Education Industry and Energy Predators

[Bussardre@aol.com]

Maybe people don't understand how education industry predators work to  
destroy public education, but this piece which explains why energy prices  are 
higher thanks to the GOP energy predators might get them thinking about the  
motives of leaders who also crafted education reforms.  Pass it on.
 
--billee
 
 
The GOP Energy Predators
Behind the higher electric bills that are busting budgets of ordinary  
Americans and wrecking havoc with the economy is a cabal of Bush-era Republicans  
that includes Enron's Ken Lay. 
Here we learn how Bush operatives decriminalized price gouging to further  
enrich wealthy interests who fund the GOP. 
 
 
THE AL CAPONE OF ELECTRICITY
Ken Lay Will Get Away with His Real  Crimes
By GREG PALAST 

Seattle Post-Intelligencer

Wednesday,  May 24, 2006  -- Al Capone cut throats, machine-gunned people to 
build his  gang and went to jail -- for not filing his taxes properly. 
Likewise, Ken Lay,  buccaneer of the power industry, will go down -- if the jury 
doesn't buy his  alibi -- for not filing his SEC forms properly. 

And just as Capone went  up the river leaving us a permanent legacy of 
organized crime, so Lay, whether  or not he's sent to the slammer, has left us, with 
the connivance of a few  well-placed politicos, an electricity system that is 
little more than a  playground for power-industry predators. 

We've been here before. In the  1930s, a character named Samuel Insull 
created the first giant power holding  companies. Insull played fast and loose with 
his account books, fast and loose  with cash for politicians and pocketed 
millions by gouging electricity  customers. Insull was indicted, like Lay, for 
crimes against his stockholders.  

In 1933, President Roosevelt made Insull's power piracy a crime. FDR  signed 
the Public Utility Holding Company Act and laws that capped the profit of  
electricity monopolies. The act required them to keep lights on by accounting  
for all maintenance expenses, barred "trading" electricity and, most important,  
banned donations by the power giants to politicians. 

Fast-forward to  January 2001. The George W. Bush administration, within 72 
hours of his  inauguration, issued an executive order lifting the Clinton 
Energy Department's  effective ban on speculative trading in the California power 
market. The state  was still in crisis, facing blackouts and 300 percent 
increases in power bills,  the result of "deregulating" its electric system, as 
first suggested by Lay.  

Instead of a "free" market, California's electricity bidding system  became a 
fixed casino where Lay's operatives and a tight-knit cabal of corporate  
cronies jacked up prices through such tricks as "death star," "ricochet" and  
"kilowatt laundering." 

In one instance, Enron "sold" the state 500  megawatts of electricity to go 
over a 15-megawatt line. Enron knew that sending  that much power through those 
wires would have burned them to a crisp. To  prevent this Enron-designed 
blackout, the state scrambled for other sources of  electricity, which Enron and 
friends sold them at a big mark-up.  

California's Independent System Operator put the cost to consumers of  this 
"gaming" at $6.3 billion in a six-month period. Under the Roosevelt rules,  
when utilities were regulated to a fare-thee-well, the gaming rooms would have  
been busted. 

Instead, the games have been institutionalized. For  example, TXU, the 
corporate alias of Texas Utilities, has seen earnings per  share rise 500 percent in 
five years. The reason: So-called deregulation allows  the company to sell 
electricity at a price based on the sky-high cost of oil  although much of its 
power is produced from cheaper coal or uranium. In effect,  deregulation has 
become de-criminalization of price gouging. 

Even more  sinister than Bush's hasty executive order allowing Enron to 
resume speculation  in the California power market was his appointment of Pat Wood 
as chairman of  the Federal Energy Regulatory Commission, the government's 
electricity cops. The  choice of Wood was suggested, in secret, by Enron. 

This put Lay one step  ahead of Al Capone who had to buy the cops. Lay just 
had them appointed.  

Wood may have been as honest as the day is long, but on his watch, Enron  and 
the industry treaded through the power market like Godzilla through a  
kindergarten. And it continues under a new chairman, also suggested by Enron.  

What about the $6.3 billion filched from the wallets of California  
consumers, let alone the larger sums taken in by power profiteers nationwide?  The 
Lay-blessed federal regulators barely batted an eye. 

Lay's  brainchild of deregulation was coupled with his other grand idea: a 
massive  increase in industry largesse to politicians. By unsubtle, but 
perfectly legal,  means around FDR's prohibition on political donations, Enron PACs 
and its  executives became the top Bush funders. 

Capone never lived to see armed  robbery made legal. But Lay, even if 
convicted, can leave the courthouse for the  Big House knowing power profiteering is 
now as legal as prayer. On July 14,  2005, Roosevelt's Public Utility Holding 
Company Act, bulwark of consumer  protection, was repealed by a Congress 
fattened with utility industry cash.  


------- 
On June 6, Penguin Dutton will publish Greg Palast's new  book, ARMED 
MADHOUSE: Dispatches From the Front Lines of the Class War.   Armed Madhouse includes 
the Project Censored Award-winning story of The  Governator of California and 
the Enron chief, "When Ahnold Got  Lay'd."   Order it today at  
http://www.gregpalast.com/armedmadhouse/preorder.html

Palast, an  internationally recognized expert on Enron and electricity market 
manipulation,  is co-author of "Democracy and Regulation," the United 
Nation's guide to control  of the utility industry. 

View his investigative reports for Harper's  Magazine and BBC Television's 
Newsnight at  www.GregPalast.com.