Despite all that is politically fucked in California, or maybe because of it, we're taking baby steps towards weakening the grip of the two party system.
Citizen Redistricting Commission - The legislature no longer gets to gerrymander districts in their favor. Instead, redistricting is done by a citizen's commission drawn from multiple parties and independents. Both the Republicans and Democrats are mad about the recently released maps, which is probably a good indicator that the commission is doing good work.
Nonpartisan Primary - All candidates from all parties compete in the same primary, and the top two candidates advance to the main election. The initial effect should be to eliminate hyperpartisan extremists, but getting more moderates into office will only bode well for passing future changes to the election system.
Instant Runoff Voting - Some cities, most notably San Francisco and Oakland, have switched to IRV. IRV is basically the next step after nonpartisan primaries, so hopefully it will move statewide if it's seen as successful in city elections. Unfortunately, Jean Quan, Oakland's mayor, only won because of IRV and is now coming under fire for mishandling Occupy. The fear is that people may equate IRV with producing bad politicians, even though the traditional voting system has created more than its fair share of horrible politicians.
If things continue progressing in California, this bodes well for the nation as a whole. We were ahead of the game on having completely dysfunctional hyperpartisan politics. Term limits and other measures didn't make things better, and perhaps even made it worse. If these new steps lead to a more civil and productive legislature, hopefully the trends will get picked up nationwide.