In this column I will seek to spend a few minutes making the case for why Gubernatorial candidate Meg Whitman should endorse Proposition 23, the Jobs Initiative, appearing on this November’s ballot. This is the measure that would suspend AB 32 until the recession in California is fully in the rear view mirror. For those looking for a good general write up on Prop. 23 – the policy and the politics – let me point you towards this piece
by Katy Grimes over at PRI’s CalWatchDog website. I apologize that this is a bit longer than what I would normally write – but I wanted this to be a comprehensive approach to an important issue.
In the meantime, it is my hope that Meg Whitman reads this column and that as you read it, you will carry its message to those people with whom you interact that can give input into Whitman and her campaign.PHILOSOPHY AND METHODOLOGY OF AB 32 EMBRACES THE TENETS OF THE DEMOCRAT PARTY
The type of approach to environmental policy that is advanced in AB 32’s regulation is totally in line with the philosophy and ideology of the Democrat Party, and runs completely counter to the guiding principles of the Republican Party. To be more specific, Democrats advocate a strong central government with broad powers to interfere with not only the market system, but to also come in and endeavor to manipulate the behavior of people through coercive government action. That is exactly what these regulations seek to do. They make one form of behavior that some politician don’t like less desirable by manufacturing government created scarcities, and by making some behaviors more expensive than others. Frankly, if you are a liberal who happens to not buy off on Al Gore’s beliefs on the cause of global warming, you are excited about AB 32 anyway – because like President Obama’s health care plan, these regulations represent yet another monumental shift of control of the economy from away from the private sector and under government controls.
The Republican Party stands for individual freedom and liberty – combined with individual responsibility. Republicans, on the natural, would be looking to educating the public in order to encourage an informed citizenry to mobilize to action. Of course, given the significant disagreements behind the scientific soundness of theories behind mankind’s impact on the Earth temperature, that could be challenging. That said, I think that the arguments that are made about reducing American’s dependence on foreign oil for reasons of political security have the potential to really motivate patriotic citizens to action – not only here in California but across the nation.
Inherent with any kind of government policy like AB 32 – government is choosing winners and losers. And if you want to look at the story behind the big bucks on both sides of the political equation on Prop. 32, you need look no further. Much has been made of the oil companies providing much of the funding to qualify and now pass this measure. Can you blame them? If this measure fails, it will make it a lot more expensive for Californians to use petroleum-based as well as natural gas. Frankly, it is the overt goal of many proponents of AB 32 to make Californians use less of these products. Being upset or alarmed that oil or natural gas companies are fighting this measure would be akin to being angry if Verizon Wireless or AT&T fought a measure banning cell phones due to radioactive leakage. HEDGE FUND BIG WIGS AND OTHERS STAND TO MAKE BIG BUCKS THROUGH AB 32’S WEALTH REDISTRIBUTION
One cannot complete a fully reasoned look at the politics of AB 32 and Proposition 23 without understanding that there is big money at stake on both sides of this equation because this measure redistributes wealth from one group of people to another. Who is on the receiving end? It’s unclear how those in state government will ultimately dole out the billions upon billions of dollars collected through the long-term implementation of AB 32’s regulations. But in the short term, it is clear that those who want to invest in alternative energy sources such as solar, wind, and technologies to reduce greenhouse gas emissions will have a chance to be the recipient of massive taxpayer and ratepayer subsidies. So look for money to stop the passage of Prop. 23 to come from hedge fund investors and those looking to profit from “green” technologies. A great anecdotal example would be very liberal and very rich hedge fund executive Thomas Stayer of Farralon Capitol Management, who has already personally donated $5 million against Prop. 23, and undoubtedly stands to make a huge financial return as his fund invests in ventures that will be on the receiving end of this government mandated wealth redistribution scheme.AB 32’S REGULATIONS ARE EXTREMELY DETRIMENTAL TO AVERAGE CALIFORNIANS, AND TO SMALL BUSINESS
It is important to remember that when a law like AB 32 is passed, that has drastic financial impacts for California taxpayers (it is estimated that electricity rates in the state could increase over 50% as power companies need massive infusions of money to be able to make the kinds of changes in equipment and pay to develop new forms power generation to comply with AB 32’s government mandates – and a myriad of example are out there of how this will negatively impact Joe and Jane consumer – such as estimates of an increase in car prices and significantly higher costs to build new homes). Unlike all of the various special interests who have advocates in Sacramento (labor unions, large corporations, public utilities and agencies, and the like), the struggling Californian has virtually no one to look out for their interests other than a legislature that seems to be beholding to these special interests (the passage of Prop. 14 last year will make this situation even worse in the coming years).
