By David M. Greenwald, THE PEOPLE’S VANGUARD OF DAVIS
A lot of people I think took for granted that given the amount of money that PG&E spent on Proposition 16, to essentially put public power out of business, that it would prevail. In fact, PG&E was not alone. Mercury Insurance also spent about $16 million to pass Proposition 17. PG&E spent $44 million.
Given the fact that PG&E’s deceptive ads were on TV every day, every hour, heck every minute, I will fully admit I had no faith that the average person would be able to see through the rhetoric. And yet somehow just enough people did.
Jack Pitney, a political science professor from Claremont McKenna College, said Wednesday, the lesson is that “if you’re going to win a special-interest initiative, you need a better disguise. The link was too obvious, and the voters smelled a rat.” He continued, “People like the idea of free enterprise, but in (Propositions 16 and 17) people sensed that one specific corporation was seeking a benefit for (itself).”
We have discussed Proposition 16 on these pages a few times, it was known as the “Taxpayers Right to Vote Act,” a deceptive title given the fact that taxpayers already have the right to vote, but this would actually make their voice worth a good deal less as it would require a two-thirds vote before a public utility could extend service to new customers or new territories. It was a naked power play intended to make service expansions such as the proposed expansion of SMUD into Yolo County from four years ago an impossibility.
PG&E was able to defeat that effort, but it cost them $10 million. They obviously felt the threat and sought to avoid such a fate in the future.
Proposition 17 was placed on the ballot by Mercury Insurance and it would have overturned state law prohibiting insurance companies from considering a driver’s insurance history to set rates.
Los Angeles Times analysis found that in counties served by PG&E, voters rejected the measure by large margins while counties less familiar with PG&E supported it. Writes the LA Times on June 10, “Fed up with big bills, distrustful of new meters that show higher usage and chagrined by power shutoffs when payments are late, PG&E’s customers sent a vote of no-confidence to the giant utility this week when they rejected the utility-sponsored Proposition 16.”
According to the San Francisco Chronicle on June 10, “Prop. 16’s strongest showing came in Southern California, which gets its electricity from other utility companies. The measure fared worst in the Bay Area, PG&E’s home. San Francisco, site of the company’s headquarters, voted 67.8 percent against the measure. A majority of voters in every Bay Area county rejected the measure.”
“It shows that the more people know about PG&E, the less popular it is,” said Mark Toney, one of the leaders of the campaign against Prop. 16. “That’s a problem for any company.”
“It sends a message to corporate America that it doesn’t matter how much money they put into this,” said Toney, executive director of The Utility Reform Network, a consumer watchdog group.
Well not exactly.
According to Gale Kaufman, a campaign consultant to the No on 16 effort, the opposition only spent about $100,000 with nearly one-third of that going to an early poll. She told the Sacramento Bee that the poll showed that Proposition would lose convincingly from the start.
“Kaufman said voters didn’t see Proposition 16 as a citizen-empowerment measure, but as a cleverly worded ploy of a single for-profit utility. ”(PG&E’s) biggest miscalculation, besides spending all that money, was that they really thought they could trick people by the phrasing they used on that initiative,” she said.”
That is one way to look at it, the other way to look at it is that PG&E took a convincing defeat and turned it into a narrow loss with their heavy spending.
Nevertheless, it would seem that questions about PG&E and the accuracy of their new SmartMeters along with rate increases which drew angry protests last year swayed key areas. These rate increases hit hardest in normally conservative enclaves in Fresno and Kern counties. And so for one of the few times, conservative Fresno and Kern counties joined with liberal portions of the state like San Francisco to vote against Proposition 16.
“When does the Central Valley ever vote with the coast?” asked Bill McEwen, columnist for the Fresno Bee. “The SmartMeter thing really eroded the trust between PG&E and its customers.”
State Sen. Mark Leno a strong opponent of Proposition 16 said on Tuesday night, “I think [Prop 16] represents the epidemic of corporate greed that is so challenging in this country right now, whether its banking or the oil industry. I think a victory tonight would really speak to California voters rebuking the lies and the deceit spread by PG&E.”
Mark Toney made the comment early on, “PG&E has one thing, and one thing only on their side, which is money. The fact that were so close is amazing, given that they’ve outspent us 500 to 1.”
Unfortunately it appears that PG&E even in defeat did not get it.
Greg Pruett, senior vice president of corporate affairs for PG&E, issued a statement that said, in part: “While the election outcome hasn’t diminished our steadfast belief that citizens should have a vote in local government efforts to enter the electric utility business, we respect the decision voters made on this initiative.”
He continued to spew the same rhetoric even as it was their own customers that ultimately rejected their efforts. That had to be a stinging blow.
Mercury Insurance’s statement was equally obtuse, as they continued to play it as a blow to consumers. The company issued a statement Tuesday night which read in part, “Proposition 17 was a pro-consumer initiative that would have lowered auto insurance rates for millions of California drivers.”
California survived two insidious propositions by the skin of their teeth. But more and more I believe this is a flawed process. The original initiative system was supposed to free Californians from the stranglehold that moneyed interests had on the legislature. The legislature certainly remains strangled, but unfortunately, companies and backers with deep pocket books are generally able to get measures on the ballot, back them with tens of millions, and usually they are able to pass them. A lot of factors played a role in the defeat, many of them had less to do with the measure and more to do with the messenger.
Tags: big corporations, consumer, contributions, deceptive, Mercury, NewsStory, Prop 17, surcharge, trust, voters
