Valley Firms Push California Oil Tax

isabotage3 writes, "Still smarting from California's recent enactment of emissions caps, the oil industry is confronting another assault in the Golden State — this one bankrolled in part by Silicon Valley tycoons pushing to fund conservation and alternative-energy initiatives with a tax on oil output. Slightly more than half the money raised by the Prop 87 tax would be earmarked to help cut gasoline and diesel use. Another 27 percent would be put toward alternative-energy research at California universities. The remainder would be used to help start-ups, retrain energy workers in new fields, and for administration." Oil companies claim the backers of Prop 87, some of them venture capitalists, would profit from state money flowing into the alternative-energy projects they are funding.

Trendy

[celardore]

It's cool to be green. Being 'enviromentally friendly' is currently some of the best marketing you can have. Take for instance, Richard Bransons latest pledge. [bbc.co.uk]

I'm not opposed to this sort of corporate behaviour myself.

Re:

[Silver Sloth]

There is a deep and bitter irony when the money that Branson pledges comes, in part, from promoting cheap air flight [virgin-atlantic.com]
Mind you, he owns trains as well so I suppose it balances.

Re:

[thrillseeker]

It's cool to be green.

as long as someone else can be made to pay for it.

Re:

[Jason Earl]

Which is why I am completely in favor of California raising its gas prices to pay for research into alternatives.

Re:Trendy

[IAmTheDave]

as long as someone else can be made to pay for it.

We should all pay for it. Somehow, this world has become so short-sighted, in-the-moment, materialistic, and irresponsible, that we have this aversion to making some sacrifices that benefit humankind as a whole.

Yeah yeah, communism blah blah, capitalism blah blah. What the hell is wrong with getting rid of oil? BEGONE! What's wrong with investing - heavily, I might add - in cleaner fuels?

Even if - and this "if" is pretty weak - there is no global warming, there is certainly high mercury levels in our oceans, polution in our oceans, rivers and wells, toxic chemicals in our computers, drinking water, meat, vegetables, etc. Being "green" seems to have taken on the conotation of only being about global warming - but it's so very much more.

We know that a lot of what we do as a people pollutes the earth. Even if it doesn't cause global warming, the dense brown layer of air the airplane flies into coming into LA or NY or even Philadelphia airports are disgusting.

We can have almost everything we have now, and in a greener, cleaner fashion. But gross consumerism and selfishness has us so completely stuck in neutral that without shit like rising gas prices and crazy-ass California passing laws like this, we might never move forward of our own accord.

Now, admittedly, my condo doesn't have solar panels to drive the central AC I enjoy. While about 50% of the bulbs I have in my house are the low-energy florescents (sorry about my spelling - lets GO Firefox 2.0!) the other 50% are not - and some are halogens. I do take somewhat lengthy showers, and yes, I wash my truck. That's "truck", not "car".

So I'm not perfect. But small changes mean something. I pay an extra $15/month for PECO to deliver only wind-generated energy to my condo. I replace all dead bulbs with low-energy (and long lasting) florescents. I use public transportation to commute (because it's available to me). I'm a consumer, but I don't understand why I shouldn't be a somewhat responsible one too.

Having the technology to be nicer to this planet and not using it because of sheer complacency is unacceptable. IMHO.

Re:Trendy

[Quadraginta]

Yes, I think the Black Death does offer food for thought. As I recall (it's been a while since medieval history class), the period just before the Black Death was one of economic stagnation, low wages, land scarcity and population pressure. The aftermath of the plague was a steep rise in the cost of labor, with consequent spread of prosperity at the bottom of the economic pyramid, a loosening of feudal constraints on trade and migration (since it was harder to hold a serf when he could make very good wages by skipping off to town), and an economic renaissance (called the 'High Middle Ages') that arguably helped bring about the Renaissance itself that shortly followed.

But the problem with this comparison is that death by plague is essentially a Malthusian crisis; it's a giant act of natural selection. It's bound to improve the species, by selectively taking those who are less healthy, less clever and capable, or who are making poor use of their resources. There's nothing wrong (as far as the species, not individuals, are concerned) with a Malthusian crisis.

What we've got in the present, however, is a different thing. As you said yourself, it looks like it's the most capable of us who are no longer breeding. It's almost an inversion of natural selection, something that would not make the species more healthy and successful, but which could lead to quite the opposite. Not good.

Of course, in the ineluctable calculus of Mother Nature, "capable" is as capable does. We may consider highly educated, morally-refined, sensitive individuals as the most capable members of our species, but if they fail to breed, then by Mother Nature's standards they are not -- they are simply an evolutionary dead-end which will be replaced by other branches of our species. The giant brontosaurs probably considered the biggest of them to be the most "capable" dinosaurs around, too. But they were wrong. It was the little guys with wings that made it.

That's why I myself (only partly in jest) favor stabilizing population by introducing a predator. Something large and agile, with fearsome claws and teeth, almost as bright as human beings, with good eyesight, smell and hearing. Let it roam the Earth, catching and eating people who fail to blend in discreetfully with their natural surroundings, who argue noisily with their neighbors or fail to dispose neatly of their garbage, or who, because of being on the cell phone, fail to pay enough attention while driving to spot the primitive deadfall traps (with crude but sharp stakes at the bottom) that the animals dig in the highways. Since the animals would be clever enough to stake out restaraunts or malls, we can imagine that the average level of human fitness would dramatically improve. No obesity pandemic when people must routinely sprint across open spaces, one eye cocked worriedly for that tell-tale rustling in the trees that presages fulfilling your destiny by becoming a tasty meal...

