Davis Lacked Legal Ability to Solve Energy Crisis

[kskiska]

Meltdown May Have Generated a Political Power Failure

(snip)

As chief executive of the nation's richest state, Gray Davis has borne the brunt of the blame for the California energy crisis that caused power costs to quadruple from the summer of 2000 to the summer of 2001. The crisis drained $40 billion from consumers and businesses and triggered blackouts up and down the state. The erosion of public support that began with his handling of the energy meltdown has grown into the recall referendum that threatens to throw Davis out of office.

Of all the central players in the drama, the one with the least direct legal authority to resolve the crisis turns out to have been Davis himself. "Really, a peripheral player," said Christopher Weare, who analyzed the crisis for the Public Policy Institute of California. But Davis was the state's leader with the ultimate political responsibility for handling the crisis.

From the start of the crisis in the summer of 2000 Davis pinned the blame on outsiders -- greedy energy suppliers based in Texas and other states and myopic federal regulators who refused to clamp price caps on the state's soaring electricity costs. He also would hurry new power projects through to completion and urge consumers to conserve power.

His role was primarily defined, however, by a futile battle with the Federal Energy Regulatory Commission, a Washington agency whose commissioners regulate wholesale power prices.

When power shortages began in the summer of 2000 and wholesale power prices tripled, Davis immediately accused generators of gouging electricity customers. State regulators cited indications of price manipulation and deliberate withholding of power supplies by generators. In response, the governor demanded that FERC impose price ceilings on generators' prices.

more…
http://www.washingtonpost.com/wp-dyn/articles/A37482-2003Aug23.html

[Democat]

1. Bush could have stepped in, but he helped rob Californians instead

Much of the money stolen by power companies from Californians will end up back in Bush's pocket during the 2004 campaign.

Davis should make a diagram showing money being stolen from California, shipped to Texas, and then sent to the White House. That money is the money stolen from the people of California with Bush's help.

Now Bush and Arnold are trying to steal more from California.

[AP]

2. Just like Republicans to create a crisis and then try to benefit

from it.

That's what they did with the government shutdown in '94 elections. They wouldn't compromise on a budget so they shut the government down. Then in '94 they ran on the argument that they were disciplined, button-downed adults who would bring order, compared to the disorganized Democrats who couldn't keep the government running.

[maggrwaggr]

3. had terrorists done what the energy companies had done

we'd be invading someone again. We'd be clamoring for their heads on stakes, we'd want them "dead or alive".

But no.

People died because of the energy blackmail here in California. People died when the switch was flipped.

Where are the manslaughter charges? The wrongful death charges?

Have we no shame?

[Emboldened Chimp]

7. That's right, people did die because of it

I remember a story about a guy who went through a traffic light that was out because the power had just gone out. That man's blood is on *'s and Kenny-boy's hands.

[Code_Name_D]

4. Forgive me, I stole your post.

Their is a @#$%! in the economics, whom I will not mention. (Economics Dude) that needs to be handed his hat. And this post was just what the Dr. ordered. :)

If you are looking for a real fight, stop on by and give me a hand here.
http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=114&topic_id=812

[kskiska]

5. No problem.

I've never figured out where Davis gets the blame for this. It happened right before our eyes.

[Classical_Liberal]

6. Davis had the ability to solve the "energy crisis" and chose not to!

http://www.alternet.org/story.html?StoryID=16641

But Davis was the sitting lieutenant governor when deregulation was adopted in 1996 and there's no record of as much as a contrary hiccup coming from him at the time. Indeed, two years later when consumer-backed Prop. 9 aimed at reversing much of the deregulation fiasco, Gray Davis, allied with the utility monopolies, signed the ballot statement opposing the measure.

Once the power shortage hit in late 2000, Davis as governor was irresponsibly slow to respond, no doubt distracted by his voracious fund-raising. He threatened to seize the power grid, but that bold position soon melted into conciliation with the energy behemoths, at one point Davis employing the same spinmeisters that that were in the pay of Edison. Remember Lehane and Fabiani?

The result? Weighing down the state with over-priced long-term energy contracts, Davis thereby contributed maybe as much as $10 billion to the deficit black hole.

