[PEN-L:33536] Re: Re: Re: Re: RE: Right wing sees the light! (almost)

[Eugene Coyle <eugenecoyle@xxxxxxx>]

Nomi,  In my short answer I seem to have misled you about Enron's role
in California.  Enron was a major driver of the process -- not only in
California but nationally.  Enron was active in every forum, touting how
the small customer would benefit from "choice."  Enron hired well-placed
civil servants to be spokespersons.  From mayors of cities in New
Hampshire to CEOs of public power cities in Oregon, Enron spent a lot of
money on co-opting through employment people who were respected in their
communities.  It was a major job program.  They also spent huge sums on
conventional lobbying in states around the USA and in Congress.  This
all in the period from early '90s through and well beyond the passage of
the California law in Sept '96.

	One of Enron's claims -- backed by the above lobbying and advocates
speaking at policy forums -- was that it would aggressively go after the
residential market where, it claimed (preposterously) that the real
profits were to be made.  In the spring of '98, just as the market was
to officially open on April 1st (!) Enron did advertise and direct mail
to seek customers.  Spent a few millions.  The market opened and within
21 days Enron announced that it was abandoning the effort to attract
small customers and closed the operation, which had not attracted the
right results.  It is clear that Enron knew all along that this was to
be the outcome and was merely posturing throughout.

	Later, when the consumer side got active and put an initiative on the
ballot, Enron privately enouraged the effort, with the implied promise
of big financial support.  None came forth and the initiative lost very
badly -- being outspent by --- from a dim memory -- $45 million of so.
$45 million to $1 million.

	Enron was all over the campaign to deregulate --- but of course was not
alone in that.

Gene Coyle



Nomiprins@xxxxxxx wrote:
> In a message dated 12/30/2002 3:14:54 PM Eastern Standard Time,
> eugenecoyle@xxxxxxx writes:
>
> > No, power plants (in California) were sold AFTER
> > the law was passed.  The conventional wisdom was that the old plants
> > would not be able to compete with the efficient and smarter new
> > operators -- as it turned out, the latter paid top dollar for the plants
> > -- and of course made a fortune from the investments.
>
>
> Gene,
>
> Thanks for both those answers. What puzzles me is that Enron and others
> weren't involved in pre-AB 1890 buying or posturing in California, maybe
> not of power plants - but was anything else going on to foreshadow their
> eventual presence? When more banking dereg. via Glass Steagall repeal
> happened in November 1999 - it was a year after Citi and Travelers had
> already merged.
>
> 1994 was the first year Enron broke the top 10 energy political
> contributors (that year, the top spot went to Atlantic Richfield, run by
> Lodwrick Cook, an old Bushian, who wound up on the board of Global
> Crossing 3 years later). So, they clearly had a hand in shaping policy.
>
>  >From an early 96 House Commerce committee meeting- "Citing his
> experience with natural gas deregulation, Lay discounted the arguments
> made in opposition to electric customer choice. "I still remember some
> of the protests against 'open access' competition for the interstate gas
> market a decade ago," Ken Lay said. "Too risky; bad for consumers;
> reliability will suffer; it won't work.""
>
> Nomi