Re:

[misleb]

It might be cool to be green, but it isn't easy.

-Kermit The Frog

shocking, I tell you!

[nojomofo]

Oil companies claim the backers of Prop 87, some of them venture capitalists, would profit from state money flowing into the alternative-energy projects they are funding.

Shocking! Because I'm sure that the oil industry never profits from any legislation that they push, right? Why is it surprising (or wrong) that people are pushing bills that help them?

Re:

[saleenS281]

It isn't "wrong" when it helps them, it's "wrong" when it's bad for the general populace just to that the few can profit from it. Please refer to net neutrality for examples.

Re:

[nojomofo]

Agreed - it's bad when it is pork. But the argument presented here is that it will benefit people who are backing it, which is not really a problem if it's a good bill.

You commies have it all backwards

[Travoltus]

Forcible transfer of wealth from the citizens to the wealthy and the corporate elite = the American way

Transfer of wealth, forcible or market-aggravated, from the wealthy and corporate elite to the citizens = godless communism = bad, bad thing.

[neo con parody off]

Silicon Valley entreprenuers?

[lawpoop]

The Silicon Valley tycoons who are pushing this bill aren't the same ones who are venturing into manufacturing high performance eletric cars [wikipedia.org], are they?

You bet they are, but what of it?

[WindBourne]

This is like having Cheney meet with the top oil guys for a national strategy back in 2001, except;

1. These guys are looking out for America's long-term interest as opposed to looking only for your own interest.
2. It is in the open.

No on Prop 87?

[Rupan]

I live in Silicon Valley. I often hear anti-prop 87 ads on the radio and TV. One day as I was driving to work I decided to listen to the ad carefully. At the end, as required by law, they state their sponsors. They (quickly) list a number of individuals, the last 2 or 3 of which are actually oil companies. It is for this reason that I decided to look into the issue. This tax will be levied on the oil companies. They will be forbidden by the law to pass the cost on to consumers, so this will NOT raise gas prices. So, to recap: 1) oil companies have to pay their fair share to improve the environment; 2) the tax cannot be passed on to cunsumers; 3) This will benefit researchers and universities Do not be fooled by the anti-prop 87 propoganda.

Re:

[Archangel Michael]

"They will be forbidden by the law to pass the cost on to consumers, so this will NOT raise gas prices."

So, you believe that will happen? Hows the turnip farm doing these days?

Re:No on Prop 87?

[0racle]

this will NOT raise gas prices

Of course it will. They'll just raise prices for 'another' reason. Just like it's illegel to fire someone for being gay. If you want to get rid of them for being gay, you just give them another reason and let them go.

Re:

[lucabrasi999]

Just like it's illegel to fire someone for being gay.

I realize this is off-topic, but depending upon where the employer is located, it may be legal to fire someone based on their sexual orientation. In some states/localitites, sexual orientation is a protected trait. In other states/localities, it is not protected. So, in some situations, your employer can fire you based on the fact that you may be gay, straight, or somewhere in-between.

Here [findlaw.com] is an article on it. You have to scroll down a few pages

Re:

[lucabrasi999]

They will be forbidden by the law to pass the cost on to consumers, so this will NOT raise gas prices.

The costs will be passed on to SOMEONE. My initial guess would be that since oil companies aren't allowed to raise prices in California, they'll simply raise prices in Oregon, Nevada, Arizona and Texas and make up the difference in lost profit that way.

Re:No on Prop 87?

[thrillseeker]

This tax will be levied on the oil companies. They will be forbidden by the law to pass the cost on to consumers, so this will NOT raise gas prices.

Announcement: The Laws of Economics have been suspended in California. Yes, Viriginia, there is such a thing as a Free Lunch!

Re:

[14CharUsername]

Ah, so its just like slashdot then?

Generally speaking, you're right costs usually get passed on to the consumer. Unless there are regulations prohibiting it. Of course you could say that they'll find a way. But if the oil companies charge californians more than what they charge elsewhere in the US, well its pretty obvious whats going on. And if they jerk around people too much then california can simply regulate gas prices. Which they really should do regardless, since this has been done where I live gas

Re:

[tsotha]

But if the oil companies charge californians more than what they charge elsewhere in the US, well its pretty obvious whats going on.

Uh, yeah, it is obvious when you realize oil companies have to produce special formulations for California because of clean-air restrictions. I still think those restrictions are a good idea, but of course we're gonna end up paying more at the pump. That and the state won't allow any new refineries, so there's an artificial bottleneck. You realize all California's imported

Re:No on Prop 87?

[BadAnalogyGuy]

The prop, if you've summarized it adequately, does not go far enough if its goal is to reduce emissions and promote a cleaner environment. It fails to reduce the actual fuel consumption at the pump by omitting the two things that would actually make a difference. First, it does not allow the tax to be transferred to consumers. Second, it does not levy a tax against gasoline consumers. The cost of gas must increase if you expect to see an impact in fuel consumption. It must be a bottom-up plan that forces consumers to consider alternative forms of transportation. A simple top-down plan that attempts to replace current transportation with cleaner forms will not succeed because there is no incentive for people to make the switch away from their current mode of transportation.

It's a bad law. Not because it goes too far, but because it does not go far enough to achieve its stated goals. Additionally, it attempts to manage the marketplace in an unnatural way which is bound to lead to some strangeness later on.

Re:

[evilviper]

First, it does not allow the tax to be transferred to consumers. Second, it does not levy a tax against gasoline consumers. The cost of gas must increase if you expect to see an impact in fuel consumption.

You can raise the price on bottles of oxygen all you want, but if there's no alternative at any price, I'm just going to be screwed by the high price, and HAVE TO pay it.

