Thursday, February 4, 2010

Senator Pavley Wrongly Defends AB 32

My responses to an Article by Sen. Fran Pavley, Feb 4, 2010, in Capitol Weekly, link here.

[Note, the Senator's comments are in standard font, my comments and responses in italics - RES]

[Senator Fran Pavley is a member of the California Senate, the author of much of AB 32, and authored the automobile mileage standards commonly known as the Pavley Standards in California.]

When AB 32, California’s landmark global warming law, was being debated in the legislature, a coalition of polluters and their misguided allies opposed the bill. This week these same opponents, who have also fought against clean air and water quality laws, are unveiling an initiative to suspend AB 32, predicting the sky will fall if the law is implemented. They predict that thousands of Californians would lose their jobs, and it will crush small businesses. There are even blaming the current loss of jobs on AB 32, but new emission reductions don’t even begin until 2012, and then are gradually phased in by 2020.

The Senator should know that AB 32 is a very comprehensive and all-encompassing government mandate that has 73 separate items, many of which are already in place and affecting Californians now.

But just as these Chicken Little arguments didn’t fly back in 2006, they aren’t holding up now.

In fact, just the opposite is happening. By adopting policies that will cap dangerous global warming pollution, we have sent a signal to the market that California wants to become the home of these new jobs and businesses and a leader of the 21st century economy. Simply put, AB 32 has already stimulated innovation, efficiency and economic benefits.

The Senator is parroting the tired, worn, and untrue line that CO2 is pollution, and that CO2 causes global warming. Neither is true, and scientists know this. Engineers especially know this, as I have written and spoken on many times. AB 32 has, perhaps, stimulated jobs for consultants to ARB as the regulations are ironed out. Also, there may be some jobs similar to the boom-and-bust of the dot-com era, where hundreds of startups had high hopes that were ultimately dashed. As the science behind AB 32 continues to unravel, these startups will also bust.

Senator, I ask you and your staff just a few questions on CO2 as it relates to the climate: first, as CO2 rose from 1940 to 1975, why did the temperatures measured in the United States not rise also? (see this link) Second, if CO2 was so very low or constant in the early part of the last century, why did temperatures rise from 1910 to 1940? And, why did the 1910 to 1940 increase in temperatures essentially match that rise from 1975 to 2000? Science does not work the way the warmists would have it. If CO2 causes warming, as they claim it did from 1975 to 2000, then it must also have caused warming from 1940 to 1975. Yet there was a cooling. Furthermore, many individual cities show a distinct cooling post-2000, in particular three cities right here in California: Eureka, Los Angeles, and San Diego. The Hadley Center’s Climatic Research Unit data shows this very clearly. CO2 cannot do what warmists claim, it cannot be fickle, because physics is not fickle. Physics is completely impartial. And, lest one claims that California coastal cities are different and that explains the cooling, one must then explain the cooling in Washington, DC, Marquette, Michigan, and Portland, Oregon.

Finally, other industries and businesses in California have either announced their intention to close, or are contemplating their options in moving to other, more friendly environs.

Consider this:
• A 2009 study by the Pew Charitable Trusts listed California as the nation’s leading state in clean energy businesses (10,209), clean energy jobs (125,390) and clean energy venture capital funding ($6.5 billion for 2006-2008);
• The average Californian today uses 40 percent less electricity per year than the average American. Saving electricity saves money.

The Senator should not mislead the public by such statements, as the lower per-capita electricity usage in California is not saving the people money. The reason for lower usage is favorable climate both moderate in temperature, and low in humidity. The rest of the United States, particularly in the hot and humid Southern states, use far more electricity than California because their air conditioners must remove moisture (humidity) from the air. Most of California’s population lives near the coast where temperatures are moderate and humidity is low. Californians are burdened with high costs of housing, whether by mortgage or rent, also high taxes, higher fuel costs, and high automobile insurance costs compared to the rest of the states, thus more than eating up any savings on the electric bill.

• California’s landmark Clean Car Law, part of AB 32’s solutions, is giving consumers cleaner, more fuel efficient cars, reducing dependence on foreign oil and helping drivers save money at the pump. And it will soon become the Federal standard;

Californians must pay far more for smaller and more dangerous cars to achieve the overly-ambitious mileage goals set by AB 32, typically because these cars require hybrid technology to achieve the mileage goals. The savings in fuel does not justify the additional expense of the hybrid equipment.

• From GED’s to PHD’s, our community college and university students are demanding courses and degrees to make them competitive for jobs in this new 21st century economy; and
• California boasts five of the nation’s top 10 cities for clean tech investment: San Jose, Berkeley, Pasadena, San Francisco and San Diego.

Notice that this isn’t just about the future. It’s happening now.

