ENRON & FRIENDS

October 11, 2003:  Sigh.  Ahnuld won.

I am very attached to California.  When I hear a word like "homeland", I don't think of the United States; to me it means the state of California.  I love this place with a passion that goes somewhat beyond the normal.  As a natural landscape, California has blessings and wonders in such abundance that few places on Earth -- Hawaii being the main one that comes to mind -- can surpass it as being one of the finest gifts that nature has given to us.  As a society, California has done great things... in almost every way that the USA has outshone other nations, so has California outshone the rest of the USA, creating in the process what is possibly the most successfuly diverse culture to be found anywhere.  We have led the other states, and the world, into the future -- not by rhetoric but by example.  There is much for my people to be proud of.

And so, when talking to friends (or even enemies) from out of state, I have sometimes been known to boast rather excessively of Californian superiority.  I've even been known to claim facetiously that the state is inhabited by a new species that has evolved beyond other humanity, which will reveal itself and launch its world takeover around July 2007.  And people roll their eyes and shake their heads at my parochial bullshit, and I just smile, knowing that they're the ones who are missing out.

Then the world watched the voting public of my home state use a bogus mid-term election to pick, by a decisively large margin, a dumb asshole movie star as the new Governor.  And I feel like a complete jackass.  Throughout the rest of the USA, everyone is laughing at us, and we deserve every last snicker.  Boy do I wish I had done a little less boasting.

The gap in male vs. female votes for Ahnuld seems to have actually narrowed after the late stories came out about his ongoing abuse of women.  (Which were actually old news, many of the stories published more than two years ago, despite his campaign's depiction of these as last-minute character assassination.)

By the way, the Ninth Circuit Court of Appeals ruling that would have delayed the recall vote until March, which was in effect when I wrote the previous edition, got overturned before reaching the Supreme Court, by a larger panel of Ninth Circuit judges.  And no doubt Antonin Scalia and his partisan pals breathed a huge sigh of relief.  He would have been faced with the choice between handing anti-recallists a victory on dubious constitutional grounds, or refuting those dubious grounds by having to repudiate his own logic for handing Florida to George W. Bush in 2000, because the pro-delay argument was based on the same rationale that Scalia used in Bush v. Gore.  I would have loved to see him squirm, but it was not to be.  In the end, nobody appealed it up to them.  There really wasn't time, and the anti-recall plaintiffs must have figured that court would never give them a chance anyway.

Shortly after writing the previous edition of Enron & Friends, thinking about the Diebold paperless voting machine mess and my own decision to vote absentee rather than use those machines, a light bulb went on over my head.  I was thinking about telling my friends that they should vote absentee too, and a light bulb went on: what if we got lots and lots of people to respond to the electronic voting issue by all demanding absentee ballots... and got them to all tell the registrars of voters that their reason was because they don't trust their votes to be counted accurately by the electronic systems?  Why, it would give county governments a true cost-saving incentive to use paper ballots again.  It would also put pressure on Congress to require a verifiable paper trail, which they are all too likely to dismiss as unnecessary right now.  In the existing debate over electronic voting, those arguing against it are basically in the position of having to persuade government officials that there is a compelling reason to junk the Diebold and ES&S electronic systems.  But if the general public starts just generally refusing to use those machines, they don't have to prove they're correct in distrusting the systems, they just have to insist on their right to a paper absentee ballot.  This could be more effective than arguing before elected and unelected officials who probably, in too many cases, have already been persuaded behind the scenes, regardless of what the public says.

This is the first time I have ever personally come up with a specific original plan for activism.  And it left me with this question: do I feel like I could be somebody who could lead a movement?  Somebody who could go out there and organize and publicize a new and unknown cause, and get people to sign "I won't vote electronically" pledges?  I decided I probably am not up to meeting that challenge.  So, I decided, I'd better contact people already active in the anti-electronic voting effort.  Since I'm a computer programmer, it seemed to me that the logical group to contact would be Roxanne Jekot's group of programmer-activists.  So I wrote to Roxanne Jekot.

She replied within half an hour, and one thing she said is that they are certainly not called the "Menopause Militia" -- some reporter got that wrong.  She also pointed out what I'd already seen earlier that morning: that Diebold has now succeeded in shutting own blackboxvoting.org as well as blackboxvoting.com, and is aggressively pursuing anyone else who posts their internal memos.  They even claim that providing a link to these memos is a copyright infringement!  This is, of course, an absurd abuse of the copyright rules, but most ISPs confronted with a cease-and-desist order based on those grounds are complying anyway.  Activists are naturally responding by copying the memos all over the place, including outside the US.

It was too late to apply the idea to the California recall.  But they say that a record number was being used for that election, which I guess is helpful.

