Another Delaware LLC Political Scam: California Air Resources Board Becomes Secretive Entity to “Handle” $50 Billion Plus in Cap and Trade Carbon-Emission Funds
Aug 16, 2012 | Christine Mann
I believe in aggressive action to protect our environment, and that big
business should have to pay in some way for the damage they do. But
‘cap and trade’ policy – which has been presented to
environmentally-minded voters as the dream solution to minimize
global-warming causing carbon emissions, as it ‘caps’ emission levels
and then lets those who pollute above that level pay for ‘traded’
carbon credits -- is actually a massive scam. This policy is actually
providing loopholes that – believe it or not -- allow the same
corporations that are big polluters to collect, through tricky
accounting, the vast sums garnered from tax-payers who think they are
The money at stake is immense: in California alone, the $50-100 billion dollars
was devoted to this ‘solution’ to managing greenhouse gases. But it did
not take long for a Delaware LLC to form, which allowed for a complete
blackout around who actually gets that money.
I have written about the corruption posed by the Delaware LLC; this
loophole legally allows any legislator to, by becoming a partner in such
an entity, profit from the very legislation he or she is passing. I
exposed the fact that dozens of “state’ government development deals are
actually being turned into untransparent Delaware LLCs, and that
individual politicians such as Sarah Palin are increasingly benefiting
from the profits of these entities; Palin’s new house was purchased,
allowing for mysterious financing, by a Delaware LLC.
Investigative journalist group CalWatchdog reporter Katy Grimes
recently broke the story that the California Air Resources Board – a
government body that is suppose to be responsible for air quuality – has
quietly turned itself into a secretive Delaware LLC: "The little jewel,
secretly placed into a trailer bill in the recently passed state
budget, will allow the California Air Resources Board to conduct state
business without any of that pesky transparency stuff,” she wrote.
According to legislative staffers, the California Resources Board,
with help from Democratic Assembly Speaker John Perez, D-Los Angeles,
figured out a way to exempt itself from the state’s open meeting
act….Government Code 11120, the Bagley-Keene Open Meeting Act, is
explicitly exempted in the language of budget trailer bill SB 1018.
"That was the final nail in the coffin of transparency," a Capitol
staffer commented. In other words, John Perez buried in an entirely
unrelated bill, language that allows the Board to slip from public
accountability into a privately held status – with no oversight, and
freedom to move around billions of taxpayer dollars to unexemanable
What happened then? the CARB set up a company called Western Climate Inc., to manage the upcoming cap and trade auctions. I last wrote about the Delaware LLC , I called it government and corporate America's dirty little secret -- and this example is as dirty as it gets.
Delaware companies, as I noted in that piece, are more secretive than
Swiss bank accounts and they allow investors in corporations
unprecedented power to hide their wealth and their individual identities
through its secretive legal methods.
So now, the new company – “Western Climate Initiative’ -- is in a
position to make politicians into anonymous investors -- who can be
paid off, via the LLc, by companies that are looking to profit from the
carbon trade auctions, and from the allocation of the funds.
At the same time, Assembly Bill 1532,
sponsored by that same John Perez, D-Los Angeles, would deposit Cap and
Trade pollution permit monies into a new “Greenhouse Gas Reduction
Account.” Who would control all that money? The California Air Resources
Board – now with their attached Llc.
CalWatchdog reporter Katy Grimes astutely notes that, "Delaware is not
subject to California state open meeting or sunshine laws, leaving many
questioning why CARB opted for such secrecy. The only reason to register
the corporation in Delaware is the lack public or legislative scrutiny
on any of their meetings or actions they take."
The bottom line is the way the California state Legislature is passing
“cap and trade” bills – and handling the subsequent billions of dollars
-- is highly suspect. Haven't we learned that no matter how good the
messaging, or how noble supposed cause -- it is never a good idea to
allow giant slush funds to be amassed in secret by politicians.
:: photo courtesy of cwillbounds, via Creative Commons license ::
Christine Mann has a Master's degree in Architecture and is currently a
candidate for NCARB licensure. She is an avid environmentalist and
bleeding heart Libertarian and interested in real solutions that solve
problems and empower people.