Californians should be wary when the Legislature makes big decisions in the hectic last days of its annual session and this year is no exception.
Tanned, rested and presumably ready, the Legislature reconvened this week for the inevitably hectic final weeks of its annual session.
The pressure cooker atmosphere that always envelops the final days is, history tells us, not conducive to thoughtful policymaking.
Preoccupied with pushing hundreds of their own pet bills through the Capitol’s sausage factory, legislators pay too little attention to larger issues with potentially huge long-term impact on the state.
Lobbyists for powerful interests thrive on the inattention, seeking measures that enrich their clients at the larger public’s expense.
That’s how, in the dying moments of the 1996 session, the Legislature passed, without a dissenting vote, a misnamed “deregulation” of the state’s electrical power utilities.
It promised to benefit consumers but wound up picking their pockets for many billions of dollars while driving one major utility, Pacific Gas and Electric, into bankruptcy and almost making another, Southern California Edison, insolvent.
Three years later, in the last hours of the 1999 session, the Legislature passed a measure granting state employees a very large retroactive increase in their retirement benefits on assurances that it would cost nothing because the California Public Employees Retirement System could easily cover the higher pensions with investment earnings.
Local governments largely followed suit, but after CalPERS lost $100 billion in the recession a decade later, both they and the state were hammered by sharply increasing demands for mandatory “contributions” to cover the losses and pay the enhanced pensions. Much like the electric power debacle, the expedient pension grab is costing Californians tens of billions of dollars.
This trip down memory lane cautions us that Californians should be leery of two big issues – both dealing with electric power – that could be decided this month.
One is the plea by PG&E and other utilities for relief from laws that can hold them financially liable for damages from the wildfires that strike California with increasing regularity and intensity.
Without relief, they say, they can be driven into insolvency and their pleas are being backed by their employee unions and Wall Street banking and investment houses which have huge stakes in keeping the utilities financially healthy.
Wildfire victims, their insurers and attorneys who specialize in personal injury cases – the latter two the strangest of political bedfellows – want to keep “inverse condemnation” laws in effect as vehicles to gain compensation.
Gov. Jerry Brown, for whom this legislative session is the last of his career, is trying to work out a compromise, but with moneyed interests on both sides, it’s a tough slog.
Brown is an advocate, rather than a mediator, on the second issue – whether California will merge its electrical grid with those of other Western states not only physically but politically, allowing a new regional entity to decide who gets juice and who pays for it.
Brown’s advocacy is apparently driven by assumptions that a regional grid would make it easier for California to peddle its surplus renewable power, and also provide backup power so the state can wean itself from carbon-emitting coal and natural gas generation.
However, there’s stubborn resistance from some environmentalists, who worry aloud about the state’s losing its political accountability for power system operations. Not surprisingly, they compare the regional plan to that disastrous 1996 “deregulation” scheme as an example of what happens when big decisions are made at the last minute.
They’ve got a very strong point.