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A Powerful Madness For Which There is a Cure
August 28, 2003
By Dan DeLisio

Albert Einstein, one of the most brilliant people to have ever lived, and the father of modern physics and technology, once defined insanity as "the belief that you can get different results by doing the same thing over and over." Thus Albert would have undoubtedly viewed the Bush Administration's relentless, single-minded pursuit of its nineteenth century, extraction-centered, regulation-free, energy policy as a classic textbook example which proved his point.

In the wake of the recent Northeastern/Midwestern power blackout, during which he and other top governmental officials spent an inordinate amount of time hidden from public view, Mr. Bush rightfully received criticism for his failure to publicly address the serious crisis in a timely fashion. It was evident that Mr. Bush devoted considerably more time on the evening of the blackout to the speech that he gave at his fund raising dinner rather than to his short tape recorded question and answer session with reporters prior to that dinner.

Because Mr. Bush has now evidently realized that it is not a recipe for political success to appear to the voting public to be more interested in gathering rich people's money than in making sure that hospitals, elderly people, and those sweltering in city dwellings have adequate power and water, he has, predictably, embarked on his usual course of attempting to spin developments to further his predetermined political agenda.

In the immediate aftermath of the blackout Mr. Bush first attempted an outlandish exercise in revisionist history by asserting that the power grid needed to be modernized and that he "had said so all along." Mr. Bush apparently had forgotten that it was he who actively lobbied the Republican controlled Congress over two years earlier to vote down an amendment offered by Democratic California Congressman Samuel Farr which would have done exactly that.

In response to Mr. Bush's lobbying, the Republican controlled House of Representatives, led by Bush's fellow Texan, Tom "the Exterminator" DeLay,defeated the provision in three separate votes. Thus, necessary and long overdue upgrades to the transmission system which would have alleviated power bottlenecks that threaten major cities with the omnipresent and recurrent prospect of blackouts like the one just experienced, did not take place. Thanks to the inaction of Mr. Bush and Mr. DeLay the grid remains, as President Clinton's Energy Secretary Bill Richardson termed it, in a "third world" condition.

Moreover, Mr. Bush's administration has been an ardent foe of government oversight of the power market even when government intervention was vitally necessary to protect consumers' access to electricity. In 2001 Mr. Bush refused to continue the emergency price caps imposed by the Clinton Administration on wholesale power prices to California electric customers. He and his administration stood by and did absolutely nothing to help that state as it was systematically being bankrupted due to its government being forced to pay outrageously inflated and deliberately manipulated prices for power so that it could keep the lights on for its residents. (See;

Additionally, their slavish devotion to the principle that government intervention is always bad has resulted in the Bush administration and its Congressional allies following the urging of power company lobbyists and failing to allow the imposition of meaningful technical reliability standards, which carry the force of law, on power companies. (See The New York Times)

As a result the oversight of the nation's vital power grid was left solely in the hands of a power industry group, the North American Electric Reliability Council. That entity had in fact previously forecast the likelihood that the Midwestern power grid, which includes Ohio where this blackout is thought to have originated, would experience unanticipated "large power flows" during this summer season; however, it lacked any legal or regulatory authority to rectify the situation and avoid disruptions. The best it was capable of doing was issuing "recommendations" which power companies were free to follow or to disregard as they chose. (See

Now with the Presidential election looming large, Mr. Bush has evidently recognized that it is politically unwise to continue to be obstructionist, lest the lights go out on his reelection bid. Thus, in an effort to show that he is "concerned" and "on top of the problem" Mr. Bush has now taken to publicly championing the passage of an energy bill which contains mandatory reliability standards.

Even so, it is evident by his statements, and the statements of those in his administration, that Mr. Bush has not had a change of heart and "seen the light" regarding the necessity of these rules. To the contrary, Mr. Bush is instead merely attempting to now reinvent himself as a supporter of the same mandatory standards which he helped to block these last two years, only because they have now become politically popular.

