Fate of California’s Prop 23 to have ripple effect throughout country

Amanda Carey Contributor
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The climate debate may be temporarily stalled in Washington, D.C., but in California, it is still in full swing. It’s quickly heating up too (no pun intended), as Golden State residents prepare to go to the polls November 2 to vote on Proposition 23 – a bill that would postpone the implementation of the state’s Global Warming Solutions Act of 2006, otherwise known as AB 32.

But as is the case with most California ballot initiatives, regardless of which side wins, the result will have ripple effects throughout the country. In other words, California’s battle over climate could be foreshadowing of a future national narrative about what is more important: a focus on renewable energy or jobs and the economy.

Signed into law by Republican Gov. Arnold Schwarzenegger in September of 2006, AB 32 is California’s very own version of the Kyoto Protocol.  It requires greenhouse gas emissions to be reduced to 1990 levels by 2020. Prop 23 seeks to postpone implementation of the act until unemployment levels are down to 5.5 percent for four consecutive quarters.

Right now California’s energy standards are the strictest in the nation; they even go further than the Waxman-Markey cap and trade bill that passed the House last summer.

Not only that, but California also had to obtain a waiver from the Environmental Protection Agency (EPA) just to be able to enforce the energy standards in AB 32. Historically, the regulation of air pollutants has been left to the EPA, something that was pretty much set in stone by Congress with the Clean Air Act.

But though AB 32 was passed in 2006, the waiver was not granted until June of 2009 after the newly sworn-in President Obama directed the EPA to review the Bush administration’s refusal of the request two years earlier. The argument was that California had a higher level of pollution (not to mention problems with smog) and thus needed the latitude to adopt regulations stricter than those set out by the EPA.

The real kicker of the waiver, though, is that it allows other states to follow suit if they can prove they are in as dire straits as California when it comes to air pollution. But in the words of Dan Kish, senior vice president at the Institute for Energy Research, this causes a real problem nationally because “as California goes, the rest of the nation tends to go”.

“It [AB 32] is incredibly radical in terms of the amount of CO2 it is seeking to reduce,” Kish told The Daily Caller. “It basically gave the government carte blanche to do whatever it takes to get to that number by 2020.”

But what was viewed at the time as a major victory for clean energy advocates has since developed a contentious legacy.

Just last March, the California Air Resources Board (CARB) released a study on AB 32’s economic impact. It found that the law would create about 10,000 new jobs over the next decade. However, an independent study done by the consulting firm Charles River Associates, said the law would not only end up costing between $27 and $98 billion, but it would also cause a decline in annual household income throughout the state.

Global warming advocates and opponents of Prop 23, though, have led the debate with accusations that the initiative is not only being funded by Big Oil, but would also deliver a huge blow to the state’s burgeoning clean energy economy.

The League of Conservation of Voters (LVC), an environmental advocacy group, has even placed Prop 23 on its “Dirty Dozen” list of concerns for the midterm elections – a spot usually reserved for politicians. And according to LCV President Gene Karpinski, the Prop 23 issue is “the single most important race in the country.”

But though the Prop 23 initiative is being (at least) partially bankrolled by oil refineries like Velero and Tesoro, opponents have raised $16.3 million. That’s nearly twice the $8.9 million raised by the initiative’s backers.

Moreover, the campaign to defeat Prop 23 is being funded in large part by its own set of special interests — Silicon Valley and venture capitalists like John Doerr. But, as TheDC has previously pointed out, Doerr and his firm Kleiner, Perkins, Caufield and Byers, stand to make huge profits from legislation pushing green technology.

“The green tech industry makes money by making products that won’t make it in the marketplace on their own,” said Kish. “That’s why these companies are rich and have employees. It’s a total scam.”

“And the reason they hate this [Prop 23] is because it’s linking loss of jobs to green technology,” he continued.

But for Kish, the broader problem is the effect he says AB 32 has had on businesses – namely, driving them out of the state. That same phenomenon happens internationally too, he pointed out. The more stringent energy standards imposed on business, the more they will go elsewhere — like China, for instance.

“[California] really hasn’t saved energy, they’ve lost it,” said Kish. “Businesses are leaving.”

“And California just doesn’t get it,” continued Kish. “It’s like children got a hold of the car keys. But they can’t be allowed to take the rest of us with them; it’s California dreaming all over again”

Although voters will decide on them the same day, Prop 23 won’t have much effect on the California governor race. Both Meg Whitman and Jerry Brown oppose the measure. In the meantime, CARB is preparing to unroll its statewide cap and trade plan by the end of October.