Still Counting...

I was going to post something when the election was over; but while the election is now over, the vote counting is not. There may be close to 2 million ballots still to count, and the race between Harris and Cooley remains very close. I am in third place, with a lead of between 4000 to 5000 votes over the Libertarian candidate, which hopefully I can maintain. Thank you for your support, and I will post something as things become clearer.

Peter's Quick Guide to the Propositions, Part 2 - Props 22, 23, 24, 25, 26

Here is the rest of them:

Prop 22 - Neutral. The idea of keeping the state from raiding local coffers when it can't balance its own budget is good, but this may go a bit further than that. I simply have not dug deep enough into this one to tell if it is good or bad. (If you have, feel free to let me know.)

Prop 23 - Strong NO! This is the effort by the oil refiners to halt implementation of California's landmark greenhouse gas law. It is nothing but corporate dirty energy self interest, pretending to be a jobs bill. But it presents a false choice between jobs and protecting our environment. Failing to take action on global warming will cost us far more than taking action. Furthermore, Prop 23 it will damage the ability of renewable and clean energy developers to get funding, by creating uncertainty in state policy. So it will actually harm job creation in the state. Prop 23 is bad for the California businesses that are actually growing, and it is bad for all Californians. Vote NO.

Prop 24 - Medium Yes. This repeals three corporate tax breaks, mostly benefitting large corporations, that the Republicans managed to extract in budget negotiations in 2008 and 2009. It seems like a weird time to be creating new billion-dollar tax breaks for large businesses. (I understand the right-wing theory that says you get more tax revenue by cutting taxes, but it just does not work in practice.) This puts things back how they were before 2008. Businesses seemed to mostly be doing okay then, so this should not do them much harm.

Prop 25 - Medium Yes. This allows the state budget to be approved by majority vote, rather than the current 2/3 vote. Given the embarrassing gridlock the 2/3 requirement has caused, this is probably a good idea. Very few other states require a 2/3 vote to pass a budget. Of course, this also makes it easier to pass a lousy budget, too.

Prop 26 - Strong No. This would require certain fees (such as fees to pay for cleaning up oil spills and toxic waste) to be approved by a 2/3 vote. While increased fees can be a problem, the 2/3 requirement to raise taxes and pass a budget have eviscerated California's infrastructure and education systems, so extending that requirement to fees appears more likely to extend the harm than to solve the real problem.

Peter's Quick Guide to the Propositions, Part 1 - Props 19, 20, 27, 21

Prop 19 - Strong Yes! Legalizing Marijuana. Prohibition didn't work for alcohol - people kept drinking, and it financed the rise of organized crime. Funny, but the same thing happened with marijuana. Substance abuse is a serious problem, but criminalizing the user is not the answer. Will there be implementation problems? Yes, but it is still worth saying "No" to our expensively failed drug policy.

Prop 20 - Mild No. Redistricting. In 2008, we passed Prop 11, which shifted state legislative district drawing from the legislature to a new commission, but it has not actually gone into effect yet. Prop 20 would extend the new process to federal congressional districts, too. Since we have not seen how Prop 11 actually works (it sounds good in theory, but may have some issues in practice), it seems a bit early to be extending it to other offices. Let's see how it works first.

Prop 27 - Medium No. More Redistricting. This would repeal Prop 11, and give state legislative district drawing back to the legislature. Of course, the last time the legislature did redistricting they engaged in extreme and shameless gerrymandering that has contributed to our ongoing budget gridlock, and that led to passage of Prop 11 in the first place. Why should we trust them again? Besides, maybe we should see how Prop 11 works before we repeal it.

Prop 21 - Medium Yes. Vehicle Fees for Parks. Parks are good. Higher fees on cars are good (see my entry of July 10 re taxes). Fees on cars paying for parks instead of going towards public transit or air quality or road maintenance is sort of weirdly indirect. And having a specific budget set aside for parks will make budgeting harder still. On balance, while not the ideal approach, it is probably still a good thing.

More Propositions coming soon.

See Me, Hear Me!

You can now see my videotaped interview on the California Channel, as well as the interviews with (most of) my opponents. Take a look here: https://www.calchannel.com/channel/sr1/Candidate%20for%20Attorney%20General

Kamala Harris totally botched one question - seemed like she was not listening very well.

I was also on Forum with Michael Krasny on KQED radio. Steve Cooley declined to participate, which for those of us in the Bay Area seems very weird. The four minor candidates shared half the show, while Kamala Harris got most of the other half. Take a listen here: http://www.kqed.org/a/forum/R201010060900

Are They Qualified to be Attorney General?

Steve Cooley (Republican) and Kamala Harris (Democrat) have both been prosecutors. Both have both worked in local district attorneys' offices. But that is all they have done. Neither Cooley nor Harris has experience in civil litigation, neither of them have worked in the private or non-profit sector, neither have them have worked on energy or environmental issues, neither of them has been a judge or administrative law judge, neither of them have worked for a state agency, and neither of them have even worked in the other half of the state.

