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What's The Motivation Behind Prop. 23?

What's The Motivation Behind Prop. 23?
Proposition 23 is asking voters if the state's greenhouse gas emission laws should be suspended until unemployment drops below 5.5 percent for a year. We speak to KPBS Environmental Reporter Ed Joyce about the arguments for and against Proposition 23.

Maureen Cavanaugh: We move from Proposition 25 that would change the way our budgets get passed to Prop 23, that could possible change our environment. Proposition 23 supporters call the measure the "California Jobs Initiative." Opponents call it the "Dirty Energy" Proposition, and there's a whole lot of money being raised around this statewide measure on the November ballot.Here to tell us about Proposition 23 is KPBS environmental reporter Ed Joyce. Good morning, Ed.

ED JOYCE (Environmental Reporter, KPBS): Good morning, Maureen.

CAVANAUGH: So what does Prop 23 ask voters?

JOYCE: From the official title and summary, Prop 23 would suspend the implementation of air pollution control lot AB-32. That’s the Global Warming Solutions Act, and that AB-32 requires that major sources of emission report and reduce greenhouse gas emissions that are linked to the cause of global warming. So it would suspend that law until the state unemployment rate drops to five and a half percent or less for a full year or four consecutive quarters. That hasn’t happened but three times in the last, oh, say, 30 years.

CAVANAUGH: Now whenever I hear AB-32 talked about, it’s always couched as an ambitious – the ambitious AB-32, Greenhouse Gas Emissions Law. What makes this, AB-32, so ambitious, so unique to California, and so much heralded by environmentalists?

JOYCE: Essentially, it identifies the statewide greenhouse gas emissions, excuse me, levels in 1990 to serve as the emissions limit to be achieved by 2020, so it’s significant in that it would require emissions of all sorts of vehicles, it would require power plants, it would require other industries that – refineries, for example, oil refineries to reduce their greenhouse gas emissions to levels that go back to 1990. It would establish a cap and trade policy as well. So it really is ground breaking and I think there’s fear that this could be – could lead to things that would happen in other states or could become a national standard. And it would cost industry a lot to meet these emission standards, at the same time people are saying this is one way to get to the place where we need to, apparently based on the science of the day to reduce the causes of global warming, which are greenhouse gas emissions.

CAVANAUGH: And just to be clear, this has a wide reaching area of industry, that it would affect many, many industries, the car industry, the building industry, you know, how we get – how we fuel our automobiles. All of this would be impacted by this legislation, even more so as time goes on.

JOYCE: And farm industry, diesel trucks, all the way down the line.

CAVANAUGH: Now what is the motivation behind this ballot measure which actually would suspend these air pollution control laws?

JOYCE: The supporters of Prop 23 say now is not the time to roll out this law. They say that the economy is in a sad state, a recession, unemployment is high in the state right now, and they say suspending this would give a break to businesses to not have to spend additional monies at this time to control those emissions and the costs in doing so could potentially lead to job losses.

CAVANAUGH: Now you spoke with a person who is with the ‘Yes on Prop 23’ campaign.

JOYCE: Yes. Anita Mangels is with the ‘Yes on Prop 23’ campaign. She tells us the reasoning behind the measure.

ANITA MANGELS (Yes on Prop 23 Spokesperson): Yes on 23 will not repeal or weaken the state’s global warming law. It’s simply a common sense measure that will adjust the timing so that we can actually afford it instead of doing it now when 2.3 million people are out of work and California is in the depths of an ongoing and very persistent recession.

CAVANAUGH: Yes, go ahead.

JOYCE: So essentially, you know, this is seen as something that would help the state’s economy because it would not require these costs at this time during this state of the economy that we’re in at this moment with unemployment at this 12% level right now in California.

CAVANAUGH: And what are the costs? Specifically, do the people who support Prop 23 tell us how this is costing the state at this time?

JOYCE: Well, there was a study that they had done that has since been challenged, let’s say, because of the methodology of the study so there’s some dispute about that. However, AB-32 does require increased renewable energy and clean fuel requirements. There’s a cost with that. Mandatory emissions recording, fee requirements for major emission sources, power plants, oil refineries, so there is a cost in meeting AB-32. The public utilities, SDG&E for one in the state, are moving toward renewable energy goals that are part of this by 2020. So you are seeing these contracts being signed and they’re making plans for solar energy, wind energy and so on, so these are costs that are borne by these utilities and passed on to consumers as well.

