Common Tragedies

Thoughts on Environmental Economics

What’s the matter with California

Posted by Rich Sweeney on September 3, 2008

Over on, Stephen Lacey* has an article on two controversial California renewable energy ballot initiatives.

The first, Proposition 7, would increase the states RPS to 40% by 2020 and 50% by 2025. The current RPS, enacted in 2002, set a goal of 33% by 2020, which is already by far and away the most ambitious target in the US. In 2007, 11.8 percent of all CA electricity came from renewable resources such as wind, solar, geothermal, biomass and small hydroelectric facilities. Now 40% isn’t necessarily impossible, but the costs and reliability impacts are highly uncertain. As one insider put it a few months ago, “If that passes, I’m stocking up on flashlights.”

The other initiative is Proposition 10, which “authorizes the state to issue US $5 billion in bonds from California’s general fund in order to provide incentives for “clean alternative energy vehicles” and research and development of next-generation transportation.” Ostensibly the idea behind the bill is to jump start California’s alternative fuel market, but Lacey points out that many clean energy analysts are skeptical. For what its worth, this clean energy analyst couldn’t separate the beef from the bs amidst all the legalese. However, the measure is financially backed by T. Boone Pickens’ company Clean Energy Fuels, which at least answers the classic Jim Garrison question “Who benefits?”

Which brings me to the point about California, and about direct democracy in general. Most propositions deal with issues that are far too complex and consequential to simply leave up to a popular vote. Even if every voter was smart and experienced enough to evaluate the issues reasonably, he most certainly would not devote the time and effort necessary to do so. Instead ballot initiatives are incompletely explained by self-interested parties, and decided on a whim by shortsighted citizens. Voters get all of their information on a proposed ammendment in a media blitz that occurs right before the vote, and devote exactly 2.5 seconds to pondering the issue between questions in the voting booth. The result is a hodge-podge of conflicting codifications which would be quite comical it weren’t so disastrous. Two examples:

  • During the 80s and 90s CA voters mandated spending increases in every direction imaginable while simultaneously enacting arbitrary estate and sales tax cuts, leaving the government perilously tied to state income taxes. Then when the economy went south and the state went into fiscal crisis, they took to the booth again to oust Gray Davis for allowing the budget deficit to get so large.
  • in 1993 Californians voted “three strikes” into law, which mandated life imprisonment for third time felons. The result has been prison overcrowding and countless inhumane incarcerations.

Good policymaking requires a careful consideration of both the costs and the benefits. Ballot propositions emphasize only the positives, often encouraging voters to think they can have their cake and eat it too. Now its totally possible that CA voters will take the time to understand the implications of a 40% RPS, or the benefits of a $5 billion alternative fuels subsidy. Much more likely though they’ll evaluate these propositions in a vaccuum, ignoring the tremendous costs/ stresses of the former and the wasteful, restrictive nature of the latter.

* FYI Stephen Lacey also hosts an excellent weekly podcast for those interested in renewables.

One Response to “What’s the matter with California”

  1. Evan Herrnstadt said

    don’t forget good ol’ Prop 13:

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