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Let California Lead: the Green Economy and Lessons from 1990's Zero Emissions Vehicle Mandate

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California has always represented a better future, and we seem more impatient to get there than anyone else. The examples are endless: the settlers risking everything to reinvent themselves on California's fertile soil, the surfers who decided they'd rather surf the streets on skateboards than wait for waves, to the dotcom boom that created the internet age. When California is ready to lead, it's best if you get out of the way. Because when California leads, it often benefits the entire country -- and sometimes the world.

And California is ready to do it again, with a plan to guide America to a greener, cleaner, more sustainable future, and pull the nation out of the worst recession since the Great Depression. That plan is AB 32 (aka the Global Warming Solutions Act), California's nation-leading initiative to reduce greenhouse gas emissions (GHGE) to 1990 levels through a mix of energy efficiency, clean/sustainable energy investment and regulations to force California's polluters to clean up their own messes. In addition to improving the environment and the health of Californians, study after study show that AB 32 will be a major job creator with little or no impact on small businesses. That's why over 2,400 large and small businesses, many in California, have joined American Businesses for Clean Energy, a diverse coalition calling on Congress to pass clean energy and climate legislation. And with the green/clean economy creating job growth and venture capital investment at a faster rate than the rest of the economy, California could position itself to lead the nation and the world in exportable green technology and solutions, just as it has with computers, software and the internet.

But this is not the first time California has attempted to lead the nation with a pioneering piece of legislation to reduce GHGE. In 1990, the California Air Resources Board (CARB) passed the Zero Emissions Vehicle (ZEV) Mandate. It stated that any large automaker selling cars in California would have to derive at least 10% of its overall sales from cars that produce practically zero emissions -- with 2% of the cars producing no emissions at all -- by 2003. That meant that unless an automaker wanted to lose the huge California car market, they would have to begin making all-electric vehicles.

A great cry went up from defenders of the status quo -- eerily similar to what is happening now with AB 32 -- predicting economic doom if the legislation was enacted. "Electric cars with broad consumer appeal are an idea whose time has come and gone, much like eight-track tapes, Betamax, and New Coke," said Jo Cooper, president of a major auto industry lobbying group. "It's not that we can't [build electric cars]. It's that we don't think it's the right thing to do. In financial terms, it's insane," said Donn Walker, a regional spokesman for General Motors, adding, "The internal combustion engine is here to stay. It's what customers want." Automakers warned that plants would shut down, jobs would be lost and businesses would flee the state. Many claimed that it would be pointless for a single state (albeit the world's 8th largest economy) to take such an ambitious step on its own -- all claims currently being made about AB 32.

While automakers and lobbyists filed lawsuits to derail the mandate, they also quietly prepared to comply with it should their efforts fail. And in the case of General Motors, they succeeded in creating a great electric car called the EV1, which was leased to a few hundred lucky Californians (including celebrities like Tom Hanks and Mel Gibson) who quickly fell in love with it. Because of California's leadership, it seemed like the automotive future had finally arrived and America could begin the long farewell to smog, dependence on foreign oil and one of the major contributors to global warming.

Then George W. Bush was elected, with an administration full of former oil executives, as well as Andrew Card, the former CEO of the American Automobile Manufacturers Association and GM's VP of government relations, as chief of staff. The ZEV mandate was killed and GM took back and destroyed every EV1, despite the leasees' offer to purchase them. This sad tale of potential lost is told in the excellent, must-see documentary Who Killed the Electric Car? See my ReThink Review of WKTEC? below and my post about it here.

California was denied the opportunity to lead the nation into a new generation of auto fuel efficiency. And look what happened.

The auto industry went in the opposite direction, creating gas-guzzling SUVs that actually decreased America's overall fuel efficiency. Our dependence on foreign oil increased, enriching countries like Saudi Arabia (home of Osama bin Laden and nearly all of the 9/11 hijackers), as well as Iran and Venezuela, handing them hundreds of billions as we fruitlessly rattled our sabers at them. Stratospheric spikes in oil prices coupled with the Bush recession left many SUV drivers unable to even fill their tanks, causing demand for gas guzzlers to seemingly evaporate overnight. With hundreds of thousands of SUVs left on their lots and few fuel-efficient or hybrid cars on their rosters, GM and other American carmakers were decimated, declaring bankruptcy, closing dozens of plants, laying off tens of thousands of workers and shuttering or selling off several of their brands. In the meantime, Toyota, which continued their investments in fuel efficiency with hybrid cars like the Prius, became the world's number one carmaker for the first time in 77 years. Nissan's electric car, the Leaf, will be onsale in December 2010. This week, GM announced it would stop making Hummers, the worst gas guzzler and an "automotive pariah", forever.

If California had been allowed to lead with the ZEV mandate, America could have been selling electric cars in the late 1990s instead of fumbling to get their half-baked hybrids and electric concept cars into showrooms as they are now. GM's electric vehicles and the pioneering technology they were based on would be sold around the world, saving and creating thousands of jobs in the US while reducing pollution from tailpipe emissions.

AB 32 has the same potential, if not more, as the ZEV mandate. And despite high unemployment and economic uncertainty that would seem to breed timidity, Californians are still prepared to lead, and are, in fact, proud of their reputation for doing so. In a recent poll by Tulchin Research, 79% of Californians said they are proud of the state's leadership in innovation and technology, with a staggering 96% seeing it as an essential part of the state's economy and 66% feeling strongly that policymakers should boost the tech sector and encourage innovation to strengthen the state's economy.

California is ready to lead. It's in our DNA. Don't listen to the scaremongers defending the status quo, who have been so disastrously wrong in the past. Just let us do it.

(with research by Sarah Phillips)

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