Crap and Trade

“The fatal attraction of government is that it allows busybodies to impose decisions on others without paying any price themselves. That enables them to act as if there were no price, even when there are ruinous prices - paid by others.”
― Thomas Sowell

The Global Warming Solutions Act of 2006, signed into law by California Governor Arnold Schwarzenegger, in part established the state’s Cap and Trade Program. The idea was to create a “market-based regulatory system” with the goal of reducing greenhouse gas emissions by setting an cap on said emissions from sectors of the state economy deemed to be contributors. These businesses could then trade their emissions allocations with other businesses. The program was to be administered by CARB, the state’s notoriously politicized and ideologically captured busybody supposedly responsible for the state’s air quality. In other words, it’s a glorified indulgence system run by the corrupt Church of Carbon. CARB themselves auction off the indulgences which they, like a nagging parent, call allowances.

The program didn’t start until 2013 and the law initially required the state’s GHG emissions to return to 1990 levels by the year 2020. Surprisingly, at least according to the ways they measured carbon emissions, this goal was achieved four years early, in 2016 ironically in large part due to replacing coal-fired generation with natural gas generation and of course with some clever accounting such as not counting energy imports.

This cap was later changed to 40% of 1990 emissions by 2030 with full “carbon-neutrality” by 2045. Originally too, the indulgence payers were limited to power plants and other large industrial facilities that emitted more than 25,000 metric tons of CO₂ equivalent annually. In 2015, the program was expanded further to cover distributers of transportation fuels such as gasoline, diesel, and natural gas.

But where exactly do these indulgences go?

They all go into a fund called the Greenhouse Gas Reduction Fund (GGRF). GGRF monies fund a variety of projects including the state’s electric vehicle rebates, various “green” subsidies, dangerous “protected” bicycle lanes, and so-called equity projects to name a few. It’s been rife with special favors and cronyism from the start.

The hilarious irony is that when carbon emissions went down during the 2020 COVID lockdowns and economic slowdown, the fund temporarily ran out of money. When a few of the state’s lawmakers discovered this bug, they demanded changes be made to keep the money flowing, particularly by lowering the number of indulgences sold. “The legislature, the nonprofits, the activists now need to figure out how to take advantage of this opportunity,” said one of the Assemblywomen. At least she was honest.

Here’s a snapshot courtesy of Mike Umbro of what they wanted to do with the money for the 2024-2025 budget cycle.

Umbro was kind enough to do the math too:

$912 million for High-speed rail to nowhere.

$362 million total for fire related activities.....

7% of the spend for fire prevention.

18% of the budget for a phony rail boondoggle.

It doesn’t take a genius to understand these costs were naturally passed down onto the end customers and is a part of the state’s excessive energy costs from fuel for automobiles and trucks to natural gas used for electricity or home heating and cooking.

It also doesn’t take a genius to realize there is a massive misallocation of funds in this program mainly to fund pet projects and grift.