Climate Change and Partisanship

Ten years ago, California led the nation in climate change policy when it passed the Global Warming Solutions Act of 2006, landmark legislation that required the state to reduce greenhouse gas emissions to 1990 levels by 2020. While passed largely along partisan lines, Assembly Bill (AB) 32 was signed into law by Republican Governor Arnold Schwarzenegger. Notably, the law enjoyed the support of a strong majority of Californians—including two in three adults across parties—in our July 2006 Statewide Survey.

Today, the state is prepared to meet the reduction targets set forth in AB 32. As policymakers debate how to further reduce emissions, a strong majority of Californians continue to favor these targets. But now there is a wide partisan divide. An overwhelming majority of Democrats (80%) are in favor, compared to a majority of independents (56%) and fewer than half of Republicans (44%).

The evolving partisanship can also been seen in Californians’ views about the state’s role as a leader in global warming policy. In 2006, solid majorities of Californians across parties were in favor of California making its own global warming policies separate from the federal government. Today, a solid majority of adults are still in favor, but the partisan divide has widened. Democratic support has held steady (73% in 2006, 70% today), but support among Republicans (62% in 2006, 49% today) and independents (70% in 2006, 55% today) has declined by double digits.

What’s changed since 2006? In California, Republican Governor Arnold Schwarzenegger has been replaced by Democratic Governor Jerry Brown, who has been a vocal leader on climate change and made the issue a major component of his agenda. At the national level, there is a contentious debate about global warming, as well as a growing partisan and ideological divide.

Democrats and Republicans in our surveys have also become more ideologically divided. Democrats describing themselves as “very liberal” made up 14% of Democrats in our July 2006 survey, while that group encompasses 30% of Democrats today. Similarly, Republicans describing themselves as “very conservative” made up 21% of Republicans in July 2006. The “very conservative” constitute 31% of Republicans today.

Despite a widening partisan divide, Californians’ support for state policies to address global warming has been consistent in the 10 years since passing AB 32. Indeed, a strong majority of Californians (68%) favor a proposal to further reduce greenhouse gas emissions to 40% of 1990 levels by 2030. An overwhelming majority of Democrats (78%) support the proposed goals, compared to fewer than half of Republicans (39%). Independents are in the middle, with 59% in favor of the expanded goals.

Does the partisan divide on global warming policy mean that there is intraparty cohesiveness? Not necessarily. Among Democrats, there is strong majority support regardless of ideology and other demographics. But Republicans as a group are less cohesive. In fact, support for further reducing greenhouse gases exceeds 50 percent among nonwhite Republicans. Among independents, support for global warming policy mirrors that of the party that these nonpartisans lean toward.

Further reducing greenhouse gas emissions will be a real test for California as it seeks to address climate change. The ongoing political debate over global warming may well continue, and once more, the nation will be watching to see what California does next.

Three Lessons on Water Accounting for California

Californians are known to take pride in the state’s many exceptional characteristics. But in at least one important area, we’d be wise to learn a thing or two from our neighbors. Not only are the Golden State’s water management challenges shared by other western states, but many of these places use more advanced practices to understand how much water is available, who has claims to it, and how much is being used.

A new report by the PPIC Water Policy Center reviewed how California compares to other dry regions—11 other western states and Australia and Spain—in integrating water information into critical management functions. We found ample room for improving the state’s systems—especially for managing groundwater overdraft, defining environmental water needs, and stimulating water trading.