When Ethanol, Biodiesel, etc., are available in volume, THEN you can raise prices, and see some change. Right now, people will just have

Re:

[stuartrobinson]

I live in the Bay Area, and Prop 87 sounds great in theory, but I'm pretty skeptical about the part of the costs not being passed on to consumers by law. How specifically is that supposed to be prevented? I find it hard to believe that it's really possible but I don't know much about the specifics.

Re:No on Prop 87?

[Quadraginta]

It can't be prevented, any more than water can be made to flow uphill.

Here's one guess as to how it will shake out: Prop 87 passes, because Californians are generically such fools as to routinely believe they can get something for nothing, if a majority votes in favor of it. This makes extracting and selling oil in California less profitable than doing so in Texas or the Gulf of Mexico. Therefore, oil companies with multi-state operations -- which is to say all of the big ones -- will reduce their business in California and increase it in other states. The reduced supply of gasoline will, quite naturally, drive up the price. Zap, the tax has now been paid for by the consumer, as it always is.

Can this be prevented by even more legislation? Of course not. So long as California cannot change the rules of doing business in other states, the most it can ever do, while pursuing the fool's gold of squeezing money out of those damn "rich" corporations, is impoverish itself by driving successful business to other states.

Re:

[curunir]

Why not instead create a regulatory body that sets the maximum price at which gasoline can be sold? This is how we determine what PG&E can charge customers, how is gasoline different? We know the exact cost of a barrel of crude oil and how much it costs to refine it, why can't a price be set that gives the oil companies a modest profit, but protects Californians from paying the inflated prices we currently pay? Our market is large enough that companies would still sell here because even a modest prof

Re:No on Prop 87?

[thrillseeker]

Do you know of any consumers who would object to a price cap on gasoline?

Only those who were smart enough to take an economics class.

Re:No on Prop 87?

[Shag]

I'm a consumer in Hawaii, which had a cap on (wholesale) gas prices. The cap was determined each week based on some spot prices on the mainland. When the cap was in effect, our gas was consistently a certain amount above the average of those spot prices.

So the oil companies said, "you know, if your gas price cap weren't there, your prices wouldn't be linked to the mainland prices and you'd probably pay less.

And enough fools believed them that the cap was done away with.

Shortly thereafter, mainland prices dropped something like 40 cents a gallon.

Ours didn't budge.

The moral? Don't believe an oil company that claims to be showing you a way to give it less money.

I think our prices have now, after several weeks or months, dropped about 20 cents. Some places on the mainland, gas is under $2 a gallon again; here, the cheap stuff is $3.40.

Re:

[albanac]

$2 per gallon. It's practically $2 per litre in most of the rest of the world...

Re:

[Quiet_Desperation]

I live in Silicon Valley.

I can't wait for the Proposition that taxes the high tech industry to pay for the recycling and alternate disposal of their toxin containing products.

1) oil companies have to pay their fair share to improve the environment;

Question: why do you automatically believe Prop 87 will do anything to improve the environment?

2) the tax cannot be passed on to cunsumers;

Question: Do you *really* believe this? Follow up question: if so, has the drinking water in Silicon Valley been

There is no such thing as a free lunch

[joe_n_bloe]

Increased costs are always passed on to consumers. If oil production becomes less profitable, supply is reduced, and, guess what, the price goes up. You can't legislate pricing without inducing shortages (or, alternatively, in the case of price supports, creating surpluses). Anyone here remember gasoline rationing? Was your license plate even or odd?

If the tax isn't passed on, what's the point?

[Colin Smith]

Isn't the point to push people away from using fuel by making it more expensive?

 

Re:

[lelitsch]

Oh, you mean "Californians Against Higher Taxes, a group of firefighters, first responders, concerned citizens, and Chevron Corporation"?

It's interesting to see how many firefighters and first responders funded [electiontrack.com] this grassroots movement. If you don't want to bother with the link, out of the $52 million they raised, 99% comes from oil producers with Chevron and Aera Energy Llp picking up most of the tab.

By the way, why does every freaking campaign ad in California have a firefighter in it????

NOT raise gas prices?????

[Pinky3]

As I understand it, the proposition will tax oil taken out of the ground from within California. Oil from within California will now be more expensive. The oil companies will then buy more oil from Alaska or Venezuela and pay the cost of shipping the oil to California. The oil companies may not be allowed to pass on the cost of the tax directly to the consumer, but they will pass on the cost of transporting oil from greater distances. The price of gas will go up, make no mistake about it.

Oh yes gas prices will go up.

[rhombic]

Incorrect. The prop doesn't tax the oil companies per se. It taxes oil pumped out of the ground in California. The law does say they can't pass the cost on to their customers, the refineries. Let's assume that the producers follow this, rather than justifying price hikes by being just a little bit creative. Costs for in-state pumping will go up, but the cost to run a well is constant, thus low-yielding wells will be shut down sooner. And companies doing exploration are going to look elsewhere rather than explore in Cali. Thus in-state production will go down-- estimates I've read go from 10-20% reduction in in-state production over 5-10 years. Consumers will still drive, demand will remain fairly constant, which means more oil will be shipped in from Alaska and overseas. Shipped in oil is more expensive. Refineries will have to pay the higher price for out-of-state sourced crude, and they most certainly can and will pass those higher costs on to their consumers. Net result-- if 87 passes, Cali gas prices will go up. Economics of commodities is a byatch.

