California's Prop 87 Energy Measure Divides Opinion California voters will soon decide whether to tag oil producers with $4 billion in new taxes to fund the research and development of alternative energy sources. Sponsors of Proposition 87 have enlisted the help of former President Bill Clinton and former Vice President Al Gore, but critics say the measure will lead to skyrocketing gas prices.
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California's Prop 87 Energy Measure Divides Opinion

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California's Prop 87 Energy Measure Divides Opinion

California's Prop 87 Energy Measure Divides Opinion

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ROBERT SIEGEL, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Robert Siegel.

MELISSA BLOCK, host:

And I'm Melissa Block.

Two weeks now until voters go to the polls, and we begin the program today by talking about direct democracy in this election. We're going to hear about some of this year's ballot initiatives and referenda, and we begin with one proposal in California and the millions being spent for and against.

Prop 87 would put a tax on every barrel of oil pumped out of the ground in the Golden State. That could generate about $4 billion in revenue. According to the federal government, California is the nation's third largest oil producing state. The money would be used to develop alternative fuels.

And as NPR's Ina Jaffe reports, some real heavyweights have turned out on both sides of the measure.

INA JAFFE: How's this for a celebrity endorser?

President BILL CLINTON: Thank you very much.

JAFFE: Former President Bill Clinton recently spoke in favor of Proposition 87 on the campus of UCLA. He urged the thousands of young people there to do what Californians have always done - claim the future.

President CLINTON: California is being given an opportunity and an obligation to do something remarkable to save the planet, improve our national security and create the next generation of good jobs for the American people.

JAFFE: The star of the third highest grossing documentary of all time is also backing Prop 87. Former Vice President Al Gore has for weeks been appearing in this ad on TV screens throughout the state.

(Soundbite of political ad)

Mr. AL GORE (Former Vice President): Prop 87 is the one thing Californians can do now to clean up the air, help stop the climate crisis and free us from foreign oil.

Mr. ROBERT STERN (Center for Governmental Studies): I think it's unprecedented. I don't remember any president or vice president coming out in support or opposition to propositions.

JAFFE: Robert Stern is the president of the Center for Governmental Studies in Los Angeles.

Mr. STERN: I think a lot of it had to do with the fact that Stephen Bing is a very strong Democratic giver.

JAFFE: And Stephen Bing is the major funder of the Yes On 87 campaign. Outside of political circles, he's best known as a Hollywood producer who fathered a child with model Elizabeth Hurley. But as a political benefactor, he's outdone himself this time, putting $40 million of his personal fortune behind the initiative.

Mr. STERN: That's the most money ever spent by an individual on a ballot proposition anywhere in the country.

JAFFE: Bing has declined to put his mouth where his money is. He never speaks to the media. But Prop 87 communications director Yusef Robb does.

Mr. YUSEF ROBB (Communications Director, Proposition 87): Steve Bing stepped up to the plate because the yes side is facing the most powerful, most profitable corporate force in the world. The oil companies.

JAFFE: The oil companies have put up more than $70 million for the no side and blanketed the airwaves with commercials reminding voters of one of their biggest pains in the wallet.

(Soundbite of political ad)

Unidentified Woman: How's our gas tank looking?

Unidentified Man: Oh, time to fill her up.

Unidentified Woman: Ouch.

Unidentified Man: Yeah, and you better fasten your seat belt because there's an oil tax headed for the ballot.

Unidentified Woman: You've got to be kidding me.

Unidentified Man: I never kid about gas prices.

JAFFE: Chevron, one of the major funders, referred calls to the No On 87 spokesman, Scott McDonald. He acknowledges that California is the only oil producing state without an extraction tax but he says you can tax oil production in lots of ways.

Mr. SCOTT McDONALD (Spokesman, No On 87): California, as a matter of fact, has the fifth-highest tax burden on oil in the country with corporate income taxes, sales taxes, gas taxes, etcetera, property taxes all added to the equation. You add Prop 87 and we would far and away be number one as far as the tax burden.

(Soundbite of machinery)

JAFFE: Which makes for uneasy times for Chris Hall. He's a third generation oil producer with a few dozen wells scattered along the north foothills of the Tehachapi Mountains. Forty percent of the oil in California is produced by independent drillers just like him. He says Prop 87 would make it harder for them to do business.

Mr. CHRIS HALL (Oil Producer, California): If the cost of producing oil in California goes up, there is no question that production will continue to decline and that will be offset by imported oil being increased in order to make up for the difference.

JAFFE: Proposition 87 was riding high in the polls at first, but support has gradually diminished. A recent survey by the Field organization found 44 percent of voters supporting the measure, with 41 percent opposed. Robert Stern says the money being spent to defeat Prop 87 is having an impact. But the yes side has more than money on its side.

Mr. STERN: When you have President Clinton and you have Vice President Gore and you have environmental groups and the (unintelligible) Association supporting it, voters will take a look and see who's supporting, who's opposing and then try to make up their mind based on these cues to them.

JAFFE: With such a complicated initiative, says Stern, it usually just comes down to who's on what side and who do you trust.

Ina Jaffe, NPR News, Los Angeles.

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