It is not shocking that California governor, Democrat Gray Davis, is blaming his state’s energy crisis on local utility companies. What is a bit more perplexing, and downright false, is Davis’, and the mainstream media, manic insistence that the crisis is the fault of “deregulation”, i.e., allowing private companies some freedom from onerous and ever-changing government rules.
According to the outstanding editorial page of Investor’s Business Daily, when California “deregulated” power in 1996, it merely added a host of new rules for utility companies, thus only changing and restructuring the way these companies did business, not freeing them up. However, the public perception, held in large part to blatant media misrepresentation, is that California utility companies have run amok, been typical greedy capitalists, and are holding customers hostage for higher profits. Not true.
Due to the one of the strictest environmental review processes in the U.S., new power plants cannot be built in California. Moreover, because of all the government rule changes in ‘96, called “deregulation” by the press, utility companies cannot charge consumers as much as they themselves pay for wholesale electricity. These are but a few of the major problems facing utility companies in the Golden State, besides the fact that they are being vilified by elected officials, most notably Governor Davis, who has threatened total state takeover of the industry. (Is it time to read Atlas Shrugged again?)
We at the DBJ believe someone should speak the truth about the energy crisis in California, one that will not doubt soon effect us here in Mississippi. The utilities there are too timid, for some reason, to do so. Situations such as this energy crisis demand honest, objective and factual reporting, not biased anti-business diatribe.