CA Dems balk at Cap and Trade cost

CA Dems balk at Cap and Trade cost


gas prices stunt recovery, mckee, cagle, July 3, 2014With gas prices soaring again, consumers are rebelling. And even liberal Democrats in California are seeking to help their constituents.

Assemblyman Henry Perea, D-Fresno, spearheaded the writing of a June 16 letter signed by 16 Democratic assembly members to California Air Resources Board Chairwoman Mary Nichols. Separately, 26 Republican legislators have advanced a similar protest. The concern of the legislators is high future gasoline prices from the cap-and-trade emissions program on their constituents.

Cap and trade and its quarterly auctions of emissions allowances were instituted by CARB two years ago under the authority of AB32, the Global Warming Solutions Act of 2006. It limits air emissions by large industries and private electric utilities unless they “trade” pollution allowances above the allowed emissions “cap.”

Most of the new letter signatories represent low-income areas in Los Angeles, the Central Valley and the Inland Empire.

The letter highlighted something not well known: “AB32 does not mandate that CARB create a program that generates revenue for the state and it was not intended to be a funding mechanism for massive, new state efforts at GHG [Greenhouse Gas] reduction.”

Yet in the new state budget for fiscal year 2014-15, which began on July 1, Gov. Jerry Brown and the Legislature grabbed $250 million of cap-and-trade funds for the controversial high-speed rail program. That’s 25 percent of an expected $1 billion in cap-and-trade revenues.

The California Chamber of Commerce earlier this year filed a lawsuit contending the Legislature did not authorize CARB to raise revenue beyond the costs of administrating the cap-and-trade program. The outcome of that case is pending.

Gas price spike

Assemblyman Perea’s concern is that gasoline prices will rise by $0.15 per gallon next year from cap and trade and will increase each year thereafter.  Gas prices are expected to rise dramatically as the cap-and-trade program expands to include large fuel suppliers next year.  The Wall Street Journal cited a Boston Consulting Group study in 2012, predicting gasoline prices would go up between $0.49 to $1.83 per gallon by 2020 due to cap and trade.

An effort called “Fed Up at the Pump” has just been organized by the California Independent Oil Marketers Association to criticize this “hidden” tax on gas.

The largest number of long distance automobile commuters in the United States are from San Bernardino County to Los Angeles County at an average of 68 miles.  The higher costs would roughly add from $799 to $2,986 per year to gasoline expenses for an average commuter (assuming 20 miles per gallon fuel efficiency).  At the higher figure, that would be equivalent to a car payment each month for many lower-income workers.

Political crackup?

The Democrats are echoing the attitude of Jim Kellogg, himself a Democrat and former member of the California Fish and Game Council. He warned in 2010:

“I don’t doubt that there will be more green jobs in California, perhaps even thousands of them; however, we don’t want to put at risk the millions of well-paying, blue-collar jobs that put bread on the table right now. We need to make sure we do our homework, ask the tough questions and make adjustments as necessary to implement AB32  in a way that reduces greenhouse gases without hurting millions of families in this state.”

The Perea caucus letter signifies a continuing split in the majority Democratic Party between Hispanic politicians representing largely working-class areas — and the Bay Area Democrats who represent ultra-wealthy, Silicon Valley billionaires interested in greater environmental restrictions.

In 2013, Democrats started losing seats in the Legislature to Republicans in the Central Valley electoral districts with heavily Democratic and Hispanic constituencies over the different issue of “Fish versus Farmers.” Further unreasonable implementations of AB32 could further hurt working-class Hispanic voters, leading them to continue moving toward the Republican Party.

Jay McKeeman of the California Independent Oil Marketers Association summed up the looming higher gasoline prices:

“I think we all just kind of realized that there was no quarter given by CARB. At this late date, we don’t see out of the administration that there’s going to be an adjustment for this, so we’ve got to take it to the streets.”

Indeed, Neel Kashkari, the Republican challenger in the November gubernatorial race, has attacked what he calls Brown’s “hidden” gas tax. Kashkari’s bid remains a longshot. But if gas prices keep rising the next four months, he could turn the issue into one that makes the race too close for Brown’s comfort.

The 16 Democratic Assembly members signing the Perea letter:

Henry Perea, D-Fresno, 31st District

Cheryl R. Brown, D-Inland Empire, 47th District

Freddie Rodriguez, D-Pomona, 52nd District

Rudy Salas, D-Bakersfield, 32nd District

Susan Bonilla, D-Central Valley, 14th District

Adam C. Gray, D-Merced-Central Valley, 21st District

Isadore Hall III, D-Compton, 64th District

Tom Daly, D-Anaheim, 69th District

Jose Medina, D-Riverside, 61st District

Christina Medina, D-Bell Gardens, 58th District

Roger Hernandez, D-El Monte, 48th District

Matthew Dababneh, D-Encino, 45th District

Reginald B. Jones-Sawyer, Sr., D-Los Angeles 59th District

Sebastian Ridley-Thomas, D-Los Angeles, 54th District

Joan Buchanan, D-Contra Costa County, 16th District

Jim Frazier, D-San Francisco Bay, 11th District


Write a comment
  1. Queeg
    Queeg 3 July, 2014, 21:30

    The globalists got the ball rolling down hill, and there may be no way to stop it….

    Assume the usual position doomers.

    Reply this comment
    • plasmacutter
      plasmacutter 7 July, 2014, 11:37

      There is a way to stop it, and a way to recover:

      Abandon “free trade” and dust off Alexander Hamilton’s economic plan as used to free us from economic domination by industrialized europe in the post-revolutionary period.