Given the broad responsibilities of the California Attorney General, their lack of relevant experience is striking. By comparison, I have significantly broader experience. I have worked for law firms, a non-profit, a state agency, and a major city. I have lived and worked in both Northern and Southern California. The following chart (based on information from the candidates' websites) shows the difference in experience between me, Cooley and Harris:

Candidates’ Experience	Peter Allen	Steve Cooley	Kamala Harris
Civil Litigation	X
Consumer Advocacy	X
Criminal Prosecution	X	X	X
Energy Law	X
Environmental Law	X
Financial/Securities Fraud Litigation	X	?	?
Judge or Administrative Law Judge	X
Telecommunications Law	X

Three Free Signs!

Here are three signs - choose which one you like the best or print out all three and post them in visible places.

Send them electronically to your friends!

Going Back For More?

The logic of much of the voting public, at least those responding to polls, escapes me. The Republicans (with assistance from the Democrats) blew up the US economy, in a big and ugly way. The Democrats (with resistance from the Republicans) have not managed to fix it. So now, according to various polls, people are going to vote for...Republicans?!?! This seems especially odd given that the Republicans are promising to run the economy the same way they did before.

This is like taking your car to the mechanic for a tune up, and he wraps it around a tree. So you take it to a second mechanic, but when he is having difficulty fixing it, or maybe is just taking too long, you take it back to the first mechanic. Who assures you he will treat it like he did before.

If you really thought the second mechanic could not fix it, wouldn't you take it to a third one, rather than back to the one who broke it in the first place? Maybe we should try that with elected officials as well.

Proposition 23 - The Job Killer

Jobs or the environment - that is the choice presented by Proposition 23, a ballot initiative sponsored mainly by oil refiners, which proposes to suspend California's greenhouse gas law, AB 32, until unemployment drops below 5.5% for a year. But that is a false choice. The choice we really face is about the short term versus the long term.

The argument for Proposition 23 is simple - limiting greenhouse gas emissions under AB 32 will cost money, and will likely cost jobs in industries that generate greenhouse gasses. Based on that logic, Proposition 23 would only allow implementation of the greenhouse gas reductions currently in California law if California unemployment drops below 5.5% (it is currently over 12%) for a year.

But if California unemployment stays higher than 5.5%, or even if it drops to 4%, but bumps up to 6% after three quarters, then California would take no action to reduce greenhouse gasses.

Under Proposition 23, regardless of why unemployment is higher than 5.5%, California would take no action to reduce greenhouse gasses. Even if unemployment is high because jobs are being lost due to climate change - think of ski resorts closing due to no snow, fisheries destroyed due to changes in water temperature, beach resorts and airports damaged by higher sea levels, redwood forests dying from heat, valuable crops lost due to extreme weather conditions, and rivers running dry - we still would take no action.

The logic of Proposition 23 is the logic that says don't limit logging until all the trees are gone, because limiting logging takes away logging jobs that could last a few more years, or don't limit fishing until all the fish are gone, because limiting fishing takes away fishing jobs that could last a few more years. But how many logging jobs are there when all the trees are gone? How many fishing jobs are there when all the fish are gone?

If Proposition 23 passes, the oil refiners and other carbon-intensive industries who are backing it may get to make their profits for a bit longer. But at what long term cost? What happens when California and the rest of the world start really suffering from the effects of climate change? The potential job losses could make us nostalgic for the time when unemployment was only 12%.

Is it worth gambling with our economy, our health, perhaps even our survival, so that a few large companies can squeeze out a few more profitable years? The short term benefits to Valero and Tesoro are not worth the long term costs to every Californian and every California business. Vote no on Proposition 23 - we cannot afford it.

Proposition 19 Opponents Are Blowing Smoke

You can read the arguments for and against Proposition 19 (The Regulate, Control and Tax Cannabis Act of 2010) that will appear in the Voter Information Guide here: http://www.sos.ca.gov/elections/vig-public-display/110210-general-election/

The arguments raised against Proposition 19 are really quite strange. The opponents of the measure don't say that marijuana should stay illegal - they just claim that the authors of the proposition made some "huge mistakes." The reality, however, is that the arguments against Proposition 19 are misleading.

My favorite is this one:

"The California Police Chiefs Association opposes Proposition 19 because proponents 'forgot' to include a standard for what constitutes 'driving under the influence.' Under Proposition 19, a driver may legally drive even if a blood test shows they have marijuana in their system."

Guess what - right now, under existing law, you can legally drive even if a blood test shows that you have marijuana in your system. Just like you can legally drive even if you have alcohol in your system (as long as it is less than .08% by weight). (See California Vehicle Code section 23152(a).) You just cannot be impaired by drugs or alcohol.

Proposition 19 changes nothing about existing DUI law. In fact, it even says: "This act shall not be construed to affect, limit, or amend any statute that forbids impairment while engaging in dangerous activities such as driving..."

