Viewing blog posts written by Ashley Hong

California's environmental litigation is a job killer

Posted by Ashley Hong, Policy Intern on Nov. 23, 2011

For those who doubt that litigation risk in California is a job killer, I recommend that you read a November 14 piece in the Los Angeles Times, “Firms turning to environmental law to combat rivals.”

This blog will serve as my public letter to the editor.  The one I sent was not placed.

Here's a portion of the article:

Environmental advocates say the focus on why groups use CEQA is misplaced. "You shouldn't really be looking at motivations of petitioners," said Doug Carstens, an environmental lawyer in Santa Monica who often files CEQA complaints. "Even if it's a solely economically motivated actor, if they're promoting transparency, good government, why not?"


It’s shameful that a California lawyer endorses the idea that lawsuits to enforce environmental laws can be “solely economically motivated.”  The impact of this goes way beyond the sheer number of lawsuits and the size of awards and settlements - Companies spend uncounted millions to protect themselves against such litigation, with no environmental benefit. These are dollars that could be spent on expansions, modernization, and innovation to create new jobs.

The evidence is in – we are losing investment and employment to other states that are not hindering employers with costly litigation. Data from Site Selection Magazine shows that California is among the worst in the country in new manufacturing facilities and expansions, averaging only two percent of the country's new growth in the last decade.  

Further, a recent study, commissioned by City Journal, used the National Establishment Time Series database to reveal the scope of California's problems -- "snuffed-out start-ups, unproductive big cities, poorer jobs, and tinier, weaker, or fleeing companies."  One key statistic from the study: California had a net loss of 260,000 jobs from start-ups and closures in the last decade.  In the 90's, we had a net gain of 776,000.


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Lt. Gov.'s economic development plan is bold & broad -- now make every job count with action

Posted by Gino DiCaro, VP, Communications on July 29, 2011

Today Lt. Gov. Gavin Newsom released a California economic development and job growth plan as his first major policy move since he was elected.

Congratulations are in order for Newsom and his report. He is showing he is serious about growing our job base by making the state attractive to manufacturing and other high wage sectors.

California's economy needs large scale job creation in every sector.  Our state must catch up and once again outpace the country's economic growth. This will require aggressive action not seen in California for over a decade. It will also depend on developing the state's existing job base and employers as a means to California's expansion. In the past, Newsom has said many times, that "95 percent of growth is organic," meaning it's easier to grow an existing California company than start a new one.  We could not agree more.

For the past few years, economic development in California has comprised of picking and providing for one winning sector, but consequentially leaving many other losers, often times existing industries, such as manufacturing and other sectors. Every job should count in California.

While the politically challenged task of growing the state's economy is immense, the essentials that any employer needs for growth are simple: predictable costs, competitive costs, adequate infrastructure, access to skilled workers and regulatory certainty.

The California manufacturing community -- and it's 1.2 million strong job base -- is anxious to work with Lt. Gov. Newsom and Governor Brown to restart California's economic engine.


Download Newsom's Economic Growth and Competitiveness Report

Download CMTA's vision document

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California should lead in all jobs, not just two percent of them

Posted by Gino DiCaro, VP, Communications on July 19, 2011

During a recent California Energy Commission proceeding on our clean energy goals, it was recommended that job creation be included as a metric for measuring the success of clean energy policies. This will only be meaningful if we count all the jobs that will be lost as a result of a policy. Therefore our job creation goal, and the metric to measure it, should only count net new jobs.

This prompted us to look at the Brookings Institution's recently released report on green jobs -- Sizing the Clean Economy. The report stated that California leads the country in the "green" sector, boasting 332,000 jobs.  To put things in perspective, that number accounts for only two percent of the state's entire job base and about one job for every 115 people. Further it doesn't make up for the state's overall jobs loss, nor does it make up for the state's high wage job losses.

Green job definitions vary widely, depending on who sets the criteria.  For instance, the Brookings report maintains that public mass transit operators are in fact "green".  Even with the broadest definitions, the green economy on its own will not catapult California into its next great economic boom.  The emerging green sector is an important part of California’s overall economy, but will only grow and succeed if California’s investment climate is competitive with other states and nations.

California can’t count on large scale job growth without a predictable and competitive environment for a diverse range of investors and employers.   "Green" mandates and subsidies increase costs and force reduced output on existing employers, making other parts of our economy inefficient and less competitive.  That's a tough pill for existing employer groups to swallow when the goal of their sacrifice is to force feed a two percent sector of the workforce that can’t survive without ongoing incentives and subsidies.

We compared some of California's high wage sector employment statistics to the new green jobs numbers.  Basically we found that our green jobs do not net out our losses.  Here's how the numbers broke down (Click image for larger pdf):


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NPR interview masks an engaged business community

Posted by Gino DiCaro, VP, Communications on June 10, 2011

On Friday, NPR's California affiliate, Capitol Public Radio, interviewed Jack Robinson, an editor from the Sacramento Business Journal, regarding California's budget situation. 

Robinson was asked if he knew of any bills that California businesses supported in the state Legislature.  Robinson responded with one, AB 333, a bill to delay the implementation of a costly cap-and-trade carbon program.  While very important and sensible legislation, this bill is surrounded by hyperbole that generates visceral responses among the electorate.  Basically it sells.  Not one other common sense bill was mentioned.

We don't fault Robinson or NPR.  Radio interviews are short and we don't expect Robinson to be able to regurgitate the entire California business agenda on the fly.  But the result of this interview with most listeners will be: California business is uninterested in the common good because it doesn't support sensible legislation, and it only works to defeat any bill with a cost.

This is exactly the reason California has ranked dead last for seven straight years among CEO's for places to grow a business, and now ranks among the worst in new manufacturing growth.  Employers are presented as irrational obstructionists.  This makes it easy to pass costly legislation without any cost benefit analysis, creating an unpredictable and uncompetitive place to invest in new growth.

California's Capitol processes approximately 2,000 bills every legislative session.   The only reason the average voter hears about "job-killers" so much is because the rational, often much less exciting bills that employers support barely ever make it past the first committee hearing.   Try calling a reporter on a regulatory process reform bill in its first hearing.  Crickets.

For example there were 20 sensible business-supported regulatory process reform bills that all died quickly over the past two years (to name a few: SB 400, SB 396, SB 560, SB 688, SB 14, AB 535 in 2011 and you'll find a bunch in this document supported by more than 375 companies in 2010).   These were simple bills that, in a nutshell, only asked for more information and cost-benefit analysis on regulations.  How is it possible that these aren't getting any traction, especially with the regulatory awakening across the country?

With high costs and unpredictability in California, businesses are fighting even more for good legislation that helps our economy grow.  The problem is, most of those bills are boring, not the type of stuff that gets you to turn up your radio.  The California media needs to make sure employers are represented for what they are: partners in a better, more employed California.


*** CORRECTION:  Previously, this blog stated that "NPR's Morning Edition" -- a series on NPR's national network -- aired the interview.  It was not.  It was NPR's California affiliate Capitol Public Radio that conducted and aired the piece. 

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California is, and has been, carbon efficient

Posted by Gino DiCaro, VP, Communications on May 13, 2011

We updated our numbers this week for California greenhouse gas emissions per capita versus the rest of the country.  Looks like California is, and has been for a long time, much more efficient than other states.


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