These three overarching lessons, drawn from our comparison study, have particular value for California:

  • Management of groundwater can be improved by adopting common standards for evaluating its availability and use. In most regions, including California, groundwater management is locally driven. Getting users to agree on long-term goals can be difficult when local agencies that share groundwater resources use different accounting methods to assess availability and use. Recognizing the need for better coordination, Australia developed accounting standards that ensure consistency across agencies. And Texas developed “authoritative” groundwater models that serve as an accepted standard for determining allocations and settling disputes, and are used as the default for local agencies. As a result, both places improved their cooperation and coordination over shared resources, and reduced costs. Establishing a set of standards could help California facilitate basin-wide planning as the state the Sustainable Groundwater Management Act.
  • Clearly defining environmental water needs makes decision-making easier for all water users. California still needs to consistently define the quantity, timing, and quality of water for environmental uses in most watersheds throughout the state. This will not only benefit the environment but also reduce uncertainty for other water users who rely on watershed resources. For instance, Washington is defining water budgets that clarify environmental needs for each sub-basin in the state. A pragmatic path for California is to develop watershed-based environmental water budgets that integrate local watershed goals such as ecosystem health and water supply objectives.
  • A well-functioning water market stands on three legs: clarity on water claims, certainty on water use, and strong systems to manage and share information. Water trading is a key tool for shifting water from less critical uses during times of scarcity. Trading opportunities in California are limited by a lack of information. Improving our understanding of how much water is used under each water right (and how much returns to streams and aquifers) is critical for determining the volumes of water that can be traded without harming other users. Idaho and Colorado have made great strides in this area. California would also benefit from more detailed, publicly disseminated information on volumes, prices, and locations of water trade agreements. The water market in Victoria, Australia, leads the way in providing timely and accessible information on water rights, allocations, and trading.

Investing in water accounting can stretch supplies during times of scarcity, as has been demonstrated in other dry regions. Making a commitment to comprehensive, authoritative, and user-oriented water accounting now, as other states and countries have already done, will help California become more resilient to the challenges posed by future droughts and climate change.

Learn more

Read the report Accounting for California’s Water (July 2016)
Visit the PPIC Water Policy Center

Spending on Corrections and Higher Education

California has long been criticized for its growing corrections expenditures, especially as General Fund spending on higher education has declined. The beginning of a new budget year is a good time to examine where the state now stands on spending in these two key areas.

California’s legislature recently adopted a budget for 2016–2017 that devotes $14.5 billion of General Fund revenue to higher education institutions, including the University of California, California State University, and California’s community college system. It allocates $10.6 billion for operations of the California Department of Corrections and Rehabilitation (CDCR), which is responsible for adults in state custody and parolees under state jurisdiction.

These budget allocations reflect a striking shift from California’s budget of forty years ago, when the state spent a larger share on higher education and a much smaller share on corrections. But by the 2008–2009 budget year, allocations to higher education (11.1%) and corrections (10.7%) were almost identical. In the years since, higher education spending has outpaced corrections in relative terms, largely because recent criminal justice reforms have drawn down the number of adults in state custody and on parole. Nonetheless, California spends more on corrections and less on higher education today, in relative terms, than at nearly any point in the past thirty years.

Despite these dramatic trends, spending in each area has actually increased alongside of growth in the populations served. Enrollment in higher education institutions has increased roughly 50% since the 1977–78 academic year; the budget has increased 65% (according to CPEC Fiscal Profiles). Until 2011’s realignment of California’s corrections responsibilities, the number of adults in CDCR custody had increased 555% and the budget increased 526% (CDCR Monthly Population Reports).

Clearly the costs of serving these two populations are different. On average, the cost of the CDCR population is much higher than the cost of students in higher education. Within each area, costs per person vary as well. The cost of educating a student at UC far exceeds the cost of doing so at a community college. Similarly, the cost of incarceration far exceeds the cost of supervising a parolee in the community. Although the per person cost of delivering services has risen over time, the dramatic increase in the prison population has been the key driver of the dramatic shift.

To reverse these trends, the state must identify and disseminate cost-effective strategies to reduce recidivism, further diminish California’s crime rates, and ultimately reduce the prison population enough to allow for the closure of state facilities or the elimination of in-state and out-of-state contract prison beds used to relieve overcrowding. Corrections realignment reduced state prison and parolee populations, but the anticipated savings from this policy shift have yet to materialize. Moreover, the most recent reports show a small uptick in the corrections population (CDCR Monthly Population Reports). ​

In the meantime, California needs to find ways to accommodate more students in its higher education systems—which it could do at relatively low cost by reducing time to degree, or at higher cost by increasing financial aid or expanding the number of slots for students. At the end of the day, ensuring that more of California’s youth attend and complete college will reap positive long-term benefits for the state, helping to meet the needs of the state’s future economy and create a brighter future for all Californians.

