California Manufacturers and Technology Association Archives - Shopfloor

California v. Texas: Jobs Leave High-Cost Locations

By | Economy, Regulations, Technology | No Comments

Writing at RealClearMarkets, Steven Malanga of the Manhattan Institute examines the consequences of government regulations and policies in California that have made the state a high-cost place to do business. Malanga pegs the column to a recent visit to Texas by California state legislators and Lt. Gov. Gavin Newsom to investigate how the Lone Star State has done so much better in job creation than the Golden State.

One theme is obvious and persistent when you peruse dozens of stories on California companies that have pulled up stakes in the past few years: Many are going somewhere else to lower costs, whether it’s a shipping company moving HQ jobs from Oakland to Phoenix, or a software maker leaving North Hollywood for Austin, or a visual effects studio leaving Venice, Ca., for Port St. Lucie and Vancouver.

Some firms also say they are leaving because California’s state and local budget crunch has made government voracious. LegalZoom, the online company, is leaving Los Angeles for Austin because of a lengthy dispute with city government over taxes. One thing that sealed the move: When the firm’s 400 employees heard the company was contemplating leaving, some began asking to relocate. Meanwhile, Creators Syndicate, the media syndication company, has also contemplated leaving because of a dispute over taxes with the city of Los Angeles that prompted an official of the company to accuse the city of operating like a “banana republic” and its bureaucrats of acting like “Stalin’s apparatchiks.”

And for all the state’s emphasis on “green jobs,” companies that manufacture environmentally oriented products are escaping California, as well.

Malanga accurately analyzes the problem, and Jack Stewart, president of the California Manufacturers and Technology Association, offers a solution. In a new column, “Texas Trip Confirms: California Needs a Plan to Create Jobs,” Jack argues: Read More

Survey: California Falls Short on Competitiveness, Regulation

By | Economy, Regulations | No Comments

From Gino DiCaro at the California Manufacturers and Technology Association, the Mpowered blog, “California regulatory and competitiveness survey shows we need to get smarter“:

A coalition of industries and employers fighting for a competitive California and a smarter regulatory environment released the first round of results this week from a survey to understand how companies feel about the regulatory climate in California.  The Los Angeles Times wrote the first story this morning.

More than 400 companies have answered the survey.  Of those 400, 84 percent said they would not consider locating a new business here if they were not already in California and 72 percent said they did not have formal plans to grow in the state by more than 10 percent in the next five years.

Two findings are becoming clear:

  • Existing and future regulations will have a major negative impact on job creation, and
  • Favorable attributes of California don’t outweigh the negative regulatory climate.

Link to survey:

Not Just a Budget Crisis, Gov. Brown, a Regulatory Crisis, Too

By | General, Innovation, Regulations | One Comment

From Hugh Hewitt, writing in The Examiner, “‘Green chemistry’ is California’s new job-killer“:

“Green chemistry” isn’t just a slogan. It is a full employment concept for government regulators and private-sector lawyers that will have the effect of costing American business billions even as it produces minimal benefits for consumers. Just like “global warming” and “clean energy,” “green chemistry” is a phrase containing worlds within it, almost all of them dangerous or downright deadly to market-driven innovation and productivity. We are entering the third decade of the “green chemistry” movement, and a handy guide to its history is in Katharine Sanderson’s article in the Jan. 6 issue of Nature.

The would-be regulators of all chemistry have not had an easy time of it these past 20 years. Anderson quotes a proponent of the movement as telling her that “a mention of green chemistry in a gathering of chemists can still provoke sighs and eye-rolling.

Yep. Green chemistry is to chemistry what environmental justice is to justice, in both cases redistributionist movements that expand government’s control over economic decisions. (The draft regulations.)

More Hewitt…

[The] new governor, Jerry Brown, will superintend the rules that almost certainly will mandate testing and labeling changes on tens of thousands of products and almost certainly trigger a new generation of product recalls.

“Take the most onerous regulatory regimes you have heard of,” Liz McNulty, one of my law partners, told me, “like those associated with the Consumer Product Safety Improvement Act or the Federal Insecticide, Fungicide and Rodenticide Act.

“Take whatever you think is the worst regulatory regime out there, and expand it exponentially,” she continued, “and then you get a glimpse of what is coming to California.”