Here in California, as the economy slowed between 2007 and 2008, total employment fell one percent. Green jobs continued to grow five percent. (according to the latest data, green jobs are growing 2.5 times faster than the overall economy). Stephen Levy, Director of Center for Continuing Study of the California Economy, recently concluded in a study that “it is likely that the first beneficiaries of green job growth will be workers who are currently unemployed.”

The Senator must not recognize that California has one of the highest percentage of unemployed in the nation, at 12.5 percent, that is if the count is correct. Recent revisions (today’s news) showed that the Federal government underestimated the unemployment numbers. In sheer number of people unemployed, California leads the nation.

President Barack Obama, who has made clean tech a cornerstone of his economic recovery plan, made reference to our state’s efforts in his State of the Union speech last week when he said “You can see the results of last year’s investments in clean energy … in the California business that will put a thousand people to work making solar panels.”

The President, and the Senator for quoting him on this, apparently do not understand that manufacturing jobs, such as making solar panels, will not be in California with our very high labor rates, high overhead rates, high real estate rates, high tax rates, etc., but will instead be farmed out overseas much as many other manufacturing jobs have been and continue to be.

That’s why we can’t afford to suspend AB 32. Killing AB 32 will chill billions of dollars in investments in our economy. It would risk the loss of more than $80 billion in Gross State Product and more than half a million jobs by 2020. We know that delay will allow China and our other global competitors, to steal our opportunity to create jobs and businesses right here in California.

That’s why the tired “jobs vs. environment” ploy that polluters have tried in the past will fail, even during these difficult economic times.

The jobs vs environment problem is not a ploy, Senator, but is very real. Many other countries not only pay their workers less than does California, but their factories, refineries, and chemical plants and other industrial facilities do not have the same investment in pollution abatement systems. Therefore, their costs of production are much lower. As I traveled the world as a consulting engineer over the past 30 years, I have personally witnessed the lack of pollution control equipment in many countries. One can easily see that California does not have today the manufacturing base it had in previous decades. The jobs are gone, the factories are closed, and this will only continue with the burdens imposed by AB 32.

Of course, proponents of the initiative say they don’t want to kill AB 32, they just want to “suspend it.” Suspending is code for destroying the law since the provisions in the initiative will send us in the wrong direction. Everyone knows that investors and businessman need economic certainty and favorable market signals.

Senator, this is quite an amazing statement, that investors and businessmen need favorable market signals. California does everything it can, it seems, to provide UN-favorable market signals for doing business in this state, as mentioned above. The cap-and-trade provisions of AB 32 will add yet another layer of cost to doing business in California, on top of high taxes, onerous and burdensome regulatory requirements, and high wages.

Besides, thousands of California employers are playing by the current rules by investing in clean technology, setting up training programs, retooling equipment and taking other actions to reduce greenhouse gas pollution and stimulate the economy. It makes no sense for a business to invest if AB 32 is implemented one quarter and suspended the next. Suspending AB 32 – or even the threat that the law could be halted – would dry up much of this investment.

The Senator is once again confused, as investment to reduce greenhouse gas emissions does not stimulate the economy. As just one example, adding catalytic converters to heavy trucks reduces one form of pollution, diesel particulate matter or smoke. The companies providing these devices have more business, it is true, but truckers must pass along the costs to comply in the form of higher fees for transport. Each customer then must raise their prices, and the consumer, once again, has fewer dollars in his or her pocket at the end of each week.

Also, as stated earlier, many employers are shutting their doors or have announced they will do so when AB 32’s more onerous and expensive provisions arrive.

That’s one of the many reasons why many leaders in California’s business community are supportive of AB 32. The state’s largest utility, PG&E, was an early supporter. Apple dropped out of the U.S. Chamber of Commerce when the Chamber opposed climate change legislation. Innovative companies such as Google, one of our fastest growing companies, also support AB 32.

Small business also is on board. Small Business California strongly supports the law, as does the Green Chamber of Commerce.

It makes no sense to introduce an initiative that would halt economic development and the energy we need to reduce our dependence on foreign sources of fuel and energy. In California, we have an unparalleled record of generating economic profit while controlling pollution. We have been doing both for the past 35 years!

Senator, I respectfully invite you and your staff to spend some time reading my writings on AB 32 and its damaging effects, these may be found at AB 32 was based on false premises, and is damaging to the economy.

If laws such as AB 32 and its cap-and-trade component, bio-fuels mandates, renewable electricity mandates, and other command-and-control provisions are such a good idea, why then did not the Copenhagen summit on climate (this past December) reach a favorable conclusion? Why did key nations refuse to participate? Why is California going it alone with AB 32?

Roger E. Sowell, Esq.
Marina del Rey, California