I am guessing that the standard the proponents "forgot" to include is a numerical standard, like the one used for alcohol, which makes it illegal to drive with .08% or more alcohol in your blood. (See Vehicle Code section 23152(b).) But the reason there is no similar numerical standard for marijuana is because marijuana is illegal - no one has been able to do studies like those done for alcohol that led to the adoption of the .08% standard. (That is because you can't give a bunch of volunteers an illegal drug. But you can give them alcohol.) If marijuana is no longer illegal, then we can do studies that will lead to a valid numerical standard for marijuana.

So if you want clearer and stricter laws against driving under the influence of marijuana, you should actually vote for Proposition 19.

Green Tax, Blue Tax, Old Tax, New Tax

As the legislature takes its recess from the stalemated trench warfare that has replaced a budget process, it makes sense to look at California's tax structure as a whole. The Republican rallying cry of "no new taxes" (while they clearly also dislike old taxes) unfortunately tends to legitimize our existing hodge-podge of counterproductive taxes.

Lets start with what is wrong. First, California has high personal income taxes, and derives much of its income from those income taxes. Because income is relatively volatile, especially at higher income levels, the level of tax revenue is extraordinarily hard to predict. When you cannot predict your income, it is almost impossible to come up with an accurate budget (especially given legislators' tendency towards extreme optimism that they will be able pay for every program that anyone wants). Warren Buffett warned Schwarzenegger about this, to no avail. In addition, the incentive created by high income taxes - reduce your income - is rather backwards.

Second, California has high sales taxes. In some counties they approach 10%. In a consumer-driven economy, this again creates a reverse incentive from what we want for economic growth, by discouraging purchasing of items in California. It also puts a huge burden on lower-income Californians, as a larger proportion of their money gets swallowed up by taxes on essential items.

Because local governments rely heavily upon sales tax revenue, they also have a perverse incentive to favor development of auto malls and big box retail, which are ugly and bad for small local businesses and the environment, but generate the most sales tax revenue. Housing, parks, schools, libraries, and mixed uses are discouraged.

Third, California has low or no extraction taxes. We have no oil severance tax, so the big oil companies can pull a lot of oil out of the ground under California (and reap huge profits) without paying for it. Alaska and Louisiana don't seem to have a problem with oil severance taxes - the oil companies are still pulling out oil and still making a very nice profit, but the states get something out of it. California is still the fourth-largest oil producing state, but it gets nothing for its oil. California could easily add an oil severance tax with no adverse consequences.

Let's move on to what is mixed. Under Proposition 13, long-time homeowners get much-needed protection against property taxes escalating to astronomic levels, which is good. But land speculators, real estate developers, and commercial landlords - all of whom profit from increased property values - essentially get a free ride. They get to reap the benefits of rising property values without bearing a corresponding tax burden, so their business is basically being subsidized by everyone else.

Let's look at solutions. The first few are obvious, based on the problems identified above. We should significantly reduce personal income taxes and sales taxes, and add an oil severance tax. For property taxes, we should keep the Proposition 13 cap on taxes on a primary residence, while allowing taxes on commercial properties (and second and third homes) to float with property values.

To make up for the lost revenue, while simultaneously creating better incentives, we can add taxes that create positive incentives, and that people can reduce - or even avoid - by making choices that benefit everyone.

Given the increasing scarcity of water in California, a water extraction tax would create an incentive to save water by increasing its cost. The proceeds could be used to fund water projects instead of relying on state-issued bonds. Under this approach, the biggest water users would pay the most for water infrastructure, which is fairer than using bonds that are paid for by all taxpayers regardless of their water use. If you don't want to pay the tax, you can use less water.

Similarly, an increased car tax, with the proceeds used to pay for highway projects, would be helpful. Those who own more cars and more expensive cars would pay more for highways, which again is fairer than having all taxpayers pay through other taxes. Car use has been heavily subsidized, and this is a way to make cars bear some of the costs they impose on everyone else. Some of the proceeds could also go toward defraying the health care costs caused by cars and their emissions.

A carbon tax, or a proxy for a carbon tax, would create appropriate incentives for Californians to reduce their carbon footprint. The proceeds could be used to begin adapting California's infrastructure for the impacts of global warming.

A tax on toxic chemicals and pesticides would create incentives to reduce their use, and the proceeds could be used to defray the health care costs (particularly cancer) that they cause.

Finally, the legalization and taxation of marijuana would provide a substantial new income stream to California.

These tax changes would reduce the tax burden on most Californians - your income taxes and sales taxes would go down a lot, and the property taxes on your home would stay the same. You would pay more for water, gas, your car, and things made with toxic chemicals - but you would gain the ability to reduce most of those taxes by using less.

These changes would also refill the state coffers, allowing us to again fund the quality programs we should be providing to our residents. We are a rich state, and we should be embarrassed that we are pleading poverty and claiming to be unable to pay for schools, infrastructure and social services. With a little common sense, we can feel - and be - truly rich again.