CAVANAUGH: And I just want to go back to one thing you said before because Anita Mangels, in the clip that we just heard, she’s a proponent of Prop 23, says this does not repeal or weaken the state’s global warming law. However, it does postpone it until the state employment rate is below 5.5% for four consecutive quarters. How often has that happened in recent memory in California?

JOYCE: Not often. It’s essentially about three times in the last 30 years so that’s almost – that’s a phenomenal rate and that’s why the opponents of Prop 23 say it essentially almost kills the Greenhouse Gas Emissions Law because that happening for four consecutive quarters would be, you know, just not something that happens that often, three times in 30 years.

CAVANAUGH: Now, the people who are for – are against Prop 23, the campaign, they also say that AB-32, the California Global Warming Solutions Act, actually helps the state economy.

JOYCE: Right, this has been seen as a prod for innovation in biofuels, for example, all sorts of energy sectors, clean and green technologies, as its called. CleanTECH San Diego has sprung up with the idea partly to do with the incentives that AB-32 is providing. I mean, people have to meet these goals. It’s creating a whole hotbed of companies that are looking at alternative sources for these, shall we say, dirty emissions, dirty fuels that we’re using that cause greenhouse gas emissions. And Jim Waring is the chairman of CleanTECH San Diego, he says suspending AB-32 may send green tech investment money to other states or other countries.

JIM WARING (Chairman, CleanTECH San Diego): We talk to companies that move here because they see potential to grow their businesses here because we have this framework. So if Proposition 23 was to pass, the air would go out of that balloon, if you will.

CAVANAUGH: So that was the other side of the coin about how much money AB-32 was actually generating. Opponents of 23 say this Clean Air Act is actually bringing jobs and bringing energy and innovation to California. I’m wondering, Ed, when you track this, which groups are lining up for and against this measure?

JOYCE: Actually, it’s a really interesting blend because George Schultz, the former Secretary of State under President Reagan, is the co-chair of the ‘No on Prop 23’ campaign. He comes at this from a sort of a national security standpoint. He thinks that this AB-32 helps drive that innovation that could lead to other sources of fuels reduce our dependence on foreign oil which, by extension, would mean perhaps there would be less military incursions in certain areas to protect those oil interests. Strangely enough, he also is a chair of Meg Whitman’s campaign and she’s said she’d suspend AB-32 so it’s – it can be a little confusing. Taxpayer groups are against – are for Prop 23, Howard Jarvis Taxpayers Association, excuse me, some other chamber of commerce groups as well but a long list of major corporations, including Sempra Energy, Google, are against Prop 23.

CAVANAUGH: And what about the money? Where is the money coming from to fuel this campaign for ‘Yes on 23?’

JOYCE: Fuel is, indeed, the word. Two big oil companies that are based in Texas, Tesoro and Valero, are the predominant funders of this campaign. And Anita Mangels with the ‘Yes on 23’ campaign has pointed out that those companies may be based in Texas but they do have operations in California. They pay California taxes, they employ people here.

CAVANAUGH: Now do we have any big funders against Proposition 23? Because I was reading and, you know how online there’s this Ballotpedia thing and it just outlines – It’s such a wonderful way to find out all the measures. And there on the site it said that there are concerns that this – or at least there are – people anticipate that this proposition might generate just a huge amount of money on both sides to try to battle this out by November.

JOYCE: There are a lot of vested interests on both sides and certainly in terms of the ‘No on 23’ campaign, you have such a mix of people behind it and a lot of companies have already invested money in this AB-32 in meeting those emission standards and goals, including the public utilities. There’s a lot of cost involved and uncertainty. And a lot of companies want to know, here’s the rules, here’s what we have to do. If this was to pass, it kind of creates a question mark and it’s hard to plan for budgets and costs, corporations going years out when you don’t know what the rules are.

CAVANAUGH: And, indeed, it may actually result in a lot of lawsuits as to which part of AB-32 still should be implemented and what should not.

JOYCE: Yes, and there was a study out of the University of San Diego Energy Policy Initiative Center this week that pointed to that as well, saying likely there will be lawsuits no matter what happens, either side. And there’s been some states that have threatened that if this does not pass, they will file lawsuits. There’s a fear that this will spread to other states like California’s emissions standards has spread which has meant cleaner air.

CAVANAUGH: We have a caller on the line. Jennifer is calling us from San Diego. Good morning, Jennifer. Welcome to These Days.

