PG and E, Why we need MORE Govt., Not less!

PG and E and the San Bruno Gas Explosion

The high-pressure gas line that exploded last week was owned by the utility company for Northern California, Pacific Gas and Electric, which recently has had a checkered history and strained relations with the public and the regulators.

This is a sound example of why Conservative politics that puts more power into the hands of the wealthy and of private business is dangerous to the interest of the majority of citizens and needs to be restrained by public policy, by public disclosure and public regulation by government.


PG&E is doing all the misinformation seen in other for profit special interests.


Like BP this summer PG&E has learned that the better PR is to jump in and help immediately even if the aid is a token meant to protect their bottom line. The history of their troubled relations with their customers and the regulators proceedes them, however. After the explosion it came out that people in the neighborhood repeatedly called them telling of the odor of gas. You would think that the fact, which should have been well known to PG&E's support staff that a high-pressure gas line runs next to that area would raise red flags and cause them to send out a crew multiple times to investigate. Yesterday a spokesman said that the utility had recieved no such calls from the public, an obvious lie. The National Transportation Safty Board (NTSB) should by now have heard the claims of PG&E's customers to the contreary and force the company to disclose its support records. It will take the NTSB over a year to set the cause, and I am betting at that time that they will cite PG&E's denialism by its support people to heed what in retrospect was a real warning.

So why the disinformation campaign so soon? It is because, like BP, a for-profit business has a built in conflict with its customers. Its incentives toward its bottom line is to give as little for as much as it can charge. This is fine as long as costs keep dropping and as long as there is competition in its market to force it to pass its savings onto its customers. I can hear Conservatives at this point clamoring that the reason PG&E has any monopoly at all is because it IS regulated and that de-regulating utilities is in line with their political exonomics. I have a one word reply, Enron! The hold PG&E has on the market is due to its control of the local energy grid. Some local groups said that they wanted to generate green energy locally reducing their dependance on the grid. That is why PG&E spent $47 million to back Propisition 15 in the last election in order to protect that investment, that monoply, which ruse the voters saw through and defeated. Prehaps they should have spent that money on maintaining high pressure gas lines which they will now have to spend no matter what their bottom line says.

PG&E's Support Problems and its Bottom Line

There has been a big controversary about the utility's effort to install so-called Smart Meters to replace the analog meters that have been used for years, but they have lost the public's trust because their support and PR conduct has failed to ensure that people are reasonably served. It may turn out in the end that the new meters may actualy help customers better manage their energy use, but PG&E has to make up for ground lost because it stonewalled on those cases where people saw huge spikes in their bills after one of the new meters was installed, and because its support culture may be corrupted. Several years ago the utility cut maintainence and support to help its bottom line. This may be coming home to roost as its support groups ignore the needs of its customers, yet another case of the conflict between cost and service in a for-profit climate.

Having worked in support for several public companies, I know first hand how a culture of denial and contempt for the customers can develope if the management is too concerned with the bottom line and not attentive to the message and results. Both companies I know about are no more. I left them because my management had not done the right thing, and in one case the manager came to me several years later and admitted to me that the organization had not done the right thing. In fact, as it turns out a VP was defrauding its customers and a take over by another company was all that prevented the VP from going to prison.

In the wake of the defeat of the ballot iniative, the Iniative process in California is terribly broken as is the budgitary process because of the sucessful efforts of Conservatives to weaken the state government and resulting in a general neglect of infrastructure, PG&E launched a smiley-faced ad campaign claiming that it was doing enough to bring alternative energy options into its operation. I say "lie" every time I see that ad, because I know that the Grid is designed mostly to use legacy energy sources, natural gas, oil, and electricity from fossil fuel generators, not new energy sources. That is the threat of local energy competition with the grid, that the value of the utility's capital investment will go down if suddenly everybody installs solar panels and their metered use of electricity goes negative.

The Lexus and the Pothole

This idea was one that I formulated in response to Conservatives whose attitudes would result in infrastructue decay. It says they wouldn't notice the impact until their luxery car hits a hole in pavement and literally wracks up a bill for repairs since the public agency that keeps the road they use repaired lets the maintenence schedule slide because of declining revenue brought on by tax cuts on the wealthy and declining business tax due to mismanagement of investiments in the economy driven largely by conservatives in managment who want less regulation but are willing to let their greed allow them to take what has emerged as unreasonable risks. The call to de-regulate always implies an increase in responsibility on the part of investors and business. This has not gone well.

Whom do you trust less?

People are people no matter who they work for. They all have the same set of failings where a greater stake in the status quo in concerned. That is why the blame can go all around, to the utility and to its regulators. A group called the Public Utilities Comission (PUC) is supposed to oversee PG&E, indeed one of its employees was among the still-rising death toll from the disaster. The type of people you meet sometimes that like to negate any conflict they encounter, to reduce it to a nullification will say: "Oh well, everybody is lazy and selfish." and try to make issues go away. The trouble is that there is a big difference from public and private empres. It is that there is lots more disclosure in the public sector in the private. PG&E is a little unique in having to strattle that divide and so we may eventually get more insight into how internal decisions were made than we might get from almost any other for profit. I know how to shut up Conservatives for good. It is to make them to agree to disclose as much as what has to be disclosed by public bodies. That would be met by stunned silence.

Media Coverage Skews Awareness


I mean something particular about this. It is that the public watching the news might get the wrong impression that all of the contention is within the public sector; that the varities of human nature play out in the conflict of unions working for governments having to close budget gaps in public. But the same things and worse happen behind the closed doors of for profits defended by the blind law of the bottom line and out of the scrutany and moral judgement or morally anguished decision making if all of these matters had to be aired in public. Rembering that the same kind of people run both public and private organizations, and that the lust for power finds its way equaly into the statehous and legislature as the boardroom and executive offices, it is significant that the difference in disclosure matters. The case of Anthem-Blue-Cross comes to mind. They took a big hit when its was disclosed how much they were going to raise insurance rates; infact when no one is paying attention and the focus has been destracted by the Health Care Bill, which has lots of loopholes, they are quietly raising the rates by the same ammount.

Hidden Tricks of Regulation


There is good reason to hate Congress, or legislatures in general, or all Politicians. It is because they lie out one side of their mouths, and regulation and infrastructure issues like the ones that caused this diaster reveal how. Not only is the for profit business cutting corners, but the regulators and the legislative bodies that fund them are cutting corners. Ironically the reasons why those responsible chintz are opposite. Politicians knee-jerk respond to public pressure for more, and deliver less in the end, and for profits claim they are doing more for less, especially to their investors. The way this works in government is that legislatures pass laws that have "fiscal impact" that is they cost somebody, the taxpayers, to implement, to enforce. So legislatures and Governors and the President of the US all know that they can talk out of both sides of their mouth, fill the emotional clamor to fix something, and when the interest is destracted, prehaps in the next budget cycle, underbudget or fail to fund effective enforcement. This really becomes obvious in diasters, whether it is Katrina, although in that case the Conservatives may have deliberately appointed incompetants to office to make sure the government can't work, i.e. George W. Bush, and Mike Brown who headed FEMA at the time, or whether it is the PUC or other state or federal agency with a conflict of interest, promoting the industry it regulates, or who was underfunded to regulate effectively, the FDA, for example, or Dept. of Interior with respect to the BP spill.