Money would be directed towards carbon emissions

by Brian Leubitz

AB 32, our landmark climate change legislation, will have some enormous impacts on the state’s economy and the government. However, there’s this:

The amounts are potentially enormous: from $1 billion to $3 billion a year in 2012 and 2013, jumping to as high as $14 billion a year by 2015, according to the nonpartisan state Legislative Analyst’s Office. By comparison, the state’s current budget deficit is $9 billion.

But like thirsty castaways on an island surrounded by ocean water they can’t drink, Gov. Jerry Brown and state legislators face strict constraints on how they can spend the money. More than 30 years of court rulings and ballot measures — dating to Proposition 13 in 1978 — limit its use, probably only to projects that reduce greenhouse gas emissions.(Media News)

The state already has some spending lined up, including helping to pay for cleaner burning trucks for the ports. There is likely to be some benefit for the budget, as spending for climate change programs are shifted away from the general fund. However, unless the legislation is changed, it isn’t the solution for the deficit.

Scheme comes out of AB32, the landmark climate change bill

by Brian Leubitz

In Washington, Congress is twiddling its thumbs as they debate what science stopped debating years ago.  Rather than aggresively taking on the environmental challenges of our lifetime and building a new sustainable economy, we are pretending the problems don’t exist.  Sure, we apparently care about the budget deficit that we are handing future generations, but a livable planet is apparently a luxury that we don’t care to pass on.

But California, as they say, is different.  We passed AB32, with a Republican Governor, yet. And today, we have a real system to put in place:

California has cap & trade – or will once the program starts ramping up next year. Today’s approval by the state’s Air Resources Board was described by chair Mary Nichols as like “moving a large army a few feet in one direction.”

The objective that “army” is marching – or shuffling – toward is, of course, the fulfillment of California’s goal to roll back greenhouse gas emissions to 1990 levels by the end of this decade. With at least a semi-intentional pun, Nichols calls cap & trade the “capstone” of that effort, although the program is expected to produce at most, 20% of the hoped-for reductions in carbon emissions. The rest will come from other measures either lumped under or related to the state’s Global Warming Solutions Act, more widely known as AB 32.

Those other measures include stricter standards for tailpipe emissions, a “low-carbon fuels standard” (still being worked on), and the ambitious-but-attainable goal to get a third of the state’s electricity from renewable energy sources, also by 2020. (KQED Climate Change Blog)

Across California, cities and counties are actually doing something about climate change. In fact, San Francisco recently announced that the City has reduced carbon emissions levels 12 percent below 1990 levels.

There is a lot more hard work to come, but it is really, really good to see this unanimous vote on the cap and trade system.

In a time when Lester Brown is writing about a World on the Edge: How to Prevent Environmental and Economic Collapse it seems that the political forces in California make for strange reading.  Republican Arnold Schwarzenegger, whose overall environmental polices were as destructive as any CA governor, made an impassioned speech this week on the need for strong action on climate change.  It may be the only environmental issue that he got right.  

At the same time, Representative Jim Costa was voting with the Republicans to continue subsides to the petroleum industry… subsidies that cost the US Taxpayers Billions a year.  It is yet one more piece of evidence that cutting the federal budget is not really a goal, but rather a question of whose ox is going to be gored.  In this case, Republicans in Congress are making sure that their ox is protected.

We all know how we are being manipulated, first by a national that considers Charlie Sheen to be the big story of the day year, but also by the political operatives who draw a public salary to be lobbyist.  One time John Doolittle / John Ashcroft aide, Kevin Ring, made that very clear on his Daily Caller blog post this month.  

If I did not know these critical facts as the lead staffer on the bill, how little did other Hill staffers (and their bosses) know when they agreed to let this bill pass? I know this for certain: If someone had objected, I would have recommended that we accuse the objector of not being serious about saving Americans from this deadly threat.

Ring was talking about how federal legislation regarding methamphetamine and the manner in which offenses are punished.  But we surely know that the same type of mnanipulation goes on in every are. BTW – Ring awaiting sentencing for Abramoff associated dealings.  In California, we need to pay attention to how demands for additional growth and invective against the EPA will play out, especially with CA Reps Buck McKeon and Darrel Issa in positions of power right now.

Schwarzenegger was right.  This is a time when we will have to manage the climate as best we know how or pass on the consequences of our non-action to our children and grand children. The Climate, Energy, Water nexus of issues will define our future.  

As a one time thespian, I am thinking of the line from Death of a Salesman: Attention must be paid.

Note: this is a cross-post from  The Realignment Project. Follow us on Facebook!

Introduction:

With the belated victory of Kamala Harris as Attorney General, the full results of the 2010 election are in for California. There many things that progressives can be proud of – a sweep of statewide offices, picking up another Assembly seat, defeating prop 23 and passing prop 25. On the other hand, there are also some major disappointments – the defeat of prop 19 (marijuana legalization), the defeat of prop 21 (a VLF to fund the state parks), the defeat of prop 24 (rolling back corporate tax breaks), and the passage of prop 26 (2/3rds requirement for fees). Prop 26 especially complicates what this victory means for California.

