For a populist moment, Davis seized the day — then let it go

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The San Diego Union-Tribune

SACRAMENTO — For one brief moment, California wasn’t governed by a bland, cautious politician.

Instead, the Golden State appeared to be led by the reincarnation of Huey Long, the “kingfish” who soared to power in Depression-era Louisiana by railing against oil companies and demanding that rich people “share the wealth.”

In his State of the State address earlier this month, Gov. Gray Davis, the man who built his career in part by persuading wealthy donors to share their wealth with his campaign committee, was born again.

Suddenly, the meticulous, precise and well-coiffed Davis was hurling angry accusations, trotting out conspiracy theories and promising bold and swift action against energy companies that would dare threaten the prosperity of his state.

Deregulation, he said, was a “colossal and dangerous” failure — and out-of-state power generators were to blame. In some cases, he said, the generators, who purchased power plants with the state’s blessing just a few years ago, “have brought the state to the very brink of blackouts by refusing to sell us back our own power because they could find higher prices elsewhere.”

Davis pledged to end this “legalized highway robbery.”

“Never again,” he said, “can we allow out-of-state profiteers to hold Californians hostage.”

Davis promised that he might even use the power of eminent domain to buy back the power plants from these profiteers.

In other words, the careful, business-friendly Democrat was going to seize the day, by seizing the plants.

Just two weeks later, Davis’ populist moment appeared a distant memory.

Talk of seizing power plants has ceased, while discussions of bailing out the utilities — and thus indirectly ensuring that the generators get fully paid — has dominated the governor’s agenda.

In negotiations on long-term energy contracts with the generators, Davis never brought up the threat of plant seizure, Davis’ press secretary Steve Maviglio confirmed. His office is now more concerned with reassuring Wall Street that the state’s credit is good.

Consumer advocates are disappointed.

Most realize that it would be difficult for the state to literally take power into its own hands. Some even acknowledged that seizures would undermine the governor’s tireless efforts to appeal to business.

Further, a takeover would force the state to build new plants on its own because private companies would be reluctant to invest here.

Still, consumer lobbyists say Davis could have used the threat more effectively. “It was the ace in the hole,” said Doug Heller of the Foundation for Taxpayer and Consumer Rights. “We would say to these energy companies — if you don’t provide power at a reasonable price — we’re going to take over the plants you own in California.”

Now, instead of operating from a position of strength in his negotiations for low-cost contracts, Heller contends, the governor is effectively “cowering in the bushes.”

Still, Davis appeared optimistic last week about the state’s efforts to buy low-cost electricity from the very same people he had earlier called price gougers.

And now that his approach is more in keeping with his nature, Davis seems more at ease. During a national television interview last week, he appeared far more comfortable than he did delivering the fiery words of his State of the State speech.

An ambitious politician, Davis would much rather deal with the money-changers than throw them out of the temple.

Consumer Watchdog
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