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California and AB32: Winning?

October 10, 2011

Conservatives love to talk about how jobs and businesses are leaving California because of our allegedly poor business climate, often citing AB32, California’s nation-leading climate change legislation. I wonder, though, if any of those writers will do a column on a business coming to California mainly because of AB32: SunEdison, the largest American solar company, recently moved its headquarters from Maryland to Belmont. According to the Wall Street Journal, the company “to be closer to one of the world’s fastest-growing solar markets”, a market which has been fostered by AB32 and California’s renewable portfolio standard.

If you want to go beyond anecdotes, check out this PPIC study (PDF). The important part:

Businesses are not fleeing the state.
Rhetoric aside, California loses very few jobs to other states. Businesses rarely move either out of or into California and, on balance, the state loses only 9,000 jobs annually as a result of relocation—that’s just 0.05 percent of California’s 18 million jobs. Far more jobs are created and destoyed as a result of business expansion, contraction, formation, and closure than because of relocation—primarily in locally owned businesses. Business relocations, although highly visible, are a misleading guide to the overall performance of the California economy. The employment growth rate, which takes into account job creation and destruction for all reasons—not just relocation—is a much better measure of the state’s economy.

My guess is we won’t be hearing anything about this from the right-wingers.

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