Energy secretary: Power rates to go up by $50 BILLION

[Newsjock]

In GD and not LBN so I can put a better headline on this Washington Post story. Honest to goodness, I was having a tough time believing the tinfoil-hat crowd over this blackout, but I'm starting to change my mind. This is the latest chapter of the BFEE robbing America blind -- and doing so quickly enough so that they'll have it all by November 2004 anyway, win or lose.

http://www.washingtonpost.com/wp-dyn/articles/A7164-2003Aug17.html

By Ceci Connolly
Washington Post Staff Writer
Monday, August 18, 2003; Page A03

As the Bush administration dispatched crews to investigate the largest blackout in North American history, Energy Secretary Spencer Abraham warned yesterday that consumers will eventually pay up to $50 billion in higher electric bills to modernize the nation's ailing power transmission system.

"Rate-payers, obviously, will pay the bill because they're the ones who benefit," he said on CBS's "Face the Nation." "And that's where most of the responsibility, ultimately, will be assigned."

... The Midwest Independent Transmission System Operator, which monitors electrical reliability in the region, said in a statement that although it is clear four power lines "tripped off" the day the blackout began, "what is unknown is the relationship among events in the Midwest and what was occurring elsewhere in the Eastern Interconnection at that time."

"What we're trying to say is that focus solely on the events in Ohio may be misleading," said MISO spokeswoman Mary Lynn Webster.

more

[Sweetpea]

1. So Basically we will be paying more for no insurance that

the problem will be corrected.

[bodhisattava]

2. In fact this is one way the wars of the PNAC/Bush

Administration will be financed. I am willing to bet that Halliburton, Enron and other energy companies will also benefit by this.

[JackSwift]

3. Energy deregulation means

never having to say you're sorry.

[Eloriel]

4. Yeah, rate payers. It would be horrible

for those corporations to suck up a few bucks less profit here and there, woudn't it?

Robber barons reincarnated.

Eloriel

[whirlygigspin]

5. here's a wacky idea

since you end up paying for it anyway, why not make it all a public
utility?

boo!

(I think Cheney just fell off his chair)

[Mairead]

6. Well, why not--we're being asked to invest, aren't we?

So why is it that We the People foot the bill but get no stock in return?

[TahitiNut]

33. Because it'd spread the costs more fairly?

When electric utilities charge their customers for the capitalization of their infrastructure, those with the least ability to pay are charged the most. Take a closer look at the rate structure of most electric utilities and you'll find that the largest consumers (big corporations) pay the lowest rates. While residential customers pay at rates that begin higher and escalate rapidly as consumption goes up (perhaps to operate a home respirator?), large industrial consumers pay at rates that the residential consumer could only dream about.

[Brian Sweat]

40. I believe that the distribution system should be public

and that generation should be private. Local, State and Federal government should own the distribution lines and the maintenance of the lines should be put out to bid.

Generation would be private and you would have your choice of generators.

[bluestateguy]

7. Hope all those folks enjoyed their Bush tax cuts

The power companies will take that, thank you...

[w13rd0]

8. Yep...

...welcome to the new income redistribution. All money flows upward...faster...

[AmeriCanadian]

14. Yes, but our rate hikes won't be hyped

Yet my mother, on a fixed income, will not be able to cool her home next summer. Grrrr

[newyawker99]

16. Hi AmeriCanadian!!

Welcome to DU!! :toast:

[indepat]

17. Will thake that and far more for most

taxpayers, many times over.

[bowens43]

9. Why is it that the repugs

always expect the public to pay for the things that benefit the corporations. I say f*ck them. They need to pay for their own upgrades. If they don't want to pay for the upgrades, fine, sue them the next time theres an outage. Hell sue the bastards this time!

[JNelson6563]

10. Welfare Reform

I think it is time to reform corporate welfare. As in abolish.

Julie

[cthrumatrix]

11. The more I hear...the more I'm concerned this was planned....

Notice the timing...after the markets closed 4:10pm...

Note that friday in August...slowest business day...

AND....as soon as it happened there was this push for getting the "energy bill" passed. And now this $50B price tag.

And...we still don't knwo the exact cause...but charge us $50B.

Yep....this all seems like it was indeed planned. Start with what you are trying to accomplish and create the situation to make it happen.

[Newsjock]

12. Mega-tinfoil-hat time

Consider this, if you will.

The lights went out at 4:11pm EDT.
411? 911?

I know, I know. But still.

[w13rd0]

13. At least it wasn't 4:20...

...there'd be thousands of stoners thrown into a massive fit of paranoia...

[Junkdrawer]

15. Did you see this thread...

Steep Spike in Power Protection Co. Stock – 4 HOURS BEFORE BLACKOUT!

