How Big Oil wins in green California


In summary

Two-thirds of the bills opposed by the oil industry this year were killed, thanks in part to an alliance with the building trades union, forcing Democrats to sometimes choose between jobs and the environment.

Sen. Lena Gonzalez represents an industrial district that includes Long Beach, where poor neighborhoods suffer from pollution. She has a 100% rating from environmental groups that praise her for taking on the Big Oil lobby in Sacramento.

It was surprising for her, though, when the state’s powerful building and construction trades unions allied this year with the oil lobby to kill three of her bills aimed in part at protecting the health of vulnerable communities.

“A lot of folks said to me, ‘Sorry, but I made my promise to the building trades that I wouldn’t vote for another environmental bill,’ ” Gonzalez said. “And so straight out of the horse’s mouth, that’s what I had gotten, which was really, really hard to hear.”

The dirty little secret about green California, a global leader on climate policies, is that Big Oil still wins a lot of its political fights.

Its trade association, the Western States Petroleum Association, and Chevron Corp. spent a combined $15.3 million on lobbying this year, more than any other lobby groups. The oil industry as a whole also donated more than $427,000 to legislators’ campaigns this year and more than $3.5 million to legislative candidates since 2019. 

But it’s oil’s alliance with the powerful State Building and Construction Trades Council of California that often makes the biggest difference, forcing the Democratic supermajority to choose between the environment and oil industry jobs. The building and construction trade unions also have long bankrolled California’s labor-friendly Democrats. So far, the council has donated at least $157,000 to the campaigns of California’s legislators this year and more than $1.9 million to legislative campaigns since 2019. 

“In California, our best (environmental) bills are being blocked by the oil industry using the building trades as ventriloquist dummies,” said RL Miller, a Democratic activist and environmental advocate at Climate Hawks Vote.

Of at least 21 bills the oil and gas industry opposed this year, Gov. Gavin Newsom signed only seven. Half of the bills the oil industry opposed also faced opposition from the building trades union, according to interviews and a CalMatters analysis of legislative testimony and written opposition to bills.

Catherine Reheis-Boyd, president of the Western States Petroleum Association, said the stalled bills reflect Democrats questioning how a transition to green energy will play out in practice. Moving too quickly would kill tens of thousands of good-paying jobs, harm California’s already fragile energy grid and could lead to a repeat of the 1970s fuel crisis that saw massive lines at gas stations as the economy tanked, she said.

“That’s why I think these questions are coming up now,” she said, “because people (in the Legislature) are beginning to go, ‘OK. Wait a minute. How is this really going to work?’ ” 

This year’s biggest battle

There has long been tension between California’s reputation for environmentalism and its role as the nation’s seventh-largest oil producer and the third-largest refiner of crude oil. California is also one of the top consumers of gasoline on the planet, even with a special blend of gas that requires a more expensive refining process.

That tension erupted into a war last year under the Newsom administration, which adopted policies to ban sales of new gas-powered cars by 2035 and go carbon neutral by 2045, with a goal of dropping gas consumption by 94%.

The biggest battle was fought early this year after gas prices spiked to record levels and Newsom demanded a windfall tax on oil company profits.

“Nothing justifies these outrageous and unconscionable prices,” Newsom said in October 2022 as he called a special session of the Legislature. “This is just price gouging. They can’t get away with it. They’re fleecing you. They’re taking advantage of you, every single one, every single day. Hundreds of millions of dollars a week they’re putting in their pockets.”

Meanwhile, the governor hinted at the power of the oil lobby in California when he said that many of his fellow Democrats are “wholly-owned subsidiaries of the fossil fuel industry.” 

The Inglewood Oil Field on March 9, 2020. Photo by Lionel Hahn, ABACA Press via Reuters

In the end, Newsom claimed victory for the bill that Democrats passed during the special session. “We proved we can actually beat Big Oil,” Newsom said in March during a ceremony under the state Capitol rotunda.

But the law was significantly watered down amid opposition from the trades unions and the oil industry. In the end, it called for a new watchdog division of the California Energy Commission to monitor prices and possibly apply penalties. But it could take years to develop the rules determining unfair profits. 

Even with the modified law, the oil industry and the building trades council made a last-minute attempt to dilute it even more. 

