Lost In The Legislative Flurry

A lot of people are looking at the rush to enact legislation at the end of the session in Sacramento as some kind of vindication for the Governor's New Moderation. I've written in more depth that this looks to me like Monet politics.

Furthermore, there's another bill that reached the Governor's desk on Monday that I'm guessing you won't hear much about. But you should, because it highlights the key difference between Phil Angelides and Arnold Schwarzenegger: a candidate for all Californians versus a governor for special interests and corporate contributors.

CalPIRG reports that AB 675, The Honest Corporate Tax Reporting Act, has passed both Houses and reached the Governor's desk:

Corporations report profits to the California state tax board that are on average 20 percent lower than the profits they report to shareholders. Because corporations keep two sets of books, some companies are able to manipulate profit numbers through the use of offshore tax shelters and other tactics. The Honest Corporate Tax Reporting Act, AB 675 (Klehs), would require corporations to disclose and explain any differences between profits reported to shareholders and profits reported to the state tax board. The Franchise Tax Board has characterized the reporting required in this bill as “a significant audit tool” that “could assist auditors in identifying tax shelter activity and dissuade some taxpayers from entering into tax avoidance schemes.”

These are the kind of corporate tax loopholes that Phil Angelides has vowed to close. The question is, will the governor sign it?

I'm guessing no, though I'd like to be surprised. But when rich corporate contributors bankroll your campaign, how could you turn around and force their hand on their tax-avoidance schemes? After all, we have one example of the Governor letting his friends off the hook. On the flip:

Oil Firms Cleared Of Price Gouging

Oil companies did not engage in price gouging at the gas pump earlier this year, state regulators said Tuesday -- at least as far as they can tell.

A monthslong investigation revealed that although refineries made higher profits in California, it wasn't clear they were excessive -- because regulators don't have enough financial information from oil companies to say for sure.

But based on the information they did collect, "We found no evidence of market manipulation,'' said Joseph Desmond, undersecretary for energy affairs in the California Resources Agency.

The Governor personally set this investigation into motion with a very public announcement. This revelation happened a week ago. Tell me if you've heard about it.

It simply strains credulity that a increase in global oil prices, which concerns crude that won't get to market for six months, can impact gas prices in the state in the matter of a couple days. But the commission had no opportunity to force the oil companies to provide the financial evidence they needed. And the governor certainly didn't use the bully pulpit to get those laws changed. In fact, the energy commission pleaded with the governor to do just that. Remember this quote?

"I want to assure the citizens of the state that whatever the reasons for'' the spike in gas prices, Schwarzenegger said at the time, "we will get to the bottom of it.''

But he made no effort to get to the bottom of it, other than commissioning a halfhearted investigation that, in Angelides' words, would have yielded the same conclusion "if the oil industry had written the investigation themselves."

I suspect we'll hear the same kind of rhetoric on the Honest Corporate Tax Reporting Act. Or we'll hear nothing at all, as the bill fades slowly away.