Ahnuld won by a large enough margin so there's no question that any electoral cheating was needed to put him over the top -- the exit polls made it clear that his win was solid.  I would still be interested to see, though, if there is any sign that any extra votes were added.  What I envision is a statistical comparison of exit poll data vs. official vote totals, divided by type of voting system used.  It would certainly be interesting if, for instance, the exit polls matched the actual vote for Ahnuld in optical-scan counties, but underestimated the Ahnuld vote in touchscreen counties.  Or, on the other hand, if there's no such mismatch... it would be a good thing to have some reassurance that this vote was honest.  This would require getting more or less raw data from exit polls out of the news organizations that paid for them... I don't know how cooperative they might be with such a query.  Might take some work to sort it all out, but I'd like to know.

If I get heavily involved in the voting machine issue, I may have to put Enron & Friends on hiatus.  Keeping elections honest is more important, in the short term, than monitoring energy industry shenanigans, or random corrupt officials already in office.

But it looks like there's still some important issues coming for this space in the short term: Governor-elect Schwarzenegger just proposed a new and improved California electricity deregulation scheme.  Yes, you heard right, our deregulation scheme worked so well that Mr. businesses-don't-count-as-special-interests wants to bring it back!  Of course, it wouldn't exactly be the same as before... that would be a little too unbelievable.

Before the election, Loretta Lynch (head of the Public Utilities Commission and one of the first state officials to really fight the power bandits) said of Arnold's proposal, "I give his plans a grade of F.  Arnold would impose a failed policy on us."  Jeff Brown, another PUC member, says the plan will stick residential ratepayers with all the debt from the previous debacle -- debt which is held by the pirate companies who created the crisis... or by their bankruptcy courts.  Some other critics have accused him of merely repackaging much of the previous failed attempt at deregulation.  Many of the individuals who designed it are the same ones who worked on the original deregulation bill signed by Pete Wilson (who later became Arnold's campaign chief) -- Jessie Knight, for one, a Wilson appointee to the PUC.

The Utility Reform Network's senior attorney Mike Florio says "Deregulation has already cost the state $50,000,000,000, give or take.  Why anyone would want to do that again is mystifying to us."

But others say that there are aspects of the new plan that would be a real improvement, bringing genuine competition to areas where the previous one produced only fake competition.

Now that the election is over, Schwarzenegger's plan has been announced in more solid form.  And he'll soon have to do something, because the majority of the notorious long term contracts that governor Davis negotiated -- for which Arnold had severe criticism -- are going to expire during Schwarzenegger's term.

One flaw of the old plan that the new one avoids is that the old one forbade utilities and generators from entering long-term contracts with each other.  That was hardly the cause of the debacle, though.  Nor was the restraint on large customers negotiating directly with generators, cutting out the utility as middle-man, which is another thing the new version would allow.

Another change from the old bill would be -- wait for it -- greater freedom for utilities to raise consumer rates.  This is in line with the Republican contention that if customers had been hit with the full costs of the electricity they were using, rather than paying a regulated rate, they would have reduced consumption more and thereby eased the crisis.

The cluelessness of this argument just makes me boil.  Consumers did reduce their consumption, dramatically!  And it helped not at all!  By the time the price spiral hit its peak, the state's total consumption was barely more than half of the peak level from before the crisis started!  (This happened during the spring, when demand is naturally low.)  Any time consumption went down, generators just reduced production to match, and kept prices going up.  The only thing that ended the spiral was when a legal cap was finally put on how high the price could go.  That one small change (resisted for many months by Republicans) cut the cable that held up the whole artificial incentive structure, production picked up again by just enough, and prices collapsed back toward normal as if the crisis had never happened.

And so this is Schwarzenegger's answer to ending future shortages: give consumers the price incentives to keep their usage within the limits of the available supply.

Ever since the story came out that Ahnuld had met with Ken Lay during those last days of the power crisis, listening attentively to the Enron CEO's plan for saving his company's illegal profits, we have been wondering whether Ahnuld would turn out to be on our side, or not, on the electric power issue.  Would he keep fighting the pirate companies, and the Federal Energy Regulatory Commission, to get back the $9,100,000,000 that governor Davis was trying to force the bandits to repay?  Or would he make some kind of deal and sell us out, throwing away an amount of money which would have been enough to cover the entire budget deficit he gave Davis such a hard time over?  I thought he might have to be in office for a year before we got our answer to that question, but it looks like we might have an answer already, before he's even sworn in.

As to how Ahnuld will relate to FERC, he seems pretty cozy with them so far.  He's endorsing their plan to consolidate the state's Independent System Operator into a regional body, taking all of its regulatory power out of the hands of state government.  Most of the Western states, and Southern ones also, have resisted this move as a usurpation of power, but now California will suddenly be cooperating with it.  As Loretta Lynch put it, "The only people who are for it are the energy companies and deregulation ideologues."

Unfortunately, Lynch's term is due to expire well before Ahnuld's does.  The same goes for Carl Wood, probably the most anti-deregulation of the other Commission members.  So then those "deregulation ideologues" will be on the PUC.