The other thing I anticipate happening is that the oil companies are going to redouble their efforts to get permission to drill in Federal controlled waters. That means anything more then 3 miles off the coast. There is absolutely nothing Californians can do about it if Congress lets them do this, it's Federal "land" (at least treated as land) covered by federal law. And guess what, oil pumped out of Federal lands isn't subject to prop 87's severance tax. Problem solved!

Morality

[BecomingLumberg]

Oil companies claim the backers of Prop 87, some of them venture capitalists, would profit from state money flowing into the alternative-energy projects they are funding.

It would be a shame for somebody to profit from something ethical and/or useful.

Ethics

[Archangel Michael]

So, you think it is ethical to tax people (take money by force) to hand it over to private entities, for political purposes, while not actually having to provide anything useful, while knowing that the results of the research will not be free (as in beer)?

Or is it just that you think Oil Companies are evil and anyone opposing them is good? Last time I checked, the Government made more on Oil Taxes than the Oil Companies made in profits.

Re:Ethics

[Waffle Iron]

Last time I checked, the Government made more on Oil Taxes than the Oil Companies made in profits.

And those oil taxes come nowhere near military expenditures that the government pays to ensure worldwide security for the oil market. So the government takes additional money by "force" from the rest of us to subsidize the oil industry by providing them with free security services.

Taking some tax money and allocating it towards finding energy sources that don't require major projection of military force to secure could very likely end up reducing the overall amount of money that's "forcefully" collected from you in the long term.

Ugh

[Anonymous Coward]

While I definitely like the idea of strongly encouraging less oil consumption and less driving, the Libertarian in me says the government should stay out of it. If there's a profit to be made in alternative energy, someone will do it. More importantly, private business can do it a hell of a lot better than the government could hope to, and the free market will select a better winner than the government can.

One of these days, I'm gonna finally move myself out of the Socialist Republic of California...

Re:Ugh

[bunions]

> the free market will select a better winner than the government can.

Just like it did with HDTV standards and the US cell phone market, eh?

While I agree that the law in question is bad, blind faith in the free market, while fashionable, is misplaced.

Re:

[99BottlesOfBeerInMyF]

While I definitely like the idea of strongly encouraging less oil consumption and less driving, the Libertarian in me says the government should stay out of it. If there's a profit to be made in alternative energy, someone will do it.

What does the libertarian in you say about people randomly shooting firearms in the air in populous areas, resulting in random deaths amidst all of society? Who should bear this cost, the people shooting or all of society?

Using gasoline is like shooting in the air. It pollu

Re:

[99BottlesOfBeerInMyF]

Wow, what a bullshit analogy. Exactly what purpose does shooting in the air in populous areas serve? How does it fuel our economy?

The analogy is apt for the aspect we were discussing, differing only by the degree of benefit and harm, not the principal. As for fueling our economy, it fuels bullet and firearm sales as well as the health care industry.

It's a criminal activity, and anyone doing it should be locked up in prison to rot.

So in principal if we passed a law banning burning fossil fuels, then

Government vs. free market

[Tony]

More importantly, private business can do it a hell of a lot better than the government could hope to, and the free market will select a better winner than the government can.

You have proof? Or is this just a statement of fact where no proof exists?

There is no such thing as a free market. It's like Santa Claus, or the tooth fairy, or WMDs in Iraq. There are always people who control the landscape of the market, whether it is the big boys (AT&T, Microsoft, oil cartels, etc) or the government (often the proxy for the big boys). Whether market dominance is long term or transient, the affect on the market is detrimental and permanent, and never in favor of the individual citizen.

I'm not defending the government, because it is usually filled with people who are unfit to govern. I'm just saying, putting your trust in the free market is like walking into a seedy Mexican bar where known organ harvesters hang out saying, "Yessiree, I just got the results of my medical exam, and I have perfect kidneys, and a beautiful purple-grey healthy liver. Yep. I have great body parts."

As far as stuff like alternative energy sources go, there's no money to be made until those sources have been found, developed, and made economical vis-a-vis petroleum. And believe it or not, many modern advances have come because of government investment in research. I'd go so far to suggest that government research has resulted in more economic health than private research.

Consider the internet as a prime example.

What was the "free market" doing? The participants were fighting amongst themselves, and not advancing anything at all like the internet. We had IPX/SPX, NetBEUI/NetBIOS, yadda-yadda-yadda. It took substantial (though not massive) government funding to provide us with a simple, resilient, adaptable protocol suite, and the infrastructure to make it useful. If we were stuck with the "free market," we'd all be using MSN dialup right now, except the oldtimers, who'd be using AOL (who would've purchased everyone else).

The free market has shown itself to be a fiction. When you pull the curtain back, you won't find a kindly, slightly-bewildered gentleman. You'll find the hideous faces of the corporate monsters who will offer you no alternative but their alternative. When they are mighty, they will eat the smaller competition who might possibly challenge them someday. They will purchase protection from the government where they can, as if it is the government's duty to protect them from their customers.

I don't believe the government should meddle in everything. But I don't think we should leave something as important as our future in the hands of corporations, either.

Buy! Buy!

[tktk]

Oil companies claim the backers of Prop 87, some of them venture capitalists, would profit from state money flowing into the alternative-energy projects they are funding.

Who are the backers? Cause, ummm...., I've got this friend who's looking to buy some stocks.

The road is paved with good intentions

[paranode]

It hardly seems logical to put the burden of this on the oil companies. While it is in their interests to eventually carry over into alternative fuel markets, taxing the crap out of them to force it defeats the free market and ultimately ends up punishing the consumer. As with many of these types of programs, it will drive California even higher into 'expensive to live in' status. That is, if the oil companies don't just jump ship altogether for a more friendly state.