Arnold Plays, State Workers Pay

Arnold Schwarzenegger has decided to withhold the pay of some 200,000 state employees, including janitors, prosecutors, file clerks, and prison guards. He claims that he is required by law to not pay the employees in the absence of a state budget. But he makes an exception for those bargaining units that have accepted a deal including pay and pension cuts.

But if he can't pay employees in the absence of a budget, then how can he pay the ones that took his deal? This isn't law - it is heavy-handed extortion: sign the deal, or don't get paid.

And a big part of the deal - raising the pension retirement age for new employees - does nothing to deal with the current budget mess. It won't have any significant effect for 20 years or so.

Schwarzenegger is trying to play the political power "game," by using the current crisis to extract concessions from "the other side." He has lost sight that real people are more important than petty partisan "victories." The livelihoods of 200,000 Californians and those who depend on them are at stake - that is not a game, even if Schwarzenegger wants to pretend it is by using them as pawns.

This latest move only confirms that Schwarzenegger has failed as a manager, a governor, and a leader.

Insurance Companies To Save The Environment?

The main complaint against environmental regulations is that they cost money. For most regulations, this is simply not true. Environmental regulations generally try to prevent one business (or individual) from shifting costs to other businesses or individuals.

Let's look, for example, at a regulation that requires toxic waste to be treated and properly disposed of, rather than dumped into a river. It is true that treatment and proper disposal will cost more for the producer of the toxic waste, but just dumping it in the river will raise costs for others.

People who eat fish from the river, or drink the water from the river, will have adverse health effects, causing them to incur increased health care costs, costing their health insurer more money, and perhaps costing their employers productivity. Water companies using the water will incur increased treatment costs. Commercial fishermen will get lower quality catches, and once the pollution problem becomes known, will have trouble selling their fish. Recreational uses of the river, such as kayaking and water skiing, will decline, harming businesses that cater to those uses.

In this scenario, the total cost of the environmental regulation is clearly less than the total cost of no regulation. It only costs the polluter more.

A related argument is that if California imposes environmental regulations, competitors in other places, such as Nevada or China, will gain an advantage, because those places allow companies to shift their environmental costs onto others.

First, there are obvious environmental and logical problems with this argument, which resembles the child's complaint, "But Andrew's mom lets him play with matches and gasoline." Second, those other places should be considered to be engaged in unfair competition. In essence, they are subsidizing polluting industries by shifting the costs onto the more general populace, like a hidden tax.

We should not tolerate such practices that not only disadvantage clean businesses, but that also degrade the environment. California should require that all products sold here, regardless of where they are made, are manufactured using process that meet the same environmental standards. This would not only protect the environment worldwide, but would also provide an incentive for businesses to locate here.

So why would insurance companies save the environment? It seems like the health insurance industry has a lot at stake here. Our failure to clean up vehicle and industrial emissions results in increased rates of asthma and lung cancer. Our extensive use of pesticides results in more cancers, plus skin, eye, and nervous system problems.

These all cost the health insurance companies money, so they should be supporting stringent environmental protection laws and regulations. Maybe their shareholders should be asking them why they are not doing more to protect the environment, our health, and their bottom line.

Or maybe we just need to protect our environment by ourselves, and for ourselves, our communities, and our children.

No Nuke Left Behind?

The Kerry-Lieberman "American Power Act" was just rolled out amid much fanfare. It attempts to address climate change and create a national energy policy out of the vacuum of the Bush years. While the bill is a start, it is not a strong start.

The bill would enact a complicated version of a cap-and-trade system, which has plusses and minuses. Simplicity is not one of them, and Kerry-Lieberman appears to take this to an extreme, separating out different sectors (e.g. industrial, electric generation, transportation) for different treatment.

It would also boost federal (read: taxpayer) subsidies for nuclear power, which is already getting huge subsidies. You could buy an awful lot of solar panels for the money that we are giving to the nuclear industry now, and this bill would just give them even more.

The allocation of allowances is also problematic. It appears that a large number of allowances will be given away (to the electric generation section) for free, and the bulk of those would be given to the most polluting generators, who would be getting subsidized by (the ratepayers of) the cleanest generators. So California would be paying for the midwest coal states to clean up their act.

In the Washington tradition of providing something for everyone, but especially those who might oppose the bill, there are incentives aplenty for coal states, such as taxpayer funding for carbon capture and sequestration, even though a real carbon price should create a market incentive for the private sector to finance this.

There is a complex smorgasbord of offshore oil drilling provisions, designed to provide something for both pro-drilling and anti-drilling states, while also bribing states with lease revenues to encourage them to be pro-drilling.

Other aspects weaken the bill further. The timelines are slow, with the industrial sector not being covered at all until 2016. The bill appears to allow for huge amounts of potentially questionable "offsets," where you can offset your emissions by doing something like planting trees or capturing cow farts.

This is just a quick preliminary take, as the bill will come into clearer focus as folks start to wade through its roughly 1000 pages. It will also undoubtedly change as the various interests line up to reshape it in their favor.

