Schwarzenegger Out of Office Four Years Can Still Raise Your Gas Taxes!

Arnold, the professional fondler and the amateur governor has to be proud. Thanks to him 50,000 criminals are back on the street—and crime is rising around the State—his policies—his pride. Every new victim is his accomplishment. A few days ago, while the rest of the nation saw the price of gas going down, almost every day—with NO increase nationally since July—California, thanks to Arnold saw a ten cent or more increase in the price of gasoline a gallon. Worse, as the price goes up, so does the tax.

Oh, Arnold was smart enough NOT to call it a tax. It is part of AB 32—cap and trade. The oil companies must buy “credits” and the price of the credits then go into the price of gas—it is a tax, with the word being not used and NO voter approval needed—nor legislative approval to have an unlimited upside tax!

“The Western States Petroleum Association, a trade group representing the oil industry, says that gas prices could rise as little as 4 percent and as much as 19 percent, which, assuming $4/gallon for the price of gas, means a price impact of 16 cents to 76 cents. Those numbers are based on a 5-year-old study released by the California Air Resources Board — an analysis done before cap-and-trade actually took effect.”

Ten cents is just the start of the unlimited taxation of gas.

arnold schwarzenegger

FAQ: Is California’s fight against climate change likely to boost gas prices?

Molly Peterson, KPPC, 1/2/15 

Prices at the pump have dropped steadily in California since last summer, until the start of 2015. A new state law requiring fuel producers to cut carbon emissions may be contributing to that. FREDERIC J. BROWN/AFP/Getty Images

Gas prices have steadily dropped since early summer, but just a day into 2015, they’re ticking up slightly. The explanation may lie in a new law taking effect this year.

This year makers and distributors of gasoline must come under California’s “cap and trade” program to limit greenhouse gas pollution, and those companies are calling compliance with the law a “hidden gas tax.” Let’s look at what’s really going on.

What is “cap and trade” and what does it have to do with gasoline?

A law called AB 32 requires California to cut greenhouse gas emissions to 1990 levels by 2020 as in an effort to fight man-made climate change.

A keystone of that law is a “cap and trade” system. The idea behind it is that major polluters must obtain allowances to spew climate-changing gases into the atmosphere. Over time, the number of those allowances will drop, and companies must either reduce their emissions or buy allowances from other companies that don’t need them.

In limited circumstances, polluters can purchase “offsets” to reduce greenhouse gases somewhere else other than their operations.

The state’s cap and trade is now a couple of years old. Transportation fuel makers lobbied to defer their participation in the system, so when it began, the market included manufacturers, cement plants, and other stationary sources of pollution, as well as electricity providers and importers. It’s been almost 9 years since the law passed. Now, the time for those companies to take part is here.

What do the fuel providers think of this plan?

They’re not crazy about it. They have mounted a campaign to brand the new law as a “hidden gas tax.”

In October, details of how fuel providers have fought this plan were revealed through a leaked PowerPoint deck.  It described what some have called “astroturfing” – a practice which oil industry groups have funded what appear to be grassroots groups fighting AB-32.

These groups have paid for print, radio and television ads describing the provision now taking effect at a hidden gas tax.

The Western States Petroleum Association has maintained that it supports, generally, California’s goal of reducing greenhouse gas emissions. The group says that its problems are with regulations implementing the law not the law itself.

Are my gas prices going to go up?

Pretty much yes. AB 32 requires California to change its behavior related to emitting greenhouse gases, and those changes will cost money. Fuel providers are likely to pass their costs on to consumers. Supporters and opponents of the law are on the record saying that gas prices will go up.

The state Legislative Analyst’s Office concluded last summer that it’s likely that within 5 years, gas prices will rise 13 to 20 cents, though the LAO offered a high-end price tag of over 50 cents.

Severin Borenstein, a professor in UC Berkeley’s Haas School of Business, has predicted that the “near-term” increase will be 9 or 10 cents a gallon. Borenstein and colleagues from Berkeley and Stanford concluded in a study, funded in part by the state, that the price of carbon pollution allowances will rise slowly, and slightly at first. That cost, he says, will be passed on to consumers.

