Days before he was recalled from office, Governor Gray Davis signed Senate Bill 2 (Burton), which would have required employers to pay at least 80 percent of the cost of healthcare coverage for workers, and in many cases, their dependents. Although many individual physicians opposed the government-run healthcare system created by SB 2, the bill was backed by the powerful California Medical Association and the deep pockets of organized labor. Business groups, faced with the prospect of $7 billion in new taxes to fund the healthcare system created by SB 2, hired FSB Core Strategies to qualify a referendum and manage the effort to repeal the legislation. Once qualified to the ballot, the referendum became Prop. 72. Our clients wanted voters to defeat the measure and thus reject Senate Bill 2.

Exhaustive qualitative and quantitative research told us that if the vote was about providing healthcare to the uninsured, the measure would pass and the legislation would take effect. However, we knew we could defeat the proposal if voters came to understand that Prop. 72 would affect their own private healthcare coverage and damage California's economy. Strategically, it was important to acknowledge the problem of the uninsured, while exposing Prop. 72 as a flawed solution. We developed a "right problem, wrong solution" communications platform. Key messages used throughout all campaign disciplines -- advertising, earned media, grassroots and direct mail -- centered on how Prop. 72 would affect those who already had private health coverage (over 90 percent of voters), as well as the consequences to non-profit and public employers and the economy as a whole. Our messages were supported by credible messengers, including Governor Schwarzenegger, school superintendents, non-profit groups, newspaper editorial writers and businesses. On November 2, 2004 Prop. 72 was defeated by California voters.