Sacramento keeps on fooling us
“Fool me once, shame on you. Fool me twice, shame on me,” so the saying goes. Unfortunately, California voters have been fooled (aka lied to) so many times by our political leaders that perhaps they have come to expect it. For a politician to actually keep his or her word is now the exception, not the rule.
And it’s not just voters who get fooled. Interest groups and other officials are often snookered by those with more political power. Several recent displays of this political behavior show beyond any doubt that promises made in Sacramento have an extraordinarily short shelf life.
The first example deals with California’s one-of-a-kind “cap and trade” law, a market-based regulatory system for incentivizing reductions in greenhouse gas emissions. Under this program, impacted industries must pay for emitting greenhouse gases by purchasing credits at auction. The program was set to expire in 2020, but in 2017 there was a big political push to extend “cap and trade” in a way that would impose another huge cost to refineries and utilities, which would then pass those costs to California drivers, truckers and electricity customers.
Surprisingly, many industries forced into the “cap-and-trade” auctions supported the extension. They did so because they were threatened by Gov. Jerry Brown, environmental extremists and powerful regulators that if they didn’t, they’d be hit with an alternative program run completely by the government bureaucrats at the California Air Resources Board. Taxpayer groups, small-business interests and most Republicans opposed the extension because it would further raise California’s already sky-high cost of living. In addition to the cost, there was nothing in the political deal that guaranteed CARB wouldn’t move forward with punishing regulations anyway.
Regrettably, the “it could have been worse” argument persuaded a handful of Republican legislators to vote for the cap-and-trade extension. And, true to form, the taxpayers’ predictions have come true. CARB has adopted a regulation relating to a “price ceiling” that will increase the cost of the cap-and-trade program by an additional 60 percent. Today’s gas prices and electricity costs will seem like a bargain compared to what they will be in a few short years under this new regulation.
The next example deals with the promises made regarding Senate Bill 1 in 2017, which imposed a huge increase in the car and gas tax. An effort to repeal those taxes with Proposition 6 failed at the ballot in November when the interests which benefit financially from the tax overwhelmed the repeal advocates with tens of millions of dollars in deceptive ad campaigns as well as illegal campaign activity.
The politicians who favored the tax hikes promised that money from SB 1 would be used to fix California’s crumbling roads. But now, Gov. Newsom has said he would like to hold back those funds from local governments that fail to approve enough housing projects, typically high-density, transit-oriented housing projects.
If local transportation funds are held hostage until local governments genuflect to state-imposed mandates on housing, that would expressly violate the promises made to voters that the state’s transportation woes would finally be addressed.
A third example of a deal about to be broken involves beverage taxes. Before the 2018 election, the American Beverage Association spent several million dollars to gather signatures for an initiative that would have required a two-thirds majority for approval of any and all new state and local taxes in California. The proposal was strongly supported by taxpayer groups and the business community at large. But the ABA made a deal with Gov. Brown to remove the initiative from the ballot in exchange for a new law that would ban state and local beverage taxes for 13 years. Although the beverage-tax ban was passed, the deal will almost surely be broken. Supporters of beverage taxes have already proposed a ballot initiative, and the law can always be changed by a new crop of legislators who never met a tax they didn’t like.
There is an object lesson here. Political deals made in Sacramento are born to be broken. In light of this, it would behoove those who still believe in free enterprise, limited government and property rights to simply advocate for that which is right and decline to sit down and negotiate away our freedoms. Because all these deals have one thing in common – taxpayers always lose.
Jon Coupal is president of the Howard Jarvis Taxpayers Association