[Le Taz Hot]

18. First California, Oregon and Washington

now the East Coast. Welcome to deregulation and the energy robber barons. Expect your energy bills to increase by about 300% -- something we here on the left coast have been experiencing for two years now. Oh yes, and they DON'T go down. Rebates? Those go to the energy companies, not to consumers. THAT will teach you East Coast "libruls" to vote Dem.! Sucks, doesn't it?

[Junkdrawer]

19. Add to that the natural gas bills which are expected to skyrocket...

and I think we will be hearing lots of tales of people who must choose to eat or freeze.

[MiltonLeBerle]

20. Actually, the higher bills may end up helping us in the long run-

It may help to spur a rapid growth in fuel-cell and/or generator technology- something that could very possibly(will probably?) make "The Grid" obsolete in a decade or two, and put the energy robber-barons out of business as they now know it. They may see the writing on the wall, and want to make their money now while they still can.

[terryg11]

24. except tht they are very good at suppressing any real change

unless they can benefit from it. It seems like every time a town or city decides to start generating energy through wind or solar there's a lot of opposition thrown out there that it's still unreliable and costly.

I agree that the higher bills could help push consumers to demand more alternative energy develpment but they hve to do more than shout to get it

[AP]

36. No money goes into researching technology that will make this

a reality.

Although I agree that once all the utilities are privatized, people are going to start looking into hydrogen cells for their homes. Nonetheless, I still think that we shouldn't destroy this generation in the hope that 50 years from now the market may develop a way to circumvent the monopolies.

[indepat]

21. What a beautiful way to sell a $50 billion regressive tax

increase. These guys could sell refrigerators in areas above the Arctic Circle not even electrified.

[DS1]

22. Hey, it's still cheaper than the war in Iraq

and nobody has to die :eyes:

[AP]

23. Utility rates are like flat taxes.

Everyone pays the same rate, regardless of income levels. If you're super rich, you're affected so much less by higher rates. Your tolerance for higher rates is on a completely different scale, and you have to consume at an exponentially higher rate just to feel the same pain as a poor or middle class person.

Couple this with the fact that utilities are essentially monopolies and there's a very narrow range within which you can alter your patterns of consumption (if gas gets too expensive, are you going to buy a second electric stove and switch between the two? If gas and electricity both get too expensive, are you not going to cook your food and heat your house?) and you have the reality that this is all about shifting wealth from tied middle and working class consumers to big business and super wealthy individuals.

It's amazing that Bush gets away with this, but I guess there is an evil genius to it. The math isn't easy to understand, and people don't really understand the difference between capitalism and monopolies and socialism for the wealthy.

[MiltonLeBerle]

26. Not entirely.

Rich and poor pay the same rate for the electricity used, but the wealthy person generally uses a lot more power, due to having more and bigger toys and appliances, and therefore has higher bills.

[Junkdrawer]

27. But that would make it EXACTLY like a flat tax...

The more you make (or use) the more you pay - just at a non-progressive rate.

[AP]

32. The central notion of progressivity is that the more money

you have, you have a decreasing marginal value of an additional dollar. Another way to put it is that you have an exponentially increasing tolerance for spending your money. If it's easy for you to make an addtional 10 cents (when you make 15,000 bucks a week), you'r not going to waste your time haggling over a few pennies more for this or that item.

When electricity is charged at a flat rate, and that rate is expected to pay for infrastructure and all those things which used to be funded out of the public purse, you are switching from a system in which people who benefitted the most were asked to fund the society that made them wealthy by paying taxes at a rate which burdened them exactly the same -- considering marginal valuations of additional dollars as wealth increases -- as poor people.

You're switching to a system of funding public infrastructure which is totally income insensitive. Consume more, pay more, yes. However, two things to consider here. First, with monopoly utilities, much of consumption is income insensitive. If you're poor, there you still need some water and electricity and gas just to live. Second, you can't just compare consumption rates of rich people and poor people without taking account the STAGGERING differences in wealth. Yes, a guy with a mansion may consume ten, twenty, fifty times more electricity than a middle class guy in the suburbs. However, is he only ten, twenty or 50 times wealthier? Even people in the suburbs are going into credit card debt, and may start having negative equity, and might actually be losing wealthy year on year. The guy in the mansion consuming, and paying twenty times more electricity may be 1000 times wealthier, or 1000000 times wealthier.

If utility infrastrutcture were funded out of progressively collected income and wealth taxes, the millionaire consuming 50 times more electricty might actually have to bear a burden for paying for that insfrastructure which matches the benefits he's deriving from an infrastructure which creates a marketplace which gives him so much wealth.

That's why Bush wants to pay for utility upgrades with increased rates, and not out of progressively collected income taxes. He knows that the super rich will get the free ride if the rates go up. He knows that they'll be asked to pay their fair share if progressive taxation funds infrastructure.

[Junkdrawer]

35. Make no mistake, AP, I agree with you...

and I think you have an excellent insight into why many of the services we call "infrastructure" are being privatized.

