[lewislynn]

Yet another example:

To print:  or Select File and then Print from your browser's menu

	This article was printed from the News&features
	section of the Sacramento News & Review.
	This article may be read online at:
	http://www.newsreview.com/issues/sacto/2001-03-22/cover2.asp
	Copyright ©2001 Chico Community Publishing, Inc.
	Printed on 7/22/2002 8:12:21 PM.

Cover Story

A rogues’ gallery
Meet the men who devised the deregulation disaster

By Bill Bradley

Jim Brulte

The ball is in Gray Davis’ court now, but it certainly didn’t start there. His Republican predecessor, Pete Wilson, pushed, prodded and presided over California’s electric power deregulation, but a number of other men played critical roles in devising the disastrous scheme. Here are four of them:

DANIEL FESSLER
While former Gov. Wilson made plain his philosophical support for deregulation in the early ’90s and pushed it through after he won re-election and his party took over the Assembly in 1994, he needed a policy quarterback. Wilson found his man in the unlikely person of Daniel W. L. Fessler. This UC Davis contracts law professor had no particular background in energy issues, but he did boast a conservative ideology and the friendship of First Lady Gale Wilson. It was enough to make him Wilson’s choice as president of the powerful Public Utilities Commission.

After first trying to lead a revival of nuclear power in California, Fessler settled down to the task of crafting electric power deregulation. An Anglophile who enjoyed affecting a mock British accent, Fessler looked to the electric power deregulation of Britain, sparked by global conservative icon Margaret Thatcher, for inspiration, bringing back many ideas from a trip he and other regulators took there with top utility executives. After originating the deregulation scheme and seeing it through several versions into its final 1996 legislative enactment, Fessler became a high-priced partner of a global law firm that worked on the issue in Britain. He refuses to respond to repeated phone calls and e-mails on the power crisis.

JIM BRULTE
“Not only do we have some fresh leadership in place,” state Sen. Jim Brulte told the New York Times last week, speaking of the reeling California Republican Party, “but we see a great political opportunity in the electricity crisis that has hit the state. The Democrats are really botching it up.”

Talk about a profile in chutzpah! The Senate Republican leader says he sees “a great political opportunity” in a crisis largely of his own making. Brulte is the actual author of AB 1890, the final version of California’s disastrous deregulation scheme (which the august Times failed to mention). Considering his central role in the debacle as an assemblyman in 1996, Brulte has gotten a remarkably free ride from most of the media, in part because he is an important inside source on Republican and legislative politics for the press corps. Yet, notwithstanding that amazing quote above, there are limits to the Rancho Cucamonga Republican’s chutzpah. Though he is a key California ally of President George W. Bush (one who would dearly love to be governor one day), Brulte has scaled back his ambitions with the advent of the power crisis. Rather than seek statewide office next year, as he had planned, Brulte will run instead for a seat on the obscure but powerful tax policymaking body called the Board of Equalization, in a district that includes Sacramento.

JOHN BRYSON
This former lawyer for the Natural Resources Defense Council-turned-CEO of Southern California Edison is, in the words of author Harvey Wasserman, “the Darth Vader of utility deregulation.” A promising young person given great political prominence by then Gov. Jerry Brown (not unlike Gray Davis), Bryson served for a time as Brown’s president of the Public Utilities Commission, opposing the expansion of nuclear power and promoting a new age of wind and solar power. His appointment as a top Edison executive presaged for some a new era for the big utilities.

But the green Jedi Bryson turned, if you will, to the dark side. With his legal counsel a principal drafter of the deregulation bill, AB 1890, Bryson pushed for a multibillion-dollar bailout for the utilities’ expensive nuclear plants and turned the once staid utility into a high-flying operation investing in fossil fuel plants around the world.

Steve Peace

STEVE PEACE
If Brulte is a study in chutzpah, this bright Democratic state senator from San Diego--whose official bio cites an award from the California Journal as one of the two purportedly smartest legislators--is a study in hubris. Happy in the aftermath of deregulation’s enactment to be called its “architect,” Peace, heretofore best known as the producer of the classic schlock movie Attack of the Killer Tomatoes, was actually merely the chief mediator and broker for disputes and deals around a template devised by others in his role as chairman of the Assembly/Senate conference committee working out differences on AB 1890. As chairman of the energy committee in a Senate controlled by Democrats, he was needed by Wilson, Assembly Republicans and the big lobbyists to grease the bipartisan skids, conducting mind-numbing, marathon meetings which few could follow.

Peace doesn’t take credit any longer. Indeed, he has produced a video explaining why he is not the architect of deregulation. Like Brulte, he has dropped plans to run for statewide office next year.

I have yet to find where Brulte denies being the author.

[Dog Gone]

Brulte authored the Bill. But Steve Peace was the one who took charge of it as chairman of his Senate Committee on Deregulation, and chairman of the of conference committee that hammered out differences between the Assembly and Senate. He had no problem with being called "The Achitect of California Deregulation" until it blew up in his face.

Deregulation fiasco shines unwanted light on Peace

By Jon Matthews
Bee Capitol Bureau
(Published Aug. 6, 2000)

Four years ago, a determined state Sen. Steve Peace stood in the Capitol and urged the Legislature to approve a sweeping plan to deregulate electricity in California.

Today, after lawmakers did what Peace asked, electric bills have more than doubled in Peace's home area of San Diego and threaten to skyrocket across the entire state. Critics have called the situation an unfolding economic disaster.

One of the state's most aggressive and intelligent policy wonks, Peace is now among those on center stage as millions of California consumers watch government and industry wrestle with the energy troubles.

Politicians at all levels are well aware that the arcane fine print of deregulation could explode into voter backlash unless the lights remain on and consumer bills are brought under -- or kept under -- control.

"One Mexican restaurant in San Diego has seen its electric bill go from $1,000 a month to $4,000. This is the stuff that can put people out of business," said consumer advocate Harvey Rosenfield, an opponent of the current deregulation scheme.

Peace is an influential -- and sometimes controversial -- policy leader in the Capitol who has been mentioned as a potential candidate for secretary of state in 2002.

But he also was a key architect -- if not the key architect -- of the complex deregulation law of 1996 that was widely supported at the time by other lawmakers for its promise to modernize the electricity market and reduce business and residential bills.

While the law had broad backing at the time from both Democrats and Republicans, Peace was singled out by former Republican Gov. Pete Wilson during the bill-signing ceremony for "a special word of thanks" for leading hearings on the measure.

With deregulation leaving consumers in an uproar four years later, Rosenfield calls the situation an "economic catastrophe" that has allowed soaring electric industry profits. Peace, he said, "is properly shouldering the blame."

Under the terms of deregulation law, San Diego consumers are the first to feel many of its full effects. Peace also has been receiving attention in San Diego for his receipt of campaign contributions from electric industry sources, his business ties and other issues.

But Peace, in a recent telephone interview, said neither he nor the Legislature is to blame for the energy mess, but rather that fault rests with a "wholesale (electricity) market that is broken."

Asked about the situation in San Diego, he said, "None of these issues are raised by the legislation.

"Power prices are up in Arizona, Nevada, Montana; there are people shutting down manufacturing plants. Those states are regulated, but what is not regulated is the wholesale market. What is at issue here is volatility and profiteering inside that market."

Nonetheless, Peace is scrambling to help bring consumers' bills back in line and stabilize an electric system that has seen shortages and pleas for conservation. Last week, he was among those arguing that the California Independent System Operator should lower the cap it pays for certain wholesale purchases of electricity -- an action the agency took and which may bring some relief to residents of San Diego.

The Legislature also may hold hearings on the energy troubles when it returns later this month from summer recess, according to several members. If the past is any guide, Peace may have a major, vocal role.

Elected to the state Assembly in 1982 and to the Senate in 1993, controversy and public attention are nothing new to the 47-year-old father of three. After all, this is the guy who helped produce -- and appeared in -- the cult horror movie spoof, "Attack of the Killer Tomatoes."

Just about everybody agrees that Peace is a very smart person. He also can be very vocal, confrontational, mercurial and, at times, rebellious. The question is whether he can now help reverse the current mess or -- as some critics demand -- help restore at least some regulation to the market.

Although he once had a reputation as former Assembly Speaker Willie Brown's "man to see" in San Diego, Peace later joined with four other rebel Assembly Democrats in a 1980s "Gang of Five" that challenged Brown's leadership and cast many relatively conservative votes.

While some say he has matured in more recent years, Peace, especially in his younger days in the Capitol, was known for outbursts and verbal confrontations. The stories are legion, and one writer once labeled him the enfant terrible of the Senate.

In one 1995 incident, then-Sen. Diane Watson, D-Los Angeles, complained on the Senate floor about what she called "ranting and raving" against a piece of legislation she was backing. Within moments, Peace -- the apparent target of her remarks -- rushed into the Senate, yelled, "Ranting and raving!" and then promptly turned around and left.

But Peace, who chairs the powerful Senate Budget and Fiscal Review Committee, also is known for his willingness to tackle complicated issues such as workers compensation, government finance and deregulation. Among other things, he is pushing a controversial plan to create a regional government authority for San Diego.

"I think he has been willing over the years to take on the toughest issues," said Sen. Deirdre Alpert, a Coronado Democrat who represents a neighboring district. "It is hard to find people to take on some of those issues."

Indeed, Peace seems at his prime when appointed to one of the Legislature's freewheeling conference committees that hammer out complicated deals and send the product straight to the Senate and Assembly floors for an up-or-down vote without amendments.link