A Newsom-backed proposal to punish oil companies for high profits 'will
only make matters worse for the California consumer,' expert tells state committee
Democratic California Gov. Gavin Newsom's plan to limit oil companies'
profits was met with criticism by Democrats, Republicans and experts alike
at a state hearing earlier this week.
During the hearing — hosted Wednesday by the state's Senate Committee on Energy, Utilities and Communications — experts balked at a proposal to
punish oil exploration and refining companies with a financial penalty if
found to increase gasoline prices "excessively." The hearing was held to consider SBX1-2, legislation backed by Newsom and proposed by Democratic
state Sen. Nancy Skinner in December.
"Enacting SBX1-2 is not in the best interests of the consumer, will not
reduce retail pump prices and is not in the best long-term economic
interests of California," said Michael Mische, a professor at the
University of Southern California Marshall School of Business. "There are better alternatives."
He added that the bill "will only make matters worse for the California consumer" and "serve as a disincentive for investing in supply and new technologies for the refiners."