California Manufacturers and Technology Association has identified regulatory overkill as one of the major factors driving companies out of state, and the CMTA is leading a campaign, “Smart Regulations for California” with an associated website, www.calrecovery.biz. From the factsheet:

Manufacturing in State of State Addresses: California

By | Economy | One Comment

Gov. Jerry Brown delivered a short State of the State address in Sacramento on Monday evening. In his prepared text, he did not use the words manufacturing, industry, business or competitiveness. Granted, he has a budget crisis to overcome, and is thus proposing cuts in government programs while extending what were supposed to temporary higher tax rates.

The closest he came to a message directed to business was this passage:

My intention is to make California again a leader in job creation, renewable energy and state of the art efficiency, innovation of all kinds and a solid primary and secondary education. Our universities are world renowned and I intend to see that they continue to enjoy the respect of students and scholars throughout the world. We also have to restructure our criminal justice system, carefully realign state and local government functions, and streamline state government. All of this can happen if we find the courage and summon the will to tackle our budget deficit head on and deal with it honestly and without purpose of evasion.

Gov. Brown might consider this chart from the California Manufacturers and Technology Association and then ask himself, why is it this way? Did the policies I promoted as attorney general and pushed by previous governors and legislatures create this unhappy trend? Have I made a sufficient break with past mistakes?

It’s from the CMTA’s policy document, “California Manufacturing Can Thrive Again.”

Circumnetting California’s New Laws, Regulations and Continuing Follies

By | Around the States, Economy, Global Warming, Regulations | No Comments

Effective today, it’s no longer a crime to possess small amounts of marijuana in California. But selling unlabeled baked goods with trans-fats is verboten. (The San Jose Mercury-News , “New laws launched today statewide affect everyone from bakers to paparazzi.”)

These economy-boosting, jobs-creating strategies are among the 750 laws signed by Gov. Arnold Schwarzenegger in 2010, many of which go into effect with the start of 2011. The Sacramento Bee reviews the statutory onslaught in “New year, new laws: A sampling of the nearly 750 bills signed into law in 2010.”

As for manufacturers, the greatest impact from state government probably comes from the cap-and-trade regulation adopted by the California Air Resources Board on Dec. 17. From the California Manufacturers and Technology Association (CMTA), “CARB adopts cap & trade“:

The market will start on January 1, 2012. Between now and then CARB will be building the market structure and finalizing important details left undone in the regulation. Also adopted were a series of resolutions for additional work to be done, described by one board member as “longer than Santa’s list.” Included is a commitment to perform an update by July 31, 2011 on the progress being made on implementation issues, among which is the status of the Western Climate Initiative, estimates of expected offset supplies, a schedule for training covered entities, and finalization of the allowance allocation system. There will also be more work on the emissions intensity and trade exposures of different industries prior to the start of the program.

CARB believes that it has legal authority to conduct an auction under the program, but does not have authority to direct expenditure of the monies. CARB resolved to deposit 10 percent of the auction revenues into the Air Pollution Control Fund for appropriation by the legislature on programs for GHG reductions and green collar employment in disadvantaged communities.

(Meanwhile, in Europe, ” Europol Arrests More Than 100 In Carbon Trading Fraud.”)

From EDAWN, a Reno economic development organization, “Two California Manufacturers Invest in Reno AM2T Moves to Reno and Synvasive Technology Expands Existing Operations“: “Reno, Nev. (December 20, 2010) – – Two California manufacturers looking to escape the high costs of doing business in the Golden State are investing in Reno creating much needed jobs and opportunities.”

The Reno release came out the same day that State Treasurer Bill Lockyer and Stephen Levy, director of the Center for Continuing Study of the California Economy, published an op-ed in The Los Angeles Times, “California isn’t broken.” Although higher taxes would fix it.

Steven Greenhut, editor of www.calwatchdog.com, refutes the column in a San Francisco Examiner piece, “Living in state of delusion. He includes the perspective from manufacturers: “CEOs like to live in California,” said Jack Stewart, president of the California Manufacturers and Technology Association. “It’s nice to have a corporate headquarters in Silicon Valley or San Diego. But they do their manufacturing someplace else.”

The California Manufacturers React (There’s Disappointment)

By | Economy, Regulations, Taxation | No Comments

From the California Manufacturers and Technology Association, “CA manufacturing gets a little help in state’s races and propositions:

Here’s the “GOOD” for manufacturing

  • Prop 26 passed and taxes can’t be passed as fees.
  • Prop 24 failed and a few of CA’s competitive tax policies remain.
  • Redistricting commission remains intact (Prop 20 passed and Prop 27 failed).
  • Steve Cooley still has a chance to be Attorney General (Cooley’s statement).
  • Pro-manufacturing candidates, Anthony Cannella and David Valadao, won competitive state legislative races.

