SACRAMENTO —
At a campaign rally in the Coachella Valley on Saturday, former President Donald Trump cited California’s cost of living and the highest cost of living in the nation as an example of how Vice President Kamala Harris and other “radical Democrats” are destroying the state. Class blamed gas prices.
“Right now, California has high inflation, high taxes, high gas prices, high cost of living, and a lot of regulation,” he said. “We will not let Kamala Harris do to America what she did to California.”
Two days later, Gov. Gavin Newsom celebrated at the state Capitol the passage of a new state law that could curb soaring gasoline prices by giving regulators the power to require California oil refiners to hold more inventory. Ta.
Newsom and other Democrats introduced the bill as a solution to rising gas prices. With less than three weeks until the Nov. 5 election, affordability has become a key political issue and a potential vulnerability for Harris’ presidential campaign.
“It’s time for us to stand up,” Newsom said after signing the bill Monday. “This is the fourth largest market in the world. This is a big deal.”
The newly passed bill gives Newsom a victory in his political battle with the oil industry, but it remains unclear whether Harris or other Democratic candidates will benefit from the governor’s victory.
Newsom’s law won’t immediately lower gas prices in California. Experts say it could ultimately reduce future price increases, but regulators must complete a thorough review process before enacting new rules.
The governors of Arizona and Nevada warned in a letter that the bill could raise costs for voters and heighten concerns in key battleground states about California’s policy.
Mr. Newsom called lawmakers back to Sacramento for a special session to pass the policy. But at the same time, his administration is expected to adopt tougher limits on carbon fuels, potentially raising the cost by almost $0.50 a gallon or more in the days after the election.
At a news conference, the governor declined to answer questions about whether he thought the new law would have an impact on Democrats in elections, insisting the effort was not about politics. In a video posted to social media minutes before signing the bill into law on Monday, Newsom said the industry intentionally raised prices to scare voters during the election and “colluded” with President Trump. accused of doing so.
Opponents have denounced his approach to gas prices as an example of “political theater.”
“This is politics, not policy,” said Katherine Rehuis Boyd, chief executive officer of the Western States Petroleum Association. “This is a show. This is never good policy.”
Newsom and the WSPA have been embroiled in a political battle over gas prices since the summer of 2022. The governor ran an ad criticizing Gov. Ron DeSantis’ conservative policies in Florida, which prompted a backlash from the WSPA, which blamed Newsom for California having the highest gasoline prices in the nation. price.
Since then, the governor has repeatedly accused the industry of intentionally gouging consumers.
The administration notes that unplanned maintenance issues with refinery equipment cause prices to soar, limiting the amount of gasoline available in the state and increasing prices. The administration says it can prevent such shortages by requiring refineries to increase their fuel stockpiles.
Rehuis Boyd argued that requiring refineries to store more gasoline would increase costs for companies and push up prices at the pump. The industry contends that gas prices, which are among the highest in the nation in California, which has environmental policies that limit oil drilling and production, are a matter of supply and demand.
Rehuis-Boyd said the cheapest way to lower gas prices is for oil companies to increase crude oil production in California and become less reliant on supplies from overseas.
He said the state should work more closely with California’s few refineries to ensure there is enough gasoline in the state, rather than introducing new regulations that would limit profits and drive companies out of business. said.
“We have a governor who is not interested in the conversation,” Rehuis-Boyd said. “He’s the only governor I’ve never met, because he doesn’t.”
This is the second year in two years that Mr. Newsom has pressed lawmakers to introduce new oil regulations, an issue that has polarized Democrats who want to fight climate change and lower gas prices. There is.
In 2023, lawmakers balked at passing Mr. Newsom’s proposal to penalize oil companies for excessive profits. Instead, lawmakers introduced new oversight of the industry and gave regulators the power to limit profits through the rulemaking process, but no new restrictions have emerged so far.
Democrats in Congress have been reluctant to pass Newsom’s new oil bill again this year.
Two weeks before the regular session adjourns at the end of August, Mr. Newsom will require oil refiners to maintain stable inventories to prevent fuel shortages and price spikes when refinery equipment is shut down for maintenance. The proposal was announced.
Assembly Speaker Robert Rivas (D-Hollister) refused to take the bill up for a floor vote at the end of the session, arguing that his caucus would not rush to pass the bill without proper policy scrutiny. He agreed to address the proposal at a special meeting.
Senate Pro Tem Mike McGuire (D-Healdsburg) took the opposite approach. He said his caucus was prepared to pass the bill at the end of the session and initially refused to go into a special session before complying with the governor’s request.
During the special session, Congress held a series of public hearings before passing the bill earlier this month. The Senate quickly approved the proposal the following week.
While some liberal Democrats were quietly furious that the governor forced a vote on a different political proposal, many felt the policy could ultimately reduce price hikes for consumers. .
“The data is clear: When refineries are unable to plan for supply during routine maintenance, price increases occur,” said Assemblyman Greg Hart (D-Santa Barbara). “This bill would hold oil companies accountable for resupply plans if their refineries are shut down, ultimately saving Californians billions of dollars.”
Several Democrats running for battleground seats in November either did not vote for the bill or opposed it.
State Sen. Dave Minn (D-Irvine), who declined to vote for the proposal, said he supports the goal of addressing the problem of high gas prices in the state, but disagrees with this approach. Minn is currently embroiled in a tight race against Republican Scott Baugh in Orange County.
Ming said opponents of Newsom’s proposal are “raising serious concerns” about whether it would be effective at lowering gas prices or whether it would backfire.
“These concerns deserve fair and thorough scrutiny, but it is difficult to do so in a special session of Congress just weeks before many of our current members retire,” Min said in a statement.
Republicans said Democrats would lower gas taxes if they were serious about addressing affordability issues.
“So who’s making the money?” asked state Sen. Brian Dahl (R-Beaver). “Who’s gobbling up Californians for every gallon of gas? It’s the government. $1.42 per gallon of gas goes toward state, local, or federal taxes.”
Opposition to the proposal from unions representing workers in the industry added to the pressure on Democrats.
Tom Baca, Western States International vice president of the International Brotherhood of Boilermakers, said giving regulators control over maintenance schedules is a good idea, as opposed to relying on the insight of workers with deep knowledge of the equipment. He said it could put him in a dangerous situation. I’m late.
David Sikorski, business manager for International Union of Driving Engineers Local 12, said the special session was “unnecessary.”
His union represents 21,000 workers in California, Arizona and Nevada. He said Newsom’s policies could be a burden for Harris in neighboring battleground states of Arizona and Nevada.
“We’ve created a lot of momentum, we’ve really hit the ground running in Arizona, and we’ve committed a lot of resources to electing friendly politicians and Kamala Harris in that state,” he said. Ta. “This is just another hurdle we must overcome together with our members and the working public.”