They turned to Sen. Steven Bradford, the Democratic chair of the Senate Energy, Utilities and Communications committee, whose Southern California district includes three oil refineries. Bradford’s campaigns received $687,600 from the trades unions and at least $155,969 from the oil and gas industry since 2006, according to a CalMatters analysis of data collected by Open Secrets, a non-profit group that tracks campaign donations. 

Environmental advocates in 2022 ranked him in the bottom fourth of California’s Democratic senators. As the special session on gas prices was gearing up, Bradford reminded his colleagues that they “must be strong advocates for every Californian who still needs reliable and affordable gasoline,” and he urged them to tread carefully and “not make the situation worse.” 

Just days before the Legislature went into its fall recess, Bradford used the secretive process known as “gut and amend” to turn a bill on homelessness into legislation that required the energy department’s new division to consult with the Department of Industrial Relations, oil industry stakeholders and labor groups “to avoid any adverse impacts to the safety of employees and surrounding communities, labor and equipment availability, other market impacts, and cost.” 

Newsom vetoed Senate Bill 842, but not before it passed unanimously out of the state Assembly. Only six senators voted against it, including Calabasas Democrat Henry Stern. He told his colleagues on the Senate floor that “creative lawyers” could exploit bill language that seemed counter to the goal of the oil profits bill. 

“The point of our oil price-gouging regulations is to have market impacts, is to stop the market from being manipulated,” he said.

In an interview with CalMatters, Bradford said the Legislature lacks the expertise to understand the consequences of its regulations, risking the kind of cost and supply crisis that caused blackouts statewide when the electric power industry was deregulated in 1996.

“The same thing is going to happen with the gas industry,” said Bradford, a former public affairs manager for Southern California Edison. “We don’t have experts in this industry … And that’s what my bill was about. Simply making sure that those experts who do this job on a daily basis had a voice in and consulted with the commission.”

State Sen. Steven Bradford, a Gardena Democrat, listens to testimony during a hearing on Gov. Gavin Newsom’s proposal for a windfall profits penalty on oil refiners, at the state Capitol in Sacramento on Feb. 22, 2023. Photo by Rahul Lal, CalMatters

Bradford at first didn’t deny the bill’s intent was to slow down the regulation.  

“There’s some truth to that,” he said, though he later clarified, “We just want to do it right. And that’s all we were doing. Not necessarily slow it down.” 

Bradford insists he had the blessing of his Democratic colleagues and the Newsom administration to push the bill through to ensure the safety of workers and communities next to refineries.

“You don’t do a gut-and-amend at the last minute without signoff,” he said.

Newsom’s office declined to comment for this story.

The alliance plays hardball

The politics of the oil profits bill also seemed to impact another oil-friendly legislator, Assemblymember Jasmeet Bains. Bains, a family doctor, was elected in 2022 to a Kern County district that is home to much of California’s oil production. She was the lone Democrat to vote against Newsom’s watered-down oil profits bill.

“Stand alone if you must, but always stand for the truth,” Bains wrote on Twitter after the vote. “As the lone Democrat to oppose the new gas tax, I will never throw my constituents under the bus. I will continue to fight for lower gas prices and a stronger Kern County.”

Newsom’s chief of staff, Dana Williamson, tweeted back, “Alone and confused you shall likely remain.”

Soon afterward, then-Assembly Speaker Anthony Rendon temporarily removed Bains from her assignment on the Business and Professions Committee for siding with Republicans on a procedural vote during the special session.

She may have irked her Democratic colleagues, but sticking up for oil jobs benefited her reelection campaign. The building trades council has since donated $21,800 to her campaign. A spokesperson declined to comment. 

The trades council also has been known to punish lawmakers who go too green. One example was when the trades council aggressively targeted former Democratic Assemblymember Cristina Garcia for pushing to include pollution protections for vulnerable communities in California’s cap-and-trade program. The unions opened a campaign account to fundraise for her opponents, and they took out newspaper and television ads attacking her.

“Garcia has been targeting our workers and our jobs,” then-council president Robbie Hunter told its members in a bulletin shared by Garcia’s campaign team. “We in the Building Trades will vigorously oppose her.”

Garcia, who won reelection anyway, declined to discuss the conflict on the record.

Learn more about legislators mentioned in this story

State Senate, District 33 (Long Beach)

State Senate, District 33 (Long Beach)

How she voted 2021-2022

Liberal
Conservative

District 33 Demographics

Race/Ethnicity

Latino

65%

White



This article was originally published by a calmatters.org . Read the Original article here. .