This is just an attempt at the 'blame game' to punish oil companies and help California seem more 'progressive'. While they're at it why don't they tax Coca Cola so that we can find soda-alternative drinks! Or maybe tax Silicon Valley itself a little higher to fund research into alternative computing?

Re:

[jellomizer]

The thing that always gets me. Is that no one is willing to revalute where the current taxes go. If taxes are going to a project that never caught on then remove it. But the problem is that the people who make these laws and taxes never want to admit that they made a bad choice.
 

Re:The road is paved with good intentions

[99BottlesOfBeerInMyF]

It hardly seems logical to put the burden of this on the oil companies. While it is in their interests to eventually carry over into alternative fuel markets, taxing the crap out of them to force it defeats the free market and ultimately ends up punishing the consumer.

Actually, it does make sense in a way. Oil based fuels contribute to detrimental factors in our society that are not reflected in the cost of the product. For example, those selling and those burning fossil fuels do not pay for cleaning up the smog or for all the related health problems likely contributed to by oil. So while some person may ride a bike every day, or buy an expensive alternative vehicle, they are still also dealing with smog they did not create. Thus, they are actually subsidizing the oil companies and users. By taxing products that are detrimental to everyone, not just those that use them, some of those costs are brought back to the oil companies and oil users. The problem is finding the right balance.

As with many of these types of programs, it will drive California even higher into 'expensive to live in' status.

Nope. The law forbids them from raising the prices in California to make up for said cost, so in reality the cost will be borne by oil users in all the US, not just CA. This actually subsidizes the cost for CA residents at the expense of everyone else, a smart move on their part.

That is, if the oil companies don't just jump ship altogether for a more friendly state.

BT says to Shell, "Yeah we're going to stop selling into the multibillion dollar CA market, we'll pull out right after you do." Not going to happen.

This is just an attempt at the 'blame game' to punish oil companies and help California seem more 'progressive'. While they're at it why don't they tax Coca Cola so that we can find soda-alternative drinks!

So here's where this differs from a traditional "sin" tax. Usually, harmful products like alcohol primarily harm the user. Coca-Cola, for example, does not harm anyone who does not buy it. Oil harms everyone regardless of whether or not they buy it.

Re:

[geekoid]

gee, let me think.
Global warming, huge smog and pollution issues.

Also, it is vital to our economy that stuff gets from place a to b. Funding ways to do that cleaner has an emense long term payoff.

And whay state could these oil companies jump to? They need to be on the coast, the need a good infrastructure, and they need the economic benefits California provide.

The free market can not run unrestrained. Otherwise we would all still be driving without seatbelts, have one phone company, and waste byproducts wou

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[account_deleted]

Comment removed based on user account deletion

same old song and dance

[avi33]

It reminds of that manuscript recently dug up from the 14th century.

If there's one thing we don't need, it's the King and his "men of science" dictating their values to the marketplace. It's businesses like mine that are leading this nation to prosperity. If I have to refrain from tossing my pissbucket out the front steps, and deliver it all the way to the cesspool, it will cost me money, and I may have to lay off some peasants as a result. Besides, it hasn't been proven that these so-called bacteria even exist, and if they do, maybe they don't cause the black death. Maybe they will make our teeth straight and white forever. I say we should wait and see.

Sometimes government-mandated values work for the greater good.

Re:

[smooth wombat]

Where did you dig that quote up? What document? It sounds awfully modern unless the wording has been rewritten so we can understand it.

Misplaced priorities

[j. andrew rogers]

A far more productive activity with respect to reducing fuel usage that would not involve California creating yet another destructive tax would be to allow high density development in places like Silicon Valley. It is the height of stupidity that the same political class that wants everyone off the roads and/or to take public transportation adamantly refuses to allow the high density construction that would make it feasible. Far more fuel use reduction could be obtained by simply letting developers turn the vast suburban sprawl of places like Silicon Valley into an urban environment, but apparently this offends their sense of aesthetics.

If they were serious, they would start with the absurdly contradictory positions of city planners rather than inventing a new tax that will invariably get pissed away with no obvious benefit.

Re:

[Archangel Michael]

"Far more fuel use reduction could be obtained by simply letting developers turn the vast suburban sprawl of places like Silicon Valley into an urban environment, but apparently this offends their sense of aesthetics."

Except that I don't want to live in HIGH DENSITY URBAN area. I want a yard where my kids can play, unmolested by child preditors, gangs, drug addicts. You know, that thing called "outside"? Take your high density living and force it upon yourself.

Why is it that every dogood liberal thinks my c

Re:Misplaced priorities

[j. andrew rogers]

"Except that I don't want to live in HIGH DENSITY URBAN area. I want a yard where my kids can play, unmolested by child preditors, gangs, drug addicts. You know, that thing called "outside"? Take your high density living and force it upon yourself."

Your argument is entirely misplaced. Right now, they are forcing developers to NOT build high density urban construction and so the suburban sprawl is the default. I am not suggesting everyone should live in an urban environment, I am suggesting that people should have the choice. I do not care if you choose to live in the suburbs, my point was that the city planners are FORCING everyone to live in the suburbs whether they want to or not. The point is nominally to reduce average fuel consumption, not to force people to live in some particular type of neighborhood. Allowing people that want to live in an urbanized environment to live there will reduce average emissions for the whole area.

Re:

[LWATCDR]

It really isn't about forcing people to live in an urban environment.
It is allowing them to.
Right now it isn't possible to build a high density project in much of Silicon Valley. So what is happening is people are being FORCED to live in a sprawling suburban landscape. The homes that are nearest the jobs are the most expensive so the poorest people are forced to drive longer distances to work. The tax on fuel would tend to place the greatest burden on the people that make the least. Also a high density doe

I think I speak for everyone when I say...