Here’s the “REAL BAD”

  • Prop 23 failed, ensuring increased energy rates and other costs for all manufacturers.
  • The race for attorney general between Cooley and Kamela Harris, the San Francisco District Attorney, is headed for a full count and then a recount.

    CMTA drives home the message, one that California’s voters seem to be missing:

    With 12.4 % unemployed, more than a third of our manufacturing base gone, and the rest of the country opting to vote for private sector economic growth yesterday, California must find ways to be a competitive place to operate. For example, CA needs to join the rest of the country and exempt from sales tax the purchase of manufacturing equipment. CA also needs to reform its regulatory process by introducing independent economic analysis. Message to all manufacturers: We need your help to make our case in California in 2011!

    Friedman and Schwarzenegger: Embrace the Regulation!

    By | Economy, Energy, Global Warming, Regulations | No Comments

    In his New York Times column today, Tom Friedman writes about California and Initiative 0104, the California Jobs Initiative to suspend the state’s greenhouse gas emissions controls (AB 32) until unemployment falls below a certain level. Shorter column: “Regulation is good, embrace the regulation, and you can tell my brilliant argument is brilliantly persuasive because Arnold Schwarzenegger agrees with me, and I just spoke at a conference he was at, and we were both brilliant.”

    Also, Friedman finds the lefty bloggers at Think Progress to be more credible on matters of public policy than the energy companies that employ hundreds of thousands of Americans and drive economic growth in the United States. Next thing you know this enlightened, worldly columnist will claim China’s system of government is superior to the American Republic.

    Ramesh Ponnuru rebuts Friedman’s arguments at National Review’s The Corner blog, a post, “Outside Agitators“:

    That businessmen under regulatory attack organize politically to defend themselves never ceases to be a source of shock and anger to some liberals. The premise of Thomas Friedman’s column today seems to be that California has the perfect right to wreak whatever economic damage it thinks necessary outside its borders while the businessmen affected are wrong to respond–at least if they’re out of state. Judging from his repeated geographic references he’d have weaker objections if California businessmen were the ones funding the anti-regulatory campaign. Right? In general, I think state governments should have regulatory authority to their borders but not beyond them. In the case of California, I’m tempted to add an “at most” qualifier.

    The California Manufacturers and Technology Association has endorsed Initiative 0104. In a news release, the CMTA explained:

    California Jobs Initiative (AB32 Suspension) — Initiative 0104 — Support (Reasons below)
    Suspends Air Pollution Control Laws Requiring Major Polluters to Report and Reduce Greenhouse Gas Emissions That Cause Global Warming Until Unemployment Drops Below Specified Level for Full Year

    Adjusting the schedule of regulations under the state’s greenhouse gas reduction law until the California economy recovers is necessary because: Read More

    ‘Green Jobs’ Could Push California (Further) Into the Red

    By | Economy, Energy, Global Warming | No Comments

    The California and Manufacturers Technology Association held a news conference Wednesday to release results of a new study, “The Truth About Green Jobs and California.” Key report conclusions:

    1. Where existing jobs are counted as green and when policies create green jobs at the expense of existing jobs, the true impact of green policies can’t be determined.
    2. Green job policies are counterproductive if California becomes economically inefficient — creating green jobs but raising costs or reducing output.
    3. Due to these and other factors, no study yet proves that green job policies will be beneficial to the California economy.

    As CMTA’s Jack Stewart argues: “California should be the home of clean tech innovation and manufacturing. Improving the business climate would grow the ‘right’ green jobs, not short term jobs that only survive with government subsidies and hurt the state’s overall economy.”

    The report was conducted by the California Lutheran University Center for Economic Research and Forecasting. The Ventura County Star covered its release.

    The report, co-authored by the center’s director, economist Bill Watkins, was commissioned by the California Manufacturers and Technology Association. It becomes the latest in a series of conflicting reports and analyses on the potential economic impacts of AB32, California’s landmark climate-change law, and will add fuel to the debate over a November ballot proposition that seeks to suspend the law’s implementation.

    The report, which Watkins called “a review of the evidence,” argues that there will be no net economic benefit from any green jobs created as a result of the legislation.

    “It is simply impossible to see how draconian legislation — particularly those mandates imposed in only one state — cannot have serious deleterious economic impacts,” the report says.

