Self-Serving Prop. 10 Sounds Good, Should Lose

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It’s never hard to find self-serving propositions on the California ballot. But there has never been anything quite like this fall’s Proposition 10, even in a state that has seen the tobacco industry run initiatives aiming to kill municipal restrictions on smoking and watched power companies put hundreds of millions of dollars behind measures they figured would bring them tens of billions.

The current Proposition 10 has been paid for almost entirely by one Texas company, aiming to benefit that single company more than any other. The firm is called Clean Energy Fuels Corp. It was formerly known as Pickens Fuel Corp. That’s Pickens, as in T. Boone Pickens, the billionaire Republican Texas oilman and investor who largely funded the scurrilous Swift Boat ads that many believe killed the 2004 presidential candidacy of multiple military medal-winner John Kerry, a Democrat once considered a war hero.

Pickens’ company spent just over $1.5 million qualifying Proposition 10 for a November vote. It’s anyone’s guess how much more he will spend this fall. Because it wasn’t part of a specific election campaign, it’s also hard to ascertain how many more millions he put into related television commercials aired during the major party political conventions.

The measure he’s backing sounds properly pious. It calls for issuing $5 billion in bonds, with 58 percent of the money going to buyers of high fuel economy and alternative fuel cars and trucks in payments between $2,000 and $50,000 each. That’s right: There are subsidies of up to $50,000 for buyers of the "correct" vehicles.

That’s a lot better than the tax credits and carpool lane stickers which made buying Toyota Prius and Honda Civic hybrid models more attractive in those popular cars’ early years.

Proposition 10 also provides about $1 billion for research, development, and production of renewable energy technology, plus grants to cities and colleges that push alternative energy technologies and research.

It all sounds high-minded and good. And it could work out that way. But it would also make Pickens’ company far richer than it is today, and there’s nothing in the measure to make sure any money invested by California taxpayers would stay in California.

Pickens’ company develops both wind energy farms and compressed natural gas (CNG). He calls the wind-battered thousand miles stretching from North Dakota through the Texas Panhandle the "Saudi Arabia" of wind energy. He’d like to develop huge windmill farms in that flat region, with their energy output replacing electric power now produced in natural gas-fueled generating stations. The natural gas freed up would them go to cars, which Pickens argues can be quickly converted to run on CNG.

It’s an interesting idea and one that has some promise for weaning this nation from a lot of its foreign oil dependency.

But for California taxpayers to subsidize it via a big bond issue makes no sense. For one thing, every tankful of CNG pumped into a car would help make Pickens’ company richer.

That firm already serves CNG customers like the major airports of Denver, Los Angeles, Dallas, and Phoenix, which run buses and other vehicles on Clean Energy Fuels Corp. supplies. City bus companies in San Diego, Sacramento, Denver, and Ft. Worth are also customers.

But all this emphasis on CNG could put a big crimp in development of hydrogen-powered cars, for which an endless supply of gas exists in the very air we breathe and which produce only water as an exhaust emission.

Then there’s the fact that buyers of alternate-fuel vehicles (mostly CNG-modified cars) would not have to prove they are California residents. In short, anyone could come to California, buy a politically correct car or truck, and then go home to some other place with lots of California tax dollars. Terms of the initiative make it plain that CNG cars would be the main ones qualifying for the subsidies, with most bio-fueled vehicles and gas-electric hybrids not meeting all its requirements. Among existing models, only the Prius would qualify, concluded an analysis by the Consumer Watchdog advocacy group, formerly known as the Foundation for Taxpayer and Consumer Rights.

While Proposition 10 might help reduce dependence on foreign oil, its environmental benefits would be limited because CNG produces far more greenhouse gases than current hybrids or prospective hydrogen models.

About the only thing you can be certain of with this measure is that purveyors of CNG will make money. And Pickens’ firm is among the largest of these.

Which makes Proposition 10 as self-serving a measure as California has ever seen, and one that deserves defeat – even before mentioning the impact of $5 billion more in bond obligations on an already-strapped state budget.

Consumer Watchdog
Consumer Watchdog
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

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