Thank goodness California is pushing the green agenda. The state will benefit economically because all kinds of business and jobs will be created to cater to the new demand for cleaner power.
How many times have you heard that statement? Probably more than you heard how the Dodgers pitching was going to carry them into the World Series.
There's one itty bitty problem, though: Thanks to the green agenda, it's quite possible the state will be a net loser economically.
The fact is, jobs and businesses likely will be created as a result of California's still-new law called AB 32. That's the one that mandates greenhouse gas emissions be chopped back about 30 percent by 2020 and more thereafter. But it's also likely that a good number of jobs will be destroyed or will migrate out of the state, too. Whether the former will offset the latter is an open question. In other words, is it really more likely we'll lose or win?
Indeed, that's the big question. Unfortunately, it's the question that isn't getting heard nearly enough. Instead, we're hearing the rustling sound of pom-poms being shaken for AB 32.
Just last week, an environmental support group put out a study saying surprise! more than 400,000 jobs would be created in the state, thanks to AB 32. The study surprise! got favorable press covering.
But wait a minute. AB 32 may seriously rough up the companies that are greenhouse gas emitters. Isn't it perfectly logical that the more costly and punitive aspects of AB 32 may force them to curtail operations or even move out of state? And since those companies employ 2.6 million workers in the state (half of them in Southern California), you have to wonder how many of those jobs may be lost to the state. More than 400,000?
I mean, shouldn't we at least inquire about the possible down side as well as the up side?
Lee Harrington, who is executive director of the Southern California Leadership Council based in Los Angeles, last week said getting on board AB 32 is like boarding the first wagon train heading west. We really don't know what's going to happen. Maybe we'll end up in a great place. But maybe we'll get stuck in Donner Pass.
One big problem is that the state government, which in theory should be looking out for all of us, instead is another cheerleader. The California Air Resources Board, which has the task of assessing the impact of AB 32 on the economy, concluded that it would create an overall positive impact on the state.
Last week, Harrington's organization, which is a business-led public policy group that's housed at the Los Angeles Economic Development Council, sent back notice to CARB saying, in essence, get real.
CARB could have based its conclusion on a whole range of economic studies, but it picked the one that was most optimistic. Harrington said there were other flaws. For example, CARB also assumed all kinds of green businesses would flock to the state when experience suggests the opposite may occur.
Indeed, it seems dangerously na & #271;ve to assume that a mandate as dramatic and potentially severe as AB 32 will be all sweetness and light. Sure, it could turn out fine, but real economic carnage could result from AB 32. We don't know.
What we do need is an intellectually sound and sober assessment of the risks as well as the rewards. Otherwise, we could end up making bad policy and mugging our business sector.
Charles Crumpley is editor of the Business Journal. He can be reached at email@example.com.
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