Yahoo Tuning Groups Ultimate Backup metatuning no lights

Published on Friday, August 15, 2003 by Greg Palast

Power Outage Traced To Dim Bulb In White House
The Tale of The Brits Who Swiped 800 Jobs From New York, Carted Off $90
Million, Then Tonight, Turned Off Our Lights

by Greg Palast

I can tell you all about the ne'er-do-wells that put out our lights
tonight. I came up against these characters -- the Niagara Mohawk Power
Company -- some years back.
You see, before I was a journalist, I worked for a living, as an
investigator of corporate racketeers. In the 1980s, "NiMo" built a
nuclear plant, Nine Mile Point, a brutally
costly piece of hot junk for which NiMo and its partner companies
charged billions to New York State's electricity ratepayers.

To pull off this grand theft by kilowatt, the NiMo-led consortium
fabricated cost and schedule reports, then performed a Harry Potter job
on the account books. In 1988, I
showed a jury a memo from an executive from one partner, Long Island
Lighting, giving a lesson to a NiMo honcho on how to lie to government
regulators. The jury
ordered LILCO to pay $4.3 billion and, ultimately, put them out of
business.

And that's why, if you're in the Northeast, you're reading this by
candlelight tonight. Here's what happened. After LILCO was hammered by
the law, after government
regulators slammed Niagara Mohawk and dozens of other book-cooking,
document-doctoring utility companies all over America with fines and
penalties totaling in the
tens of billions of dollars, the industry leaders got together to swear
never to break the regulations again. Their plan was not to follow the
rules, but to ELIMINATE the
rules. They called it "deregulation."

It was like a committee of bank robbers figuring out how to make
safecracking legal.

But they dare not launch the scheme in the USA. Rather, in 1990, one
devious little bunch of operators out of Texas, Houston Natural Gas,
operating under the alias
"Enron," talked an over-the-edge free-market fanatic, Britain's Prime
Minister Margaret Thatcher, into licensing the first completely
deregulated power plant in the
hemisphere.

And so began an economic disease called "regulatory reform" that spread
faster than SARS. Notably, Enron rewarded Thatcher's Energy Minister,
one Lord Wakeham,
with a bushel of dollar bills for 'consulting' services and a seat on
Enron's board of directors. The English experiment proved the viability
of Enron's new industrial
formula: that the enthusiasm of politicians for deregulation was in
direct proportion to the payola provided by power companies.

The power elite first moved on England because they knew Americans
wouldn't swallow the deregulation snake oil easily. The USA had gotten
used to cheap power
available at the flick of switch. This was the legacy of Franklin
Roosevelt who, in 1933, caged the man he thought to be the last of the
power pirates, Samuel Insull.
Wall Street wheeler-dealer Insull creator of the Power Trust, and six
decades before Ken Lay, faked account books and ripped off consumers. To
frustrate Insull and
his ilk, FDR gave us the Federal Power Commission and the Public
Utilities Holding Company Act which told electricity companies where to
stand and salute. Detailed
regulations limited charges to real expenditures plus a government-set
profit. The laws banned "power markets" and required companies to keep
the lights on under
threat of arrest -- no blackout blackmail to hike rates.

Of particular significance as I write here in the dark, regulators told
utilities exactly how much they had to spend to insure the system stayed
in repair and the lights
stayed on. Bureaucrats crawled along the wire and, like me, crawled
through the account books, to make sure the power execs spent customers'
money on parts and
labor. If they didn't, we'd whack'm over the head with our thick rule
books. Did we get in the way of these businessmen's entrepreneurial
spirit? Damn right we did.

Most important, FDR banned political contributions from utility
companies -- no 'soft' money, no 'hard' money, no money PERIOD.

But then came George the First. In 1992, just prior to his departure
from the White House, President Bush Senior gave the power industry one
long
deep-through-the-teeth kiss good-bye: federal deregulation of
electricity. It was a legacy he wanted to leave for his son, the
gratitude of power companies which
ponied up $16 million for the Republican campaign of 2000, seven times
the sum they gave Democrats.

But Poppy Bush's gift of deregulating of wholesale prices set by the
feds only got the power pirates halfway to the plunder of Joe Ratepayer.
For the big payday they
needed deregulation at the state level. There were only two states,
California and Texas, big enough and Republican enough to put the
electricity market con into
operation.

