It turns out that there wasn't really an excuse for expecting the California deregulation scheme to lower prices. A very similar scheme had already been tried in England, and it led to an upward price spiral just as it did here! Only repeated regulatory interventions stopped the problem, and the England and Wales Power Pool was finally junked in March 2001 (though many say that, after debugging, it eventually resulted in a significant improvement over the old pre-reform setup). Any responsible and professional review of the proposal by governmental staff would have turned this up as a reason not to do it, or at least to be ready to intervene with price controls. Such review was apparently not permitted to be part of the decision making process.
By the way, Al Gore endorsed the California deregulation plan as a model for other states. Woops! He's lucky to have won the state after that. Clinton was favorably disposed to it too. Adds a little extra edge to the riddle going around now: "How are Dubya and Clinton alike? They'll both do anything for a Lay."
Here is the Legislature's official history of the passage of the deregulation bill. Check this out: it turns out that nobody voted against it! Well, there was one version in the middle of the process where all but a few voted against it, and then after one more conference committee tweak, everyone voted for it. In other words, both parties were deciding together how they wanted the bill to read, and there was no disagreement between them. Almost as if a single player were calling the shots for everybody. About the only major-league politician to speak out against the deal was Ralph Nader. Now do you begin to understand why some of us voted for him in 2000? (By the way, he also called for airplanes to have their cockpit doors toughened to stop hijackers, well before 2001. The airline industry made sure it didn't happen.)
I saw Ralph Nader on TV this morning (a day or two after writing the paragraph above, by coincidence), promoting his book Crashing the Party. He described what's going on around us as a "corporate crime wave" and urged as many of us as possible to take five minutes to write to our congress-organisms and demand that they address the Enron mess with real systemic reforms for corporate criminality in general, not just treating Enron as an isolated special case. "I know these people in Congress. When the people take an interest and start demanding action, they're terrified." [paraphrased] I can only add my voice to his. For Californians, I particularly suggest leaning hard on Senator Dianne Feinstein. Here's my letter to her:
I very much hope that your response to the Enron scandal will not be just to hold accountable the particular criminals in this one egregious case. Enron is probably not the only large company whose entire business model is founded on bribery. The problem of corporations buying what is euphemistically called "access" is, as many have noted, systemic in today's business climate. I hope that you will do something genuinely constructive to change this, so that policy is guided less by contributors with special agendas, and more by voting constituents. You must support both better oversight of the kind of financial shenanigans that companies like Enron put to the same uses that organized crime groups do, and also effective campaign finance reform.My letter to Senator Boxer is less confrontational. And as for my representative, well, I think I can count on Barbara Lee. (Yes, my representative is the Barbara Lee who made the sole vote against bombing Afghanistan.) But I mentioned it to her anyway -- I suggested a simple limit of $1000 per donor per election for any candidate or party.
Perhaps this will help reduce some of the peculiar policy choices you have made yourself, such as backing PG&E in opposition to the San Francisco initiative for a public utility company.
Here's a tidbit from Boxer which I consider a nice start on responding to the Enron fallout.
For me, this whole process of following the California
electricity crisis has been eye-opening. I never really understood
before just how corrupt our political system is, how much of it is controlled
by legalized bribery. And also (this is a point Nader made strongly)
how little the Democrats and Republicans differ from each other when they
aren't being watched. The only difference that counts, on this issue,
is that the Republicans, with some exceptions like John McCain, will usually
stand by a policy of "Keep bribery safe and legal!" in public, while many
Democrats will switch to an anti-bribery position once put on the spot
by public attention. (McCain ran for the Republican nomination as,
basically, the anti-corruption candidate, and was defeated solely by money.)
I think there's nothing unfair at this point about labelling the Republicans
as the Party of Bribery... so long as we don't forget that the Democrats
are taking nearly as much and delivering nearly as much. But the
Democrats at least tend to abandon the practice if they're being watched,
while the golden boys of the Republicans, like Dubya (who, like a number
of other GOP figureheads, may truly have never done an honest day's work
in his life), are much more prone to stand by their generous friends through
thick and thin, and write an entire platform around selling the interests
of their donors to the people and protecting their opportunities to keep
taking more bribes.
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