uses of popular media and rhetoric to both popularize and demonize candidates. Rest of term Upon beginning his first elected term, Merriam immediately faced an ever-shrinking state budget and growing deficit. In an effort that later angered many powerful conservative backers who had originally supported his 1934 candidacy, as well as challenging his own deep-seated conservativism, Merriam proposed to the Legislature a tax increase of nearly $107 million. The tax reform laws included instituting a state personal income tax modeled after the Federal Income Tax of 1934, which had been created by the Democratic-controlled Congress, and raising sales taxes to three percent. The Legislature agreed, and passed the tax reform law in 1935. William Randolph Hearst, whose newspapers provided one of the bulwarks of the governor's 1934 campaign, complained bitterly over the reformed tax laws. The Hearst-owned San Francisco Examiner's editorial shortly after the reform bills' passage read: "[e]xtortionate and confiscatory taxation will mean ... devastation of business, paralysis of industry." Fanning the growing rift between Merriam and conservative Republicans, right-wing author and playwright Charles Gilman Norris penned letters that became widely circulated thanks to Hearst's newspaper empire, complaining of Merriam's reforms. "[T]he minute the proposed State Income Tax becomes law, my wife, Kathleen Norris, and myself will put both our homes — the one in Palo Alto and our ranch near Saratoga — up for sale and move out of the State. There is no alternative for us. We pay 52% of our income now to the Federal Government at Washington and under the proposed State Income Tax Law, we shall have to pay an additional 18%, so that out of every dollar we earn from our writings, 70¢ will go out in taxes!" Hearst supporters challenged Merriam's and the Legislature's 1935 reform laws during a special referendum in 1936 with Proposition 2. The proposition would automatically repeal the tax reforms, and would in the future require the support of two-thirds of the Legislature and approval of voters by statewide referendum before any new income tax could be imposed. The measure, however, was defeated. While the State Senate was controlled by Republicans, the crucial lower house Assembly, where finance bills originated, was split between conservative and socialist-leaning Democrats. Merriam proceeded with appeasing the closely divided Legislature by praising the federal Townsend Plan, while complaining to conservatives and other capitalist supporters that he was surrounded by fanatics. By the 1938