Advancing a Free Society

In California: Stem Cells and Stemming the Tide of Flawed Ballot Initiatives

Thursday, July 7, 2011

By far, the most difficult choice I’ve faced as a California voter was Proposition 71, approved by 59% of the electorate in the November 2004 election.

Otherwise known as the California Stem Cell Research and Cures Initiative, the measure called for the creation of the California Institute of Regenerative Medicine, which in turn would issue $3 billion in tax-free, state general obligation bonds over 10 years (actually, a $6 billion obligation after factoring in the interest on the bonds) to fund stem-cell research.

Here’s what had me perplexed . . .

On the one hand, I have relatives, friends and associates who suffer from the sort of diseases that stem-cell research might help remedy one day. Moreover, California has a proud tradition as America’s biotech leader. Breakthroughs that save lives and keep the Golden State on he cutting edge of media reach, all fueled by Californians' largesse, sounds good to me.

But as it was written, Prop 71 lacked suitable state control over the expenditures of state money – the measure creating a semi-independent organization with its own defined set of directors. Critics of Prop 71 tried to block it in court on the grounds that the state should be in charge of the grants; the courts ruled otherwise (the rationale being that 1998’s Proposition 10 was handing out early childhood development grants in a similar manner).

Unfortunately, that's not the end of the story. Prop 71 and California’s stem-cell progress is back in the news of late – those concerns over fiscal control at last coming home to roost.

First, newspapers reported that California’s stem-cell agency intends to pay a Los Angeles investment banker a $400,000 annual salary to serve as its new part-time board chairman – even though a former Cedars-Sinai Medical Center cardiologist with a history of leading medical start-ups was willing to do the job for $123,000, the bare minimum.

Making matters worse: the agency says it will need another ten-figure infusion of bond money -- another $3-$5 billion by 2016, perhaps – to make good on the campaign promise of cures to major diseases.

Here are my three takeaways from this mess:

  1. Sacramento Failing To Do Its Job. Prop 71 was designed and driven by a Palo Alto real estate developer. But the matter could just as well have been handled via the legislative process. Democrats are decidedly pro-stem cell research; California’s State Legislature is decidedly Democratic. Republicans are more divided on the subject. However, then-Gov. Arnold Schwarzenegger was a Prop 71 supporter (for Arnold, it was a personal matter as his father-in-law, the late Sargent Shriver, was suffering at the time from Alzheimer’s disease). Had lawmakers drafted Prop 71, odds are California’s stem cell agency would have avoided the public embarrassment of its head honchos earning double the salary of the director of the National Institutes of Health.
  2. Trouble Ensues When Emotion Trumps Logic. Fewer California initiatives have been as brazen in tugging at voters’ heartstrings. Christopher Reeve appeared in TV ads – two weeks after his death. Michael J. Fox cut ads; so did a pair of male twins, one of whom suffered from cerebral palsy. Adding to the emotional pull: Democrats nationwide were using Reeve’s death and the stem-cell cause as a wedge issue against the Bush presidency (you might remember John Edwards’ boast: "If we do the work that we can do in this country, the work that we will do when John Kerry is president, people like Christopher Reeve are going to walk, get up out of that wheelchair and walk again." Had voters been more ice-water in their veins, they might have noticed some of Prop 71’s more apparent design flaws.
  3. Time to Amend the Initiative Process? Let’s assume it’s 2016 and time to hit up California voters for another multi-billion dollar bond. Emotions will run high, as they did in 2004. Perhaps it’s also time for a safeguard, to protect voters from themselves. My suggestion: change California’s initiative rules so that any ballot with an impact on the Golden State’s finances (bonds, taxes, spending programs) requires “supermajority” approval – say, the same 55% currently required for school bonds. This would not have prevented Prop 71 from passing. But it would have stymied another initiative on the November 2004 ballot bearing a fiscal impact – Proposition 63, a 1% state income tax increase on $1 million earner to fund mental-health programs.

Final note, under the category of "you can't make this stuff up": in a written statement, the new chair of the California stem-cell agency told his colleagues they were in a “communications war” where the "the world seems to be focused on internal issues instead of the grand big picture" of medical research.

His solution: hire a publications director, at $208,520.

After all, it’s not his money he’s spending . . .

(photo credit: Dave Campbell)