Bush Energy Plan: California Reamin’

Greg Palast

by Greg Palast

You nasty-minded readers probably believe George Bush’s Energy Plan is just some pee-brained scheme to pay off the Presidents oil company buddies, fry the planet, and smother Mother earth in coal ash, petroleum pollutants and nuclear waste. If that’s what you think, you’ve overlooked the really vicious intent of the whole program.

It’s payback time – and Bush intends to make California pay. Let me list California’s sins. First, California voted Gore. Second, California’s Governor, Gray Davis, is an intelligent, popular Democrat who could whup Little George’s bottom in the next election. Three, California voted Gore.

Keep in mind that the entire excuse for this polluters’ wet-dream of an ‘energy plan’ is that there’s an energy ‘crisis’ in California. We’re told there’s just not enough electricity and gas. Even the Democrats and the New York Times agree there’s an energy crisis in California — which is evidence enough to conclude: There is no energy crisis in California.

In case you need more evidence, check this out. In December, the lights went out in Southern California, the price of electricity jumped 1000% over the previous year and the price of natural gas jumped 1000% in one week. Power shortage? Nope. The California power grid operator reported that, just over the California border at the “Henry Hub,” gas pipeline switching center, you could buy plentiful gas for $1 a therm. A couple miles down the road in California, the price was $10.

By golly, it turns out two power merchants that controlled the biggest pipe into California simply blocked part of the tube. Result: panic, price spikes, black-outs. Market speculators made a half a billion dollars on that cute little maneuver. In all, says last week’s report by Dr Anjali Shiffren of the grid system, “monopoly rents,” “economic withholding” and “physical withholding” were responsible for artificial shortages and excess charges of $6.2 Billion last year – half the state’s light bill.

So you see the cause of the ‘crisis’ — California didn’t run out of energy, it ran out of supplies of government. Until two years ago, California regulated electric companies. Then Davis’ predecessor, a Republican governor, ‘de-regulated’ energy, and the state became a pricing predators picnic.

Governor Davis proposes a bit of re-regulation and government purchase of more of the power system. (The public already owns the Los Angeles electricity and water system which — no surprise — is not in ‘crisis.’) In other words, Davis’ cure is one part realism, one part populism and one part so-she-lizm.

Now, that’s a crisis. So Vice-President Dick Cheney, the man we Americans pay to think for Dubya, drafted a plan to deal with the Davis crisis. Until January, Cheney was CEO of Halliburton Corporation, the USA’s largest oil drilling services company and builder of nuclear plants. His plan is all about drilling for oil and building more nukes. This won’t do squat for California — which doesn’t use oil-fired plants and can’t put more reactors on earthquake faults. But then, if I may remind you … first, California voted Gore ….

Greg Palast investigated the influence of Texas money on the Bush energy plan for BBC television’s Newsnight. Click here to watch the video or read the transcript.

Palast, columnist for the Observer’s business section, is author of the book, Democratic Regulation, published this week by the United Nations. Catch more of his investigative reports at www.GregPalast.com