Gavin Newsom backing off on punishing Big Oil

 March 18, 2023

California Governor Gavin Newsom (D) has taken steps to lessen the sharpness of his attempts to punish Big Oil in his state, even as he claims to be doing more to combat fossil fuels. 

Newsom said on Thursday that he would hand efforts to corral Big Oil over to a watchdog arm of the California Energy Commission to monitor energy markets for evidence of price-gouging.

"We’re making major progress with the Legislature to hold Big Oil accountable for fleecing Californians at the pump," Newsom said in a statement. "With a coalition representing hundreds of organizations and local leaders backing our proposal to impose strong and effective oversight measures on oil companies, the momentum is on our side to get this done for California families."

"What we’re asking for is simple: transparency and accountability to drive the oil industry out of the shadows," he continued. "Now it’s time to choose whether to stand with California families or with Big Oil in our fight to make them play by the rules."

Changing "tax" to penalty

The action is actually a paring back of efforts that started in December to punish energy companies for perceived price gouging.

In addition, it could end up indefinitely delaying a price-gouging penalty that has been in the works.

He already changed the proposed penalty from a "windfall tax" to just a penalty because of pushback from Republicans in the state assembly.

"Enacting SBX1-2 is not in the best interests of the consumer, will not reduce retail pump prices and is not in the best long-term economic interests of California," Professor Michael Mische at the University of Southern California Marshall School of Business, said during a hearing last month. "There are better alternatives."

Hurting consumers

The main problem with what Newsom wants to do is that it will raise prices for consumers even more, and some producers may just exit the state.

"Enacting it will reduce supply, force out producers and reduce employment in a high-paying sector," Mische added.

The move goes along with a trend by leaders to delegate their authority to "independent" third parties that eventually end up being a permanent bureaucracy vested with power that should belong to the legislature or executive branch.

This kind of delegation allows leaders to escape responsibility when their initiatives don't go right, but claim credit for what does go right because they delegated the authority.

Cowardly move

It's a cowardly move, but that's no surprise to those familiar with Newsom.

Lawmakers on both sides of the political do the same thing on the federal level, which has allowed the "deep state" to gain power at the federal level that it should not have according to the Constitution.

" A free people [claim] their rights, as derived from the laws of nature."
Thomas Jefferson
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