The next time a politician talks about creating a green economy, just remember that the green goes to the consultants and bureaucrats. In 2012, California voters passed an initiative that hiked business taxes that would supposedly fund research, education, clean-energy expansion, and create 11,000 jobs each year. Instead, the Associated Press’ Julia Horowitz found that the only significant jobs that the tax hike has created are those for consultants and auditors:
Three years after California voters passed a ballot measure to raise taxes on corporations and generate clean energy jobs by funding energy-efficiency projects in schools, barely one-tenth of the promised jobs have been created, and the state has no comprehensive list to show how much work has been done or how much energy has been saved.
Money is trickling in at a slower-than-anticipated rate, and more than half of the $297 million given to schools so far has gone to consultants and energy auditors. The board created to oversee the project and submit annual progress reports to the Legislature has never met, according to a review by The Associated Press.
Voters in 2012 approved the Clean Energy Jobs Act by a large margin, closing a tax loophole for multistate corporations. The Legislature decided to send half the money to fund clean energy projects in schools, promising to generate more than 11,000 jobs each year.
Instead, only 1,700 jobs have been created in three years, raising concerns about whether the money is accomplishing what voters were promised.
This initiative was one of Tom Steyer’s pet projects. He spent $30 million to convince California voters to increase costs on businesses, even though California already had one of the worst environments for business and investment in the country, and promised them an environmentalist Utopia would result. Predictably, not only did this boondoggle not create jobs, it didn’t come with any accountability for performance, either. What. A. Shock.
Horowitz notes that the tax-hike revenues have not met expectations; they run about 60-70% of projections from advocates. Why is that?
There’s no exact way to track how corporations reacted to the tax code change, but it’s likely most companies adapted to minimize their tax burdens, nonpartisan legislative analyst Ken Kapphahn said. He also said the change applies to a very small number of corporations.
In other words, this got sold to voters through the use of static tax analysis. Static analysis assumes that changes in tax policy will produce no change in behavior, a favorite assumption of those who want to hike taxes for pet projects … like Steyer and his allies. It’s practically the only assumption that will work out to be 100% wrong for modeling tax hikes and revenue, and yet politicians — especially progressive politicians — keep using it, and voters keep buying it. Of course businesses adapted to changes in the tax code. Some might end up adapting themselves right out of California if voters keep passing this kind of nonsense.
But don’t worry. The Oversight Board that controls this project will be meeting this fall to get to the bottom of this. And when they do, it will be the first time they’ve met, ever, despite this project going on for almost three years. It’s a green future for California, all right — green for consultants, green for regulators, and green lights on all the highways out of the state.