06-23-10 by dugan
The latest round of state political contribution reports show that Chevron has given another $250,000 to California Gov. Arnold Schwarzenegger’s huge political slush fund, the "California Dream Team." That makes a total of more than $1.25 million straight from Chevron to Schwarzenegger. The governor can’t run again, and there are no new Gov-sponsored ballot initiatives in sight, but it’s pretty clear what Chevron is after: insurance that Schwarzenegger won’t support or sign any legislation to make California the final state to enact an oil extraction tax.
Every other state with substantial oil production has such a tax. The pennies a gallon it would collect in California could put a billion-dollar dent in the state’s crippling annual deficit. But Chevron, the oil gorilla of California and both a producer and refiner in the state, says No. And "No" it has remained, every time the issue comes up in the Legislature or at the ballot.
Chevron money was also key to the 2006 defeat of Proposition 87, which would have used an extraction fee to fund green tech. Chevron sprinkles major dollars around the Legislature, too, but Arnold gets the biggest money.
Schwarzenegger in late 2008 raised the idea of a 9.9% extraction tax in one of his budget statements. The plan dropped off the table, as I said at the time, "faster than a doughnut in front of a golden retriever." When Chevron then shoveled $250,000 to Schwarzenegger, the Gov switched to supporting new oil drilling off the California coast, an idea he dropped only after the BP catastrophe in the Gulf of Mexico.
But an extraction tax? No. Schwarzenegger threatened a veto when a legislative committee brought up the idea again last spring, and the bill fizzled. Now, again, the state Legislature is once more talking oil extraction tax, and Chevron–with fantastic timing–has reached into its deep pockets. What’s a few million to political slush funds and campaign contributions, if it acts as a magic shield against that oil tax?