JENNIFER (Caller, San Diego): Good morning. This is Jennifer Badgley with the Electricians Union of…


JENNFIER: …of San Diego. Hi. And I was just calling because we represent (audio dropout) in the energy (audio dropout) in San Diego and Imperial Counties and we are opposed to Proposition 23.

CAVANAUGH: And your group has taken a stance on that?

JENNIFER: Yeah, we are (audio dropout) to defeat Proposition 23 because clean energy has really been a part of our economy that even in this recession has helped keep electrical workers employed. And, you know, we’re going to – in the country and in the world, we’re going to continue to experience growth in the clean energy sector, and the question is are we going to let Texas oil companies tell us that we can’t create those jobs and large scale manufacturing and generation in Imperial County and improving energy efficiency here in San Diego. And we say we shouldn’t let Texas oil companies do that to our local workforce.

CAVANAUGH: Well, thank you, Jennifer. Thank you very much for the call. I know that, Ed, not all biotechnology industries or trade groups have taken any kind of a stand on this, on Prop 23, at this point.

JOYCE: Yeah, some have for and some against. It’s a strangely mixed bag. There’s different groups. For example, the Santa Maria Valley Contractors Association are for 23, and here’s an electricians union that is against it. So it really splits up – I spoke with somebody in the biotech industry, the biotech industry trade group, BioCom, they’ve not taken a position on Prop 23 but when I talked with BioCom CEO Joe Panetta about it, he says AB-32 does create an incentive for the biotech industry.

JOE PANETTA (CEO, BioCom): One of the reasons that we’re doing what we’re doing is because we know that there are goals to be met under AB-32 and, you know what we’d prefer to be doing is to find ways that we can meet those goals and create the workforce and create the products that are going to help us to get there.

JOYCE: And that – I was talking with him because they had put out a study with another trade industry group that showed the biofuel sector has been growing rapidly the past five years in part because of AB-32.

CAVANAUGH: It’s so interesting how both sides on Proposition 23 seem to have their own studies that they cite and their own separate ideas, their own resources to measure how much this would cost or how many jobs and resources it would create for California. It’s hard for a voter to come to an issue like this and find out which side is right.

JOYCE: Yeah, well, they both say it’s a job killer. I mean, basically ‘Yes on 23’ says suspend AB-32 because it’s going to hurt jobs, this is the wrong time for it. The people against 23 say this is not a good idea because it will cost jobs, it will reduce innovation. The legislative analysts and analyzation (sic) of this said that if AB-32 is suspended, it could result in a modest net increase in overall economic activity but there would be an unknown but significant – potentially significant net increase in state and local government revenues. However, the flip side of that, the legislative analyst also says the potential loss of a new source of state revenues from the auctioning of emission allowances by state government to certain businesses, that would be the cap and trade, that would pay for those allowances by suspending the future implementation of cap and trade regulations. So it’s one of those balancing acts that we’re moving in this direction. The idea and the goal is to get away from the fuels and the things that cause greenhouse gas emissions and there’s going to be a little pain here and there but on the plus side, this is driving a lot of innovation, new jobs, cleaner, green technology and that’s what all these other businesses and industries are growing up around. So it’s sort of a segue, I guess in a sense, here it is 2010, to a new – maybe a new era from an older – an old century way of fueling our vehicles and getting around to a new way and it’s – there’s going to be pain and it may be a longer transition than a lot of people think.

CAVANAUGH: So what I understand from what you just said about the legislative analyst is we’re paying a little bit more money now for a dividend in the future.

JOYCE: That would be one way to look at it, yes.

CAVANAUGH: Yes, and people have to decide if now is the time, with our recession and with our economy the way it is, to pay that little bit extra right now in order for a dividend in the future.

JOYCE: Exactly, and that, apparently, in the process, cleaner air.

CAVANAUGH: Cleaner air, right.

JOYCE: And the things that cause – are linked to climate change, greenhouse gas emissions, are reduced. Again, the proponents of ‘Yes’ also say that this would put California in a kind of an unfair competitive disadvantage, if you will, because there’ll be more requirements here than in other states. However, California has, in the past, been that leader in a lot of different areas, including fast food, then trends spread to other countries and other states.

CAVANAUGH: Very, very, very complicated, and very good. Thank you, Ed, so much for sorting this out for us.

JOYCE: I hope we helped.

CAVANAUGH: You’ve been listening to KPBS environmental reporter Ed Joyce. If you would like to comment, please go online, Coming up, we get a glimpse at the world’s undercovered news stories. That’s as These Days continues here on KPBS.