In California, A Bad Proposition
Bill Clinton Stumps with Al Gore and the Glitterati
By Pat Cleary Posted in Energy — Comments (5) / Email this page » / Leave a comment »
California seems intent on tumbling into the sea. However, this will not be caused by nature, it'll be brought on by a huge, crushing self-inflicted economic earthquake.
Exhibit A (or is it Z?) is Proposition 87. Prop 87 will levy a tax on oil production in California and use the money to pay for alternative energy research. One of its stated goals is to reduce gas consumption by 25%. They'll no doubt do that in two fundamental ways: By driving up the price of gas for everyone, including those least able to afford it, and by driving people and businesses out of the state. Recall that California already ranks dead last in state migration, meaning more people leave California to move to other states than any other. Prop 87 will only speed the exodus.
Bill Clinton was in California this week to stump for Prop 87 along with a bunch of hypocritical Hollywood types and an equally hypocritical Al Gore. All have preached a good game about consumption while burning up the carbon. After all -- rules in their world are for the little people.
On his pro-Prop 87 stump, Clinton is fond of citing Brazil as a role model. Says Bill, "If Brazil can do it" meaning energy independence, "So can California." Sure sounds good, right? But look at the facts: Brazil made a move toward ethanol to be sure, but Brazil ultimately became energy independent by drilling their way there. As this editorial in Investors Business Daily points out, Brazil "Launched a crash program of offshore oil drilling in the late 1990's, working with a Manhattan Project-like determination to develop its own natural resources." (Developing its own natural resources? What a concept! Congress, are you listening?) The story has a chart that shows how Brazil's oil production far outpaced its ethanol production, but that doesn't make the same gooey 30-second spot that stretching the truth does in this case. Had Brazil decided to tax its own oil production, they'd still be buying oil on the international market like we are.
The bottom line is that Prop 87 will drive up the price of gas for all Californians. At the end of the day, it will create a disincentive to drill for oil there, making California and the rest of us even more dependent on foreign oil.
Maybe Bill Clinton, Al Gore and their Hollywood glitterati pals should just climb back into their Gulfstreams, burn up a little more carbon and go find a better -- and less expensive -- cause.
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In California, A Bad Proposition 5 Comments (0 topical, 5 editorial, 0 hidden) Post a comment »
If radio and TV commercials in San Diego are indicative of the rest of the state, the no-on-87 guys are outspending the advocates by a huge amount. I've yet to see any pro-87 ads; I see (or rather, fast forward through) tons of anti-87 ads every night, and hear the same on the radio (and this is the sports talk station, not the conservative talk station).
Even the LA Times came out against this turkey; it's going down.
Great points, all -- thanks for writing.
Nat'l Assn of Manufacturers
www.shopfloor.org
this proposition to reduce CA production and force them to use more Alaska oil - since the house is burning, keep warm - except the NIMBYs in CA would probably also move to restrict tanker traffic and refinery production too.
As was once said of SC, California is too small to be a country and too large to be a lunatic asylum.
In Vino Veritas
If we could just wall off five counties (Los Angeles,
San Francisco, Contra Costa, Alameda, and Santa Clara) that'd make three fine asylums right there. Then the rest of the state could be the new Florida.
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If you're seeing shades of gray, it's because you're not looking close enough to see the black and white dots.
...is that California can't target "Big Oil" with a production tax because most of "Big Oil" abandoned California production long ago.
BP, Shell, Valero, ExxonMobil, ConocoPhillips and Chevron are big California refiners. This tax will not cost refiners a dime. Of these companes, only Chevron (headquartered, BTW, in California, and formerly known as Standard of California) has substantial California production.
So who produces most of the oil in America's #3 producing state? For the most part, it's a list of independent companies most people have never heard of. These independents are small, non-integrated companies, many of them privately-held; almost none of them are household names.
There is no doubt that Prop 87 will fail in its goals to punish "Big Oil" and make California less import-dependent. At the same time, it will undoubtedly make future investment (i.e., drilling and production-enhancement projects) in California substantially less attractive to those small companies who have staked their fortunes on such an anti-corporate, anti-capitalist business climate.