As California gas prices soar — reaching an average per gallon of $5.90 on Friday — lawmakers are trying rush to the rescue with expensive proposals to help drivers. Governor Gavin Newsom wants to give car owners $400 per car for up to two vehicles, at a cost of $9 billion.
Yet at the same time, California is investing billions to tear people away from their gas-thirsty cars and trucks. Position yourself as a world leader fight against climate change, the State proposes discounts to knock thousands of dollars off the price of a Chevy Bolt or a Nissan Leaf. The governor is committed $10 billion to accelerate the transition to electric vehiclesand even committed to end the sale of all new gasoline-powered cars in California by 2035.
Sending money to car owners would run counter to state climate goals in response to a political moment, said Danny Cullenward, policy director of CarbonPlan, a nonprofit climate research organization. . “It’s not a policy that measures up to tackle income inequality or the climate,” he said.
So is the state engaged in a multi-billion dollar contradiction here? Would a payout for car owners essentially undermine the state’s climate efforts?
“I actually think it’s not, because of the way it’s structured,” said Severin Borenstein, an economist and director of the Haas Energy Institute at UC Berkeley. Californians who receive a check or debit card can use it for anything, Borenstein said. As long as gas prices are high, drivers still have an incentive to try to buy less gas and spend the state payment on other goods.
What is important, he said, is that this proposal does not try to drastically lower the price of gasoline – as would the complete suspension of the gasoline tax, which the Republicans claim. Cheaper gas would encourage people to use more gas, and “that definitely undermines our environmental goals,” he said. He would have preferred to see the payment targeted at low-income people, “instead of people who own cars, many of whom don’t have financial hardship.”
The advantage of doing lump sum checks or debit cards, rather than lowering gas tax to lower the price, is that the checks don’t get bigger if you drive more, or smaller if you drive less, a said Jesse Rothstein, professor of public science. politics and economics at UC Berkeley and faculty director of the California Policy Lab. In other words, they don’t change the incentives for how much gas people use.
Already, rising gas prices have caused more people to search for electric vehicles onlinebut drivers looking to make the switch may have trouble finding onethanks to supply chain delays and pent-up demand.
Under Newsom’s proposal, EV owners would also receive the $400 debit cards, and the payments are part of a larger package, including:
- $750 million in grants to incentivize transit agencies to make rides free for three months
- $500 million for pedestrian and bicycle lanes and other infrastructure
- Funds to reduce or suspend certain gasoline and diesel taxes
- Accelerating financing of $1.75 billion for a largest set of zero-emission vehicles.
Still, some conservationists wanted to see lawmakers do much more to hasten the move away from gas-powered cars.
RL Miller, a member of the Democratic National Committee and founder of Climate Hawks Vote, said she recognizes that gas prices are hurting people and appreciates that the governor’s package includes funding for transit projects, cycling and walking. But she wanted a bigger share of the total package spent on car-free transit.
Of Newsom’s $11 billion proposal, about 80% would pay for sending debit cards to car owners, while about 7% would go to transit agencies and 4.5% would go to infrastructure. walking and cycling.
“We know the long term goal is to get people away from oil. But in the short term, we need to do something to help people who are having a lot of pump pain.
– Erin Mellon, spokesperson for Governor Newsom
Miller would have preferred California to tackle rising gas prices by offering a generous reward for people willing to ditch their heavy gas guzzlers – a “cash for clunkers” program – as well as a pledge to expedite the date that California will ban the sale of gas-powered cars.
“If you pair these long-term investments with the short-term gas card refund silliness that they’re talking about,” Miller said, “then I would consider that acceptable.”
A spokesman for the Newsom administration said the proposal is not a “this or”, it’s “this and” approach. “We know the long-term goal is to get people away from oil,” said Erin Mellon, the governor’s spokeswoman. “But in the short term, we have to do something to relieve the people who are suffering a lot at the pumps because of Putin’s war,” she said.
“Sending people $400 checks and saying ‘sorry, gas prices are so high, hope this helps,’ isn’t the ideal message,” said David Weiskopf, senior policy adviser on climate and environmental issues at NextGen Policy, which advocates for progressive legislation But he thinks relief payments, especially when the government has a large budget surplus, are appropriate.
There’s kind of a knee-jerk reaction that says, “Why do we reward vehicle ownership?” he said. But he sees the policy as an attempt to reach many people who are on DMV records but who might not be reached by a program that distributes money based on their tax return, which is often the case of reimbursements based on income. This includes some of the poorest Californians, who may not have to file their taxes. But, he said, he would like the money to also go to people with ID cards, to reach households that don’t own a car.
“It’s impressive how quickly governments can react to certain things – COVID or high gas prices,” said Ellie Cohen, CEO of the Climate Center. She complimented the elements of Newsom’s proposal, but would have liked to see the funds targeted at low-income people. “We’re just not moving fast enough on climate change.”
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