California fell first. The power companies spent $39 million to defeat a
1998 referendum pushed by Ralph Nader which would have blocked the
de-reg scam. Another
$37 million was spent on lobbying and lubricating the campaign coffers
of legislators to write a lie into law: in the deregulation act's
preamble, the Legislature promised
that deregulation would reduce electricity bills by 20%. In fact, when
San Diegans in the first California city to go "lawless" looked at their
bills, the 20% savings became
a 300% jump in surcharges.

Enron circled California and licked its lips. As the number one
life-time contributor to the George W. Bush campaign, it was confident
about the future. With just a half
dozen other companies it controlled at times 100% of the available power
capacity needed to keep the Golden State lit. Their motto, "your money
or your lights." Enron
and its comrades played the system like a broken ATM machine, yanking
out the bills. For example, in the shamelessly fixed "auctions" for
electricity held by the state,
Enron bid, in one instance, to supply 500 megawatts of electricity over
a 15 megawatt line. That's like pouring a gallon of gasoline into a
thimble -- the lines would burn
up if they attempted it. Faced with blackout because of Enron's
destructive bid, the state was willing to pay anything to keep the
lights on.

And the state did. According to Dr. Anjali Sheffrin, economist with the
California state Independent System Operator which directed power
movements, between May
and November 2000, three power giants physically or "economically"
withheld power from the state and concocted enough false bids to cost
the California customers
over $6.2 billion in excess charges.

It took until December 20, 2000, with the lights going out on the Golden
Gate, for President Bill Clinton, once a deregulation booster, to find
his lost Democratic soul and
impose price caps in California and ban Enron from the market.

But the light-bulb buccaneers didn't have to wait long to put their
hooks back into the treasure chest. Within seventy-two hours of moving
into the White House, while
he was still sweeping out the inaugural champagne bottles, George Bush
the Second reversed Clinton's executive order and put the power pirates
back in business in
California. Enron, Reliant (aka Houston Industries), TXU (aka Texas
Utilities) and the others who had economically snipped California's
wires knew they could count on
Dubya, who as governor of the Lone Star state cut them the richest
deregulation deal in America.

Meanwhile, the deregulation bug made it to New York where Republican
Governor George Pataki and his industry-picked utility commissioners
ripped the lid off electric
bills and relieved my old friends at Niagara Mohawk of the expensive
obligation to properly fund the maintenance of the grid system.

And the Pataki-Bush Axis of Weasels permitted something that must have
former New York governor Roosevelt spinning in his wheelchair in Heaven:
They allowed a
foreign company, the notoriously incompetent National Grid of England,
to buy up NiMo, get rid of 800 workers and pocket most of their wages -
producing a bonus for
NiMo stockholders approaching $90 million.

Is tonight's black-out a surprise? Heck, no, not to us in the field
who've watched Bush's buddies flick the switches across the globe. In
Brazil, Houston Industries
seized ownership of Rio de Janeiro's electric company. The Texans (aided
by their French partners) fired workers, raised prices, cut maintenance
expenditures and,
CLICK! the juice went out so often the locals now call it, "Rio Dark."

So too the free-market cowboys of Niagara Mohawk raised prices, slashed
staff, cut maintenance and CLICK! -- New York joins Brazil in the Dark
Ages.

Californians have found the solution to the deregulation disaster:
re-call the only governor in the nation with the cojones to stand up to
the electricity price fixers. And
unlike Arnold Schwarzenegger, Gov. Gray Davis stood alone against the
bad guys without using a body double. Davis called Reliant Corp of
Houston a pack of
"pirates" --and now he'll walk the plank for daring to stand up to the
Texas marauders.

So where's the President? Just before he landed on the deck of the Abe
Lincoln, the White House was so concerned about our brave troops facing
the foe that they
used the cover of war for a new push in Congress for yet more
electricity deregulation. This has a certain logic: there's no sense
defeating Iraq if a hostile regime
remains in California.
Sitting in the dark, as my laptop battery runs low, I don't know if the
truth about deregulation will ever see the light --until we change the
dim bulb in the White House.

See Greg Palast's award-winning reports for BBC Television and the
Guardian papers. Contact Palast at his New York office:
media@.... Greg Palast is
the author of the New York Times bestseller, "The Best Democracy Money
Can Buy" (Penguin USA) and the worstseller, "Democracy and Regulation,"
a guide to
electricity deregulation published by the United Nations (written with
T. MacGregor and J. Oppenheim).

###
-- -Kraig Grady
North American Embassy of Anaphoria Island
http://www.anaphoria.com
The Wandering Medicine Show
KXLU 88.9 FM WED 8-9PM PST

no lights

🔗kraig grady <kraiggrady@...>

🔗monz@...