The curious case of why Chevron is sitting out Prop 23
Proposition 23, known as the Dirty Energy Proposition for its financial backing from oil companies, has garnered national publicity for its effort to roll back California’s greenhouse gas law. Virtually all of its funding has come from outside California, beginning with Texas-based Valero, Texas-based Tesoro, and the Kansas-based Koch brothers. Californians who care about our state, and who remember Texas-based Enron and the Utah-based Mormon Church, resent the intrusion of out-of-state interests meddling in our politics.
But what of in-state oil companies and businesses who might normally put their money into Proposition 23? Chevron and the California Chamber of Commerce are staying neutral. That’s good, right?
I investigated. Short answer: No, that’s not good.
Proposition 23 is easy to understand — FAQs here. Propositions 25 and 26, by comparison, are MEGO (My Eyes Glaze Over) propositions dealing with the state budget. Proposition 25 will end budget gridlock by requiring a simple majority, rather than a two-thirds vote, to pass a state budget; both the California Democratic Party and the Los Angeles Times recommend a “Yes” vote. Proposition 26 would amend the state constitution to require a two-thirds majority on certain business fees by declaring them “taxes”; both the California Democratic Party and Los Angeles Times recommend “No” votes.
While officially remaining neutral on Proposition 23, California-based oil companies Chevron and Occidental, and the California Chamber of Commerce, have been quietly funnelling their cash into a No on 25/Yes on 26 political action committee (PAC). I’ve reviewed donations made through the end of September 2010. All of the following data is from California secretary of state’s office.
REPORTING PERIOD: 07/01/2010 – 09/30/2010
CONTRIBUTIONS FROM THIS PERIOD: $3,868,216.65
TOTAL CONTRIBUTIONS 1/1/2010 – 09/30/2010: $6,051,060.29
EXPENDITURES FROM THIS PERIOD: $6,208,269.55
TOTAL EXPENDITURES 1/1/2010 – 09/30/2010: $9,459,904.08
ENDING CASH: $819,351.21
By contrast, here’s the same data for the dirty energy Yes on 23 PAC:
REPORTING PERIOD: 07/01/2010 – 09/30/2010
CONTRIBUTIONS FROM THIS PERIOD: $5,231,934.05
TOTAL CONTRIBUTIONS 1/1/2010 – 09/30/2010: $8,362,235.39
EXPENDITURES FROM THIS PERIOD: $1,774,375.49
TOTAL EXPENDITURES 1/1/2010 – 09/30/2010: $5,317,593.35
ENDING CASH: $3,122,966.01
In other words, both groups have taken in about the same amount of money; Yes on 23 has more cash in reserve and No on 25/Yes on 26 has spent more.
Here are some contributions to No on 25/Yes on 26:
California Business Political Action Committee, Sponsored by the California Chamber of Commerce:
$2,322.65 7/1/2010 (non-monetary contribution)
Chevron Corporation [based in San Ramon, Calif.]:
Occidental Petroleum [based in Los Angeles, Calif.]:
[Subtotal from California-based oil companies: $1,500,000]
Chevron has donated $1,250,000 to pass Proposition 26, compared to the $1,000,000 donated by the Koch brothers to pass Proposition 23. But why does Chevron care about an obscure budgetary proposition? Proposition 26’s backers portray the initiative as necessary to stop “hidden taxes.” Jean Ross of the California Budget Project explains otherwise:
The fees at issue are primarily those that regulate, mitigate and otherwise respond to environmental, health, and other social impacts of products and services. In other words, businesses seeking to avoid financial responsibility for the “externalities” of the products that they sell …
If the state can’t impose the fees on “pollution-causing industries” to recoup the cost of environmental monitoring and remediation, those costs will be shifted to taxpayers as a whole. Or, in an era where budget crises have become the status quo, programs that enforce environmental, food safety and other laws will be scaled back, if not eliminated. Which may be the true goal of the backers of Proposition 26.
Proposition 26 is a Polluters Protection Act. Its goal is simple: Whatever Proposition 23 can’t undo openly, Proposition 26 will undermine sneakily. AB 32 will seek to impose fees on polluting businesses; Proposition 26 would require a two-thirds approval (which is virtually impossible in gridlocked California). Californians are enthusiastically mobilizing against Proposition 23, but they need to be equally energized against Proposition 26 and for Proposition 25.