[Garse Janacek]

Still smarting from California's recent enactment of emissions caps, the oil industry is confronting another assault...

Poor, poor oil executives :'(

Damn it people, when will you finally stand up and say "enough is enough?" These people already have to suffer through the uncertainty of how to spend billions in federal subsidies, and what to do with their record-breaking profits, higher than that of any other industry at any other time in human history... that's a lot of pressure! And now this?!

These people are true unsung heroes.

Taxes on oil companies end up being paid by people

[johnlcallaway]

Tax a business, their costs increase, they pass that charge onto their customers. If you are going to tax it, tax it at the pump so everyone knows about it. Provide tax relief for people who will be impacted, and get on with it.

Know why gas went to $3/gal in the US?? Because PEOPLE WERE WILLING TO PAY IT. They griped, they whined, they complained, but everyone still went down to the gas station once or twice a week and filled up. Don't believe me?? Why do people pay 5 cents more a gallon for gas when they could go across the street and get it for less?? Or 20 cents when they could drive 5 miles and get it for less?? Because they can. Oh, they'll whine about the cost, and then they'll eat Kraft Macaroni and Cheese one night a week instead of spending $25 for pizza for the family to make up for it.

My heart goes out for the minority that can't afford it, but businesses are in business to make money, not provide charity work. The funniest thing I heard was someone whining about Exxon's record profits. I didn't hear anyone offering to give them money several years ago when their profits were in the crapper.

My daughter, bless her heart, wanted a new car. She went out and bought a Yaris and now gets 40MPG. Toyota can't keep them on the lot. I bought a motorcycle a year ago and get 50MPG, so there are already means to reduce consumption.

As for those 'cheaper alternatives', where are they. Ethonal?? I've read mixed reviews, some claiming it's the answer to everything, some claiming that the resulting agribusiness pollution might be worse than what comes out of our tailpipes now. Hybrid cars?? First, they cost more. Maybe their effective MPG makes up for some of it, but the anlysis I've seen says they are still more expensive in the long run once you start swapping out batteries. Biodiesel?? There is only so much french fry oil in the country.

My fellow citizens of the USA have it easy -- just look at the price of gas around the world. This is one of the cheapest places to by it.

And we still whine....

Re:Taxes on oil companies end up being paid by peo

[kindbud]

Tax a business, their costs increase, they pass that charge onto their customers.

The authors of this bill know that, and have included language in it that attempts to prohibit passing on the costs to the customers. Whether it will work or not, I have no idea, but your objection misses an important feature of the bill.

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[RexRhino]

You CAN NOT keep the costs from being passed on to consumers!!! Thinking that the government can change economic laws is like thinking the government can change pi, or change gravity. All the language on all the peices of paper in the world cannot change fundamental properties of economics.

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[Brandybuck]

The authors of that bill are idiots. I heard one of them on an interview last week, and his economic ignorance was disgusting.

Go slow, but steady.

[WindBourne]

It would be good if they implemented these taxes over a period of time. Say raising ten cents every 6 months. If you do that, you give the sellers and buyers time to adjust. The real issue is that we politics coming in and skewing things all the time. JC pushed America hard core towards Alternative. Reagan pushed us back towards oil. Poppa Bush/Clinton left it up to the free market. And W. has pushed us hard core towards oil. If a state is going to have a success, they need a long-term view on change and one that is voted in and can not be repealed. If the tax is applied over a period of time AND they know that it will increase (as opposed to hoping that it will decrease), then companies such as EEStore and Tesla will do what GM/Ford/Toyota/etc are unwilling to do.

More Money Swirling in the Bowl

[joe_n_bloe]

Here in California we already have the most expensive fuel in the US, except for perhaps some locations in Hawaii. We have the least affordable housing in the US, except for perhaps Manhattan. New refineries will probably never be built in California. There will probably never be significant new oil development in California. Lawmakers are considering requiring that imported power come from power plants that meet California greenhouse emission standards.

I know what problems continuing to increase the price

*sigh*

[Colin Smith]

Don't tax oil/fuel, simply include it in the cap'n trade emission system. This'll send the funds directly to the greener systems without the politicians first getting their greasy paws on it. It reduces their ability to f*ck it all up.

 

Reduce fuel costs

[cubicledrone]

How about a tax credit for telecommuting? Ding! Traffic goes away.

But see, that would take control away from asscrack middle managers who insist on being able to penalize people for failing to leave for work two and a half hours early (and therefore miss breakfast and time with family) to overcome miles of 5 MPH traffic and unreasonable traffic signals. All we have to do to solve 21st century traffic problems is to get the fuck OUT of the 19th century workplace.

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[robertjw]

The State of California would never do something intelligent like that. They would rather blame their problems on oil companies, car companies and power companies than take any responsibility themselves.

Is this the best we could do?

[Random Utinni]

When the issue is a California proposition, the best article we could find to link to was from the "Northwest Florida Daily News"??? Huh?

Here are some more local sources that might be useful in the debate... and yes, the critical sites do raise the same point... from within California.

(Neutral)
Secretary of State's Analysis [ca.gov]

(Critical)
Local Blogger [blogspot.com]
Official "No" Site [nooiltax.com]

(Favorable)
Official "Yes" Site [yeson87.com]

Backers

[Pfhorrest]

Oil companies claim the backers of Prop 87, some of them venture capitalists, would profit from state money flowing into the alternative-energy projects they are funding.