[AP]

37. Yes. That reply was directed at Oncle Milton.

not you. However, thanks for giving me the opportunity to reply.

[Junkdrawer]

42. BTW AP, that reads like the start of a good, timely, op-ed piece...

what with all the talk of deregulation and privatization, the idea that middle class people will pay more when services are privatized seems to have escaped the public discussion.

[AP]

30. A person who is 100 or 1000 times wealthier

doesn't use 100 or 1000 times more power.

And even if a rich person had way more lights and appliances than a poor or middle class person, you could still turn off most of them and save money and live a dignified life, and you'd be paying a much much lower percentage of your income and wealth on utilities relative to a poor or middle class person.

[TahitiNut]

38. Manure.

The affluent can afford newer, more 'energy efficient' homes and appliances. The poor often live in rentals where they're required to pay their own utilities but the property owner is unwilling to make the investments in insulation upgrades and furnace upgrades that would lower the energy consumption. When one is living at or close to a subsistence level, it's nearly impossible for them to 'front' the costs of longer term savings. It's an economic trap -- a bit like a Chinese finger puzzle.

At the same time, large commercial (think World Trade Center) and industrial (think Alcoa) consumers of electricity pay at rates that're between 40% and 80% less than what's paid by a single mother of two who lives in a "low rent district".

[MiltonLeBerle]

44. OK- I grok to it.

since we are trained to think of electricity and all the wonderful things that it powers as 'luxuries', and the power itself as the product of a 'private industry', it's easy to overlook the regressive nature of electric rates- that is that the poor pay a much higher percentage of their income on what is in actuality, a necessity.
BTW- I have long held with the notion that utility companies, Power& water, should be publicly-owned entities.

If electric rates were made more progressive, with higher kilowatt usage being charged at higher rates(rather than "volume discounts") we'd see a much much faster growth in the alternative energy field. When the wealthy are getting a steal on electric rates, and the poor are getting shafted then all is right with the system, as far as the far right is concerned, and there's no incentive for R & D.

[terryg11]

25. makes you wonder doesn't it?

not until Bush came into office have we had so many large scale utility problems. Could just be coincidence or bad luck but the coincidences are just glaringly bad.

on edit, I shouldn't really say "so many" when it's only been two or three but it's still more than we're used to

[shanti]

28. bend over, folks

and get ready to take it! they've been waiting for another opportunity to shaft us and it's here.

[SoCalDem]

29. That's the way it always works...

We , the public...


have been paying outrageous rates for years (they said it was for modernization and upkeep)

it appears that the extra money we have been paying, has found its way into some pockets, and they have just made an already antiquated system, WORSE..


so....now they want us to pay MORE, because THEY did such a shitty job..

sounds about right for the deregulated states of america:(

[Jose Diablo]

31. Socialize the cost, privatize the profit

CLC mantra

[samsingh]

34. and this after plundering Iraq

for oil.

[Generic Other]

39. 50 billion? I want a bill of sale and a receipt, please

I do not give money away. This is America. You corporate freeloaders! You have defaulted on privatization. We the public will take back our PUBLIC utilities. 50 billion dollars is a lot of money for near bankrupt hideously mismanaged businesses. What's in it for us? Give me the deed to the property. I don't invest 50 billion dollars in somebody else's business. That's called buying them out. I own that business.

[TahitiNut]

43. Absof**inglutely.

It's insane to shovel out public funds to private companies with no strings attached. The airline "bailout" was nuts. No equity, lien, or attachement of assets in return for BILLIONS of taxpayer dollars? Since the fuck when was this called "free enterprise"? The whole notion of such "enterprise" was that poor companies would fail and decent companies would succeed. When the public allows any company to become so large that it cannot "afford" to let that company fail, that company should and must become government-owned and operated as a public utility.

Privatization of profits and socialization of costs is Fascism!

[sexybomber]

41. Good God, that's it.

Whenever I get out of college and get a place of my own, I'm putting solar panels on the roof.

[tom_paine]

45. I heard that this morning and thought the same thing

Of course, history shows that modernization by utilizing goverment resources doesn't work at all. Liberal Socialist Programs such as:

1) The Interstate Highway System
2) Rural Electrification

</sarcasm off>
:puke: :puke:

Either the Busheviks did it personally (well their cadre of ex-CIA spooks did it), or al-Quaeda did it and the Bushes suppressed it or it was a legitimate accident.

Either case, the bastards are certainly taking advantage of the situation to the tune of $50,000,000,000 more of theft/robbery that WE and not the Imperial Aristocracy will pay.

But at this point, it would NOT surprise me to see Busheviks behind this every step of the way. Just where was Charles Kane last Friday? Hanging out at First Energy in Niagra?

[Junkdrawer]

46. Kick

:kick: