It would appear that Governor Arnold Schwarzenegger thinks that you (and me) are stupid.
Seriously.
Chris Reed, a member of the editorial board of the San Diego Union Tribune, sent off a group of four questions to the Governor’s office all centered around the fact that the Governor himself insisted that there be a provision in AB32 that would allow for its suspension during tough economic times. Given that we are in a recession, Chris’ questions seemed on point. Here are his four questions and the four unbelievable answers from the Governor’s office…
A. Your question is premised on an unproven assertion that implementation of AB32 would be harmful to the economy when all the evidence points in the opposite direction. Major programs under AB 32 will not go into effect until 2012. By then, the economy will continue to improve — helped by the continued growth of California’s clean tech sector.
Q. If the unemployment rate went to 15 percent, would the governor consider suspending AB 32 then?
A. This Governor is not going to suspend regulations that are creating jobs and stimulating the economy. Thanks to California’s forward-looking climate policies, we lead the nation in clean-tech investments with more than 50 percent of the nation’s total clean-tech investment last year. We also lead the nation in venture capital investment. Given all this good news it would be unwise to stop AB 32 — sending exactly the wrong signal to investors, pulling the rug out from beneath others, putting us at uncompetitive advantage compared to other states, and setting us back in being able to compete in the global clean-tech market.
Q. Are there literally any economic conditions under which the governor would suspend AB 32?
A. Not unless there is evidence that AB 32 has something to do with growing unemployment. On the contrary, we know jobs are being created. Just visit San Diego’s own Sapphire Energy where they recently scored $50 million from the Department of Energy to turn algae into jet fuel and diesel. In fact, thanks to California’s climate policies, San Diego is the national, and international, center for algae research as a source of clean next-generation fuels — with over $1 billion in investment over last 18 months.
Q. If the answer to the last question is no, then why did the governor fight for the suspension provision in the first place?
A. The Governor is a proponent of fiscal responsibility so it made sense then, and still does, for him to have included the provision.
Huh?
What kind of a sane person would say that the imposition of massive and ever-increasing draconian regulations on Californians would not have a huge and negative economic cost? Check out this study produced by the California Small Business Roundtable (available via the website of the Small Business Action Committee) that maintains that:
The direct AB 32 cost of $24.878 billion results in a total loss of output of $71.464 billion annually for the State of California (after including indirect and induced costs). The direct cost of $52.194 billion cost to consumers results in total lost output of $149.2 billion annually. The direct cost of $63.895 million to small businesses results in a total loss of output of $182.649 billion annually.
It’s staggering just to try and imagine this kind of chok ehold on economic opportunity in California.
We have yet to see the implementation of the worst aspects of AB 32, such as the Cap and Tax component that would literally cause California businesses that emit greenhouse gases to pay between $48 billion and $143 billion between 2012 and 2020 according to a draft report by the California Economic and Allocation Advisory Committee. Greg Lucas has more of the ugly details on that here. Note that AB 32’s costly regulations pave the way for a massive wealth-redistribution scheme where government will take in massive amount of money that will then be available to politicians to spend on pet projects of their choosing.
Arnold Schwarzenegger insults the intelligence of Californians by trying to say that this massive regulatory scheme has not already had a negative impact on California’s economy – and that what lies ahead isn’t going to be devastating.
The Governor’s assertion that AB 32’s draconian regulations are actually “creating jobs and stimulating the economy” is laughable. Of course when you regulate adversity, you are going to create a cottage industry of new jobs from those seeking to benefit from the “new rules” – but this comes at the expense of a much larger group of jobs that are lost because government has fundamentally interfered with the free market (emphasis on the word free).
It makes you wonder if the Governor passed a regulation making it easier to rob banks, thus forcing police departments to hire more officers to guard banks, if the Governor would then praise his pro-bank robbing regulation because of the “new jobs” created in law enforcement?
Look, obviously I (along with many others) disagree fundamentally with the science used to establish AB32, as well as the regulatory scheme itself. I “get it” that the Governor thinks that man-made worldwide carbon emissions represent a clear and present danger to Planet Earth. Fine. The Governor needs to man up and simply say, “Look, we have to significantly cut our emissions to save the planet. It won’t be easy and it will be very, very expensive. Californians and everyone else will have to surrender a significant amount of their freedom, liberty and property rights in order for the government to take the necessary steps to reverse the direction of global warming. I don’t like it, and you don’t like it, but that’s the way it is."
I wouldn’t like AB 32 any more if the Governor was candid and realistic when talking about its real impacts on the economy and in terms of shifting power from the people and into the hands of the government. But at least I would have more respect for the Governor for being honest about what it is that is happening, and what it means for us.
There is no doubt that AB 32’s regulations are hurting the state’s economy – and it will only get worse.
Fortunately for all of us, there are some sane policy makers who are trying to stop us from hurting ourselves. Congressman Tom McClintock and Assemblyman Dan Logue, working with Ted Costa of the Peoples’ Advocate, are working to place an initiative measure on the 2010 ballot that would suspect AB 32 until unemployment drops considerably, a sign that our economy has recovered. You can find out more about that here.
Let me close with some words of praise for Chris Reed who continues to stay focused on this critical issue. You should definitely keep an eye on his blog, though we’ll always pull his best stuff and link it on the FlashReport.
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