On the plus side, Schwarzenegger's plan would require generators to maintain a prudent reserve of extra capacity to handle threats of blackout.  How realistic or effective this measure will turn out to be in practice is anyone's guess.  Arnold admits that there is "no incentive to build excess capacity" in a deregulated market, so he says he'll use regulatory coercion in this one area.  Almost seems out of character.  I wonder if the rules will have any teeth?

But what about the real question: will his plan change any of the parts of the first one that helped create the crisis?  Will he still retain the feature of the original plan that allowed "competing" generators to raise prices for each other?  Nothing has really been said.  The most Ahnuld's "detailed plan" on his campaign website said was that he'd follow recommendations of FERC, and maybe look at schemes in other states that didn't fail spectacularly like ours did.  (Of course, deregulation in Eastern states hasn't produced any horrible price spirals yet, but somehow utility customers over there have still managed to end up pretty pissed off, thanks to a certain record-breaking blackout you may recall hearing about.)  This may lead to the necessary changes.  If not, then our worst fears that Ahnuld would lead a fresh generation of Enrons right back to the trough woule come true.

But, not to fear... according to assemblymember Joseph Dunn, who has led investigation in the Legislature into the companies who inflicted the power crisis on us, there's no way the legislature would ever passing a deregulation bill like this today.  The public would flay them and roll them in rock salt if they did.

Hey, you know how Dick Cheney was supposed to have no financial ties to Halliburton anymore, and if anyone wanted to accuse him of helping them, it would have to be based on the idea that he was doing it just for old times' sake?  Well guess what, it came out in the US Senate that he's still getting hundreds of thousands of dollars from the company, while in office.  Tom Daschle and Frank Lautenberg have made a stink about it, pointing out that the guy pretty much was lying his ass off when he claimed to have "no financial interest in Halliburton of any kind".  His spokeswoman said the payments were "deferred compensation".

At the same time as he was defending against this charge, the big guy also renewed his claim that there was some link between Saddam Hussein and Al Qaeda... while the rest of the White House was trying to deny they'd ever linked the two.

The Senate democrats had already been giving loud warnings that they would not allow Halliburton to indulge in profiteering in Iraq, especially if any of it comes out of the $87,000,000,000 that Bush recently requested for the Iraq effort.  They said they had no problem with the part that goes to the military, but the "reconstruction" portion would get a lot of scrutiny.

The post of Boss of Energy in Iraq just got given to a Halliburton guy, by the way: Robert E. McKee III, chairman of Enventure Global Technology, which is co-owned by Halliburton and Shell.

There's an awful lot I could say about the disastrous way things are going for the Bush administration with regard to Iraq, from how the country has become exactly the expensive quagmire that we anti-war protestors warned it would (for instance, the plan to make Iraqi oil pay for reconstruction has been completely scuppered by pipeline saboteurs, to the point where occupation head Paul Bremer has resorted to lying about the amount of oil exported), to the failure to explain where half of the money spent on Iraq is going, to the astonishing story that some pissant in the White House was so irresponsibly vengeful that they outed a covert CIA agent to the press -- a major felony -- just to get back at someone who criticized how we got into the war, to what appears to be the final failure to find any Weapons of Mass Destruction, to the abject failure of the conquest of Iraq to help bring peace to Israel as they had boasted it would (not that anyone cares about that because nobody believed it anyway), to the refusal of our coalition allies to put their soldiers' asses into the hole we dug because we insist on keeping every bit of decision making about what happens there to ourselves... but forget it.  For today I'm declaring this to be off topic, though I've certainly wandered into these subjects in the past.

I will note one irony, though... the Right To Bear Arms crowd has always insisted that gun control is the first step of tyranny, and that a dictatorship can't oppress an armed populace and therefore gun ownership is the best guarantee of freedom.  Must be painful for them to see how (1) Saddam Hussein successfully held a totalitarian reign of terror over a populace which stayed heavily armed throughout, and (2) it's now us, the bringers of freedom, who are trying to take the Iraqi's guns away.  We'll never succeed at that, of course.

I have to pass on this one bit... it turns out that Edwin Meese -- who is from Oakland, where I live, by the way -- hates librarians.  Losing his temper when asked a question by Katie Couric about Libarians' opposition to the Patriot Act, he blurted out "Librarians are more interested in promoting pornography than they are in promoting patriotism!"  Way to go, homeboy.

Oh, and I might mention that when George W. Bush departed from the subject of Iraq to talk to the General Assembly of the United Nations about curbing international sex slavery, and saying he's going to pursue a law to prosecute US citizens who make use of it -- one of the few things he's done that I wholeheartedly applaud -- he might have been talking about his brother Neal, in whose divorce proceedings it came out a couple of months ago that he had several times flown to Thailand and other Southeast Asian countries and gotten laid there.  Whether the women involved were prostitutes or not, and if so how much coercion they were under, was not disclosed... but one has to wonder what it was that he couldn't get here in the states.
 

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