Chart source: California Department of Finance Chart C-1 Program Expenditures by Fund.

Learn more

Will California Run Out of College Graduates?
“California’s State Budget”
California’s Future: Corrections

Video: Assessing California’s Global Warming Law

Ten years ago, California enacted a law to combat global warming that set an ambitious goal: reducing greenhouse gas emissions to 1990 levels by 2020. Today, the state is poised to reach this target, and policymakers are discussing aiming for a new one.

Each year since the law—AB 32—took effect, the PPIC Statewide Survey has examined Californians’ views on climate change and the state’s actions to address it. The survey has consistently found that most Californians believe that the effects of global warming have begun and that majorities support the state taking action to address it.

But a partisan split has emerged since the law took effect. AB 32’s goals no longer have the bipartisan support they did in 2006. Today, Democrats and independents are much more likely than Republicans to support the goals of AB 32. This divide is reflected in a number of findings in the 2016 Californians and the Environment Survey.

Research associate David Kordus presented the survey at a briefing in Sacramento last week.

How Green Is My Water?

Harmful plumes of algae in waterways have been much in the news lately, in California and nationally. We talked to James Cloern, a senior scientist at the US Geological Survey and a member of the PPIC Water Policy Center’s research network, about this pressing water quality issue.

PPIC: What are algal blooms, and how big a problem are they for California?

James Cloern: Our waterways are home to many thousands of species of microscopic algae, but only a few dozen can develop into harmful blooms. They become harmful when they either produce toxic chemicals, which can make people and animals sick, or disrupt biological processes like animal feeding or bird flight—some species excrete goo that can gum up birds’ wings.

There’s growing evidence that harmful blooms are increasing because we are over-fertilizing our lakes, rivers, and estuaries such as the Bay-Delta. This over-fertilization comes largely from the discharge of treated sewage or runoff of nutrient-rich water from farms, cities, gardens, and animal lots. Two nutrients are causing these problems: nitrogen and phosphorus.

Algal blooms can grow very rapidly when they have the right conditions: warm water, high sunlight, and high concentrations of nutrients. California’s latest drought coincided with record-high temperatures, which warmed waterways and was a contributing factor to a number of algal blooms around the state.

One really nasty algae—Microcystis—seems to be increasing globally. It has an advantage as the climate and waters warm. Microcystis has become a challenge in California. In recent years we’ve seen it bloom in the Sacramento-San Joaquin Delta, Pinto Lake, Pyramid Lake, Shasta Lake, and reservoirs of the Bay Area’s East Bay Regional Parks.

PPIC: Could climate change worsen this problem?

JC: There is still much to learn about the ecology of these blooms, but we know these events are strongly tied to climate and especially to extremes such as heat waves and drought as well as El Niño/La Niña cycles. One grand challenge is to understand the interactions between climate variability, including climate change, and over-fertilization. Developing that knowledge is critical for establishing the quantities of nutrients that cause more frequent or intense harmful blooms.

PPIC: How well prepared are we to manage these water quality challenges?

JC: Water managers today are asking three essential questions of the scientific community. First, at what point do we have to take action? Second, which nutrient do we tackle first? And third, what level of action is required?

These are challenging questions, and they have global implications. They’re important in densely populated urban areas, where we dispose of treated sewage in water bodies, and in areas where water bodies drain large agricultural areas.

California’s Regional Water Quality Control Boards are tackling these issues. They have two new programs on nutrient management—one for San Francisco Bay, one for the Delta. The technical solutions are very different for dealing with land runoff and sewage. The sewage issue can be solved technically, but the fix is expensive. The San Francisco water board is now trying to determine what level of impairment should trigger mandated water treatment to reduce nutrients coming into the Bay. Since the problem could cost on the order of $5–$10 billion to solve, board members don’t want to mandate unnecessarily strict changes.

