Cautionary advice from California

Christian Science Monitor Tuesday September 04, 2001, 08:36:00 PM

SAUSALITO, Calif. (CSM) - Making sense of the California energy situation is hardly more fruitful than trying to understand California itself.

For many citizens, the energy drama was demeaning and confusing. To use the word "tawdry" to describe the maneuverings and pronouncements of the larger energy suppliers might be too kind. To use the word "inept" to describe the California governor may be equally charitable. After securing long-term contracts for electricity at the top of the market, California is now selling its surplus electricity at a loss.

Having been gouged the first time, Gov. Gray Davis must have looked like a "mark" to the professional dealers, who proceeded to fleece him a second time.

In short, the crisis had none of the virtues or vices one could like. But, as with all crises, there are cautionary points to bear in mind:

1. Energy has always been a boom-and-bust commodity, because of the lag between demand, supply and investment. When prices are low, economies are stimulated to use more, which soaks up supply, eventually causing price increases. As supply shrinks and prices rise, it brings on new investment in supply. Before supplies come on line, high prices suppress demand. As demand falls and new supply becomes available, prices plummet. The cycle repeats itself time and again.

2. Energy is the nation's most politicized commodity; politics and markets are dreadful bedmates. Never confuse price volatility and a free market. In fact, it is this volatility that curbs free markets. OPEC's raison d'etre is to prevent an open market.

Even a cursory reading of the events surrounding California's blackouts and surpluses reveals how energy supplies were manipulated, carteled and controlled by corporate interests with one end in mind: windfall profits. What California endured, what the country experiences, is a coercive market owing to the absence of energy policy.

3. American's expectation that energy be cheap and abundant greatly reduces the opportunity for a long-term policy that would lead to less pollution and more energy security. We are the world's spoiled children when it comes to gas and electricity prices. We howl when we can't get our candy. It's unbecoming and prevents us from learning from countries such as Germany, Switzerland and Sweden, all of which have considerably higher energy prices, greater energy productivity and better standards of living.

Although encumbered and manipulated markets are present in every society, what is uncommon about the United States (and California) is the absence of an energy blueprint. Developed countries such as Germany, France and Japan have energy plans extending far into the future. Sweden has announced policies that will make the country essentially carbon neutral within 25 years.

The U.S. strategy, crafted in secret at Vice President Cheney's office by industry lobbyists, is no plan at all. It is simply a combination of concessions and corporate welfare to the energy industries of the past. Nothing that emerged from California resulted in a game plan that will make the state more self-sufficient, less polluted or more stable. Welcome to the next crisis.

In the rush to re-energize California, there was no mention of carbon emissions or global warming. While Democrats quickly denounced President Bush's renunciation of the Kyoto Protocols, possible Democratic presidential hopeful Gray Davis hasn't even discussed the issue.

In 1979, the Energy Department said, "carbon dioxide from unrestrained combustion of fossil fuels potentially is the most important environmental issue facing mankind." It still is. United States antipathy to responsibility for global warming has been greeted with incredulity by the rest of the world. Australian Sen. Bob Brown put it succinctly: "The world's got a pretty simple choice here. It's between President Bush and our grandchildren."

The greatest loss in California was not the billions of dollars flowing into Texas-based energy companies. It was the loss of leadership. If ever there was a moment to enjoin citizenry to engage in a real dialogue about California's future, its needs and its responsibilities, this was the time.

A crisis, whether personal or national, is an opening, a moment when the scattered pieces from the past can be put together in new ways that can lead to transformation. Since California is the economic equivalent of the fifth-largest country in the world, it would have been appropriate for Bush to participate collegially and thoughtfully.

Despite the need to solve the power crisis, Governor Davis had the opportunity to remind us that energy is not only a matter of price and availability, it is also a moral issue that will indeed affect our grandchildren and their grandchildren to come.

Paul Hawken is a businessman and author of 'The Ecology of Commerce' (HarperCollins, 1993) and six other books

http://www.bakersfield.com/24hour/opinions/v-print/story/679023p-721279c.html

-- Martin Thompson (mthom1927@aol.com), September 05, 2001

Answers

If you like this letter to the editor by Hawken, then you might like the following account of his experience when he was rioter/protester on the streets at the WTO (see below)

Why does this posting LOOK like it is a news article and not just the opinion of the radical ecology/WTO protester???? ------------------------------------------- 'N30

by Paul Hawken January 2000

When I was able to open my eyes, I saw lying next to me a young man, 19, maybe 20 at the oldest. He was in shock, twitching and shivering uncontrollably from being teargassed and pepper-sprayed at close range. His burned eyes were tightly closed, and he was panting irregularly. Then he passed out. He went from excruciating pain to unconsciousness on a sidewalk wet from the water that a medic had poured over him to flush his eyes.

More than 700 organizations and between 40,000 and 60,000 people took part in the protests against the WTO’s Third Ministerial on November 30th. These groups and citizens sense a cascading loss of human and labor rights in the world. Seattle was not the beginning but simply the most striking expression of citizens struggling against a worldwide corporate-financed oligarchy – in effect, a plutocracy. Oligarchy and plutocracy often are used to describe “other” countries where a small group of wealthy people rule, but not the “First World” – the United States, Japan, Germany, or Canada.

More at http://www.towerofbabel.com/features/wto/N30/

-- Gerald M (GeraldM@yahoo.com), September 05, 2001.

Gerald M. --

I worked with the enviornmental movement and got to know about Hawken fairly well, even meeting him a few times.

I'm sure that Hawken was never a rioter, but he clearly was a protester in Seattle (WTO).

He's always been, unabashedly, a very liberal/enviornmental activist, and a democratic insider (friend of Gore), who has proposes some extreme changes to capitalism...like no private ownership (of anything).

In the wake of the Gore's loss of the White House, he has become a lot more radicalized and has shifted his more reasonable and balanced approach that got some praise by the middle, to one of attacking Bush and the Republicans.

That's why he leaves out so many, now, well known facts (like the unanimous -- bipartisan -- rejection of Kyoto by the Senate) and uses references to some 1979 Energy Department statement and an obscure Australian. They can't be challenged since they can't be found and put in context. The Democrats, like Clinton and Gore, NEVER had an energy policy, yet he dances around that in order to criticize the Republicans (Bush) for having one because he says they didn't release a list of the people they talked to.

I guess Clinton was able to talk to anyone he wanted to in private, since he didn't have a public energy policy. Grey gets a pass because he was "duped".

You are also right about this being an opinion piece originally published, as an effort to air divergent views, by the CS Monitor. It was reprinted in the California Paper with the "look" of being an article/OP-ED piece by the Christian Science Monitor...which it was not.

Cheerz --

JB

-- Jackson Brown (Jackson_Brown@deja.com), September 05, 2001.