      Tariff off-shoring destinations until it becomes cost-prohibitive for firms to off-shore, subsidize and offer funding grants to those who wish to bring various economic sectors back to life in the US. Watch as the industrial base which won us two world wars slowly turns over and roars back to life over about 15 years.

      This will cause some domestic price increases, but the alternative of negative wage and job growth under current policies is worse.

      Reply this comment
  2. Ricky65
    Ricky65 4 July, 2014, 09:35

    The D-Rat party is owned lock, stock and barrel by the coastal elitist greens, Silicon valley high tech know nothings, and the Hollywood trash. Raising gasoline to $10 bucks a gallon would not affect these oligarchs one bit. They will still have their mansions, vacation homes and private jets. In their view, all is justified if it furthers their goal of ridding the world of fossil fuels. Destruction of the middle class is just so much collateral damage. Regretable?..well maybe or maybe not, but it has to happen so Gaia can repair itself.
    They have no idea how middle and lower class families suffer when policies like AB 32 are inflicted on their lives. Never mind we already pay 35-50 cents more than other states for gasoline because of extreme environmental rules.
    Here is your future California middle class: You will be driven into poverty. The first steps are already nearly complete. Driving out well paying jobs by ruinous taxation and over regulation of manufacturing, mining and natural resource extraction. So is driving down the wages of middle class jobs through mass illegal immigration and an unlimited supply of cheap labor. Then drive up the price of ordinary food, commodities, and electricity. With ever dwindling resources it will eventually pressure the beleaguered middle class out of their energy wasting single family homes into Soviet style 320 square foot apartment into urban ghettos near rail lines.
    That’s your source of mobility, you little people. You don’t need automobiles and a patch of grass of your own in the suburbs to raise your kids. Those things are reserved for the green gentry and the elite class. Don’t worry they won’t have to share your sacrifice. They will still have their vacation cabins at Tahoe.
    Why working class person would vote for these people totally escapes me. It’s like a chicken voting for Col Sanders.
    And that’s your 4th of July vision of your future California Democrats!

    Reply this comment
  3. Ulysses Uhaul
    Ulysses Uhaul 4 July, 2014, 15:03

    Was in Ralphs Market last night. Hamburger was in five-seven dollars per pound range. Brats five bucks a pound.

    How can people afford protein?

    Reply this comment
    • John Seiler
      John Seiler 5 July, 2014, 09:17

      Democrats want us all to become vegetarians. But…

      Inflation is here because two Republican chairmen of the Federal Reserve Board, Alan Greenspan and Ben Bernake, vastly increased the money supply after 9/11; and Democrat Janet Yellen now is continuing the policy. But blame mainly Republicans for this one. It takes 15 years for an increased money supply to course through the economy and cause inflation, which is why it’s getting much worse now.

      Reply this comment
  4. Ulysses Uhaul
    Ulysses Uhaul 4 July, 2014, 15:07

    Check out bacon…..five bucks a pound for so so bacon…premium bacon up to at least eight bucks a pound.

    High gas, high housing, high food cost….

    Pack and ship with us…

    Reply this comment
    • John Seiler
      John Seiler 5 July, 2014, 09:17

      Inflation is here because two Republican chairmen of the Federal Reserve Board, Alan Greenspan and Ben Bernake, vastly increased the money supply after 9/11; and Democrat Janet Yellen now is continuing the policy. But blame mainly Republicans for this one. It takes 15 years for an increased money supply to course through the economy and cause inflation, which is why it’s getting much worse now.

      Reply this comment
    • Bill Gore
      Bill Gore 6 July, 2014, 08:30

      I gave up red meat about the same time I gave up California (2 years ago). Lower cholesterol, way fewer life and business headaches, much less time wasted in traffic, saving tons of money, etc.

      And my x-large UHaul w.grandma’s attic performed beautifully! Got me and my belongings safely north, out of the rat maze with palm trees……

      Reply this comment
  5. Ted Steele, The Decider
    Ted Steele, The Decider 4 July, 2014, 16:21

    Bacon is the rice and beans of the new world order!

    Reply this comment
  6. Queeg
    Queeg 5 July, 2014, 08:56


    All those uber rich guys holding secret meetings in old dank castles sending out these punk Euro purse wearing MBA’s to globalize labor to cut people’s wages, workplace dignity and standards of living.

    What do unsuspecting consumers get…..shiny trinkets from big box stores and Atlantic Salmon from Peru…..

    Reply this comment
    • Ricky65
      Ricky65 8 July, 2014, 08:16

      Careful with those purse comments, Queeg. Don’t you know Ol’Teddy and Ulysses have matching purses?

      Reply this comment
  7. Hondo
    Hondo 7 July, 2014, 00:11

    High gas prices and taxes are off the scale, regressive. They hit the poor, the middle class and most of all, the small business owner, the hardest. The poor Hispanic dude driving around mowing lawns is catching it in the nuts. Same for the carpenter and carpet layer. Small business’s have always been the economic engine that drives our economy. But these policies of the democrats are the reason why, Kalifornia, which has more economic assets than any place on earth, has one of the highest unemployment rates in the country.

    Reply this comment
  8. Ulysses Uhaul
    Ulysses Uhaul 8 July, 2014, 08:27


    Never insult the fair and balanced pithy messengers of conservative compassionate schooling of hapless doomers lost in their goose stepping ideology.

    Reply this comment

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