Like a toddler's first step, the existence of the bill is significant, but it does not take us very far.

Waffling Toward Totalitarianism

Eric Holder, speaking for the Obama administration (which is going seriously wobbly in the face of Republican accusations of being soft on terrorism), announced that the administration will consider modifications to the Miranda rule for terrorist suspects:
http://www.washingtonpost.com/wp-dyn/content/article/2010/05/09/AR2010050902062.html

Joseph Lieberman would go farther, and strip Americans of their citizenship if they were tied to terrorism: http://www.nytimes.com/2010/05/05/nyregion/05arrest.html

One big problem: who is a "terrorist?"

Is it an art professor in Buffalo, making art with bacteria?
http://rochester.indymedia.org/newswire/display/21161/index.php
http://www.thenation.com/article/terror-hysteria-gone-absurdist

Or is it a Jewish college student, planning to protest the Republican National Convention?
http://www.commondreams.org/headline/2008/10/14-0

How about a graduate student in Idaho running a website for a Muslim charity?
http://seattletimes.nwsource.com/html/localnews/2002097570_sami22m.html

While these may not be the type of people who the change is aimed at, they have all faced terrorism-related criminal charges, and would be subject to the same law.

Anyone who has watched American television, with its plentiful cop shows, probably knows the Miranda warning better than the Pledge of Allegiance, so it seems unlikely that this new erosion of rights would actually accomplish anything, especially since there is already a public safety exception to Miranda. It is scary, however, how willing the Obama administration is to give away (or perhaps take away) even more rights just to appease right-wing attack dogs. But that is what happens when polling comes before principles.

Glenn Beck, of all people, in discussing the suspect in the botched Times Square bombing, actually showed a better grasp of Constitutional law than Holder (Columbia Law School) or Lieberman (Yale Law School): “He has all the rights under the Constitution. We don’t shred the Constitution when it’s popular.”

If Oil Drilling Can Do This, What Could a Nuclear Plant Do?

Given the ongoing disaster of the BP oil spill in the Gulf of Mexico, how much should we trust claims that nuclear power is totally safe? Maybe less than we thought.

The problem is that the potential scope and scale of a nuclear disaster, such as Chernobyl, is so huge that our minds don't really believe it. Our nuclear reactors in California have been operating for decades, and they have not melted down or blown up or spawned multi-headed livestock. Check out this article explaining why most California homeowners do not have earthquake insurance, despite the likelihood of a large quake: http://articles.moneycentral.msn.com/Insurance/InsureYourHome/why-you-may-be-in-disaster-denial.aspx

But the owners and operators of nuclear power plants, who would normally be on the hook if a reactor melted down, have insurance. And they have a federal law that limits their liability, and that provides for federal indemnification (read: taxpayer bailout) if the liability goes above that limit. It is called the Price-Anderson Act. http://www.eoearth.org/article/Price-Anderson_Act_of_1957,_United_States

Even that bastion of environmental protection, the Cato Institute, complains about how this is just one of the massive subsidies given to nuclear power: http://www.cato.org/pub_display.php?pub_id=3134

Oh, and the nuclear power industry gets government (taxpayer) loan guarantees, too: http://www.ucsusa.org/assets/documents/nuclear_power/nuclear-loan-guarantees.pdf

So we are subsidizing the nuclear power industry in a number of ways, including paying for part of their insurance, or more precisely, making it so that their insurers do not have to cover the full cost of a nuclear disaster - because we do.

If nuclear power was really so safe, would it need this protection against liability? If nuclear power was really so safe, would it need us to subsidize its insurance costs? If nuclear power was really so safe, why would it be asking us to pick up the tab if there is a disaster? There isn't really going to be a disaster, is there?

Environmental Disaster Continues to Grow

The destroyed oil drilling rig is continuing to spill oil, but not just 42,000 gallons a day - more like 200,000 gallons a day: http://news.yahoo.com/s/ap/us_gulf_oil_spill

In addition to 11 lost lives, this is turning into an environmental catastrophe, and appears likely to be an economic disaster as well, with its potential effect upon fisheries and other resources.

This spill has shown the vacuousness of the claims that "drill, baby, drill" is an energy policy. Let us hope that BP can and will use all of its resources to stop the leak soon.

Destroyed Rig Continues to Leak Oil

The offshore oil drilling rig that exploded, burned, and sank off the coast of Louisiana continues to spill oil at the rate of 42,000 gallons per day into the Gulf of Mexico.

http://uk.reuters.com/article/idUKTRE63O27L20100426

Offshore Oil Rig Explodes, Burns and Sinks

An oil drilling rig off the coast of Louisiana exploded late Tuesday, and burned fiercely until it sank on Thursday. 11 workers are missing and 17 were seriously injured. For details, see: http://www.msnbc.msn.com/id/36683314

Our sympathy goes out to the victims and their families and friends.

