www.sfweekly.com/issues/2001-12-26/smith.html/1/index.html
Try opening presents with an elephant or playing a game of Ba-Da-Bingo! Bay View 33 Law of the Bungle Sara Jane Olson's attorney would like to say a few words about how her San Francisco co-counsel handled the high-profile case Dog Bites 34 A Little Fine Tuning How on earth will KRON fill airtime without NBC? Unseasonable storms might clean a blood-stained sidewalk; Or, in the case of Gray Davis, who last year fenced California's economic and fiscal future for his own political gain, the World Trade Center falls, America goes to war, and energy trading giant Enron Corp. Recent events have so obscured Davis' mishandling of California's electricity meltdown last summer that the governor now appears poised to steamroll whomever emerges from the squabbling field of Republican pretenders in the 2002 gubernatorial race. And that's too bad, because the degree of damage caused by his shifty, demagogic bungling of our electricity crisis will hobble the state for decades. The 1996 restructuring of the electricity industry forced utilities like PG&E to sell their generating plants and buy power from a centralized trading floor. This faulty system allowed wholesale providers to jack up prices by shutting down select plants during moments of shortage. Davis played himself off as government's only populist during this time, refusing to raise rates until utilities had accumulated billions of dollars in debt. He then whitewashed the horrific situation he'd created with an electricity buyout financed by a proposed $12 billion in public bonds. They weren't aware that this policy would be far more expensive for Californians in the long run. Now, Davis may be betting that the arduous economic effects of his deeds will enfeeble Californians only slowly, subtly, and in ways they don't understand. Such a scenario might allow Davis to continue his specious pose through next year's election campaign; Mayor Richard Riordan for abetting California's energy woes -- we can expect more to come. To a political consultant's way of thinking, Davis' strategy may seem sound: Recent events have stripped thoughts of electrons from most voters' minds. Inappropriate lessons drawn from the bankruptcy of Enron Corp. Next came Davis' version of the vacationing detective or evidence-cleansing storm: Financial journalists reported that Enron executives had apparently concocted a series of illegal self-dealing schemes, hidden by shady accounting practices. But ultimately the more remarkable aspect of this tawdry corporate tale is the way Enron tricked us politically, the way its leaders persuaded the world that their passion for free markets, particularly in the field of electricity, was somehow equivalent to "revolution,' to "creativity,' to human freedom itself. But during the past week a couple of weaknesses have appeared in Davis' near-perfect crime -- and they're related to the seemingly PR-positive Enron collapse. In the Bay Area, the Enron bankruptcy has revealed one of the most pernicious yet least-noticed effects of Davis' bailout scheme: It forces businesses, schools, and other entities to buy power from PG&E, so that PG&E will buy power from Davis' Department of Water Resources, so that he can pay down $12 billion in proposed debt. In San Francisco, that may mean an increase in electricity prices for downtown office buildings. After the 1996 restructuring, only a small percentage of ordinary consumers took advantage of the opportunity to sign up with power suppliers other than PG&E. They entered into low-price direct energy contracts with companies such as Enron. These utilities need all available customers in order to finance the bailout, lawmakers reasoned when they drew up the bill. Otherwise, "It would be like voluntary Social Security," says Public Utilities Commissioner Geoff Brown: Many customers would opt out. Remember all those "green electricity" billboards that sprouted around the state two years ago? Buying green power is illegal now, unless it's from PG&E. BOMA sent a letter to the Public Utilities Commission asking if it could replace its Enron contract, which is destined to become null, with a contract with another cheap, outside producer. San Francisco office building owners, a third of whose costs come in the form of electricity bills, will pass their coming rate hike on to commercial renters. Factories, farms, offices, builders, schools, consumers -- all the people and institutions playing a role in the state's economic recovery -- will find themselves fettered by the need to repay Davis' $12 billion bailout.
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