Thomas Sowell

SOME people were surprised when California's Governor Gray Davis hired two Democratic Party operatives at $30,000 a month to serve as spinmeisters during the current electricity crisis. But all indications are that they are well worth their money.

Think about it: Here is a state that has already had rolling blackouts and is facing more blackouts in the months ahead, not to mention losses of millions of dollars in taxes as businesses start leaving California, taking jobs with them, because they cannot get reliable electricity. Yet a recent poll shows that most Californians do not believe that there is an electricity shortage.

Could you or I have convinced so many people of such a thing under these conditions? Let's face it. We don't have the talent, much less the gall.

It has been a stroke of political genius to get Californians' minds off electricity and onto prices. If the focus is on electricity, then the big question is: Why don't we have enough? And the answer is likely to lead back to bungling politicians.

But if the focus can be shifted to prices, then it is just a matter of blaming electricity generating companies for "price gouging" and blaming the feds for not stopping them with "price caps." On Friday, June 29th, those who have been whooping it up over "price gouging" seemed at last to have come up with a smoking gun.

Three former employees of Duke Energy testified that the company deliberately shut down some generating capacity when it did not have to, in order to drive up prices and make bigger profits. This was a political gold mine, and the politicians were not about to lose it by allowing Duke Energy to testify on the same day with its side of the story. According to the San Francisco Chronicle, Duke will be allowed to testify "later this month."

In other words, these charges will be allowed to be repeated endlessly in the media, until they become "well-known facts" by sheer repetition before Duke Energy belatedly gets a chance to answer them. Meanwhile, Duke has had to buy full-page newspaper ads to try to get its side of the story out.

According to Duke Energy, it shut down when it did under direct orders from California authorities. The Los Angeles Times -- a liberal newspaper -- checked out this version of the story and found it corroborated by official documents. But do not look for this to get big, front-page headlines like the charges made by Duke's former employees. Nor is anyone likely to ask why these employees are "former."


Thomas Sowell

Thomas Sowell is a senior fellow at the Hoover Institute and author of The Housing Boom and Bust.

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