The land-runoff challenge is much harder to address, because the source of pollution is the application of fertilizers on land, feedlots, and septic systems. Solving the problem will require substantial behavioral changes such as new farming practices. But it has been done elsewhere—for example, Denmark mandated national-scale action to reduce both nitrogen and phosphorus.

We have a clear understanding of how nutrient pollution can make our waters unswimmable, unfishable and undrinkable. Solutions to the nutrient pollution problem exist, but they have costs. Californians must decide if the benefits justify the expense.

Learn more

Read “California’s Water Quality Challenges” (PPIC Water Policy Center fact sheet, October 2015)
Visit the PPIC Water Policy Center water quality resource page

Video: Improving California’s Water Accounting

Understanding California’s balance sheet for water—how much there is, who has claims to it, and what is actually being “spent”—is key to effective and sustainable water management, especially during droughts. But the state’s system of accounting is outdated and ineffective for managing some of our biggest water challenges, according to new research from the PPIC Water Policy Center.

A group of water management experts gathered to discuss the topic at a PPIC event last week.

“The drought has spotlighted weaknesses in California’s water accounting,” said PPIC researcher Alvar Escriva-Bou. These weaknesses make it harder to manage groundwater, water for the environment, surface water allocations, and water trading, he said.

Better information about groundwater use and claims is an especially urgent need. Lance Eckhart, director of basin management and resource planning for the Mojave Water Agency (which relies 100% on groundwater), said, “It’s probably going to take a generation” to bring the state’s over-drafted basins into balance. “The way you do that is by collecting good data…to quantify how much you have going in and how much is going out.” A lack of good information increases conflict over the resource, he said.

Tom Howard, executive director of the State Water Resources Control Board, noted that California has made “huge improvements” in managing information about water rights in the past six years. “But there are still a lot of blank spots” in the state’s water accounting system—for example, understanding how much water returns to the system from farms.

The drought revealed major weaknesses in how the state accounts for environmental water. Maurice Hall, associate vice president of water for the Environmental Defense Fund, said tightening the system of environmental water management through better information would allow managers to “specifically put the water where it needs to be for the fish and wildlife” and enable them to “defend the actions we are making for those wildlife.”

The issue of cost prompted a lively conversation about how we currently value water and how to fund the modernization of the system. Ellen Hanak, director of PPIC’s Water Policy Center, put the cost in context: “California annually spends $31 billion on our water system overall… And then look at the size of our economy—over $2 trillion. In the scheme of things, we ought to be able to find a little more money to do these kinds of things.”

Escriva-Bou and Hanak are coauthors of a new report that compares California’s water accounting systems to those of 11 other western states, Australia, and Spain. The authors identify gaps in California’s water information systems, and propose a dozen ways to bridge them.

Learn more

Read the report, Accounting for California’s Water (July 2016)
Visit the PPIC Water Policy Center

Regional Higher Education Gap Grows

Just as income gaps have grown across California’s regions, so too have disparities in levels of education. Because higher education is a major contributor to economic opportunity, these disparities have significant implications for the future well-being of the state and its residents.

Since 1980, personal income has grown at vastly different rates across the state. Workers in the Bay Area and Orange County earn substantially more (on an aggregate, per capita basis) than the average Californian. Residents in the Central Valley and Sierras, the Inland Empire, and the far north earn substantially less than the statewide average. These disparities have grown over time. In 1980, per capita regional income ranged from 80% to 111% of statewide per capita income. Today, this range is wider, with the Inland Empire at 66% and the Bay Area at 138% of the statewide average.

Regional income differences are tied to the industries and occupations that make up regional economies, as well as broad economic drivers that have accelerated growth in some industries but not others. These same factors affect individual workers’ decisions about where to live.

