27 September 2010
The Boeing Co.'s recent announcement that it's relocating two key defense programs, and 800 jobs, from Long Beach to Oklahoma City demonstrates why California's Global Warming Solutions Act of 2006 – also known as Assembly Bill 32 – is reckless and damaging to our state. With unemployment at or above 30 percent in many areas of the state, it is imperative that Californians pass Proposition 23 on Nov. 2 to suspend the implementation of AB32 and its series of new and untested environmental mandates.
AB32 requires employers to reduce their "green-house gas emissions," and provides for a cap and trade program to restrict their use of energy. On top of rising taxes and the budget crisis, this self-imposed law is forcing businesses to redirect capital that could otherwise be used for expansion or salaries toward the elimination of green house gas emissions, which even proponents of AB32 admit will have no substantial effect on global levels. Additionally, businesses that are unable to meet these new requirements will be subject to costly fines and other enforcement actions.
AB32 is almost single-handedly driving up the cost of doing business in this state by shackling California employers with massive regulations and increased costs, all at a time when they are least-equipped to shoulder the strain.
This bill might be just enough to push businesses over the edge and drive them out of state for good. California is already seen as one of the nation's most expensive and burdensome places to do business. Adding more hostile business policies will push more companies – and jobs – to other states.
Although Boeing did not identify AB32 as the sole reason for the layoffs and the transfer of positions, does anyone really doubt the effect of AB32's invisible hand on the company? Does anyone think that it is a sheer coincidence that a longtime employer has elected to transfer its operations now?
Climate activists have not given enough consideration to the economic harm this bill will have. We are setting California on a course to lofty rules that will drive businesses out of the state and increase the prices for the goods we buy.
Supporters of the bill contend that it will create a massive number of "green jobs," but at what cost? You do not create wealth by destroying wealth or over-regulating its creation. AB32 is doing just that.
Any job created by AB32 will come at the expense of two to three others. This bill benefits only government-favored industries that could not otherwise stand without the direct or indirect subsidies afforded by AB32.
I urge voters in Orange County, the Inland Empire and across the state to reject the approach taken by AB32 and support Prop. 23, which will suspend implementation of AB32 until the unemployment rate in California comes back down to the reasonable level of 5.5 percent for four consecutive quarters.
Given the current unemployment levels, implementation of the bill will be delayed for several years. Such a delay will produce multiple benefits. First, it will entice employers to remain in California for the short-term and prevent the loss of hundreds and thousands of jobs. Second, it will allow Congress an opportunity to fully debate the issue and perhaps determine a national climate policy. If Congress passes similar measures, it will equally devastate all states. If Congress rejects such measures, the California Legislature could realize the destructive effect it will have and repeal AB32.
Passage of Prop. 23 is a reasonable approach that will set our priorities and get the state's economy moving in the right direction. Once the economy rebounds, we can focus on doing even more than we already do as a national leader in environmental stewardship.