A viewpoint by Thomas D. Elias: Term limits, campaign finance behind power crisis

February 20, 2001

Looking for the real culprits in the power crunch that has raised consumer bills, disrupted business and produced rolling blackouts from time to time around this state?

Almost everyone has a candidate for villainy. But no public figure names the real sources of the problem: term limits and campaign donations.

President Bush blames environmental laws that he says have stymied development of new power plants. In fact, environmental laws have not pushed even one proposed plant off the drawing board in this state.

Gov. Davis says "out-of-state price gougers" have "held California hostage." That's true, to some degree. But the out-of-state companies that bought California power plants under deregulation and then jacked up the wholesale price of electricity didn't write the rules; they're just taking advantage of what's already in place.


Utility companies blame consumer groups that steadfastly oppose rate increases that could restore their credit ratings and make power readily available — at much higher prices. But those same companies promised their customers rate decreases, not increases, when they pushed deregulation in 1996 and then spent $90 million defending it against the 1998 Proposition 9 ballot initiative that would have restored full regulation.

Consumer advocates often finger ex-Gov. Pete Wilson and the state legislators who voted almost unanimously in 1996 for the deregulation scheme devised principally by the utility companies and Wilson-appointed members of the state Public Utilities Commission.

The politicians did indeed vote for deregulation and they were just as unanimous in opposing Proposition 9.

Why did they vote solidly for deregulation? Why remain adamant two years later in favor of a plan whose flaws were obvious to some from the start?

The explanation lies in a combination of term limits and campaign donations.

Talk to present and former legislators, both Republicans and Democrats, and almost to a person they say they didn't know what they were doing when they voted for deregulation.

"The leadership said it was a good bill, so I voted for it," explained Democratic state Sen. Liz Figueroa of Alameda County when confronted about her vote. She didn't understand it, she whines.

Why didn't she know anything about a major bill she voted for? Term limits. In 1996, Ms. Figueroa was a second-term assemblywoman, just three years into the Legislature. She had never taken much interest in utility issues. She had no knowledge of past battles and neither did her staff.

That's exactly what opponents warned against when term limits were instituted with 1990's Proposition 140, which passed by a 65-35 percent margin and probably would pass by at least as much today. Term limits, said the ballot argument against them, "will force our representatives to become even more dependent on entrenched bureaucrats and shrewd lobbyists."

In fact, several former legislative aides who lost their jobs in the staff cutbacks also mandated by Proposition 140 became utility company lobbyists and analysts, helping create deregulation.

"The fact is, you're new in Sacramento, you're faced with 2,000 bills, you can't know them all, and you're advised to listen to the experts and vote accordingly," said one former lawmaker who voted for deregulation and later became a Davis administration cabinet secretary. "I had no idea what I was voting for, but the experts said it was good, so I did it."

In short, term limits give California a Legislature containing many ignorant innocents who are easy marks for special interest sharpies.

Then there are campaign finances. Why, for instance, has Davis been so adamant about avoiding any plan that would mean bankruptcy for the utility companies who fought for deregulation? One reason may be the $570,000 they have pumped into his campaign coffers since his election in 1998. Never mind the money they gave him before he took office.

Other Sacramento pols took more than $6 million from the top utilities in the same time. (The utilities have suspended political donations — for now.)

Like Davis, most legislators say campaign donations don't influence policy. But how likely are they to buck their benefactors? Even the nominal reforms stemming from last fall's Proposition 34 won't change much, as companies will now donate to political parties instead of giving directly to candidates.

In short, over the last 11 years, this state has created a system that promotes unsound lawmaking by ensuring a corps of know-nothing officials susceptible to the will of the folks whose money put them in office. Utility deregulation is one disastrous result.

We the voters created that system, so it's time to look in the mirror and remember the words of Pogo, the wise old comic strip raccoon: "We have met the enemy and he is us."

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