once the attorney general has formally agreed the wording, it will have until next April to get 1.6 million signatures – which it aims to do by Obama-style volunteer organising.
If all went according to plan, these proposals would be endorsed by the people at the same time as the next gubernatorial election, in November 2010, the convention would be held in 2011, and the people of California could approve a gleaming new mountain bike of a constitution in November 2012 – which, in case you hadn't noticed, is when president Barack Obama will be bidding for his second term.
And there's the larger story. The philosopher Isaiah Berlin liked to quote the saying "The Jews are just like everyone else – only more so." Well, Californians are just like other Americans – only more so. Of course, some of California's specific difficulties are unique, and most states are better run. But in many ways the golden state's sickness is an extreme, hypertrophied version of the politico-economic problems of the whole United States in the early 21st century. The deeper structure is the same: an accumulation over many decades of systemic burdens – in healthcare, for example – which the country could once carry by a combination of economic dynamism and the advantages of its preeminent place in the international system, but no longer can; a multiplication of checks and balances that makes it extremely difficult to reform. The odds may be against the reformers, but everyone who believes the world needs an open, dynamic America must hope they will succeed.
by Timothy Garton Ash