Dennis Kucinich Gets
a Well-Deserved Payback for Integrity from the Northeast
Blackout
© Copyright 2003, From The Wilderness Publications, www.copvcia.com.
All Rights Reserved. May be reprinted, distributed
or posted on an Internet web site for non-profit
purposes only.
[August 21, 2003, 2350 PDT, (FTW) -- Although
FTW will not endorse any Presidential
candidate who does not address
all the issues of Peak Oil and Gas, Bush Administration
Complicity in 9/11, Trillions of Dollars Stolen from
the US Treasury, and criminal misrepresentation of
Iraqi intelligence before the US invasion, we do
like to give praise where praise is due. Two and
a half decades ago, young Cleveland
Mayor Dennis Kucinich stood his ground, alone and
defiant
against deregulation of the power industry, corporate
greed, and in the best interests of his constituents.
Not only did he show courage, he paid a big price
for it. What's more, he survived.
If anyone has earned the
right to speak out on an issue that threatens the
future of this country it is Dennis Kucinich. If
anyone has earned a right to remind people of this
history, it is Dennis Kucinich. Now, if he would
just join with Texas investment banker and Bush energy
advisor Matt Simmons [Behind
The Blackout] in
not only slamming deregulation but addressing Peak
Oil and Gas issues and also take on the bubbling
revelations that show that the administration held
the door open on 9/11, lied about Iraq, and hold
the government accountable for the money we need
to fix things and develop alternative energy sources,
we might just have a leader worth following to hell
and back. We're going there anyway. - MCR]
----------
Lights Out on Deregulation
By Dennis Kucinich
With
and estimated 50 million Americans and Canadians left
without power and in some cases water, common sense
requires us to reflect on the absurdity of deregulation
of public utilities. In the first case, the right of
utility franchise is vested in the people. We give
utilities permission to operate, and enable them to
set up a profit making business in exchange for the
promise of affordable and reliable service. In 1992,
investor owned utilities pushed the Democratic House
to pass HR776 which granted electric utilities broad
powers. The bill was supposed to restructure the electric
utility industry to spur competition.
Utilities
used deregulation to effect a series of mergers limiting competition. In order
to accelerate profits, cost cutting ensued, involving
the layoff of thousands of utility company employees,
including some who were responsible for maintenance
of generation, transmission, and distribution systems.
A number of investor-owned utilities stopped investing in the maintenance
and repair of their own equipment, and, instead, cut
costs to enhance the value of their stock rather than
spending money to enhance the value of their service.
A
prime case in point is FirstEnergy
Corp, late of Ohio.
FirstEnergy formed through a merger of utility companies
which owned nuclear power plants which often were neither
used nor useful, and as a result incurred huge debt.
FirstEnergy's predecessor, The Cleveland Electric Illuminating
Company (CEI) in the 1950s and 60s was a high performing
blue chip stock until they invested in nuclear power.
FirstEnergy has tried without success to keep online
a very troublesome nuclear power facility at Port Clinton,
Ohio, the Davis-Besse plant. Davis-Besse is currently
shut down and has been for some time. FirstEnergy and
federal regulators failed to properly monitor the operations
of the plant, resulting in conditions where the plant's
reactor vessel was threatened with a breach when boric acid ate into the head
of the reactor.
Millions
of people in the Midwest and
the water supply of our entire Great
Lakes region
were at risk because of First Energy's negligence,
improper maintenance, and actual cover-up of the degradation
of the reactor. Furthermore, federal regulators determined
that notwithstanding the peril which was presented
to one of the largest populated areas of the United
States,
FirstEnergy's financial condition necessitated the
continued operation of the flawed reactor. The regulators
put profit ahead of public interest.
If
there was ever an example of an unholy alliance between
government and industry, this is it. If there was ever
an example of the failure of necessary regulation by
the government of an investor-owned utility, it is
found in the government's failure to regulate FirstEnergy,
because now, according to published reports by the
Associated Press, CNN, and ABC
News, the blackout which
affected an estimated 50 million people began in the
FirstEnergy system.
I've
been familiar with First Energy and the challenge of
utility monopolies for over 30 years. Early in my career,
in the 1970s, I watched FirstEnergy's predecessor,
CEI, as they were hard at work trying to undermine
the ability of the City of Cleveland to
operate its own municipal electric system. CEI conducted
a tireless crusade to attempt to put the city's publicly
owned system, Muny Light, out of business. Muny Light
competed against CEI in a third of the city and provided
municipal power customers with savings on their electric
bill of 20-30 percent. It also provided cheaper electricity
for 76 city facilities and thousands of Cleveland
street lights,
saving taxpayers millions of dollars each year. In
the 1970s, CEI applied for a license to operate a nuclear
power plant. The license application triggered an antitrust
review. The antitrust review revealed that CEI had
committed numerous violations of federal antitrust
law in its attempt to put Muny Light out of business.
The Atomic Safety and Licensing Board of the Nuclear
Regulatory Commission, in an extensive investigation,
determined that CEI blocked Muny Light from making
repairs to its generator by lobbying the Cleveland
City Council to place special conditions on Muny Light
Bonds which made the bonds more difficult to sell,
thereby depriving the city of revenue it needed to
repair its generators in order to provide its own power.
The delay in repairs to the generators caused Muny
Light to have to purchase power. CEI then worked behind
the scenes to block Muny Light from purchasing power
from other power companies. CEI became the only power
company Muny Light could buy from. At that point, CEI
sharply increased and sometimes tripled the cost of
purchase power to Muny Light. And, as a result, Muny
Light began to lose money. CEI used Muny Light's weakened
operational and financial condition (which they created)
as evidence of the public system's lack of viability
and as proof that the only way the people of Cleveland
could have reliable power was for the city to sell
its electric system to CEI. The antitrust review cited
one incident when during a period of inclement weather,
Muny Light asked CEI for a special transfer of emergency
power. The transfer of power was conducted in such
a way so as to cause an outage on the Muny Light system.