The environmental and health costs of the explosion and its aftermath are still unknown. Just the air pollution from the burning rig is massive, but that could pale before the potential pollution from oil, as the well that the rig had just finished drilling could be spilling over 300,000 gallons of crude oil a day into the Gulf of Mexico.

California's fisheries, marine habitat and scenic coast are too valuable to risk this kind of damage. We should not endanger our coastal environment and human lives and health for the sake of a little more gas for the cars and a lot more money for the oil companies.

Even before the explosion, it was clear that drilling for oil off of California is a bad idea (see the March 30 post: http://peterallenforag.blogspot.com/2010/03/drilling-for-oil-dry-hole.html); this confirms it.

No more oil rigs off the coast of California.

Meg In Wonderland

Meg Whitman claims her business experience would help her run California.

She also says she will cut 40,000 state jobs.
(http://www.kron.com/News/ArticleView/tabid/298/smid/1126/ArticleID/5691/reftab/622/t/GOP%20Gubernatorial%20Candidate%20Meg%20Whitmans%20Job-Cut%20Pledge%20Questioned/Default.aspx)

Since one of California's big problems right now is a high unemployment rate, it is not clear how firing 40,000 people would help that.

And, what Meg is saying she would do as Governor is exactly the opposite of what she did at eBay. According to her own website: "When she joined eBay, the company had just $4.7 million in revenues and 30 employees; when she retired in March of 2008, ten years later, the company had nearly $8 billion in revenues and 15,000 employees worldwide..."

It looks like Meg's business experience is in doing the opposite of what she claims she can do for California.

Proposition 16 - PG&E's Scheme To Buy (More Of) A Monopoly

How far will PG&E go to protect its monopoly? Too far, judging from the huge amount of money PG&E is spending to buy votes for Proposition 16, and its misleading claims in support of its pet initiative.

Currently, communities can choose to stop taking service from PG&E by joining a municipal utility district, or taking the more limited step of buying their electricity from another provider by means of community choice aggregation. But even thinking about taking either of these steps will trigger a massive retaliatory response by PG&E, making getting out of the utility's stranglehold very difficult.

Just ask the folks in Davis, who tried to escape PG&E, only to be bombarded with something close to $15 million in spending by PG&E to defeat the effort at the polls. Which means it must have been worth more than $15 million to PG&E to keep them as captive customers.

PG&E has been using its standard scorched-earth litigation strategy against the not-s0-mighty South San Joaquin Irrigation District, which had the nerve to propose to provide electric service to 35,000 PG&E customers (at a lower cost).

And PG&E has pulled a bunch of dirty tricks, including scare tactics, threats, and bribes, to thwart the Marin Energy Authority's efforts to implement community choice aggregation. It got so bad that the CPUC slapped PG&E on the wrist for its behavior: http://docs.cpuc.ca.gov/word_pdf/AGENDA_RESOLUTION/115960.pdf

So it is already difficult to get away from PG&E to join a municipal utility or community choice aggregator, given that PG&E will do, say and spend just about anything to stop such a move. And now PG&E wants to make it even harder.

If passed, Proposition 16 would require a two-thirds vote for a municipal utility to expand its service territory (or possibly even to sign up new customers). PG&E is threatening to spend up to $35 million to pass the initiative. PG&E's arguments as to why we should vote for the measure are heartwarmingly philanthropic:

"1. What will this ballot initiative, Proposition 16, do?

Yes on Prop 16 – The Taxpayers Right to Vote Act – does only one thing… it ensures that voters will have the final say—by requiring a vote—when local leaders decide to spend public dollars or incur public debt to go into the retail electricity business.

2. Why is Prop 16 necessary?

When local governments enter the retail electricity business, it can cost taxpayers millions or billions of dollars in public money or debt. These are risky long term capital decisions that can impact local spending on other budget priorities, can increase consumer electric rates, and cannot be easily reversed...Especially in difficult times like these, why shouldn’t taxpayers have the final say on decisions of this magnitude?"

One can reasonably ask the question: why would PG&E spend $35 million to look out for the welfare of California taxpayers? Answer: They would not do so. They are spending it solely to look out for their own bottom line.

Instead of spending $15 million every time some community wants to bolt, they can spend $35 million one time to lock them all in. PG&E admitted this to its investors: http://pgandeballotinitiativefactsheet.blogspot.com/2010/03/peter-darbees-weird-prop-16-soliloquy.html. (Otherwise PG&E would likely face a shareholder suit for wasting its money.)

The only competitive threat to a monopoly is the possibility it will lose that monopoly. PG&E will spend whatever it takes to preserve its monopoly. Proposition 16 is designed to do that, by eliminating the only potential competition to PG&E. Proposition 16 will not provide voters a choice - it takes the real choice away. Vote no on Proposition 16.

Why Do Soldiers in Iraq Have to Pay to Call Home?

This is not directly an issue for California's Attorney General, but it is emblematic of how our society's priorities have gotten really skewed.

