How To Tank Your Economy

Seed Magazine, internet science's version of The Sierra Club, NARAL and whatever groups hate religion the most, is all atwitter that California Governor Arnold Schwarzenegger will sign yet another aggressive, anti-business piece of legislation. Now, of course, it won't harm California industry if someone finds an expert that says it won't. No, more legislation will help industry in California. You and I know that is always true. Wait, maybe that is true. Ohhhhh ... only in the case of utilities because, as Barry Abramson, utility analyst at Gabelli Asset Management Inc. points out, utilities can simply pass the additional costs on to consumers without them ever seeing it. So California can institute its own mini-Kyoto protocol, even though 80% of the countries that signed it don't meet their targets and have no intention of doing so, and if it only hurts poor people with higher utility rates, that is okay. No wonder Seed Magazine is so happy. Lots of liberals working in New York skyscrapers are happy when someone else does something. Actual manufacturers are not so happy. "We have put the California economy at risk by addressing the risk of global warming," said Jack Stewart, president of the California Manufacturers & Technology Association. "This just moves the problem somewhere else." Indeed it does. Like Nevada. No one in their right mind will stay in California much less move here once the place gets even more expensive for business. Much like manufacturing jobs will move to exempt countries like India, China and Mexico if America were to institute the job-killing strategy. I live in California so I will tell you what I see. When an environmentalist makes a claim, reach for your wallet. We have billions of wasted dollars on windmills in this state. Yes, I said windmills. But they said it would save money. They always say that. How do they make that claim? Here is the process for justifying your ridiculous cause: 1. Take your cause and its current cost and say it will becomes much cheaper. Say something like, "When this catches on, it will drive the cost per unit to 1/10th of what it is today." State that as fact. Get a law passed. This is why in a very few years people with hybrid vehicles are going to be alarmed when they are spending thousands of dollars to replace their batteries. "But environmentalists said popularity would make the price drop", they will say. If only it worked that way. Yes, environmentalists think all manufacturing is like computers, where old technology becomes cheaper. What they fail to recognize is that unless you are manufacturing millions of something it never works that way. This is why hospital care has not gotten cheaper, people. Or cars. 2. State that business is the friend of your idea. Yes, insist that it is good for business and that entrepreneurs and capitalism will solve the pesky cost dilemma. In this case, insist that new businesses will spring up to cater to the new legislation you just impemented. In fact, say it will be a Gold Rush of new business. California people love to hear that. Has this ever happened? California people ran nuclear power out of the state and then made sure no new refineries can be built, so California ends up getting whiplash every time OPEC raises prices even though the Alaska Pipeline runs right into the state. What businesses sprang up to replace nuclear power? None, of course. Who would dare? The only new 'business' that will spring up is more government agencies to enforce the new laws and do inspections. 60% of the California economy is already controlled by the fed and state governments. I am not sure more of that is the answer. "This is confirmation of a state that knows an economic opportunity when it sees it," said Fred Krupp, president of advocacy group Environmental Defense. You remember Environmental Defense, right? They're the ones suing an MIT professor for disputing some of their facts about global warming. Who is in the chair beside them in that complain? The state of California. That's a surprise. But, wait, there is a study by The University of California at Berkeley. You know, Berkeley. Long-time friend of business. THey published a study that said California's global warming legislation will add US$60 billion to the US$1.5 trillion economy and 17,000 jobs annually. But if the state also offers innovation incentives to business, the boost to the economy will be US$74 billion and 89,000 new jobs annually, the study said. Incentives? You mean tax rebates? Who pays for that? Oh yeah, everyone else ... and poor people more than anyone. But don't expect the University Of Californa system to speak against the California Legislature. When the state was compiling a $30 billion deficit the U of CA system got 30,000 new employees while community college students got tripled tuition. Guess which of those two overwhelmingly votes Democrat? We'll give SEED Magazine a break for their naivete. They have a big corporate venture capital investor ( in Canada, naturally ) who wants to make some money ... and global warming is big business these days. Just visit the Sierra Club headquarters some time. Hint: it ain't that log cabin in Yosemite they show in brochures. Though they have a nice multi-million dollar mutual fund you can invest in. That always says 'we care about the environment' to me.