California has to be a leader, the progressives tell us, by which they mean that ordinary people should just shut up and eat their spinach. The spinach is necessary for the good of mankind, ordinary people included, and, anyway, it tastes good, fills you up, and costs next to nothing. Trust us.
So went the arguments in favor of the California global warming law — “AB32” — passed in 2006 as the state’s contribution to mankind’s sacrifice to Gaia, representing the repentance and suffering necessary to forestall the imminent catastrophe of global warming. Alas, unlike the case back then, the state economy is not in such great shape these days, even in comparison with the poor conditions in the nation writ large; and so the voters had a chance last month — Proposition 23 — to suspend the implementation of AB32 until unemployment fell to 5.5 percent or lower for four consecutive quarters.
That proposition lost badly — about 62 percent to 38 percent — in no small part because of the loud argument that the goals of AB32 (a reduction in the emissions of carbon dioxide to 1990 levels by 2020, or about 25-30 percent) could be met cheaply through the substitution of “renewable” energy in place of conventional fuels in electricity generation. And what about the state’s massive unemployment problem? Not to worry: Good, high-paying, green jobs would substitute in place of all that dirty, traditional employment upon which the state actually was built over many decades. How will that happen? Easy: The taxpayers and electricity consumers will subsidize it, but only temporarily. How can employment in green energy be “high-paying, good jobs” if the end product is to be cheap? Oh, shut up, they explained.
Oops: Now they tell us. Sadly, better late than never doesn’t quite cut it in this context. The first of the LA Times stories linked above notes that during the gubernatorial campaign, Brown “called for developing 20,000 megawatts of new, renewable energy in California.” (As an amusing side note, the LA Times reporter, one Anthony York, writes that “each megawatt of power would be enough to serve up to 1,000 Southern California homes,” an assertion that obviously is incorrect: The figure should be “each 1,000 megawatts.” Is it too much to expect the journalists actually to learn something about the topics they address?) The state public utilities commission claims that this would raise rates by “as much as 14.5 percent.” That, of course, is the optimistic view: The Los Angeles Department of Water and Power estimates that it would raise rates by around 5 percent per year for the next 20 years.
Are they kidding? Both solar and wind power are notoriously unreliable, meaning that they have to be backed up with conventional (i.e., gas) generation. (That is why China, often cited as a model of the clean energy future, is building about one coal-fired generating plant each week.) Will that be free? Of course not, and the same sad reality will afflict the transmission lines needed to carry electricity from the “solar panels on parking-lot roofs, school buildings and along the banks of state highways” envisioned by Brown.
Brown differs from Governor Arnold, also a vehement supporter of renewable power, in that the Governator was willing to use electricity produced outside the state to meet the renewables mandates. Brown wants most of the power produced within the state, not because California electrons are better than those produced in, say, Utah, but instead because the state’s labor unions want to do good for Californians the construction jobs. Said Scott Welch, “a lobbyist for the International Brotherhood of Electrical Workers”: “We totally support Jerry Brown’s initiative … but you simply can’t get there without” in-state renewable energy. Riiiiight…
On the local front, the LADWP “is quietly backing away from [Mayor Antonio Villaraigosa’s] ambitious goal of generating 40% of its power from renewable sources by 2020.” Because the politicians cannot change reality, LADWP has been in a state of upheaval for several years: “Multimillion-dollar initiatives have been announced, then abandoned. Executives have been installed, then jettisoned.” Specifically: There have been five, count ’em, general managers over the last 3½ years, and four board presidents since 2006. What’s the problem? Simple: Massive consumer resistance to the higher rates needed to pursue Villaraigosa’s 40% target has forced the utility to scale things back even as Hizzoner forges ahead in the face of facts impervious to political rhetoric.
This blatant unwillingness on the part of politicians to speak truth to interest groups, to the electorate, indeed even to themselves is a significant contributor to the slow-motion disaster unfolding for the California economy. Always opting for government bigger rather than smaller and more rather than less centralized, for taxes higher rather than lower, for regulatory intrusion more rather than less oppressive, the political class has perfected the art of hiding hard truths until after the next election. Sadly, the now-they-tell-us stratagem is unlikely to work again, for the budget and economic problems are so massive that collapse may well be far closer than anyone admits. The market is telling us hard truths, now.
Benjamin Zycher is a visiting fellow at the American Enterprise Institute and a senior fellow at the Pacific Research Institute.