[Emboldened Chimp]

8. He could have seized the power lines and generators

He had the authority to do so, but never did. That was one of the big arguments at the time: whether or not it would be wise to take such a step. I think it would have been.

[Classical_Liberal]

9. I agree. This writer was being kind

but people have short memories.

[ctex]

12. He could've tried, but most of these are Federally controlled

Davis threatened to seize the power plants and transmission lines, but did not. I suspect it was because the state attorney's advised him that deregulation put these plants under Federal jurisdiction and FERC permission would have to approve any change in ownership or control.

And, interstate transmission lines (the most important ones) has always been under Federal control.

[wabeewoman]

10. As they say, hindsight is always better than foresight.

Who would have ever dreamed bush would be as bad as he is-I knew he'd be bad but I never dreamed the country would go to hell in a handbasket so easily. I remember when 'the California energy crisis' was happening it seemed like a plan to 'repay' California for not voting for bush. What Davis and all democrats need to be saying over and over again is that the energy crisis was contrived by the bush administration (the whole thing was planned to get rid of the democratic governor-they thought they could do it in the election and when that didn't happen they went with the recall). The recall election was driven by the bushies and now they are picking the candidate, forcing others to drop out and planning to control California. Then there will be drilling off shore, raping the environment(who really needs redwoods) and continued give aways to bush cronies. California ain't seen nothing yet. Hopefully, the democrats can focus the debate to what it really is: lawless, unconstitutional thugs insisting on having their way with state governments (they are planning to 'insert' themselves into Washington state's governor and senate races-bush said when he made his fundraising trip here last week). I bet they have a plan to take over all the democratic run states. Here is a slogan for California: You ain't seen nothing yet-let the bushies do for California what they've done for America.

[Classical_Liberal]

11. The trouble is that Davis could have stopped alot of those things

and didn't. Things will get worse if we keep politicians that act as facilitators to Bush.

[VolcanoJen]

13. Kick!

:dem:

[felix19]

14. Sigh... This is a very confused article

Unfortunately, the whole electricity boondoggle story is confused and confusing, and what really happened will probably never be entirely clear.

One of the confusions then and now is what "California" is responsible for, what "California" can and should do. Time and again, "California" is advised to build power plants, for example. Since most of the power plants in the state are privately owned, thanks to deregulation, and "California" -- the state, ie: the government? -- is not in the power plant business, saying "California" should do thus and so about a crisis brought on through market manipulation abetted by Washington, DC, is bewildering.

How is "California" to do this? It is the responsibility not of "California" but of the corporations that own the power plants to build more. And guess what? They refused, for the most part. Why? Oddly enough their economists said there wasn't a market for the additional power on the one hand, and they couldn't pillage enough money fast enough to make the unneeded plants sufficiently profitable to make it worthwhile to them on the other.

A couple of additional "peak" plants were built, yes, but the problem was never a lack of generating capacity and it still isn't. The problem was what Davis said it was: a flawed deregulation plan and gross market manipulation which the "Feds" -- the White House, FERC, Congress, the Justice Department, and so on -- would do nothing about.

Davis was right at the time, spot on, and he is still fighting for justice for the people of California -- who were raped and robbed by a completely out of control "free market."

Under deregulation schemes (and they are all schemes to enrich a few at the public's expense), the government has very little power to intervene directly when markets are being jerked around the way they were in California during the bogus "power crisis." The whole point of deregulation is to get the government (and the public interest in general) out of the market and let the plunderers run rampant.

Deregulation is still a mess in California, and it is probably not soluable in the short term. The most likely long term solution is to transform all the utilities into public power authorities, and have them generate their own power -- through the eminent domain seizure of all the plants that were sold to the private companies that ripped us off.

But that won't happen quickly. And though PETE WILSON urged Davis to seize the power plants if electricity wasn't being made available, he also fiercely defended deregulation as the way to go, regardless. In fact, it was partly Davis's threat to seize the plants that ensured they would stay on line instead of being shut down to drive up prices.

Shortly thereafter, Jeffords switched and Democrats took back the Senate, and -- surprise -- the "crisis" suddenly ended.