CEI used the incident as further proof of the city's
inability to operate a municipal electric system. Throughout
this period, the Cleveland media,
which received substantial advertising revenues from
CEI, crusaded against the city's ownership of a municipal
electric system. When the federal government came to
review CEI's practices, CEI executives appeared at
a city council committee meeting to declare that they
had no interest in the acquisition of Muny Light even
as they worked behind the scenes to put Muny Light
out of business.
In
1976, after years of work to undermine Muny Light,
CEI finally succeeded in getting the mayor and the
council of Cleveland to agree to sell Muny Light, giving
CEI a monopoly on electric power in the Cleveland area
and enabling CEI to greatly expand its rate base to
get more revenue to pay for its rapidly mounting expenses
associated with building nuclear power plants. At that
time, I was clerk of the Cleveland Municipal Court,
a citywide elected office. I organized a civic campaign
to save Muny Light. People gathered signatures in freezing
rain to block the sale. I ran for mayor of Cleveland on
a promise that if elected, my first act would be to
cancel the sale of Muny Light. I won the election.
I cancelled the sale. CEI immediately went to court
to demand that the city pay 15 million dollars for
power which it had purchased while CEI was running
up charges to the city. The previous mayor had intended
to pay that light bill by selling the light system
and simultaneously disposing of a 325 million dollar
antitrust damage suit. My election not only stopped
the sale, but kept the lawsuit alive. CEI went to federal
court to get an order attaching city equipment as a
means of trying to destabilize city services as still
another desperate effort to try to try to create a
political climate to force the sale. I moved quickly
to pay the bill by cutting city spending. The Muny
Light issue came to a head on December 15, 1978, when
Ohio's largest bank, Cleveland Trust, the 33rd largest
bank in America at that time, told me that they would
not renew the city's credit on 15 million dollars worth
of loans taken out by the previous administration unless
I would agree to sell Cleveland's municipally owned
utility to CEI.
On
that day, by that time, the sale of Muny Light was
being promoted by both Cleveland newspapers, virtually
all of the radio and TV stations in town, the entire
business community, all the banks, both political parties,
and several unions, as well as a majority of the Cleveland
City Council. All I had to do was to sign my name to
legislation and the system would have sold and the
city credit "protected." The chairman of
Cleveland Trust even offered 50 million dollars of
new credit if I would agree to sell Muny Light.
Where
I come from it matters how much people pay for electricity.
I grew up in the inner city of Cleveland. The
oldest of 7 children. My parents never owned
a home, they lived in 21 different places by the time
I was 17, including a couple of cars. I remember when
there were 5 children and my parents living in a 3
room upstairs apartment on Cleveland's
east side. My parents would sometimes sit in the kitchen
at one of those old white enamel top tables, which,
when the surface was chipped, was black underneath.
When they counted their pennies, I could hear them
clicking on the enamel top table. Click,
Click, Click.
When
I was in the board room with the Chairman of Cleveland
Trust Bank, I was thinking about my parents counting
their pennies and I could hear those pennies hitting
the enamel top table. So, I said no to the sale of
Muny Light to CEI. At Midnight,
Cleveland Trust put the City of Cleveland into
default. Later, it was revealed, that Cleveland Trust
and CEI had four interlocking directors. Cleveland
Trust was CEI's bank. Together with another bank, Cleveland
Trust owned a substantial share of CEI stock and had
numerous other mutual interests. Public power was saved
in Cleveland.
I lost the election in 1979 with default as the major
issue. Cleveland Trust changed it name to AmeriTrust.
The new mayor changed the name of Muny Light to Cleveland
Public Power.
In
1993, the City of Cleveland announced
that it was expanding Muny Light. It was the largest
expansion of any municipal electric system in America.
I had been long gone from major elected office. In
fact, after the default, most political analysts considered
my career over. I had been asked many times by other
politicians why I just didn't make the deal and sell
the light system, especially when my career was on
the line. I believe that there are, in fact, some things
more important than the next election.
When
a reporter from the Cleveland Plain Dealer reached
me to tell me about the expansion, I was on a beach
in Malibu watching
the dolphins play. Cleveland was
the farthest thing from my mind. After I left City
Hall, I couldn't get a job in Cleveland,
I almost lost my home, and my marriage fell apart.
But I had no real complaints, because, according to
a US Senate Subcommittee studying organized crime in
the Mid-Atlantic states,
I had survived, through sheer luck, an assassination
plot. There was something comforting looking out on
the Pacific and watching the waves glisten in the sun.
So
when a reporter told me that people were saying that
the expansion could not have happened without my making
a decision to save the system, I thought "that's
nice." People in Cleveland began
to say that I was right not to sell Muny Light and
they asked me to come back. So I did. I ran for State
Senate in 1994 on a slogan "because he was right" with
little rays of yellow light shining behind my name
on my campaign signs. I was one of the few Democrats
to unseat a Republican incumbent that year in a state
election.
Two
years later, I was one of the few Democrats to unseat
a Republican incumbent to gain election to Congress.
My campaign signs had a light bulb behind my name with
the words "Light up Congress." Today, I'm
running for President of the United
States and
I want to light up America,
and a good place to start will be to shed light on
a deregulation process that has abandoned the public
interest.
Dennis
J. Kucinich
On the road to Davenport, Iowa
This
entry and my personal blog are licensed under a Creative Commons License.
posted by
[ Dennis Kucinich ] on [ Aug
17 03 at 10:20 AM ] to [ ]
http://www.lessig.org/blog/archives/001424.shtml
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By Richard Heinberg
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