Is Stem Cell Research the Next Big Thing for California?

Gov. Arnold Schwarzenegger has not taken a position on arguably the most unique, intriguing measure on the Nov. 2 state ballot. That’s Proposition 71: a $3-billion bond issue for embryonic stem cell research. But he did recently make a compelling argument for the initiative without mentioning it.

“Our state is busy writing the next chapter of its economic success story,” Schwarzenegger told his Council of Economic Advisors. “We are already the world’s undisputed leader in biotechnology. More than 400 biotech companies call California home....

“In a decade, this will be an enormous industry in California, creating countless new jobs and driving our economic engine.”

That’s a message being pitched by Prop. 71 backers. With this proposal, they argue, California can become the cutting edge of embryonic stem cell research and continue to ride a wave of the 21st century, biotech. Medical science can be for California what aerospace, oil and gold once were, they assert.

“It’s a stretch,” says former Secretary of State George Shultz, chairman of the governor’s economic council, while quickly adding: “Well, I’m sure it’s true.

“But I think you really have to look at this and judge it by the possibility for human betterment. And I hear people say, ‘Well, why should California support stuff that will help people in New York or help people in Rome? And I say, well, why not if it’ll help people in California.”

Shultz, a Hoover Institution fellow, strongly backs Prop. 71.

“The track record in this country of [government] investment in basic research has been extraordinarily positive,” he says. “You look around and see how different life is than it used to be, and a lot of it comes right out of investment in basic research -- as distinct from the kind of development research that a company would do....

“I know a lot of people in biological sciences. Some have Nobel Prizes. And they are uniformly, wildly enthusiastic about the prospects” of Prop. 71.

California wouldn’t be venturing into this research if President Bush weren’t so timid about using embryonic cells. He’s the first president to spend federal money on stem cells, but has restricted funding to only a few existing embryonic cell “lines.”

“To destroy life to save life is one of the real ethical dilemmas that we face,” Bush said in Friday’s debate with Sen. John Kerry. “I made the decision to balance science and ethics.”

Kerry’s position is different: “We can do ethically guided embryonic stem cell research. We have 100,000 to 200,000 embryos that are frozen in nitrogen today from fertility clinics.... They’re either going to be destroyed or left frozen. We have the option ... of curing Parkinson’s, curing diabetes, curing ... spinal cord injury.... It is respecting life to reach for that cure.”

Prop. 71 is sponsored and bankrolled largely by parents of severely ill children who are hoping for cures.

Film producer Jerry Zucker’s daughter Katie, 16, is diabetic. “If a cure happens in 10 or 15 years, it could change her life dramatically,” Zucker notes. “Not only hers but her children’s....

“For California, it’s an investment in reduced healthcare costs. When they came up with a vaccine for polio, that saved billions of dollars. Would you want to invest in a polio vaccine or more iron lungs?”

Prop. 71 requires all the research to be done in California.

This would be the first time California has sold bonds for research. Bonds usually finance brick and mortar projects. These bonds would be repaid out of the general fund -- and further squeeze health programs, such as care for low-income children and in-home services for the disabled, plus law enforcement and environmental projection.

Sacramento is in such horrible shape financially that the proposition-writers provided for a five-year delay in payments on principal and interest. Nothing down, no payment until 2010. Then the payments would stretch out over 30 years, for research completed in roughly 12 years. Interest is projected at $3 billion, for a total cost of $6 billion.

There’s legitimate reason to oppose this. It’s not all about “pro-life” -- and hardly any of the opposition pitch is.

“I don’t know why it’s the responsibility of the taxpayers of California, which has the country’s lowest credit rating and the highest debt service, to finance research for the rest of the world,” says Sen. Tom McClintock (R-Thousand Oaks).

“Our kids are going to have their own research to fund 30 years from now without having to pay for research that may or may not have panned out 30 years earlier.”

Orange County Treasurer John Moorlach: “I see it as another financial boondoggle.”

Debra Burger, president of the California Nurses Assn.: “There’s not enough safeguards for the women [donors].”

On the other side is state Treasurer Phil Angelides: “Unlike the governor’s deficit bonds, this has a great chance of producing new revenue and wealth.”

And Controller Steve Westly: “California needs to get to the point where our bold risks are not all behind us. Everyone keeps looking back at the state water project and the UCs.”

But it’s hard to look in the mirror and defend such longtime borrowing when we’re already almost maxed out on the credit card.

Yet, as Shultz told me: “Californians like to do things that are out of the way. People in the East all think we’re crazy and a little nutty. So let’s be different.”

State government already is screwed up fiscally. This may screw it up more. But at least it’ll be for a good cause, one that can make us proud. We’re buying dreams -- that may come true.