Alternate Opinion: Prop 23 is Good for California

Editor’s Note: We have been running posts about California’s Prop 23 for the last 2 weeks and have been approached by some folks who believe differently than we do. In the interest of editorial completeness, today we are offering another point of view on Proposition 23, offered by Tom Tanton, President, T2 & Associates

When Californians take to the polls on November 2nd, the ballot measure known as Proposition 23 offers voters a real chance to improve the state’s economic future. This initiative would suspend the state’s Global Warming Solutions Act of 2006, legislation passed in September 2006, commonly referred to as AB 32.

Passing Proposition 23 is a necessary step to getting California back on the track to prosperity and, more specifically, significantly improving the bleak job and fiscal situation currently plaguing the state. California’s unemployment rate now stands at 12.4 percent – that exceeds the national unemployment rate by more than 25 percent. In addition, here in California, we are 97 days into the state’s fiscal year. And the health of the state’s treasury is hurting, badly. With a budget deficit of over $19 billion, California needs pro-growth policies that strengthen balance sheets, create jobs and attract new businesses to the state. Our climate change law does the exact opposite. David Crane, special assistant to Gov. Schwarzenegger, mentioned during a speech to an investor forum in Silicon Valley this past June that it does not do anything for the climate either.

If Proposition 23 is passed, it will save many local jurisdictions – such as cities, counties and fire departments, among others – currently on the brink of bankruptcy. This measure will help budgets currently in the red by increasing revenues without raising taxes, and by implementing energy cost savings, to the tune of one to seven percent of their current budgets, saving teachers and firemen and police. This may seem like simple economics to some, but others are fighting tooth and nail against this straightforward, pro-growth proposal. And a recent poll conducted by the Public Policy Institute of California finds that voters are effectively split on the proposition.

Opponents of Proposition 23 have consistently slandered this ballot initiative, calling it the “Dirty Energy Proposition”. It is important to point out, however, that supporters of Proposition 23 are a cross section of California. Supporters include a broad coalition of small businesses, non-profit groups, labor groups, community organizations and individual citizens that are right to advocate for the net increase in overall economic activity and lower energy costs that Proposition 23 will provide.

At the end of the day, California simply cannot afford an experiment of this scale, one that has drastic economic implications for every business and consumer statewide. Policies like AB 32 have failed in every other place they have been implemented, most notably in Europe. Across the Atlantic, enacted cap-and-trade systems have not only failed to hit emissions reduction targets, but also have created substantial energy price volatility. Proposition 23 provides the time necessary to implement global warming laws correctly, not as they currently are.

The challenges facing California’s economy and environment are great. But one solution is clear. We need to improve productivity across the state and enact policies that re-invigorate fiscal stability and return California to its previous status as a place where businesses use to flock. If Proposition 23 is rejected next month, however, there is no telling how long it will take to put Californians back to work.

Mr. Tanton is President of T 2 & Associates, a firm providing consulting services to the energy and technology industries. T 2 & Associates are active primarily in the area of renewable energy and interconnected infrastructures, analyzing and providing advice on their impacts on energy prices, environmental quality and regional economic development. You can follow him on Twitter.

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