Saying someone else's arguments for X aren't good isn't the same as making an argument for not X, and you've totally failed to do that.
There have historically been two major issues in California: Prop 13 itself, and the 2/3 requirement for budgets. Prop 13 has not only made it difficult to raise taxes as necessary, it's forced the state (and municipalities) to rely on less-stable, less-efficient methods of financing. Property taxes are historically a much more stable source of revenue for states than income taxes, and states that rely heavily on income taxes (like California) tend to have less stable revenues than states that rely more on property taxes. Prop 13 forced California to rely more and more heavily on income taxes, destabilizing its revenue. The 2/3 requirement to pass a tax has also made that basically impossible, so initiatives are financed through even-more-expensive bond measures. Also note that Prop 13 helped shift the tax burden away from corporate property owners (since corporations can live forever, they never have to transfer property), further drying up a source of revenue for the state. So while the best analysis I can find indicates that the initiative "earmarks" of funding are at worst a minor hindrance, Prop 13 is really the elephant in the room, and it couldn't/wouldn't have happened outside of the initiative process. But without it, we wouldn't be talking about the initiative process as an issue, because the CA budget wouldn't be such a mess.
Meanwhile, the 2/3 budget requirement also made things a mess by historically making it impossible to get a budget passed without compromising/buying off enough legislators to get it through. Since everyone knows the majority party needs every last vote to get things through, they can all hold out for their pet concessions, making it impossible to come up with any kind of a responsible, honest budget. Thankfully that issue was sort of resolved by another initiative this past year, though by not addressing the tax side of the equation it's only a half-measure: spending cuts can now be done with a simple majority, but revenues can only be increased by a 2/3 vote, which means that the legislators are basically trying to balance the budget with only half the available options.