CA economists to Meg Whitman: Your “policy proposals will deepen Californias budget crisis and are likely to reduce employment and economic growth.
"CA economists to Meg Whitman: Your “policy proposals will deepen Californias budget crisis and are likely to reduce employment and economic growth."
Guest blogger Rebecca Lefton is writing regularly to keep us up to date about Big Oil’s tricky proposition 23 initiative to kill California’s clean energy economy. Read more on Prop 23’s national repercussions and funding from Texas oil companies.
A group of California economists signed an open letter to Californians warning that gubernatorial nominee Meg Whitman’s economic policies would only leave the state’s already suffering budget worse off and raise unemployment. The experts, including Stanford University economist and Nobel laureate Kenneth Arrow, probed Whitman’s economic proposals concluding that Meg 2010 is not based on facts or solid economic analysis. They write, “If implemented, her policy proposals will deepen California’s budget crisis and are likely to reduce employment and economic growth.”
Michael Reich, University of California-Berkeley professor sums up the arguments in a new Center for American Progress Action Fund report. Reich concludes:
Meg 2010 is based on faulty economic theories and on studies that are fundamentally unsound. The nonpartisan California Legislative Analysts Office states that one of these studies is “unreliable” and that the other “contains a number of serious shortcomings that render its estimates of the annual economic costs of state regulations essentially useless.”
Because Meg 2010 is not based on facts or experienced analysis its economic policy prescriptions are equally dubious. If implemented, Whitman’s program would worsen California’s budget malaise and its economic performance. Californians need to examine carefully her faulty economic assumptions as well as understand the consequences of her misguided conservative economic proposals.
Whitman has pledged to suspend the state’s progressive clean energy and climate legislation for a year, citing a study by Sacramento State University professors Sanjay Varshney and Dennis Tootelian that exaggerates costs and is inconsistent with other analyses on the impacts of the law on jobs and the economy. Whitman continues to use the Varshney and Tootelian study even though it has been discredited (See UCLA economist Matthew Kahn’s examination here and the Legislative Analyst’s Office’s debunk here.)
In reality, California’s landmark clean energy and climate law is creating jobs and giving the economy a much needed boost (see Economists agree, don’t block AB 32!). That’s why even in the face of a recession and budget crises, the majority of Californians continues to support the law. But it seems that Whitman is on the side of the oil industry which is spending record amounts to orchestrate the proposition 23 campaign to repeal the law.
This may work against Whitman come November. A Public Policy Institute of California poll in July found that the 79 percent of voters believe gubernatorial candidates’ positions on the environment are at least somewhat important. Of those that say a candidate’s environmental position are very important in determining their vote, only 16 percent would vote for Whitman.