Energy Interests Spending Big to Stop California Emissions Law
In 2012, a California law aiming to reduce greenhouse gas emissions in the state by roughly 25 percent over the next decade, is scheduled to go into effect. The Global Warming Solutions Act of 2006 (or AB 32,) will give the California Air Resources Board sweeping new powers to set emissions limits and reduction measures—and set the stage for the creation of a regional cap and trade system called the Western Climate Initiative.
But a powerful group of business interests including two billionaire brothers who recently came into the public eye for their role in financing the Tea Party, are hoping to head off AB 32 with a ballot measure called Proposition 23, or “the California Jobs Initiative.” Charles and David Koch, whose Koch Industries has an annual revenue approaching $100 billion—and has several times been ranked among the country’s top air polluters—have donated $1 million to groups organizing for the law.
The campaign, which emanates from a series of political action committees, reportedly has received 98 percent of its funding from a group of oil companies led by Valero Energy Corp. and the Tesoro Corporation—with 89 percent of that money coming from out-of-state. (Koch Industries is based in Wichita, Kans.)
Big Money Resting on National Implications
So why is Proposition 23 so popular with out-of-state energy companies? In a letter sent to more than 400 members of the National Petroleum Refiners Association, the group’s president Charles Drevna called the the measure “the difference between life and death for our industry in this century.” Drevna went on to write that the new regulations could one day spell the end for gasoline-powered transportation, saying “You simply can’t achieve these drastic reductions in carbon and still refine petroleum for use as a motor fuel.”
But the real danger for the oil industry isn’t AB 32 itself but its potential to set the stage for similar regulations in other states—and its implications for a proposed federal cap and trade bill. In their campaign to overturn AB 32, opponents see a chance to send a message to lawmakers all over the country that even in one of the nation’s greenest states, voters do not support carbon-cutting legislation.
If That’s Grass, Then Where Are the Roots?
Despite its financial and ideological ties to the surging Tea Party movement—which boasts more than 200 local chapters in California alone—there is little evidence to suggest that the Prop 23 campaign has been successful so far in organizing the group’s members around the issue. Yes on 23 has staged two rallies, with the most recent taking place outside the California Republican Convention in San Diego—but neither attracted more than a handful of participants, and the issue hasn’t been central to larger Tea Party gatherings around the state.
Moderate Republican gubernatorial candidate Meg Whitman has refused to take a firm stand on Prop 23, but has said that she is personally leaning towards voting against it. Whitman has never enjoyed much support from Tea Partiers, but she’s counting on high turnout from motivated conservatives in and outside of the movement to help boost her to victory in November.
Whitman’s refusal to appease those voters on Prop 23 speaks to the reality that Yes on 23 is hoping to use its deep pockets to change: Conservatives in California just aren’t as passionate about that issue as they are others, such as taxes and health care.
‘Make it About Jobs’
Much of the $8.2 million that has been raised to pass Prop 23 will be spent on media buys aimed at convincing voters that the measure is primarily about jobs, not the environment. Opponents of AB 32 have long warned that the bill acts as a tax on businesses, and will discourage hiring around the state while leading to layoffs in the industries that are most affected. To highlight the alleged economic implications of the law, Proposition 23 was drafted specifically to prevent AB 32 from taking effect until California’s unemployment rate drops to 5.5 percent for four consecutive quarters—something that has happened just three times in the last 40 years.
That economic argument is undercut somewhat by the fact that much of the business community in California opposes Prop 23, with the state’s largest oil companies deciding to remain uninvolved in the campaign to pass it.
Still, as the election nears and voters begin to pay attention to the issues that will be on this year’s ballots, polling indicates that enough voters are still undecided on the measure to potentially tip the scales in favor of its passage. Also working in the legislation’s favor is expected high turnout from conservative Republicans like the Tea Partiers. Whether or not those voters will head to the polls thinking about Prop 23, many are likely to pay close attention to the endorsements of the larger organizations that make up the conservative movement—and those organizations are firmly behind the Koch brothers and Valero in their efforts to stop any and all climate legislation.