Small businesses up and down California are also largely unrepresented in Sacramento – yet the massive burden placed on small businesses with the pending implementation of AB 32’s most draconian regulations is immense. According to Meg Whitman’s own campaign website, “A recent study conducted by the Business School Dean of California State University, Sacramento estimated that AB 32 would cost California businesses more than $100 billion to implement and would destroy one million jobs. The state simply cannot afford this economic cost, which could reach $50,000 on average for small business.”THE COALITION THAT OPPOSED LAST YEAR’S PROP. 1A TAXES SUPPORTS PROP. 23
While opponents of Proposition 23 are quick to point out that oil companies are major proponents of the initiative (for good reason – it is estimated that AB 32’s regulations will lead to $3.7 billion a year in higher gasoline and diesel prices), they conveniently leave out of their literature that also supporting Proposition 23 is the same coalition of taxpayer protection organizations that came together to defeat Proposition 1A last year which would have extended over $14 billion dollars in sales, income and car taxes on Californians. Groups like the Howard Jarvis Taxpayers Association, Americans for Prosperity, the National Tax Limitation Committee and the National Federation of Independent Business have joined with the California Republican Party in urging support for suspending AB 32. Meg Whitman also strongly urged Californians to reject Proposition 1A and it would be very natural for her to once again stand with this pro-taxpayer coalition.THE FALLACY OF “JUST SUSPENDING AB 32 FOR A YEAR”
There is certainly a vibrant debate taking place in the scientific community about whether or not changing temperature around the globe are tied to actions of people on the planet, or possibly part of a large, epic cycle of atmospheric change that is naturally caused. That said, there is no doubt that encouraging good stewardship of our natural resources is important and creating public education and awareness of new technologies to both reduce pollution and shift American dependence on oil from other countries is important.
That said, the severe, extreme regulations and mandates in AB 32 are “off the charts” punitive on Californians and will create a massive, negative impact on the ability of the private sector economy in this state to revive and thrive. In fact, these regulations are so burdensome that you have to wonder whether our state could survive their implementation at all.
According to Whitman’s website, “Meg has called for a one-year moratorium on specific AB 32 regulations. This additional time will allow for careful examination of the true costs and benefits of each proposed rule…”
This approach to AB 32 begs the multi-billion dollar question: What if the conclusion of the process of examining the impacts of AB 32’s extreme regulations is that the regulations should not be implemented?
The big-government supporting liberals who supported AB 32 (it is important to remember that AB 32 represents an extreme, partisan agenda --- and was passed through the legislature on a party line vote with no Republican support) are not about to send to a then-Governor Whitman a new bill to moderate or eliminate AB 32’s harmful regulations – the massive wealth redistribution scheme that is a center point of this policy is something which they all embrace with a passion. The only way stop the eventual implementation if the “Global Warming Solutions Act” would be to either change the partisan makeup of both houses of the legislature – a great idea but perhaps a lengthy, multi-year endeavor -- or to put forth yet another ballot measure.
The alternative, of course, is to support the measure that is on the ballot right now. There is nothing that keeps a then-Governor Whitman from conducting her study of the impacts of these regulations (as if we don’t know what they are) and if there turns out to be some that can work, then as Governor she can begin working with the legislature to move those forward through alternative vehicles than AB 32, and if necessary, bring a modest measure back to the voters.
It makes no sense, however, to leave AB 32 on the path to full implementation, which is exactly what happens if Proposition 23 is defeated. It is also Meg Whitman’s responsibility, as someone who cares deeply about this state, to factor into the equation the potential that despite all of our efforts, she is not successful in winning the Governor’s office this November. Shouldn’t the decision about whether or not to support Proposition 23 be made considering that is entirely possible that it will never be suspended, that it will be fully implemented right away – by Jerry Brown?THE IMPORTANCE OF REPUBLICAN GRASSROOTS ENTHUSIASM AND UNITY
On a closing note, I would offer a political argument to Meg Whitman for coming out in support of Proposition 23 – unity of Republicans going into the general election. As a Party Official, I can tell you that the grassroots energy that has formed behind the Yes on 23 campaign, which the party has endorsed and is working hard to pass, is palpable. Republican workers up and down the state see this measure a clearly defining issue between liberals and liberty-lovers, and relish the opportunity to punch a hole in this ill-conceived regulatory scheme authored by former Democrat Assembly Speaker Fabian Nunez and embraced pretty much exclusively on the GOP side by Republican-turned-“post-partisan” Arnold Schwarzenegger. You could feel the surge and enthusiasm when Republican U.S. Senate nominee Carly Fiorina, after well articulating the fallacy of a “single state” approach to nation energy policy, came out solidly in support of Proposition 23. If Meg Whitman does the same it will really held excite our volunteers and further contrast our position from that of the Democrats who have to deal with the so-called enthusiasm gap.IT’S ABOUT THE BIG-PICTURE ON JOBS AND THE ECONOMY
Meg Whitman has made it abundantly clear that her campaign is tightly focused on a few key area – one of them being jobs and the economy. There is no doubt that AB 32 is a job-killer. Whether she is the next Governor of California or not, our state will be better positioned to come out of this recession is AB 32 is mothballed until the economy is humming – which will likely take a lot longer than the next Governor’s ability to temporarily suspend AB 32’s draconian regulations for just a year.THE CLOSE
There are those out there who would try to say that if you don’t support AB 32 and oppose Prop. 23, then you are no longer an “environmentalist” and that is just utter nonsense. It is about applying a “reasonableness test” to this proposed solution to helping our planet’s long term health. I’m reminded of the environmental extremist who blocks the clearing of brush that is a fire hazard (because of critters living in the brush) – only to find that a fire starts in that brush and consumes a vast area, killing many more critters and destroying a vast amount of property. AB 32 represents that kind of overzealous extremism in pursuit of a goal, with caution and common sense tossed aside.On behalf of our party, our state, and all of those millions upon millions of Californians who would be hit so hard by AB 32’s regulations, I urge Meg Whitman to strongly and enthusiastically endorse and campaign in support of the passage of Proposition 23.