Proposition 23: Nothing More Than Misdirection

10/22/10

After giving my best attempt at an objective summary of Proposition 23 to a colleague, he asked rhetorically, “How can something like this even make it onto the ballot?” He was, of course, familiar with the process that allows any proposition that gathers enough signatures to make it to the ballot in, but the question was really addressing a more fundamental issue: how can something so transparently bad for California even make it to the ballot?

Proposition 23 is the legislative version of the flickering neon sign that reads “lower your standards for global environmental quality to protect state oil interests.”

To recap, Proposition 23 suspends AB 32, otherwise known as California’s Global Warming Solutions Act of 2006, until the state unemployment drops to 5.5% for four consecutive quarters (otherwise known as a year). AB 32 requires that California lower its overall greenhouse gas emissions to 1990 levels by the year 2020—an ambitious goal that may require certain sacrifices. However, the issue requires further investigation.

The author of this proposition is the linguistic equivalent of David Copperfield. First, the wording may lead one to believe that climate legislation and unemployment are somehow correlated. The proposition even seems to imply that climate legislation is causing unemployment and removal of the legislation may lower the unemployment rate.

This misdirects the conversation from the real issue, which is that the oil industry is attempting to self-regulate. The Yes side argues 23 would create a million and a half jobs. I argue that 23 would destroy an entire industry—the nascent clean technology business that so many courageous startups have begun to explore—and that any initial economic uptick would be short lived. Who is right? It doesn’t matter. The conversation has been moved to the only area where proposition 23 actually makes sense: the imaginary.

Proposition 23 will kill the Global Warming Solutions Act for a period of time. It is, literally, a proposition to suspend a solution. But the oil industry is not merely content to delay implementation of clean air standards in California. They would prefer to prevent it altogether, which is where Proposition 26 comes in.

Proposition 26 would cripple AB 32 with legislative bureaucracy, potentially rendering it ineffective. Proposition 26 is as damaging as 23 to the clean technology industry and air quality standards. Yet because of its subtle and often sleep-inducing wording, much of the fight has been focused on 23.

If Proposition 23 is all about flash, Proposition 26 will be the legislation to pull a quarter from behind your ear. Magicians often use sleight of hand techniques to misdirect the attention of audience participants in order to trick them. Proposition 23 may be the distraction, while 26 accomplishes the same goals right from behind our collective ear. Californians should ignore the oil industry illusionists and vote no on both.

Jim Watson is managing general partner at San Francisco-based investment firm CMEA Capital. The firm manages over $1B in venture capital and invests in Information Technology, Life Sciences and Energy. Follow @

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  • Full Disclosure

    Probably a good idea for Watson to note that he has a financial interest in the defeat of both propositions through CMEA’s investments in clean energy companies.

  • Earl Richards

    PROP 26 is just as damaging as PROP 23. Prop 26 is a treacherous, Big Oil rip-off, which “passes the buck” from oil corporation, clean-up fees to the public’s taxes, who will pay the oil recycling fees, the materials hazards fees and other fees. If you do not understand the the ambiguities and the intrigues behind Prop 26, then, vote no. Power to the people. BP, Exxon Mobil and Shell are silent partners behind Prop 26.

  • Wayne

    “Proposition 23 is the legislative version of the flickering neon sign that reads “lower your standards for global environmental quality to protect state oil interests.””

    Ummm, no. It’s putting off an expensive global warming solution that has no chance of effecting global warming, until the economy recovers.

  • NewportMac

    From my perspective, this isn’t about Oil vs Clean Energy, its about a poorly crafted piece of legislation that will do more harm than good and about protecting jobs until AB32 is fixed and we can afford it.

    Very few voters have taken the time to read AB 32.

    AB 32 was enacted before the facts were known. It simply needs to strip out the Cap and Trade provision and reliance on Green House Gas assumptions and its potentially a piece of leadership legislation. Sustainability, Clean Energy, and Stewardship are great goals but not at the expense of Common Sense.

    AB 32 needs to eliminate the Cap and Trade provisions 70% of America Opposes, eliminate the unnecessary oversight Fees, eliminate the reliance on flawed Green House Gas assumptions, correct the vague language that will introduce Environmental Red Tape that will do more damage than good, ensure AB 32 doesn’t undermine The Rule of Law, and make non-governmental agencies like CARB accountable to the taxpayer for their mistakes.

    Voting YES on Prop 23 makes the most sense until AB 32 is fixed and we can afford it.

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