Indeed, our situation is a lot like the national picture after the 2008 elections – we have an executive who straddles the line between the left and right wings of the Democratic Party, a big legislative majority, but not the ability to break the fiscal deadlock and really be able to govern our state.

So where do we go from here?

Finance:

The rather comfortable million-vote margin by which prop 25 passes would make me rather optimistic about the possibility for the passage of a majority-vote revenue proposal. However the failure of every revenue increase – prop 19, 21, and 23 – are daunting evidence to the contrary. Granted that the outcome might be different in a presidential electorate (younger, more minority and working class voters, higher turnout generally), but I think this shows how difficult it will be to thread the needle of the “Program/Government Blindspot” and the prevalence of austerity thinking, even if we link taxation to spending.

In the mean time, California Democrats have a daunting task ahead of them – to balance the budget without doing any more harm to already brutalized public services, and to create the economic growth necessary to ensure that the budget stays balanced. In the short-term, there are four things we can do:

1. Going back to the Steinberg Maneuver – According to the California Budget Project, Prop 26 doesn't establish a blanket 2/3rd requirement for all fees. A number of fees, including “charges where the feepayer receives a service, product, benefit, or privilege…charges imposed for entrance, use, purchase, or lease of state or local government property, penalties, fines, or other monetary charges resulting from a
   violation of the law, charges imposed for “reasonable regulatory costs” and assessments and property-related fees,” are not covered by the 2/3rds requirement. Thus, it's still possible to raise revenue through a two-step process in which said fees are raised by a certain amount by majority vote, then taxes are raised and the fees are lowered by the same amount by a majority vote. The issue here is whether we can get Governor-elect Jerry Brown to sign such measures, given previous statements of his.
2. We can try again with Ballot Box Budgeting – there's some indication that Brown's approach will be instead to put the budget to a vote as a proposition in a special election. The tricky thing here is how to persuade the public to vote for said budget; Schwarzenegger tried this in 2009 and it was dramatically unsuccessful. Perhaps the 2010 election signals a more realist (and realistic) electorate, but it's a roll of the dice.
3. Banks – I'vewritten before about the potential that a state reserve bank offers. That was true before the 2010 election, but it's even more true now. Given the newly-created restrictions on raising revenue, a state reserve bank offers an entirely new possibility, both for resolving the current budget crisis, and for creating the economic growth necessary for California's future development.
   1. I believe that this bank would be even more likely to gain support if, within the state bank, there was created a series of Development Funds – a Green Development Fund, an Education and Innovation Development Fund, a Health Care and Medical Science Development Fund, and so on – that could make targeted investments into key sectors of California's economy, both public and private.
4. Jobs – with or without financing from a state reserve bank, a Job Insurance fund would fit under the exemption in prop 26 – since the “feepayer receives a service, product, benefit, or privilege,” namely eligibility for a job when unemployed. Ultimately, as I have said before, California cannot balance its budget with 12% unemployment because revenues will continue to decline, no matter how much spending is cut. What is needed is a sudden shock to California's labor market, and unemployment being cut in half is that shock – it will pump huge amounts of money into local retailers and other businesses, it will make employers see the ranks of the unemployed in their communities shrinking, and hopefully shift the “animal spirits” of both employers and lenders.

None of these steps is a total solution for the fundamental problem of revenues – given the problems we had with the budget even before the recession. But they will fill the gap so that we can debate the question of majority-vote revenues in an economic climate of balanced budgets, normal levels of unemployment, and higher economic growth.

Green Economy:

Now that AB32 and CEQA (California Environmental Quality Act) are safe from Prop 23, we need to do more to show the real possibilities of a green economy. This means making it fast and seamless to develop sustainability, through the creation of expedited approval and categorical permits for model projects. It also means establishing special zoning rules in transit corridors to allow for sustainable, energy-efficient, high-density development.

This doesn't mean dismantling regulations in the name of the environment, but rather shifting the direction of regulation away from NIMBY no-growth, which only encourages sprawl and wasteful development, towards in-fill building of affordable housing in already-developed areas while protecting undeveloped land. It also means – and here is where environmentalists need to reckon with the realities of class and race – getting rid of the tools of modern class (and racial) discrimination: zoning rules that limit building heights to two-stories or less, that ban unrelated individuals from living in the same house (to prevent renters and subdivision), that establish minimum lot sizes to mandate , or that mandate the construction of garages. In other words, ending exclusionary zoning and encouraging inclusionary zoning.

Finally, it means supercharging public investments into green energy, mass transit, and other sustainable ventures. A statewide version of LA's 30/10 plan, aimed at speeding up and extending High-Speed Rail and local mass transit would be a huge transformation, both in terms of creating jobs and spurring growth, but also in lowering CO2 emissions and pushing land-use away into energy-efficient high-density development. Large-scale alternative energy projects, like the Beacon Solar Energy Project, San Fransisco's tidal energy project, should be built under public auspices, making use of the newest forms of technology. The advantage to this approach is that it allows the public sector to act as a yardstick competitor to California energy companies, spurring innovation and providing a guaranteed market for green manufacturing firms under democratic auspices.

