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Date Posted: 06:02:08 01/27/01 Sat
Author: HAL
Subject: Hey Gman unplug the sex toys and VCR

Power Play
Energy Crisis Poses Political Quandary for Bush

By Carter M. Yang





W A S H I N G T O N, Jan. 26 — As California continues to endure an unprecedented energy crisis, with its rolling blackouts and record-high electric bills, President Bush has put the largest and most electorally valuable state in the nation on notice: You're on your own.

"The president believes that this is a problem that can be and should be addressed by Californians," White House spokesman Ari Fleischer told reporters Wednesday. "We cannot pass laws for the state of California."
But the course of relative inaction, which some say the new president has charted, may have political consequences for him.

"The biggest potential downfall for the Bush administration staying at arm's length from the crisis is not a political negative as much as it is a missed opportunity," says Dan Schnur, a California-based Republican consultant. "Symbolically, it's important for voters to know that their leaders understand what they're going through."

Despite a concerted effort by the Bush campaign to court California voters during the 2000 campaign, Vice President Al Gore trounced the then-Texas governor by a whopping 54 percent to 42 percent. Democrats also strengthened their majorities in the state assembly and Senate and picked up four seats in Congress.

"You're talking about a state that he clearly wants and needs to keep out of the Democratic column," says political analyst Sherry Bebitch Jeffe, a senior scholar at the University of Southern California. "You're talking about a state in which the Republican Party is on life-support … That is at risk if he turns his back on California."

White House: No 'Federal Panacea'

California's power woes are largely the result of the state Legislature's 1996 decision to deregulate the electricity industry, opening up the market to competition in an effort to drive down prices. But rapidly rising demand quickly outstripped supply, resulting in shortages and sky-high prices.

"The fact is the federal arsenal is not well-equipped to get California out of this problem," Fleischer insisted. "There is no federal panacea. California understands that and so does Gov. [Gray] Davis."

Davis and other prominent California Democrats are clamoring for the new administration to step in and impose price controls, but Bush has repeatedly panned the idea.

"He's long been a proponent of deregulation. He's long been a proponent of the free market economy," observes Jeffe. "[H]e would be loathe to cap anything. Economically, politically, ideologically, it goes against George W. Bush's grain."

Curt Hebert Jr., who Bush tapped Monday to chair the Federal Energy Regulatory Commission — which oversees wholesale electricity sales among states — is also a staunch opponent of price fixing and has argued strongly against any major federal intervention in the state power crisis.

"I believe [the free enterprise] system is part of the solution rather than part of the problem for the malfunctioning markets on the West Coast," he said in a statement.

On Tuesday, newly sworn-in Energy Secretary Spencer Abraham, with Bush's approval, extended for two weeks a pair of emergency orders issued by the Clinton administration, requiring power wholesalers to continue selling power to the state's utilities, which are now buried in debt and on the verge of bankruptcy due to soaring wholesale prices.

But Abraham made clear that power-starved Californians expecting a Washington bailout would be sorely disappointed.

"[A] real solution must address the need for the construction of more electric power generation in California, reform of the flawed state market rules, restoration of the financial health of California's utilities and encouragement of greater conservation," the secretary said in a statement.

California Schemin'?

Some Democrats have not taken kindly to Bush's apparent reluctance to dirty the federal government's hands in the Golden State's mess.

"He can lollygag around there 3,000 miles away in his new digs and think somehow this isn't his problem, but he's going to learn very quickly it is his problem," Garry South, a political adviser to Davis, told The Sacramento Bee. "If a president of the United States allows the California economy to collapse, it's going to have dire impacts on the national economy."

But will the handling of California's energy crisis by the state and federal government degenerate into bitter partisan warfare, with Bush and Davis each blaming the other? Most political experts say no.

"You're not going to see any 'Drop dead, California,' coming out of George W. Bush's mouth," says Allan Hoffenblum, a California-based GOP consultant. "If this becomes 'Davis vs. Bush,' neither one will win that battle because it'll appear partisan … If [Bush] is perceived as playing games in California, that'll hurt him on a national level."

But it may be Davis — who is facing re-election in 2002 and has been talked up as a potential Democratic presidential candidate for 2004 — who stands to gain or lose the most from the power crunch.

"Davis' presidential prospects are only a fraction of what they were 90 days ago," Schnur insists. But others disagree.

"If this gets out of control, if he can't turn around the energy emergency, he is in grave political trouble," says Jeffe. "If, however, he manages to come up with a solution … he hasn't created that much of a political risk."

"If Gray Davis looks like he showed strong leadership, then it might be difficult to find a strong Republican to battle him in two years," adds Hoffenblum.

In his interview with The Sacramento Bee, South suggested Bush might be trying to exact his revenge on a state that voted heavily for his opponent in November and whose governor is a potential opponent in 2004.

"It's not politically tenable to disregard or do deliberate damage to the largest state in America … just to take a few bites out of the rear end of a sitting governor," he said.

"If you are George W. Bush, do you help a state's governor who has been touted as a possible opponent in 2004? Do you give anything to a state that voted overwhelmingly for Al Gore?" asks Jeffe.

If his answer is no, Jeffe says, "George W. Bush and the people around him are fools — and I don't think they're fools."

"There are 55 excellent reasons why the administration should be doing everything it can to help California," adds Schnur. "Bush and his advisers know that a severe recession in California could have a significant impact on the national economy."


The Environmental Option


Jan. 26 — Before he was sworn in as the 43rd president of the United States, George W. Bush suggested a way to ease the energy crisis in California.
"If there's any environmental regulations preventing California from having 100 percent max output at their plants, like I understand there may be," Bush said in a Jan. 17 interview with CNN, "then we need to relax those regulations."

But environmentalists say the president has his facts wrong.

"Right now, our power plants are pumping out like crazy," says Gail Ruderman-Feuer of the National Resources Defense Council. "If you relax those regulations, you'll see a lot more pollution for the public, but you won't see any more power in California."

And many politicians and utility company officials agree.

"It's not air standards that are keeping us from meeting the power needs of Californians at this moment," insists Democratic state Sen. Debra Bowen, chairman of the Energy, Utilities and Communications Committee.

"So far, we have been able to generate as much electricity as is necessary and be in compliance with all relevant regulations," adds Angelina Galiteva, director of the Los Angeles Department of Water and Power's Strategic Planning Organization.

In fact, only a handful of power plants in the Golden State have been shut down for failure to meet anti-smog regulations. But the state has already given them a break, in the form of waivers, aimed at getting them back on line.

"In some instances, one of the conditions of those waivers was that pollution control equipment is added so that we don't have to continue to have waivers," explains Bowen.

But industry officials say it's not existing plants that are causing the problem — it's the non-existent plants.

"California, with demand increasing at twice the national average for electricity, hasn't built a power plant in 10 years," says Bill Brier, vice president of communications for the Edison Electric Institute, an association of American-owned electric companies.

If the Bush administration does decide that pollution controls are putting a substantial crimp on power output in California, the president will likely move to ease the standards mandated by amendments to the Clean Air Act, signed into law in 1990 by his father, then-President George Bush.


— Judy Muller, ABC NEWS

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