This just in: people who support proposed law think they somehow stand to benefit from said law. Film at 11.

Saying "yeah, of course YOU like that, it does good things for YOU!" is no argument against anything. You need to show that it also does bad things for someone else (or in the case of something tax-funded, where there's the automatic bad thing of costing us money, you need to show that it provides insufficient public benefit).

This is no more interesting than saying "Rich folk claim that welfare supporters, many of them poor, stand to benefit from such laws". Of COURSE they do. The question to the rest of us is, do WE benefit from THEIR benefit? If these VCs make money off of projects they fund which also benefit the rest of us, where's the loss?

Have we learned nothing?

[TheWoozle]

Come on people, this is America we're talking about here.

If you want to reduce dependence on foreign oil, make sure that advertisements, TV shows, and movies only associate automobiles with fat, ugly people. As it is right now, all the stars drive big cars - the less fuel efficient the better. Can you name me one automobile over $100,000 that gets at least 25 mpg?

Even better, someone whip up an astroturf campaign complete with "scientific studies" that show that fossil fuels cause impotence.

Another crap law

[Eccles]

Want to reduce emissions? "Tax" all CO2 producing fuel based on its carbon content. Let the tax be passed on to the consumers. Then, at the end of the year, distribute the money evenly, with checks to every man, woman, and child. Thus anyone who reduces emissions gets a bonus, while long-range Hummer drivers pay more. The incentive to produce alternative energy will come from its lower cost, the disincentive to produce more greenhouse gas will be represented in higher costs.

Simple, few bases for anyone to object (cabbies and long-distance truckers would have to raise their fares), promotes alternative energy.

Re:This oughta be interesting

[bahwi]

Yeah, except california is a big state. They wouldn't stop selling gas there if it meant the gas was being used to burn babies alive, they'd still sell because it's such a big market.

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[UbuntuDupe]

"It's a big market" does not contradict "the gasoline is taxed into unprofitability". The idea about "market share" being more important than "profits" was only true in 1999 ;-)

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[a whoabot]

Shell reported 22.49 billion in profit for 2005. I think they could afford to have even a lot of tax increase.

Hey, wait, I thought capitalism was supposed to bring profits down, because everyone would compete and so there would be no room for large profits, and so someone would just undersell you? I've only seen profits increasing...

Re:This oughta be interesting

[Elwood P Dowd]

Wait until the Oil companies refuse to sell oil to anyone in California.

Oil is a commodity good.

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[rubycodez]

anyone could buy it and then resell it in california, just raises the price a tad

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[thrillseeker]

anyone could buy it and then resell it in california, just raises the price a tad

Which either reduces the demand for it or leaves even less money in the consumer's pockets.

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[Elwood P Dowd]

It is still a product that can be withheld from consumers in particular areas if the business or businesses decide to not sell in that area.

The point is that it cannot be withheld. There's no cartel of oil companies that can shut out a specific purchaser. If they try, then any of their customers can just resell to California for a profit. All the cartel would be doing is robbing themselves of profits. So they wouldn't do it.

Although I guess it would be hilarious for Unocal (Chevron, whatever) to stop sellin

Re:

[nelsonal]

The tax is on extraction of oil not sales of oil, California remains one of the larger oil extraction states in the Union. The fungible nature of oil means it's terribly difficult to actually harm someone by boycotting in either direction (it's pretty cheap to ship oil even a long distance so if for example California producers stop selling to California consumers the roughly 1 million barrels of oil extracted in California would just go from California to say Oregon, Washington, Nevada and Arizona while o

Re:

[El Torico]

Think about it. The Oil Companies refuse to sell in California, which alienates every gas station owner and motorist in the state. This creates an instant demand and relatively easy to modify distribution system there. Someone with a lot of ethanol could be in business in a very big way if that happened.

Bring it on!

[Travoltus]

We're the world's 6th largest economy. If we tank, they tank. Demand plummets because California's out of the equation. Oil prices fall, and their stock falls.

Plus, we get to pursue alternative energy a lot faster. California will be bruised but we'll come out of it even better off than Brazil.

Then the rest of the world will follow our example, and the oil companies will get bent over like a cocktail waitress wandering into the NFL post game locker room.

Save it for later!

[Kadin2048]

In the long run this might actually be a good thing for California. If it encourages oil to be consumed from the Middle East or Venezuela first, then it just means that oil is still in the ground to be pumped out and sold later, when the price will probably be higher. Given the rate at which oil prices have risen and will probably rise in the future (well ahead of the rest of the market), keeping the oil in the ground for later probably isn't a bad investment. However, it's not one that most companies would make, because they're too focused on short-term profitability.

By making it economically unfeasible to use the oil now, Californians might be unwittingly doing themselves a favor: they'll suffer now, but once the oil elsewhere is gone and they're all that's left (of easily extractable reserves), it's fat city.

The only exception to this would be if there was some plan to take the money that would be gained from pumping and selling that oil now, and doing something with it that would be more profitable than just leaving it in the ground until the price goes up. Given the way that both industry and government squander cash, I suspect this is unlikely. Whatever they're going to make by selling it now will probably just be blown on stuff that has little or no lasting impact.

Re:

[bunions]

Beats the current federal strategy of "cut taxes and spend."

Of course, that's like saying "having an eye gouged out beats getting disemboweled," but I'm just sayin'.

Re:

[Archangel Michael]

Oh, I agree. Cut Taxes and spend less. This is bad why?

Re:Follow the money

[BluedemonX]

There was no "less" on the end of his statement.