Most egregiously, though, it is abundantly plain that Mr. Bush is also attempting to capitalize on the public's fear of more blackouts by tying passage of new reliability standards to the passage of the rest of his and Vice President Cheney's energy wish list, much of which is politically unpalatable. It is also clear that he is attempting to use this situation as an excuse to foist the cost of physical improvements to the power grid system solely onto the backs of taxpaying electricity consumers.

Mr. Bush's energy secretary Spencer Abraham has made abundantly clear in public interviews that the administration does not support a separation of a requirement for reliability standards from legislation that would allow drilling in the Arctic National Wildlife Refuge, a position that Mr. Bush has himself recently reinforced in his public statements. (See The New York Times) . Additionally Mr. Abraham dismissively and nonchalantly indicated that it would be the ratepayers who "obviously" would be footing the bill for any upgrades to the transmission grid since, according to him "they're the ones who benefit." (See The Washington Post)

Moreover, and importantly, the energy legislation which Mr. Bush is championing contains other highly contentious provisions which have the potential for significantly negative long term consequences to electricity ratepayers and taxpayers. Chief among the more odious provisions contained in this legislation is a provision which repeals the Public Utilities Holding Company Act, (the PUHCA) which was enacted in the 1930's specifically to prevent power companies from becoming giant multi-industry behemoths and from passing on their losses in non-power related industries to the ratepaying consumer.

Importantly the PUHCA also prevents utility holding companies from engaging in fraudulent accounting practices, which are not just modern day corporate shenanigans. Such practices ran rampant in the 1920's and 1930's and were the impetus for the passage of the PUHCA. The PUHCA seeks to avoid such practices through audits and oversight by the Securities and Exchange Commission of all utility holding companies required to register under the Act. However, the lessons of history have now apparently been forgotten or ignored by Mr. Bush.

Indeed the revelations regarding some of Enron's egregious business practices which took place under "Kenny Boy" should serve as a warning of what can be expected if the protective provisions of the PUHCA are removed, since Enron specifically sought and was granted an exemption from the PUHCA for its wholesale power business which was free from the tight scrutiny of the Securities and Exchange Commission that it would have otherwise received under the PUHCA.

The proposed energy legislation pending in Congress also allows the creation of massive new power companies via the merger of existing companies, requires the transfer of federally controlled transmission facilities to private consortiums, allows owners of transmission lines to charge consumers more for the use of those lines, and allows the Federal Energy Secretary to order power lines to be built in a specific area even if a state government objects to the specific site chosen for the line. Also, the legislation contains more that $10 billion of brand spanking new tax breaks to subsidize the oil, coal, gas and nuclear industries while further draining the depleted national treasury.

This entire exercise is therefore a disingenuous bit of political "bait and switch" on the part of Mr. Bush and Congressional Republicans. The simple fact of the matter is that legislation setting national transmission reliability standards can and should have been passed years ago. Because such legislation could achieve widespread bipartisan support it can pass right now without being held hostage to these other provisions.

However the Bush administration, by stubbornly insisting on the linkage of this long overdue reliability insurance for the consumer to these other provisions, which are nothing more than blatant handouts and handovers of vital national infrastructure to highly profitable corporations, has once again shown that it will unhesitatingly put the interests of the powerful over the interests of ordinary people whenever the two interests conflict.

The simple and stark reality is that none of these other items on Mr. Bush and Mr. Cheney's wish list would have prevented a blackout of the type most recently experienced. The blackout was a transmission failure and not caused by lack of energy production. Indeed as Secretary Richardson said, the problem was actually the reverse, in that the current system encourages overgeneration,and the grid is overloaded with power. (See The New York Times) Hence any power which could be generated by the six months worth of oil that the Arctic National Wildlife refuge can produce six years in the future would not have averted this problem, nor will the building of new and environmentally hazardous nuclear and coal fired plants avert future such transmission disruptions.