The Western States Petroleum Association, a trade group representing the oil industry, says that gas prices could rise as little as 4 percent and as much as 19 percent, which, assuming $4/gallon for the price of gas, means a price impact of 16 cents to 76 cents. Those numbers are based on a 5-year-old study released by the California Air Resources Board — an analysis done before cap-and-trade actually took effect.

Is that the whole story, that environmental laws are going to cost me money?

Not if you believe the state and environmental advocates. The Natural Resources Defense Council’s Alex Jackson argues that AB 32 will reduce overall consumer fuel costs and will save households on average $380 this year, and as much as $850 a year by 2020. They’re basing that on the idea that more fuel efficient cars will need fewer fill-ups.

How much money does the state take in from the “cap and trade” allowances, and where does it go?

At current prices, California takes in about $1.7 billion a year selling allowances to polluters participating in the “cap and trade” market.

Cap and trade proceeds are divided among several state programs. In last year’s budget, that included high-speed rail, clean energy incentives, affordable housing and sustainable communities, energy efficiency, fire prevention and urban forestry, and some drought response measures.

About Stephen Frank

Stephen Frank is the publisher and editor of California Political News and Views. He speaks all over California and appears as a guest on several radio shows each week. He has also served as a guest host on radio talk shows. He is a fulltime political consultant.


  1. Man-made climate change vs. solar hibernation climate change, as in “Dark Winter” by John L. Casey. Cold times ahead? Yes according to many scientist around the world. Obama says it’s man-made and we know what a liar he is.
    I am in great appreciation for this website…an opposing argument to main stream media.

    • That book is amazing!!! Casey’s RC theory makes so much sense but GW/CC makes no sense at all!! Everyone should read Dark Winter!!

  2. Density infill and RHNA are the basis of the irrational attempts to take your right to drive and own a car. This has been a long term definition of the Democrat’s and environmental activist.

    Going back to the 1980’s Democrat Staffers throughout the State were telling people they may not rebuild engines and / or replace engines with high performance engines. There was no State Law prohibiting this, but was part of a program from Japan to kill auto use in their largest cities. They were willing then to mislead the public just as they are now.

    Having seen the results of technology in cleaning the air, making gasoline use reasonable, they then switched to Carbon as the Scarecrow of the new century. Read the latest NOAA reports on air pollution in S. Calif. and the impacts of human carbon use and you will see they are in a panic. 4 decades of planning and excuses are now in the ash bin. Their entire power base is in peril. Hold on to that car you may need it to leave the state.

  3. The increases to transportation costs are real, and now;
    and possible ‘savings’ are in the future, and ephemeral.
    We were sold a pig-in-a-poke, and now we’re told that pork is bad for us.

  4. The public should be allowed to participate in the Cap & Trade issue. Seems the funds generated comes from selling “Blue Sky” as California has produced a number which is attached to all Businesses, Animals & People pricing the cost of Fresh Air.
    Credits are sold however No One has ever seen CREDITS.
    Juse think, the credits are a method of collecting funds to Build a High Speed Railroad from here to there.

  5. Anyone with high school knowledge of the scientific method of proof knows that the experiment to prove man made climate change does not account for other potential causes and does not have uniform data before 1951. Any analysis of the experiment is just an opinion!

    …and now the Pope wants to replace the Catholic religion with the tree hugger religion! Truly, nothing is sacred!

  6. The “credits” are just another tax on business that is passed on to consumers. How dumb can people be here? Increased gasoline and diesel fuel are going to make the cost of all goods shipped with these fuels increase and they are already expensive here. And why isn’t the industry suing the State for this? Some Democrats in Sacramento were whining that this would hurt their poor constituents, but did they take any action? This is environmental bullying at its worst! Maybe we can repeal this awful tax with a constitutional amendment via the initiative process.

  7. Social engineering takes many forms. Many times the evil plans of the socialist/communist social engineers are implemented by stupid people like our infamous ex-governator. What is that saying? Stupid is as stupid does. Yep , that fits for Arnold.

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