May 25 - 31, 2001

Powerlines: Edison’s Con Game

Ratepayers will pay for new anti-ratepayer advertising campaign

by R. Scott Moxley

In early May, Southern California Edison (SCE) launched a new statewide television- and radio-advertising campaign designed to convince the public that it should assume additional responsibility for the privately owned utility’s massive debts.

Don’t laugh.

In 1998, SCE propagandists overwhelmingly convinced California voters that the state’s now-embarrassing deregulation law was a great idea that would result in permanent, significant rate reductions for consumers.

You certainly aren’t laughing now.

But our friends at SCE are a humorous, if shameless, bunch. The estimated $3 million anti-ratepayer lobbying campaign is being paid for by—drum roll, please—you, the ratepayer.

This is, of course, a sore point for Edison executives. In recent internal "talking points" memorandums obtained by the Weekly, the company has urged its high-priced team of media flacks to claim—erroneously—that shareholders and not ratepayers are footing the bill. But the funds used for the series of four TV and several radio spots targeting the English- and Spanish-language markets will come directly from company coffers that are solely funded by ratepayers. Not one penny will come from the pocket of any shareholder. If history offers any clue, the state’s mainstream media—including the Los Angeles Times and The Orange County Register—will report Edison’s claim without question.

But John Bryson, chairman of SCE parent company Edison International, is not taking any chances. In a May 4 memo, Bryson encouraged employees to tell "family, friends and neighbors" that the "informational campaign" is in the best interest of consumers.

"The time for action is now," wrote Bryson, who took more than $2.5 million in compensation from ratepayers last year. "Please join us in communicating the urgency and the importance of restoring Southern California Edison’s financial health."

The ads, which began airing on May 5 and are run under the auspices of the independent-sounding but Edison-controlled Coalition for a Secure Energy Future, are specifically intended to convince the public and state lawmakers that Edison unconditionally deserves billions of dollars more for a bailout. The company’s spin is classic circular logic: "The only hope for returning energy stability to our customers is by returning utilities back to sound financial footing."

Translation: "You want to pay less? You gotta pay more. Oh, and pay no attention to the man with the gun to your head."

Edison International memos fail to mention that since 1998, the company has diverted an estimated $5 billion in profits from ratepayers to unregulated subsidiaries operating businesses in Mexico, Turkey, Thailand, Puerto Rico, Spain, Italy, Great Britain and Indonesia. Nor is there any mention of exorbitant Edison salaries (scores of employees take home more than $100,000 annually), the $30 billion in subsidies Edison and the state’s two other electric monopolies grabbed from their deregulation law, or the latest $5.7 billion rate increase.

Concerned that consumers might not swallow Edison’s claim that it is looking out for their interests, the utility has once again cleverly rolled out its PR mouthpiece: David Horowitz, a "consumer advocate" so unconscionable that he quietly took payments for touting the utility industry’s anti-consumer positions in the 1990s.

"Only when the utilities can resume the role of providing safe, reliable electricity will the state be able to upgrade its credit rating and focus on its own business," says a trademark no-nonsense Horowitz in the ads. He ends by telling viewers to tell politicians to support the bailout: "We’ve got to fight back, keep the lights on and the economy strong."

Noticeably, Horowitz does not explain how bailing out Edison shareholders, who over the decades have gained the most financially from the monopoly system, is "fighting back."

Meanwhile, the folks at the Santa Monica-based consumer-rights group Foundation for Taxpayer & Consumer Rights are now aptly calling the 1996 electricity deregulation law "the crime of the century."

http://www.ocweekly.com/printme.php3?&eid=25087

-- Martin Thompson (mthom1927@aol.com), May 24, 2001