Given the importance of post-secondary education to economic opportunity, it is not surprising that regional differences in the share of adults with college degrees are similar to differences in income. In the Bay Area as well as Orange and San Diego Counties, the share of adults with four-year college degrees is much larger than the statewide share. The Central Coast region, Sacramento metro area, and Los Angeles County have roughly similar concentrations of college degrees as the state overall; the Central Valley, Inland Empire, and far northern parts of the state have substantially smaller shares.

However, the value of post-secondary degrees has been increasing even in occupations that traditionally have not required college education—including the jobs that comprise a larger share of the economy in lower-income regions of the state. So we might expect regional disparities in college degree attainment to be narrower today. But this is not the case.

In fact, the distribution of higher education credentials across California has become more uneven over time. For example, in 1980 the share of Bay Area adults with college degrees was 128% of the statewide average; today, that share is 138%. Over the same period, the share of college graduates in the Central Valley has fallen from 65% of the statewide average to 56%.

These widening educational disparities are a warning sign for the state’s future. Narrowing regional gaps in educational attainment probably won’t eliminate differences in income, but it could increase competitiveness across all regions and expand economic opportunities for individual Californians.

Note (TOP CHART):The “far north” region includes Butte, Colusa, Del Norte, Glenn, Humboldt, Lake, Lassen, Mendocino, Modoc, Nevada, Plumas, Shasta, Sierra, Siskiyou, Tehama, and Trinity Counties.
Source (TOP CHART): Author calculations from Bureau of Economic Analysis data.

Note (BOTTOM CHART): Share of regional population with a bachelor’s degree or higher compared to statewide share in each year. Source (BOTTOM CHART):Author calculations from the 1980 and 2000 Decennial Censuses and the 2014 American Community Survey, age 25–64 in California.

Learn more

Will California Run Out of College Graduates?
Income Inequality and the Safety Net in California

“Sin” Taxes on the Ballot This Fall

Two measures have qualified for the November ballot that ask California voters to increase so-called “sin” taxes. One measure, the Healthcare, Research, and Prevention Tobacco Tax Act, will add an additional $2.00 per pack to cigarettes sold in the state. Currently, the tax is $0.87 per pack, which ranks lower than the cigarette tax in 33 other states. The other measure, the Adult Use of Marijuana Act, proposes to legalize the recreational use of marijuana and impose a state tax on its sales.

States use sin taxes not only to raise revenue for state treasuries, but also to affect behavior. The notion is that as the price of a product goes up, consumption will drop, and with that drop, negative societal consequences—the rate of lung cancer, for instance—will decrease. In fact, revenue from sin taxes often fund related treatment or health care programs.

Though it is early on in the campaigns, Californians hold favorable views of both ballot measures. According to the May 2016 PPIC survey, 67% of likely voters favor an increase in the cigarette tax to fund health care and 60% favor marijuana legalization.

While there are a number of reasons voters may support or oppose these measures, our focus here is on the revenue implications.

How much more money could these taxes bring in?

Both measures hold promise for raising significant funds and represent an alternative source of revenue in a state that is heavily dependent upon personal income taxes. Together, they could bring in more than $2 billion in state revenue. This would be significantly more than the state’s other sin tax on alcohol, which raised about $350 million in 2014.

The state reported more than $800 million in tobacco tax revenue in 2014. An additional $2.00 per pack would more than triple the current tax, suggesting a significant jump in total revenue. The Legislative Analyst’s Office estimates that an additional $1 billion to $1.4 billion would be raised should the proposition pass.

Why wouldn’t total tobacco revenue triple? Total revenue will be determined by both the tax rate and the amount of tobacco purchased. If the increase has the desired effect, cigarette smoking will decline in the future. That, combined with the fact that California recently raised its smoking age to 21, should have an impact on total consumption. Indeed, the share of individuals who smoke cigarettes has been declining in California, from 18.6% in 1996 to 12.8% in 2014. In comparison, alcohol consumption has decreased since 1977, but has remained consistent over the past 20 years.

