Delaying Actions on State Climate Change Regulations Would Undermine California's Small Businesses
Scott
Hauge
President
Small Business California
It is interesting, as a small businessman, to watch large industry weigh in on my behalf. Over the past several months, claiming to act in the best interests of small business, big business has actively lobbied to delay action on climate change. Implementing California’s Clean Energy and Climate Security Plan, they exclaim, will hit small businesses hardest. Their evidence? Projected economic impacts based on assumptions like there will be no future clean technology innovation. Unfortunately, you can find any economic projection to meet your special interest need if you pay enough. As a businessman, I cannot balance my budgets with models. Instead, I look to historical data to inform my view of the current debate.
In California, there is no shortage of real data on the financial ramifications of reducing greenhouse gas emissions. Over the last thirty-five years, California has been moving deliberately – through policy -- away from a fossil fuel intensive high-energy use economy. As our state has become cleaner and more efficient, we have saved money and grown the economy – to the tune of 1.5 million jobs with a total payroll of over $45 billion, a UC report documented. How? Because energy waste is expensive –- to business and consumers. It is literally like burning money. Precedent setting appliance and building standards in California, which the federal government eventually copied, have saved consumers and businesses over $56 billion, the equivalent of $1000 per household. Consumer spending represents over 70 percent of our Gross State Product (GSP). When consumers have more money in their pockets, they spend it inside our economy buying products from small businesses like mine.
How have these clean energy policies affected small businesses in California? They have protected us from volatile fossil fuel prices, empowered us to become more efficient and increased our energy productivity. We now use less energy to produce more – what is not to like? Reducing greenhouse gas emissions reduces overall waste, lowers business costs and bolsters bottom lines. Small businesses that streamline their operating costs will always perform better than less efficient firms – so smart business advocates should be fighting for not against clean energy policy.
We all know that no policy is perfect, but delaying action on AB 32, or worse, doing nothing, would only undermine the strength of the California small businesses vital to our state economy. It is not simply hyperbole when I say that small business is vital to our state’s economy. Small business is the workhorse of California’s economy, representing 60 percent of the private sector workforce—more than 8 million people either work for or own a small business in California. On the national level, small businesses have generated 60 to 80 percent of new jobs annually in the past decade. What is good for small businesses in California is good for our economy. Increasing energy efficiency, reducing waste, and spending less to support inefficiencies are all good for small business—period.
Over the last thirty-five years the same old tired opponents have made the same old tired arguments to attempt to delay or derail these forward thinking clean energy policies. And they are at it again. Over the years they have made the assumption that California – the land of innovation – would not innovate. And, like Chicken Little, they have claimed the sky would fall with each new clean energy policy. Detroit has sounded the same note for the past 30 years, and now, when forced to make more fuel-efficient cars, they all acknowledge they can meet higher standards with little effort.
There is a reason the oil and gas industry is spending billions of dollars to stir up fear and ignorance about higher standards requiring cleaner energy. These policies will force dirty old fossil fuel industries to pay for their pollution, change the way they do business, and protect the consumer while they are doing it.
We are in the midst of the deepest financial hole our state or nation has ever experienced but those who say now is not the time to act do not understand the urgency or the opportunity. New technologies and markets have always been an economic engine for California. Clean technology is an emerging multibillion-dollar global industry – it has the potential to jumpstart California’s economy. Indeed, it is already making a difference. While jobs creation in the rest of our economy was flat, clean energy jobs grew at a rapid clip. New analysis by the Pew Charitable Trusts reveals that by 2007, more than 10,000 businesses in California had generated more than 125,390 jobs in the clean energy economy.
California’s leadership in the inevitable reckoning over carbon emissions will grow our competitive advantage over other state and global economies. New investment and new markets mean opportunity for small businesses – the backbone of our state economy. That position of strength is key to generating the jobs, pumping dollars into our local economies and keeping the engines of our small business communities humming. Failure to act swiftly and decisively would prompt unacceptable costs for small businesses in the future.
Scott Hauge, a small business owner, is founder and president of Small Business California, an organization representing over 4,000 businesses. He was named Small Business Advocate of the Year 2007 by the National Small Business Association (NSBA).