All of this links together. Without financing, there's not going to be a green revolution in California any time soon. Without new sources of economic growth that don't depend on housing bubbles, California won't get the revenue it needs. In the end, the fight over our budget is really about the future direction of this state – whether we will have a government that can help build a broad economy or a night watchman state that is powerless to prevent corporate greed from running wild.

So let's get to work.

Governor Schwarzenegger and Meg Whitman aren’t really seen around town too often.  Whitman can’t seem to get far enough from Arnold, and with his record, who would blame her.  Yet, as Meg Whitman attempts to make California into Texas, Governor Schwarzenegger is lashing out at the terrible Texas two, Valero and Tesoro, who have been funding Prop 23’s effort to kill California’s regulation of greenhouse gas pollution.

Schwarzenegger, speaking before several hundred people at the Commonwealth Club in Santa Clara, said the proponents of Prop. 23 are attempting to subvert the democratic process using scare tactics. He likened the campaign to a shell game hiding what he said was the real purpose: “self-serving greed.”

“They are creating a shell argument that they are doing this to protect jobs,” the governor said. “Does anybody really believe they are doing this out of the goodness of their black oil hearts – spending millions and millions of dollars to save jobs?”

Schwarzenegger said AB32, which he signed into law in 2006, will create jobs by allowing California to establish a “green economy” featuring solar energy, hydrogen power, bio-energy and a renewable electricity standard that will provide “the seed money for the world’s energy revolution.”

The only job losses or costs, he said, would be in polluting industries like Valero Energy Corp. and Tesoro Corp., both of which have refineries in California that climate experts say are sources of greenhouse gas emissions.(SacBee)

The tone of Schwarzenegger’s attacks were as surprising as anything else, so it is worth watching the Olbermann clip up top to here the audio of the speech.  He puts the lie to the notion that Prop 23 is going to “save a million jobs.”

It is striking that Arnold Schwarzenegger, who has attempted to throw the state off the cliff through his shock doctrine budget techniques.  But even for him, this is a bridge too far.

By Kristin Eberhard

Originally posted on The MarkUp.

Now that Republican gubernatorial candidate Meg Whitman has announced her opposition on Proposition 23, this dirty energy proposition stands as the main issue that she and the Democratic candidate Jerry Brown agree on.  While Whitman’s stance against Proposition 23 is good news for California, jobs and our strong clean air and health standards, it is troubling that she coupled her technical opposition while simultaneously announcing her intent to suspend AB 32 for at least a year if elected Governor.  Her position sounds like she wants it both ways.  Delaying AB 32 would throw a monkey wrench into the implementation of our clean energy polices, and significantly hamper the transition of the state – indeed, the nation – to a clean energy economy.

Sponsored by out-of-state oil interests, Proposition 23 would wreak havoc with implementation of AB 32, our country’s only economy-wide clean energy law, an initiative that is creating thousands of cleantech sector jobs, stimulating research in clean energy and alternative fuels, and cutting the state’s emissions of greenhouse gases. Proposition 23 would keep us addicted to dirty fuels, kill jobs and derail California’s efforts to lead the global push to a high tech, clean energy economy.

While California’s Democrats and Republicans may disagree on many points, they have come together over the years to support state leadership on one issue:  clean energy. Support for strong environmental regulation and an economy founded on clean technologies and sustainable energy sources is broad-based.

The bipartisan opposition to Proposition 23 is not an anomaly.  Clean energy in particular has long been a priority for the state’s electorate and lawmakers.  In 1974, the California Energy Commission was established by the state legislature and then-Governor Ronald Reagan.  Among the Commission’s early accomplishments were setting energy efficiency benchmarks for new buildings and appliances, standards which have kept California’s per capita electricity consumption flat for 30 years, saving residents billions of dollars on their energy bills.

In subsequent decades, California built on this foundation, establishing Renewable Portfolio Standards that have minimized electricity generation from fossil fuels.  Bipartisan efforts also passed bills such as SB 375 in 2008, which sets regional targets to reduce global warming pollution from cars and light trucks and make community resources and energy use more sustainable.  Just this year there was strong bipartisan agreement on SB 77, a bill that funds voluntary energy retrofits to residential and commercial property, providing for a projected 10,500 jobs.

And we shouldn’t forget that bipartisan support for clean energy and environmental protection is part of our national tradition. The Clean Air Act of 1970 and the Clean Water Act of 1972, two of the seminal legislative efforts on any subject in the past 30 years, could not have passed without the support of lawmakers from both parties.

AB 32 creates a stable policy environment that attracts billions of dollars in venture capital and cutting-edge businesses to the state and we need a reliable policy roadmap.  We need a commitment to a clean environment and sustainable energy that transcends party lines.  This is an issue that speaks to the American ethos – to the American Dream.  It is about security, innovation, entrepreneurship, and leaving our children a world that is better than the one we inhabit.