Neither was this blackout caused by "too much government regulation." Indeed the problem arose specifically because there was insufficient government oversight, and there was no government agency which had the authority to step in and insure that the power would continue to flow. The industry was left to regulate itself in this instance, and it failed. Thus the dismantling of what few regulations remain in place to protect the consumer from price gouging, corporate fraud and monopolistic practices would have done nothing to avoid the blackout nor will it do anything to avoid future such occurrences.

Additionally, national interstate transmission facilities are a critical national infrastructure. As with the Interstate Highway System the cost of improvements should be borne both by the government and the users, which includes power companies. Power companies should most assuredly be required to help pay for the required grid upgrades by a non-passthrough tax on power company profits, and their rates should be tightly regulated to insure that consumers are not gouged. Contrary to Mr. Abraham's assertion power companies will inure great financial benefit from these upgrades and they should not be paid for solely by the government and the taxpayer who have subsidized the profits of these corporations for many years.

Significantly, as is reflective of his and his administration's essential philosophy that energy policy should consist only of unlimited drilling, strip mining and blowing off the entire tops of pristine rural mountains, the energy legislation that Mr. Bush seeks passage of contains no provisions to reduce energy consumption, or to encourage the development and utilization of alternative energy sources. No, Mr. Bush's energy policy is planted firmly in the days of the late 1800's during the height of the industrial revolution, when industries ripped the land asunder with fearsome ferocity in order to pillage the natural resources they were consuming with reckless abandon.

Science and technology have enabled humanity to long since move on from the days when forests of smokestacks belched carcinogenic fog that enshrouded cities and killed many, but Mr. Bush's policies have not. The consequences to humanity of ever-increasing fossil fuel consumption and accumulating nuclear waste are evident for all to see except, obviously, to Mr. Bush whose proposed energy policy is certain to guarantee even greater pollution, environmental degradation and global warming.

What is most galling about Mr. Bush's effort to return our nation to the failed policies of endless consumption and reliance on environmentally harmful methods of generating energy is that it is wholly unnecessary, and it needlessly places the health of this planet and its inhabitants at grave risk. Today there is simply no reason why our country cannot achieve vastly greater efficiency in the utilization of energy and begin to immediately convert our energy production to cleaner alternative methods of energy generation.

Quite simply it is long past the time for the adoption of a new national energy philosophy. We need nothing less than a fundamental paradigm shift in thinking which turns away once and for all from the outmoded discredited wasteful practices of old and which strongly embraces a new era of environmentally friendly energy generation.

Our society is simply so complex and interconnected that we can no longer afford to rely on power being generated at some remote location and transported over many thousands of miles before reaching its final destination. Such massive far flung distribution networks waste billions of dollars of energy annually in thermal power loss, (see and these large networks are highly vulnerable to both natural and man made disruptions. Our national focus, as reflected by our national energy policy, should therefore be on empowering citizens and communities to generate power locally where it is least prone to sudden catastrophic disruptions. The more decentralized our power generation system is the less likely it is that that a failure will be total and the less harm it will cause.

The creation of a vast network of small self-sufficient producers of electricity can be accomplished through the use of and improvement of existing technologies involving wind, solar and biomass conversion. Also our government can and should encourage less energy consumption through common sense initiatives like raising automotive fuel efficiency standards and increasing the energy efficiency of appliances, both things that the Bush Administration has steadfastly refused to do. Additionally we all must make the personal conscious effort to use only the energy that we absolutely need and abandon wasteful consumptive practices. Only through a concerted effort on all of these fronts will we as a nation achieve true energy independence and self sufficiency.

Once we have done so, we as individuals will then have some much-needed measure of stability and control over this vital part of our lives. Then we as a country can finally be free of the need to commit our young men and women and our national treasure to the protection of rapidly dwindling supplies of fossil fuels and turn our full national efforts to solving the myriad of vexing problems that confront us at home and abroad and thereby achieve great things for mankind.

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