Viewing blog posts written by Gino DiCaro

Why Not California #4 (and AB 32)

Posted by Gino DiCaro, VP, Communications on Aug. 6, 2008

Why is the CEO of Cypress Semiconductors discussing, in a letter to the Wall Street Journal, the past closings of their two manufacturing facilities in California?  Why is Cypress Semiconductor -- formerly a 100% California-based company -- employing 7,000 of it's 8,000 employees outside of California?  With this question in mind it is not surprising that almost a quarter of California's 440,000 lost manufacturing jobs since 2001 have come from Santa Clara county.

A good portion of the answers to these questions lie in Forbes Magazine's "Best States for Business" list, released last week, that ranked California 50th worst in business costs and 40th worst overall when quality of life and other issues were taken into account.

Cut to the State's global warming efforts.  Today, in a joint legislative committee hearing on AB 32, California Air Resources Board Secretary Mary Nichols acknowledged that in implementing AB 32 she does not "speak for" the state’s entire economic development strategy and that the scoping plan does not at this time describe how we will outreach to existing businesses to keep them competitive in the state.    Nichols -- a well informed and well respected leader – suggested that this issue will be the focus of many agencies in the years to come.

The California-only global warming bill places the daunting responsibility of reaching both the environmental and economic goals squarely on the shoulders of CARB and  relies largely upon retaining and growing businesses here in this state, and not elsewhere.  

Global warming leaders in the State should be concerned deeply about the competitive sacrifices of California companies such as Cypress Semiconductors, Intel, 'pre-tax-incentive' Tesla Motors, Toyota, emerging solar manufacturers, and others.  Whether it's investment taxes, global warming costs, labor costs, training costs, etc., companies in California need signals that they can stay, and stay long-term, in California.

An historic frame of mind also surfaced today during Nichols' comments as she subconsciously offered a cautionary tale:  "People don't pay attention to things they don't value" said Nichols in response to a question about pricing carbon at the gas pump.   Truer words have not been spoken.  Businesses do and must value the State's bold attempt to reduce carbon.  On the flip side, regulators tasked with meeting the goals of AB 32 must value the genesis of their much coveted reductions and do everything possible to improve California's standing as one of the  most expensive places to do business.

View Dorothy Rothrock testifying on AB 32 - August 6, 2008

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