The People’s Initiative to Limit Property Taxation, an amendment to the California State Constitution passed in 1978, was a tremendous policy achievement for fiscal conservatives. Dubbed Proposition 13, it finally said “no” to out of control taxes that seemed to get higher every year, and drew a line in the sand that – when you really think about it – is only fair: It mandated that when you buy a property, you will pay property taxes on it only at the rate you agreed to at the time of purchase, not what the government later decides is fair. In other words, the value of your property can’t be reassessed to yield a higher tax rate for as long as you own that property. This just seems right anywhere, but in a state like California, whose government seems inordinately preoccupied with squeezing every possible penny out of the citizenry, it was especially important.
It wasn’t perfect, of course – no law ever is. It lead to situations that gave a first appearance of being unfair, like the understandable umbrage in 1992 of a California homeowner who was upset that, because she had only recently purchased her home, she had to pay a higher property tax than her neighbors who had been there for many years. Why, she asked, should she have to pay more? She went so far as to claim that her rights to equal protection under the law were being violated, and it’s easy to see why she felt this way. But there were good reasons that Proposition 13 was a wise idea in 1978, good reasons it was 1992, and good reasons we still need it now.
One man who understood the intricacies, and importance, and the warts of Prop 13 was the late Justice Antonin Scalia. Tragically, Justice Scalia passed away in recent weeks, but he heard the case of the 1992 homeowner – a woman by the name of Nordlinger – when it went before the Supreme Court. As always, Scalia considered all angles and questioned the attorneys on both sides of the argument, but in the end, he sided with the wisdom of the amendment. “We’ve never insisted that in any public policy field the State has to choose the most precise way of solving the problem,” he said at the time. Then, referencing the burden homeowners would bear from unrestrained property taxation, he went on: “This is not very precise, but you have to admit it solves that problem.” Later he observed of Prop 13, “It’s rough and ready, it’s not perfect, but close enough for government work.”
And perhaps the most important reason this “rough and ready” law was needed was because of the assurance it provided for California homeowners. During the case, when Nordlinger’s attorney argued that his client had been stretched financially in order to purchase her home, Scalia brilliantly illuminated this point. “But she knows she won’t be stretched any further, doesn’t she?” he rhetorically asked. “Isn’t that some advantage to the people of California?”
But Scalia didn’t just make brilliant arguments – he was a brilliant man. Not surprisingly, he came up with a much simpler, and probably, better solution even than Prop 13. “Of course, an easy way to solve it would just be as inflation pushes the price up and up, just lower the tax…there’s no reason why the fact that there’s an unreasonable inflation in the value of the property has to result in unreasonably high taxes.”
Timeless wisdom from a man who lived a long life, yet nevertheless was taken from us all too soon. It is impossible to overstate the damage that can potentially be done to a free society by taxation. It is a mandatory surrender of personal resources to a malevolent government. There is no free exchange, no option to decline the “deal”, no escape from making payment. Private Citizens are forcibly compelled to give up part of their earnings to people who often misuse and abuse the plundered money. The practice stifles private businesses and individual enterprise, and is harmful to the overall economy. Some level of taxation is necessary, to pay for what little we actually need the government to do, but it must be kept carefully under control and if ever a way is found to reasonably reduce taxes, it should be explored.
Unfortunately, government officials in California don’t seem to understand this fact. They’ve been attacking Proposition 13 almost since the day it passed, and they’re at it again. Lately they’re pushing a “split roll” tax, seeking to divorce the protection Prop 13 offers homeowners from that given to commercial enterprises as well. Essentially, it’s a roundabout, sneaky way of increasing taxes on businesses, something California has already done countless times. That, along with out of control regulation and an otherwise hostile environment, is probably why businesses are leaving the state in droves. Right now, California is one of the least popular states in the country among the corporate sector, and it’s not hard to see why.
The matter will go before voters yet again in the November elections, when so much will be at stake in so many arenas. It’s important, then more than ever, that we remember the kind of wisdom Antonin Scalia possessed and used to espouse. We must never forget the importance of limited government, taxes as low as reasonably possible, and a fundamental respect for the freedom and capabilities of private citizens. These are the sorts of principles upon which our great nation was founded, and through which it has been blessed to prosper so tremendously throughout history. It is only at our own peril that we ignore such values.
May Justice Antonin Scalia rest in peace. He was a brilliant man whose service to this country was incalculable, and he will be dearly missed. He can never be replaced, but may the necessary process of filling his seat not be a political matter, but one of seeking that which is best for the nation he so loved.