Battles over business regulation are renewed in California’s Capitol

from Dan WaltersCalMatters

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A nearly two-hour hearing in the Assembly Judiciary Committee on Tuesday encapsulated the Capitol’s longest running conflict — spanning at least half a century and counting.

It pits the state’s business community against four interest groups over how much corporate operations should be regulated by new laws, new rules and lawsuits.

Each year, the four interest groups—unions, plaintiffs’ attorneys, consumer organizations, and environmentalists—persuade friendly lawmakers to introduce bills that would impose new regulations, raise taxes and fees, or make it easier to litigate.

The measures are needed, sponsors say, to protect consumers and workers from mistreatment by corporate interests.

Each year, affected business interests argue that overregulation generates costs that will be passed on to consumers as higher prices, or will reduce employment or encourage corporations to leave California.

Tuesday’s debate is over Assembly Bill 1776which would expand California’s 119-year-old law known as the Cartwright Act, which prohibits companies from colluding to create monopolies that undermine competition.

The measure, if passed, would ratify the recommendations of the California Law Revision Commission and allow individual companies to be sued for monopolization even if they are not in collusion with other corporations.

Trial lawyers, labor unions and dozens of other groups support the measure passed by the Assemblywoman Cecilia Aguilar-CurryDemocrat from Davis. Supporters have lined up to say the legislation is needed to curb the anti-consumer dominance of corporate giants, with Amazon being one obvious target.

An even longer list of opponents, led by the California Chamber of Commerce, opposes the measure because it opens the way for extensive litigation that would discourage business investment and technological innovation on the knee cap.

AB 1776 is one of the main targets of the business community this year, but not the only one.

The Chamber of Commerce, the Business Round Table, California Association of Manufacturers and Technology and other business groups have drawn up lists of several dozen bills they will oppose.

The House no longer publishes its annual list of “job-killing bills,” but still cites 26 “harmful legislative proposals”, is opposed, some of which appear on other lists.

Bills to regulate the use of artificial intelligence are important — a conflict that could embroil Gov. Gavin Newsom, who has largely defended AI from calls for more oversight.

Another big point in corporate goal lists is Senate Bill 982 which, like AB 1776, would increase corporate exposure to potentially costly litigation.

It is carried by the state Senator Scott WienerDemocrat from San Francisco, running for Congress this year, the measure would allow companies to be sued for their contribution to the effects of climate change.

The Business Roundtable and the manufacturers’ association touted SB 982 as an open invitation to the attorney general and perhaps private lawyers to file massive lawsuits, particularly against oil companies, claiming they are a “significant factor” in climate impacts.

“What are these lawmakers thinking? California families are already paying some of the highest prices in the country, and this bill will make it worse,” said Rob Lapsley, president of the Business Roundtable, as the group published an analysis of the bill’s potential impacts.

“SB 982 adds another layer of cost to gasoline and diesel, pushing prices even higher at the gas station and throughout the economy. When you raise diesel prices, you raise the cost of everything — groceries, housing, transportation — everything Californians rely on every day.”

This year’s version of the eternal conflict plays out against what should be seriousness concern for the state’s economy. The Legislature’s budget analyst, Gav Petek, described it as “sluggish,” with virtually no net job growth and other measures of economic health, as well as tech job cuts and some spectacular corporate migration out of California.

This article was originally published on CalMatters and is republished under Creative Commons Attribution-NonCommercial-No Derivatives license.