Nationally, California had the second-lowest cigarette smoking rate in 2014 (after Utah). But it’s worth noting that e-cigarette use nearly doubled among California adults from 1.8% in 2012 to 3.5% in 2013, complicating estimates of future revenue. If passed, the tax would also apply to e-cigarettes. If Californians use e-cigarettes as a substitute for cigarettes, then the measure will also capture revenue due to increased e-cigarette use. As we noted in our recent report, the additional revenue generated by taxing marijuana could be as much as $1 billion a year for the state. In the first full year after legalizing recreational marijuana, Colorado raised just over $120 million in state revenue, and Washington collected slightly less than $130 million. Given California’s larger population, the $1 billion figure is in the right ballpark. But since much is still unknown about the marijuana market, any estimate should be treated with caution.

How does California compare with other states?

The proposed taxes would be comparable to those currently in place in other states. If the tobacco tax passes, it would boost per capita revenue from $21 per resident to $50 per resident. This would still be below the national average of $57 per resident, though it would be much closer. For marijuana, the estimate of $1 billion in revenue would translate to about $26 per resident. Though there isn’t a national reference point for marijuana taxes, this number would be higher than the per capita amounts raised in Colorado and Washington. Interestingly, California’s alcohol tax revenue is less than most other states. On a per capita basis, California ranks 40th of the 50 states in alcohol revenue collected. In 2014, California collected only $9 per resident in alcohol taxes compared to the rest of the country, which raised $21 per resident. Doubling this rate—which would still be below the national average—could add another $350 million to state revenues.

Sources: National Institute of Alcohol Abuse and Alcoholism (NIAAA), Centers for Disease Control and Prevention (CDC), US Census, Office of Attorney General (OAG), Legislative Analyst’s Office (LAO).

Notes: Per capita alcohol consumption is taken from the NIAAA, which calculates consumption based on sales and a conversion of gallons in terms of pure alcohol (ethanol). Population data are drawn from the US Census. Cigarette smoking rates are from the CDC.

The Employment Value of Higher Education

As of June, California’s unemployment rate was 5.4%, the lowest that it’s been in nearly nine years. Of course, in that nine years, California’s workers have seen drastic swings in employment opportunity. Higher education is a key determinant of how people fare when the economy slows.

Californians with education credentials beyond high school, from an associate’s degree up to a doctoral degree, have lower than average unemployment rates in general – and had smaller spikes in unemployment during the recession. Even workers with just some schooling beyond high school, but less than an associate’s or bachelor’s degree, fare systematically better than those without any college experience. The following figure shows how unemployment varied according to education levels since 2008. These estimates rely on detailed Census Bureau survey data, which is produced with a significant lag, so the most recent information we have pertains to calendar year 2014.

Although employment across all categories has recovered to its pre-recession levels (or nearly so), Californians with more education have had a smoother course. Unemployment among workers without a post-secondary degree jumped 5–7 points during the recession, but increased by only 2 points for those with advanced degrees.

In good times and in bad, the likelihood of employment is higher the more education Californians have. This—along with generally higher wages—contributes to the substantial gain in lifetime earnings for those who obtain post-secondary credentials. Despite widespread discussion about the value of a college education, the lifetime economic opportunity afforded by post-secondary credentials is not up for debate.

Chart source: Author calculations from American Community Survey data, age 25 and older.

Learn more

Will California Run out of College Graduates?
California’s Need for Skilled Workers
Student Debt and the Value of a College Degree

Commentary: California Needs Better Account of Groundwater


This commentary was published in the Sacramento Bee today, Thursday, July 21, 2016.

California’s prolonged drought has driven home the need to improve our balance sheet for water—determining how much there is, who has claims to it, and what is actually being used. New research by the PPIC Water Policy Center compared California to 11 other western states, Australia and Spain—places that also struggle with water scarcity—and found significant room for improvement.

Read the full commentary on sacbee.com.

Learn more

Read Accounting for California’s Water (July 2016)
Visit the PPIC Water Policy Center