I received a brochure, asking for a donation to the USO, so it could provide pre-paid phone cards to soldiers in Iraq and Afghanistan, so they can phone home for free. Details are here: http://www.uso.org/whatwedo/usoprograms/usooperationphonehome/

There is something very wrong here. We will send our soldiers to the far side of the planet to get shot at and blown up, but they have to pay to call their families? As a society, we won't even cough up the money for our soldiers to call home, while we are giving billions of dollars to Halliburton, Blackwater, and DynCorp? (And to bribe various Afghans and Iraqis.)

My guess is that someone is making money - lots of money - charging American soldiers for their phone calls home. There should be outrage at this, and a congressional investigation, but since the Democrats and Republicans have enabled this shameless corporate profiteering in all segments of our society, they can no longer recognize that this is simply wrong.

The Oil Empire Strikes Back

I don't actually think that oil companies are inherently evil. Really. But there is a problem when large, wealthy corporations act as though their only responsibility is to maximize short-term profits, at the expense of our health, our communities, and perhaps even our long-term survival.

The bigger problem is that under current law, the corporations are largely correct in that assumption. We need to change the laws governing corporations, so their responsibility under the law extends beyond their most recent quarter's stock price. Instead of relying upon the courage and conscience of a relative few corporate executives who have embraced social and environmental responsibility, we need to raise the lowest common denominator, so that all corporations must take the interests of people and the environment into consideration.

If we did that, then the Texas oil companies Valero and Tesoro would not be trying to eviscerate AB 32, California's landmark law on global warming. As oil companies that operate refineries in California, Valero and Tesoro must believe that implementation of AB 32 will result in them selling less gasoline. Less gasoline sold means less $$$ in their pockets. So they are trying to halt implementation of AB 32: http://news.yahoo.com/s/ap/20100404/ap_on_bi_ge/us_calif_climate_law_backlash.

Burning more gasoline is bad for people's health and the environment, and global warming may be a threat to human survival. Valero and Tesoro know that. They just don't care. We can make them care, by passing laws that require higher levels of corporate responsibility and accountability.

In the meantime, we should ignore their arguments that we should sacrifice our health, our environment, and our lives on behalf of their stock price.

Eastman and Harman Try to Stretch the Truth

I was a prosecutor. John Eastman and Tom Harman really want people to think they are prosecutors. Too bad that they are not really prosecutors.

Eastman, a Republican candidate for Attorney General, who until recently was dean of Chapman University's law school, tried to have the ballot say he is an "Assistant Attorney General." He isn't. And certainly not in California, although he is working on one case for the attorney general of South Dakota.

Harman, another Republican candidate for Attorney General, and a current member of the Legislature, tried to have the ballot describe him as a "Prosecutor." He isn't. He did sign up for an eight-week volunteer prosecutor program, but he has not tried a single case.

Fortunately for the truth, those designations were rejected. (Eastman sued to try to overturn the Secretary of State's determination, but he lost.)

More details are at: http://www.metnews.com/articles/2010/ag040210.htm
and:
http://articles.latimes.com/2010/apr/02/local/la-me-eastman2-2010apr02

Kamala Harris - Will Kill To Get Elected

As San Francisco District Attorney, Kamala Harris gained notoriety for her opposition to the death penalty. Now, however, as a Democratic candidate for Attorney General, she has decided that the death penalty is really okay. Her campaign website is notable for its utter silence on the issue (at least I couldn't find it anywhere), and according to the San Francisco Chronicle she has flipped her position. (http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/04/03/MNUJ1CNFH9.DTL)

The logic is hard to follow as to why the death penalty is a bad idea if you are district attorney, but a good idea if you are attorney general. Unless, of course, she thinks being anti-death penalty helps you get elected in San Francisco, and being pro-death penalty helps you get elected statewide.

Selling California - Cheap

In a blatantly boneheaded attempt to avoid facing the roots of California's budget crisis, the Schwarzenegger administration is proceeding with a plan to sell a number of office buildings, and then lease them back from the new private owners. And pay a large commission on the sale. The logic is obvious - get a bunch of cash now, so the budget looks better, and let someone else worry about 20 or 40 or 60 years of lease payments stretching into the future. It is nothing but another smoke-and-mirrors budget trick.

Selling the buildings is a bad idea for a number of reasons:
1) If you are going to sell a large amount of real estate, do it when the market is high, not when the market is low. This is probably the worst time to sell commercial real estate in recent memory.

2) Don't sell something you plan to occupy for a long time. Why should we pay forever to rent what we already own? How much will California have to pay when the leases run out in 20 years, and it goes to renew? How much leverage will California have in negotiations? Will it threaten to relocate?

3) These buildings are a long-term investment paid for by California taxpayers, and the governor (and the legislature) want to sell them for a short-term gain to cover up their inability to balance the budget. This sort of resembles what Bernard Madoff went to prison for.

4) The deal reeks of cronyism, with the broker handling the deal and the commercial real estate interests buying the properties standing to benefit at the expense of California taxpayers. But it is easy to give away something that someone else, like the citizens of California, paid for. And I am sure it is just a coincidence that the broker chosen for the deal (CB Richard Ellis) has been a significant contributor to Schwarzenegger and his causes.

