CA Should Apply for EU Membership: taxes and regulation in line with Europe

From the WSJ:

It may be time for California to formally apply for membership in the European Union. Its taxing, borrowing and regulatory policies are already more in line with the southern tier of Euroland than with other U.S. states, and the Golden State has taken another lurch in the Euro-direction by becoming the first jurisdiction in the nation to adopt a full-scale cap-and-trade tax to combat global warming. The new taxes and regulations will require a nearly 30% reduction in carbon emissions from power plants, manufacturers, cars and trucks by 2020.

This green tax was signed into law in 2006 by then-Governor Arnold Schwarzenegger when the state’s economy was flying high. California was going to be the green role model for other states. Now no one believes that fantasy. Ten states in the Northeast entered a regional cap and trade compact to limit greenhouse gases in 2008, but that market is now dying if not dormant and states (recently New Jersey) are dropping out.

In 2006 it also seemed plausible that the federal government would establish national carbon caps. But in 2010 the Democratic Senate killed cap and trade, and there is no chance anytime soon this tax will be implemented in Washington.

So California will go it alone on cap and trade, and the economic fallout won’t be pretty. Nearly every independent analysis agrees that water, electricity, construction and gas prices inside the state will rise. The only debate is about how much.

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