Bush has been spending freely like there's no tomorrow. No war, corporate perk or handout to the rich that can't be put on the credit card for others to pay later. While cutting taxes for the top 1%.

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[thrillseeker]

While cutting taxes for the top 1%.

Is that the same top 1% that still pay a multiple of the taxes that the other percentages pay, or is there a different top 1%?

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[Howserx]

That's a great idea! I'll find 30 or so of my friends, give us a year and 30 Million dollars and I'll give you a commission report that says "Spend less"

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[mspohr]

Actually, here in California we have the same "cut taxes and spend and borrow so our children will pay for it" philosophy.

Our current slimy governor promised to cut taxes but didn't mention that he would have to borrow $15 billion to meet the budget deficit. (His promised budget cuts and savings never materialized... big suprise here.) The idiots voted for him.

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[jd]

It's better than not to tax, and spend anyway. Or to tax, then not spend (there's no return if there's no investment). I'd rather have a sensible tax-and-spend system - provided the spending was going to produce a return to the community and not to a specific individual or corporation - than have no tax and no investment outside of high-profit sectors. I'd also rather see a tax that reflected the true cost of the commodity it was taxing. Oil is expensive on the environment and on the infrastructure, and som

Re:

[WindBourne]

As opposed to tax cuts and spend?

I prefer those that know how to balance a budget vs. those that seem to run huge deficits that kill the economy.

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[misleb]

Tax and spend! Nutjobs. I know, I live here.

Sure beats the Republican alternative: Spend and spend.

-matthew

Money flowing

[Mateo_LeFou]

My memory is fuzzy, but I think one of the initiatives meant to encourage alternative-fuel R&D was a big subsidy for that industry. This gets added to our tax bill alongside the giant subsidies to the oil industry.

I don't get it. If you want to level the playing field, why not retract the fossil fuel subsidies?

On a sidenote: do conservatives really think the US has a "free market" when all this govt. money is being pumped into damn near every industry?

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[thrillseeker]

On a sidenote: do conservatives really think the US has a "free market" when all this govt. money is being pumped into damn near every industry?

There is no free market as long as the government exercises the authority to tax in any manner and for any legislated-moraility reason, other than a flat basis and for Constitutionally mandated purposes (and there ain't many). It's only "kind of free", as in on-the-surface.

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[Mateo_LeFou]

"There is no free market as long as the government exercises the authority to tax in any manner and for any legislated-moraility reason, other than a flat basis and for Constitutionally mandated purposes (and there ain't many). It's only "kind of free", as in on-the-surface." That's what I thought. So how come whenever anyone proposes stuff like net neutrality or alternative fuels the conservatives say "the free market will take care of it"?

Re:Money flowing

[Erectile Dysfunction]

Because the Myth of American Capitalism was useful in making a stark contrasts with the evil Communist Russians during the Cold War, and has since been useful for dismissing everything from environmental regulation to deciding which businesses are to receive subsidies (by calling subsidies for the other businesses "socialist"). They aren't really conservatives, they're just using words with their base that get them elected. It is customary to ignore all of the intervention in the economy except the ones that you don't want. In the end they funnel their pork to their states, and despite electing them based upon their capitalist rhetoric, their constituents are pleased to receive the handouts and vote the same in the future.

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[phantomlord]

how come whenever anyone proposes stuff like net neutrality or alternative fuels the conservatives say "the free market will take care of it"?

I'm a conservative in the strict Constitutionalist sense of the word. I think limited regulation is good but too much regulation or no regulation is harmful.

I see net neutrality as a solution in search of a problem. Some ISPs are out there threatening to charge the Googles of the world extra fees for carrying their data, throttling VOIP so it can't compete with

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[evilviper]

I don't get it. If you want to level the playing field, why not retract the fossil fuel subsidies?

The state of CA can't retract federal subsudies.

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[PhreakOfTime]

Its not short-sighted. They just know there is only so much room on that teet, and they are already there.

Do you remember that Ken Lay was on the VP's energy task force? Do you remember right after that how CA had rolling blackouts due to the 'speculation' in the free market trading of electricity? Do you remember that Enron supplied the energy market that CA was using?

Open your eyes my friend. They arent being short-sighted. They are pissed because THEY might be pulled off the teet you so eloquently sp

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[thrillseeker]

That is exactly the short-sightedness I'm talking about. There's plenty of room at this sow's tit.

This sow's tit is the pocketbook of the taxpayer - and apparantly the departure of so many of those paying taxes from the state is read as an incentive to 'squeeze 'em more".

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[thrillseeker]

Let me get this straight... the fat cats are worried other fat cats will get a shot at the saucer of milk, even though it'll still all be paid for by the consumer?

The Fat Cats want the consumer to have as much excess money as possible to buy more of his product. The Nanny State wants the consumer to have the minimal amount of money possible to not revolt.

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[ackthpt]

The Fat Cats want the consumer to have as much excess money as possible to buy more of his product. The Nanny State wants the consumer to have the minimal amount of money possible to not revolt.

Ideally, you want to maximise your return on as little product as possible, that way you don't run out of your money making stock. Doubled the price, gasoline still sold in large quantities. I work in California and am shocked how many people won't pay $180 for annual school bus fare, but will happily join the

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[Archangel Michael]

You do realize that more people have died in California Car Accidents than US soldiers in Iraq War, during the same time frame, right?

And while you're on the subject, how much money is not being a Muslim or dead worth to you? Or perhaps we should be like Chamberlain and bring back a piece of paper stating Hitler will not invade.

While I have my problems with Bush, I don't see the democrats offering anything worth considering except "we're not Bush". They could be worse than Bush, it is possible, you know.