It was awfully hard for Gov. Jerry Brown to push through that legislation to renew cap and trade. Expensive too.
But don’t feel sorry for the governor. It was his own damn legislation facing obstacles that are his own damn fault.
Brown needed to get two-thirds because cap-and-trade raises revenues, and that requires a two-third vote in California because of Propositions 13 and 26. Brown was governor when Prop 13 passed, and in his second go-round in state office, he’s declined to fix the supermajority-mad governing system, even watching as Prop 26 and other supermajorities were added. He’s preferred to focus on climate change, water and sustainability.
Brown is being celebrated nationally for pushing through the legislation, with Republican support. But there’s been less focus on the cost of winning the two-third vote. Such votes are always very costly—because there are all those extra votes to buy.
We don’t yet know all the costs – we’ll see when the money raised by cap-and-trade has to be spent, and we learn more about the promises that were made for those votes. But already, there are obvious costs.
Brown agreed to waive a fire prevention fee for rural property owners that raises a little less than $100 million a year. He agreed to extend a sales tax break for manufacturers and R&D through the end of the next decade. And he agreed to eliminate sales and use tax for companies making purchases on renewable energy projects.
And then Brown committed to work on a housing package; that won’t be free either.
And the costs aren’t all about money or programs. Brown agreed to make the governing system a little bit more complicated and dysfunctional, by adding a constitutional amendment to the package. It would establish – yes, you guessed it – a new supermajority. Specifically, there must be a two-thirds vote in 2024 on cap-and-trade revenues. Republicans wanted this leverage as part of the price of their votes.
Given the high price of winning two thirds, it’s way too early for all the declarations of victory that have accompanied the passage of this legislation. Is the value of cap-and-trade – in reducing greenhouse gases and pollution, producing revenues for programs, and inspiring investment in renewable energy – greater than the costs of the giveaways, financially and in governance?
Let’s hope the answer is yes. But it will be years before we know. Let’s hope that, before the program faces renewal again, that our leaders and the people return California to majority governance. It makes things less costly.