Prop 23 and the Green Jobs Myth

Californians could protect a million or so jobs by overturning the state's self-imposed carbon dioxide limits

By T.J. RODGERS     WSJ.COM



I have an indelible memory of the one time I was on Rodeo Drive. There she was, a rotund matron dressed in a pink sequined jumpsuit, exiting a limousine and handing her three toy poodles to the doorman at an upscale shop specializing in $1,000 purses. It's a perfect metaphor for California's economy: We ignore the important, focus on the trivial, and spend way too much money in the process.



While our state government frets over issues like the disclosure of trans fat on restaurant menus and the habitat of the red-legged frog, our economy—the habitat of homo sapiens—is a disaster. Jobs and the companies that produce them are being pushed out of the state by excessive taxes and regulations. We have borrowed to the limit and at times have been forced to pay state employees and vendors with vouchers until more cash could be secured.



California, which once plowed through recessions, now has 12.4% unemployment, third worst in the nation. CEOs surveyed nationally by Chief Executive magazine recently rated California the worst state for business, for the fifth consecutive year. My company, Cypress Semiconductor, has recently stepped up its contributions of food and money—and even donated an extra warehouse building—so that San Jose's Second Harvest Food Bank can feed the swelling number of hungry people in Silicon Valley.



Californians have voted to avert economic disaster before. In 1967, we elected Ronald Reagan as governor. After improving our economy, he led the nation out of Carternomics. Then in 1978, we passed Proposition 13, which still limits property taxes to 1% of assessed value, a lifesaver today as our rapacious state government scrounges for revenue rather than cuts spending.



In a few days, we Californians have another chance to restore our competitiveness. We can elect as governor Meg Whitman, former eBay CEO, to make the structural changes necessary to stem the flow of jobs out of California. Or we can elect Jerry Brown, a recycled governor who took interim jobs as state attorney general and mayor of Oakland, where, under his administration, the public schools were taken over by the state for gross mismanagement. For U.S. senator we can elect either Barbara Boxer, another business-hostile veteran politician, or former Hewlett-Packard CEO Carly Fiorina, who understands the economic problems we face.



Most importantly, Californians have an opportunity to vote for Proposition 23, which will prevent implementation of the California law known as AB32. AB32 is yet another tax, this one on carbon dioxide, the substance that we exhale about 50,000 times per day, that comes from our cars when we drive to work, and from our Silicon Valley plants as we use power for our computers and air-conditioning. Pushed by dogmatic green politicians, the tax would put another burden on California companies that our Chinese and Korean competitors will not have to bear.



The basic premise of AB32 fails a grade-school math test. The latest EPA figures show that total U.S. carbon dioxide emissions in 2007 were 5.98 gigatons, of which California contributed 0.40 gigatons. If California had held its carbon dioxide emissions to its 1990 level of 0.36 gigatons, as AB32 mandates by 2020, the 2007 U.S. carbon dioxide emission figure would have been 5.94 gigatons, rather than 5.98 gigatons. For this our state government has chosen to terminate the jobs of 1.1 million Californians (the impact estimated by the California Small Business Roundtable) on top of existing unemployment.



I know firsthand about green jobs. SunPower Corp., a company I chair and the second-largest U.S. producer of solar cells, has produced about 800 green jobs in California. But that's just a fraction of the 4,700 jobs lost when Toyota pulled the plug on its local Nummi automotive plant due to the high cost of doing business in California.



This is a common unintended consequence of so-called green economies. For example, a recent study by Rey Juan Carlos University in Madrid showed that for every green job created in Spain, 2.2 jobs were lost at large. A similar Italian study showed an even worse result. Green jobs, because of the subsidies and regulations that surround them, are often overall economic losers. And there is no guarantee that new green jobs will even be domestic.



When Cypress acquired the 18-year-old, money-losing SunPower Corp. in 2003, I planned to make the company viable by shutting down its high-cost California solar cell factory and moving its manufacturing to the Philippines. One could say that I eventually exported 4,000 green jobs. Yet it's more accurate to say that SunPower created about 800 new American jobs that would not have existed without its offshore manufacturing capability.



After building its first and second manufacturing plants in the Philippines, SunPower chose to build its third in Malaysia. We never considered a California site due to high cost and red tape.



On Nov. 2, by supporting Prop. 23, Californians can prevent another job-killing tax.



Mr. Rodgers is the founder and CEO of Cypress Semiconductor.