Amidst the crowded ballot of initiatives for the November election is one that its proponents call the “California Jobs Initiative.” The ballot title is much longer: “ Suspends Implementation of Air Pollution Control Law AB 32) Requiring Major Sources of Emissions to Report and Reduce Greenhouse Gas Emissions that Cause Global Warming Until Unemployment Drops to 5.5 Percent or Less for Full Year.”
While the majority of the $6.5 million funding in support of Proposition 23 initially came from oil companies outside of California: Valero, Tesoro Companies, Flint Hills Resources, Marathon Petroleum Company, and Occidental Petroleum, the Howard Jarvis Taxpayers Association, Adam Smith Foundation, California Trucking Association, and California State Pipes Trade Association have donated substantially since the ballot initiative qualified.
The majority of the funding for the opposition campaign has come from a group called “Californians for Clean Energy and Jobs,” made up of wealthy individuals who are believers in global warming as a reality: Thomas Steyer, Robert Fisher, Wendy Schmidt, Claire Perry, L. John Doerr, William Patterson, as well as such organizations as the Natural Resources Defense Council, the Green Tech Action Fund, and the California Teachers Association.
Thomas Steyer, founder of San Francisco-based hedge fund Farrallon Capital Management LLC, gave $2.5 million and promised another $2.5 million to come. Steyer and his wife donated about $40 million to fund renewable energy research at Stanford University last year.
Governor Arnold Schwarzenegger is just as strongly opposed to Proposition 23, as he was supportive of AB 32. He isn’t buying the report from California’s Legislative Analyst’s Office that shows near term job loss from implementing AB 32.
Opponents say that Proposition 23 would delay sensible measures to create a clean energy economy. William Sundstrom, Professor of Economics at Santa Clara University, said “The net impact on California’s employment picture is likely to be so small as to barely noticeable in the unemployment statistics…. Offsetting these transitional impacts will be new ‘green jobs’ in the renewable energy and energy efficiency sectors. Clean technology is a growth industry, and California has been a significant beneficiary of that growth…”
James Birkelund, an attorney at Cleantech Law Partners, said, “California has invested billions of dollars in clean energy technology such as wind and solar, and is well positioned to lead the nation in the rapidly expanding renewable energy sector… California already had 500,000 workers employed in green jobs, and more than 12,000 clean tech companies call the state home. It is estimated that Prop. 23 will reduce the state’s economic output by $80 billion and cut over half a million jobs by 2020.
On the other side, a new study released on October 6, 2010 by the non-profit Pacific Research Institute showed that passage of Proposition 23 would create about 1.3 million California jobs by 2020, with 500,000 of those jobs created by 2012, and 150,000 in 2011. The study assumes that four consecutive quarters of 5.5 percent unemployment or less would not be observed, so that implementation of AB 32 would not resume. If AB 32 is implemented, they project an employment loss equal to about 5 percent of the working age population, or more than a million jobs.
The California Trucking Association is strongly in favor of Prop. 23 because the California Air Resources Board (CARB) has imposed billions of dollars in high costs on trucking companies to comply with on-road and off-road diesel regulation, and fuel costs could increase another 32%, depending on how AB 32 is implemented. A study authored by a former Executive Officer of CARB found that the Low Carbon Fuel Standard (AB 32 Scoping Plan Measure T-2) would increase gasoline and diesel costs by $3.7 billion a year with no detectable impact on global warming and a five ton per day increase in smog-forming emissions. The increase in fuel costs would apply to everyone purchasing gasoline and diesel fuel, not just businesses.
Valerie Liese, Chairwoman, California Trucking Association said, “Implementing AB 32 at this time would break the back of the trucking business in California. That’s why the California Jobs Initiative is so important …Right now, that represents the difference between surviving this recession or going under for a lot of our members.
Law enforcement and firefighters have voiced their support. Kevin Nida, President California State Firefighters Association said, “The economic crisis of the last few years has put a real strain on resources available to fund firefighters, emergency medical technicians and other public safety personnel throughout the state…The last thing we need is a law that will leave local governments with even less money to fund public safety.”
Small businesses have joined the campaign to support Prop. 23. Reid Ennis, Ennis Inc., Lakeside, CA said, “We already are burdened with so many taxes and regulations, we barely exist. We are down from 190 people to 46 and are losing money every month. With California’s construction unemployment above 30% any more fuel cost increases, fees, or taxes, will destroy many more businesses.”
Michelle Grangetto, 5th Axis, San Diego, CA, said, “…We machine parts for aerospace, military, and medical fields…another increase in electricity will force us to relocate to another state.”
San Bernardino County Supervisor, Brad Mitzelfelt said, “Our top priority has to be job creation…With more than 2.2 million people out of work in the state and the jobless rate at close to 15 percent in some counties including San Bernardino, Prop. 23 represents a common-sense approach to protecting jobs and holding the line on costs for California’s struggling families.”
When the California Global Warming Solutions Act of 2006 (AB 32) was passed in 2006, California’s economy was booming, with unemployment at only 4.8 percent. Now California’s unemployment is at 12.4 percent statewide, and we’ve lost over 50,000 manufacturing jobs since the recession began at the end of 2007. Over the last several years, hundreds of manufacturers have relocated to Nevada and Oregon where there is no state income tax, workers’ compensation costs are much lower, and the cost of regulatory compliance is also much lower.
Now is not the time to make it harder for California companies to stay in business and stay in California. County Supervisor Mitzelfelt said it best — a “yes” vote on Prop. 23 makes sense. Passage of Prop. 23 will save more California businesses than it will hurt in the clean energy technology industry.