Going Green is Becoming Irrelevant

JULY 23, 2010

In spite of the fact that the U. S. Senate has finally thrown in the towel on Cap and trade legislation, California continues to push the green agenda.

Yesterday it was announced that Senate majority leader Harry Reid (D) of Nevada, abandoned cap and trade comprehensive energy reform (meant to address climate change), because it could not be passed before the August break.

The Christian Science Monitor reported yesterday, “In a bid to win Republican support, Democrats will drop proposed controls on greenhouse gas emissions in favor of more limited measures that have attracted bipartisan support in the past. These include: lifting the liability cap to hold BP accountable for the Gulf oil spill, decreasing dependence on foreign oil, boosting incentives to create up to 400,000 green jobs, and expanding funding for land and water conservation.”

Reid said he would have a scaled-down version of the legislation to the Senate floor as early as next week.

But the story in California is much different. Proponents of California’s cap and trade global warming legislation, AB 32, refuse to give up the ghost, even with evidence that the global warming agenda has been discredited, and the cost to business will be staggering as well as unsustainable.

This week I attended Sacramento Mayor Kevin Johnson’s second public meeting for Greenwise Sacramento, to observe the controversial former “Green Czar” Van Jones speak.

Jones is a charismatic individual, and obviously experienced at public speaking.  He was quippy, charming and funny – all part of his shtick.

But his criticisms of Proposition 23, the anti-AB 32 measure (California’s global warming act), were emotional and unsubstantiated, which surprised me.

Calling it a “ludicrous move” that would stop implementation of AB 32, Jones used inflammatory language to describe the proposition, without even attempting to explain the initiative. “A sledgehammer that’s being designed to destroy your job-creating machine,” was how Jones characterized Prop 23.

This is where most people get off the bus. The average hard working person doesn’t see the green movement as a “job-creating machine.” But this statement comes from a guy who has made a nice living off of promoting a green way of life. Of course he’s going to be against the ballot initiative that would render him irrelevant.

Prop 23 is a very simple ballot initiative. Taking up less than one page of paper, the crux of the initiative is merely to suspend the operation and implementation of AB 32 until the state’s unemployment rate returns to levels that existed at the time of its adoption – 5.5 percent or less, for four consecutive quarters.

Of course, implementation of AB 32 is already taking place, and will have catastrophic results if allowed to continue.

There will be higher housing costs due to regulations requiring home builders to use more expensive building methods, as well as mandatory retrofitting of families existing homes to make them more environmentally friendly. Additionally, families will pay nearly $800 more every year for gasoline and auto maintenance, at least $35 more for natural gas, $124 more for electricity and almost $1,000 more for food annually, according to a study by Sacramento State University economics professors.

The costs to small businesses would total nearly $50,000 for the average small business with the costly cap and trade system, and many new industrial regulations. California is rapidly losing well-paying manufacturing jobs due to a regulatory climate, ranked by George Mason University, as one of the nation’s most regulated states.

Aggressive efforts to attract California companies by neighboring states with lower taxes and less regulations are having impacts as well. AB 32’s overall stifling effect on entrepreneurs could result in the loss of up to 1.1 million jobs.

Joe Vranich, a California business relocation specialist, has been keeping an informal tally of businesses leaving California for neighboring states with more business-friendly policies. Vranich updates his website and last week wrote about another ‘green’ company recently choosing to leave California, “The number of companies now increases to 85 as Solexant, a San Jose-based company, will build a manufacturing plant in Oregon.” Vranich said that the Solexant facility will start out with 170 employees, but is expecting to increase to 1,000 employees.

Incredibly, in just two days already in July, California lost three company headquarters – Globalstar, Inc. is leaving Milpitas for Louisiana, eEye of Irvine will move to Arizona, and TriZetto Group will leave Newport Beach for Colorado.

In just the first half of 2010, 85 companies left California, nearly double what occurred through all of 2009.

Vranich says that the exodus has reached such an alarming point that California ought to declare a “state of economic emergency.” He added that “unless there is a reduction in the hostility California directs toward businesses, we will see more commercial enterprises calling site selection companies for help in finding friendlier states in which to locate.”

The farce of “green jobs” is almost funny, except politicians all over the country are buying into it. There are not the millions of green jobs being created the way Jones claims. Most companies merely have to get green certified to be able to classify employees as “green” in order to play the “green” game.

Jobs are not necessarily being created – just reclassified. And the companies manufacturing environmental materials, seem to be leaving California for greener pastures.

With nearly 2.3 million Californians out of work, the state cannot afford regulations that will destroy any more jobs.

California’s Legislative Analyst’s Office reported that AB 32 implementation will cause job losses and “leakage” of businesses, jobs, revenues and productivity to other states not encumbered by AB 32-like regulations, and also warns that because of AB32’s substantial up-front costs, some companies “might go out of business, cut back operations or choose to relocate elsewhere” and that AB32 implementation will “involve various workforce labor dislocations, including temporary job losses and unemployment for some people and permanent unemployment and income disruptions for others.”

In addition, the Congressional Budget Office reported that climate change policies are likely to destroy jobs and lead to lower wages for jobs that remain.

The obvious question is why is government pushing an industry when the free market is not? If green jobs were really so profitable, then tens of thousands of business owners would be scrambling to get into the game. Instead, guys like Van Jones travel the country giving speeches, selling books and lecturing people about how they live. Guilt does not drive change.

Business drives the economy, not politicians. When politicians push something the way they are pushing AB 32, you can bet that it’s going to cost you something.

— Katy Grimes