5) It is a stealth form of union-busting. By selling the properties, California would pay the new landlord for maintenance and cleaning, instead of paying its own employees, meaning Schwarzenegger can get rid of hundreds of unionized state employees. The new landlord will likely hire lower-paid workers and pocket the difference as profit, so California won't save any money, but the janitors will find it even harder to make ends meet.

Selling ourselves into eternal debt for the financial equivalent of a bowl of porridge now is short sighted, and a quintessential example of the budget shams that have kept us mired in our current mess. Tell the governor and your legislators to stop this misguided sale of California's future.

Proposition 14 - A Really Bad Idea

Proposition 14 on the June ballot would, if passed, enact a "top two" election system, with the top two vote getters from the primary election, regardless of party, being the only candidates on the ballot in the general election. Chances are pretty good that this means only major party candidates would actually make it to the general election. In some cases, it might be two Democrats or two Republicans, but you won't likely be seeing any third parties on the ballot anymore. And that seems pretty undemocratic.

There are interesting commentaries here:

http://www.calwatchdog.com/2010/02/19/new-will-prop-14-kill-third-parties/

and here:

http://www.independentpoliticalreport.com/2010/03/editorial-ipr-opposes-proposition-14-in-california/

and here:

http://www.stoptoptwo.org/

Drilling for Oil: A Dry Hole

Sarah Palin and John McCain got attention for their call for drilling for more oil, and Barrack Obama is following suit. But drill-for-more-oil is an energy policy like searching under the couch cushions for spare change is a fiscal policy. It is exciting when you find something, but it doesn't buy you much.

First, if what we are trying to do is protect against future supply disruptions in a world where oil is in shorter supply than it is now, doesn't it make sense for us to keep our oil, rather than pump it out and sell it or use it? If we pump it out, it is gone. Chevron and Shell are not likely to spend the money to drill wells, only to leave the oil in the ground - they will sell it or use it in their own refineries. So if we drill now and use the oil, if things get really tight in the future, we will be even more vulnerable to supply disruptions because we will have already used up our reserves.

Second, drilling here does not necessarily mean that we get the oil here. We do not have a state-run oil company that will keep the oil and its refined products here. The big oil companies sell oil on a global market, meaning that if China or Germany is willing to pay more for oil, that is where the oil will go. Just drilling here does not guarantee us any more oil.

Third, there is little economic benefit to California of drilling here. There are a few, but they are small. Some Californians, but not many, may be employed in drilling for oil. To the extent the oil is refined here and the refined products sold here, California will collect some taxes, but again, not much. If the drilling is done on state-owned land, California may get some lease revenues. California has no oil severance tax, meaning that we do not collect any money for the hundreds of thousands of barrels of oil that are pulled out of California every day. Zero.

Fourth, the costs of oil production to California are high. California gets significant income from tourism and from fisheries. Offshore drilling is a significant threat to both of these. Drilling platforms and the occasional oil spill will harm tourism, and oil spills and other pollution from drilling activities will harm valuable and already-threatened fisheries.

Drilling for oil in California, particularly offshore, simply makes no sense.

Cap and Trade: The Good, The Bad, and The Ugly

Cap and Trade as a method for addressing greenhouse gas emissions has been hailed as the savior of the earth and demonized as the destroyer of our society. While it could end up being one of those, most likely it is neither. There are aspects of it that are good, some that are bad, and some that are just plain ugly.

The Good: It has a cap. If you are trying to control greenhouse gas emissions, having a firm and specific cap does it. (A carbon tax does not do this.) The cap on emissions would get lower over time, bringing down greenhouse gas emissions levels.

The Ugly: Setting the level of the cap and the rate at which it gets reduced. If the cap is set too high, it effectively does nothing to reduce greenhouse gas emissions. If the cap is set too low, you get significant economic and social disruption, as higher carbon industries or processes are forced to either shut down or rapidly change, potentially at great expense.

The Good: Theoretically, the trading of emissions allowances will result in a fair price being put on greenhouse gas emissions. No one has to try to calculate a carbon price - the market will just do it.

The Ugly: This pricing theory only works if the level of the cap is about right, and it only works if the allowances are not initially given away (or priced too high, but this seems less likely), and it only works if the market is set up properly with rules and enforcement to prevent fraud and gaming.

The Bad: If the initial allocation of allowances is made by giving them away, particularly if they are allocated based on past emissions, then the public is (again) subsidizing the emitters, and the price for carbon will be artificially low.

The Ugly: Allocation of allowances by auction would appear to be the approach that would result in the most accurate price for carbon, but then there will be arguments about who should get the proceeds from the auction. New clean technologies? Consumers? Dirty industries that need help cleaning up? The outcome will most likely be based more on politics than on sound policy.

This is just a quick examination of cap and trade - it does have some good aspects, and some bad aspects, but mostly it is just ugly.