The ballot, as a device to communicate to the government by citizens, is perceived to be much more effective in some settings--the direct question in a local election--and less effective in others--the major questions and primary offices in a national election. Such political facts of life are part of the resurging interest in the referendum as a political tool. Because its recent uses have emphasized fiscal controls and because major financial shifts cause major policy revisions, referendums have forced a renewed appreciation within the educational establishment of the harsh reality that money is the lifeblood of institutions. The effects of the referendum in the states of New York and Washington are briefly analyzed. An analysis in greater depth is made of the effects of the referendum in Oklahoma, Nebraska, and California. One reason for use of the referendum as a tool to halt budgets for schools is inflation, but another reason is the lack of confidence in schools caused by federal involvement in the courts, congress, and funding. Local control is perceived as slipping away, and unwelcome policies are seen as being imposed from afar by people who are not affected by those policies. Citizen resentment is fueled by this perception. (Author/MLF)