California: Stanford economists praise Governor Newsom’s plan to prevent gas price spikes
The Californer/10293007

~ In a recent article published by the Sacramento Bee, Stanford economists have praised Governor Gavin Newsom's plan to prevent gas price spikes. The economists analyzed the governor's special session plan and concluded that it is an economically sound policy that addresses an important problem in a well-targeted way.

According to the economists, Californians paid an extra $2.2 billion for gasoline during last September's gas price spike, which lasted for over 100 days. They attribute this spike to the fact that the California gasoline market does not function properly. In-state suppliers are highly concentrated, with only five companies controlling 98 percent of the capacity to produce California-grade gas. This concentration of market power limits the incentives for these suppliers to build up robust reserves.

The economists also refuted Big Oil's talking points that the proposal would require new infrastructure and drive prices in the West higher. They argue that during a supply crunch, releasing these inventories would actually put downward pressure on prices in California. Additionally, they believe that this additional supply would free up refinery capacity to serve neighboring states like Nevada and Arizona, ultimately reducing prices in those markets as well.

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The article also highlights the impact of last year's gas price spike on Californians. Families were forced to choose between busting their budgets or canceling planned Labor Day road trips, while small businesses struggled with increased transportation costs. The spike lasted for 105 days and resulted in an extra $2.2 billion being paid by Californians for gasoline.

Governor Newsom's proposal aims to prevent future price spikes by increasing gasoline inventories to avoid shortages. The article concludes by stating that he is on the right track and his plan could have prevented last year's devastating spike.

In other news, Governor Newsom has signed legislation promoting fiscal responsibility and budget stability in his final act of this year's legislative session. The new law will create tools for the state to set aside a portion of anticipated surplus funds in future fiscal years.

The governor also announced his nomination of three Court of Appeal Justices, including Justice Brian M. Hoffstadt as Presiding Justice of the Second District Court of Appeal, Division Five, and Judge Michelle C. Kim as an Associate Justice of the Second District Court of Appeal. These appointments mark another milestone in Governor Newsom's efforts to promote diversity and inclusion in the judicial system.

As California continues to face challenges and make progress, Governor Newsom remains committed to implementing policies that benefit all Californians and promote a more equitable and prosperous state.

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