    Let’s Transition to this Examiner Column about Green Jobs

    By | Energy, Global Warming | No Comments

    From President Obama’s remarks last night:

    The transition away from fossil fuels is going to take some time, but over the last year and a half, we’ve already taken unprecedented* action to jumpstart the clean energy industry.  As we speak, old factories are reopening to produce wind turbines, people are going back to work installing energy-efficient windows, and small businesses are making solar panels.  Consumers are buying more efficient cars and trucks, and families are making their homes more energy-efficient.  Scientists and researchers are discovering clean energy technologies that someday will lead to entire new industries. 

    Good things, conceptually, but do the data match the exhortations? Byron York, Washington Examiner, “Billions for ‘green jobs,’ whatever they are.”

    In a June 2 letter to Labor Secretary Hilda Solis, [Sen. Charles] Grassley noted that there was an enormous amount of money in the $862 billion stimulus bill for those still-undefined green jobs.

    “According to the administration, the Recovery Act contains more than $80 billion in clean energy funding to promote economic recovery and develop clean energy jobs,” Grassley wrote. “However, it has come to my attention that the [Labor Department] is just now attempting to define what a ‘green job’ is. Interestingly, this comes more than a year after the Recovery Act was signed into law and after millions of dollars in funding have already been distributed for green jobs.”

    Since the Labor Department is looking for a definition after spending hundreds of millions of taxpayer dollars on green jobs, Grassley asked, then what definition of green jobs did it use when it spent the money? The question applies beyond the Labor Department. What about all the other government agencies that are spending zillions on green jobs? They don’t have a widely accepted definition either.

    Looks like the California Manufacturers and Technology Association may provide us more detail about greenery today at a news conference:

    Manufacturers and Cal Lutheran University’s Bill Watkins to release green jobs report
    Study finds that California’s economy would weaken
    if state sacrifices existing job base to reach green job goals

    Sacramento, CA — On Wednesday, June 16, at 10:00 a.m. the California Manufacturers & Technology Association (CMTA) will hold a statewide media teleconference to release and discuss a green jobs study — The Truth About Green Jobs and California — recently completed by Bill Watkins, Ph.D. of Cal Lutheran University.

    The report provides context to recent green job studies and claims, analyzes what has occurred in countries with “green job” mandates, and takes a look at the real costs of green job policies that ignore markets and the need for overall economic growth.

    The report will be available online at www.cmta.net/greenjobs.php at 9:30 a.m. on Wednesday.

    * Unprecedented! We’re up to 472 uses of the word at www.whitehouse.gov. It’s an unprecedented use of unprecedented.

    Tough Times and California

    By | Economy, General, Regulations | No Comments

    From a blog post from Gino DiCaro of the California Manuafcturers and Technology Association, “Create California jobs through efficient, effective regulations and renewed commitment to economic development“:

    We must understand the impact new rules and regulations will have on job creation. Recent trends, resulting in unacceptable job and wage loss for California workers are alarming and unsustainable. Site Selection magazine has released new research showing, over the last three years, California averaged only 3.7 new or expanded industrial facilities per 1 million people, while the national average was 28.7. These results coupled with the fourth worst unemployment rate in the nation and an eroding manufacturing base requires a new perspective on California’s regulatory and economic development priorities.

    It’s not about one regulation, it’s not about one industry or sector, it’s about overall process improvement and a renewed commitment to jobs in California.

    The April 13 post released an open letter to the Legislature with more than 300 companies supporting a campaign to expand the Legislature’s oversight of California’s government agencies.

    From the Bureau of Labor Statistics, unemployment rates in February for the bottom 10 metropolitan areas in the United States. Anything jump out?

    363 Hanford-Corcoran, CA Metropolitan Statistical Area 18.2
    364 Stockton, CA Metropolitan Statistical Area 18.4
    365 Fresno, CA Metropolitan Statistical Area 18.5
    366 Rockford, IL Metropolitan Statistical Area 18.6
    367 Visalia-Porterville, CA Metropolitan Statistical Area 18.7
    368 Modesto, CA Metropolitan Statistical Area 19.1
    369 Yuma, AZ Metropolitan Statistical Area 19.9
    370 Yuba City, CA Metropolitan Statistical Area 21.6
    371 Merced, CA Metropolitan Statistical Area 22.1
    372 El Centro, CA Metropolitan Statistical Area 27.2