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Today's
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Uri Avnery
Hero of War and Peace
Recent
Stories
August 16 / 17, 2003
Flavia Alaya
Bastille
New Jersey
Jeffrey St. Clair
War Pimps
Saul Landau
The Legacy of Moncada: the Cuban Revolution at 50
Brian Cloughley
What Has Happened to the US Army in Iraq?
William S. Lind
Coffins for the Crews: How Not to Use Light Armored Vehicles
Col. Dan Smith
Time for Straight Talk
Wenonah Hauter
Which
Electric System Do We Want?
David Lindorff
Where's Arnold When We Need Him?
Harvey Wasserman
This Grid Should Not Exist
Don Moniak
"Unusual Events" at Nuclear Power Plants: a Timeline
for August 14, 2003
David Vest
Rolling Blackout Revue
Merlin Chowkwanyun
An Interview with Sherman Austin
Adam Engel
The Loneliest Number
Poets' Basement
Guthrie, Hamod & Albert
Book of the Weekend
Powerplay by Sharon Beder
August 14, 2003
Peter Phillips
Inside
Bohemian Grove: Where US Power Elites Party
Brian Cloughley
Charlie Wilson and Pakistan: the Strange Congressman Behind the
CIA's Most Expensive War
Linville and Ruder
Tyson
Strike Draws the Line
Jim Lobe
Bush Administration Divided Over Iran
Ramzy Baroud
Sharon Freezes the Road Map
Tom Turnipseed
Blowback in Iraq
Gary Leupp
Condi's
Speech: From Birgmingham to Baghdad, Imperialism's Freedom Ride
Website of the Day
Tony Benn's Greatest Hits
August 13, 2003
Joanne Mariner
A Wall of Separation Through the
Heart
Donald Worster
The Heavy Cost of Empire
Standard Schaefer
Experimental Casinos: DARPA and the War Economy
Elaine Cassel
Murderous Errors: Executing the Innocent
Ralph Nader
Make the Recall Count
Alexander Cockburn
Ted Honderich Hit with "Anti-Semitism" Slur
Website of the Day
Defending Yourself Against DirectTV Lawsuits: 9000 and Counting
August 12, 2003
William Blum
Myth
and Denial in the War on Terrorism
Ron Jacobs
Revisionist History: the Bush Administration, Civil Rights and
Iraq
Josh Frank
Dean's Constitutional Hang-Up
Wayne Madsen
What's a Fifth Columnist? Well, Someone Like Hitchens
Ray McGovern
Relax,
It Was All a Pack of Lies
Wendy Brinker
Hubris in the White House
Website of the Day
Black
Mustache
August
11, 2003
Douglas
Valentine
Homeland Security for Whom?
Mickey
Z.
Bush's Progress
Bill
Glahn
RIAA Watch: Meet the New Bitch, Same
as the Old
Elaine
Cassel
Indicting DNA
Dr. Mohammad
Omar Farooq
Civil Liberties and Uncivil Super-Patriotism
Uri
Avnery
Who Will Save Abu Mazen?
Website
of the Day
RIAA Subpoena Clearinghouse
August
9 / 10, 2003
Alexander
Cockburn
California's Glorious Recall!
Saul
Landau
Bush and King Henry
Gary
Leupp
On Terrorism, Methodism, "Wahhabism"
and the Censored 9/11 Report
Paul de
Rooij
The Parade of the Body Bags
Michael
Egan
History and the Tragedy of American Diplomacy
Rob Eshelman
A Home of Our Own
Daoud
Kuttab
Life as an ID Card
Philip
Agee
Terror and Civil Society: Instruments of US Policy in Cuba
Jeffrey
St. Clair
Marc Racicot: Bush's Main Man
Walt Brasch
Schwarzenegger, "Hollyweird"
and the Rigtheous Right
Christopher
Brauchli
Bush, Bribery and Berlusconi
Josh Frank
Mean, Mean Howard Dean
Elaine
Cassel
Will the Death Penalty Ever Die?
Sean Carter
Total Recall
Poets'
Basement
Hamod, Engel, Albert
August
8, 2003
John
Chuckman
What the US Says Goes
Roberto
Barreto
Defend the Vieques 12!
Bruce Gagnon
Iraq War Emboldens Bush Space Plans
Elaine
Cassel
The Reign of John Ashcroft
Dave
Lindorff
Snoops Night Out
Website
of the Day
Zero Boy
August
7, 2003
M.
Shahid Alam
It the US a "Terrorist Magnet?"
Toni
Solo
Neo-liberal Nicaragua: a New Banana
Republic
Adam Lebowitz
Hiroshima Commemorated: the View from Japan
Hanan
Ashrawi
When the Bully Whines
Niranjan
Ramakrishnan
Conscience Takes a Holiday
Jason
Leopold
Wolfowitz Lets Slip: Iraq Not Behind 9/11; No Ties to Al-Qaeda
Mike Kimaid
What's the Score?
Elaine
Cassel
The Smell of VICTORY: Ashcroft's Latest Stinkbomb
Dardagan,
Slobodo and Williams
CounterPunch Exclusive:
20,000 Wounded Iraqi Civilians
August 6, 2003
Steve
Higgs
Going to Jail for the Cause: It's Not
Easy Confronting King Coal
David
Krieger
Remembering Hiroshima and Nagasaki
Robert
Fisk
The Ghosts of Uday and Qusay
Christopher
Brauchli
Bush's War on the National Forests
Elaine
Cassel
No Fly Lists
Stan
Goff
Military Equipment and Pneumonia
Hugh Sansom
An Open Letter to Nicholas Kristof on the Nuking of Japan
August
5, 2003
Uri
Avnery
The Prisoner of Ramallah: Arafat at
74
Forrest
Hylton
Terrorism and Political Trials: the
View from Bolivia
Ray
McGovern
"We Cook Estimates to Go"
David
Morse
Poindexter's Gambit
Edward
Said
Orientallism: 25 Years Later
George
W. Bush
My Darn Good Resumé
Hammond
Guthrie
It's Incremental, Watson!
Website
of the Day
National Prayer Day
August 4, 2003
Bruce
K. Gagnon
Another Peace Activist Detained by
Airport Cops: My Story
David
Lindorff
Fear-Mongering About Social Security
Mark
Zepezauer
George F. Will: Descent into Self-Parody
James
Plummer
Tracking You Through the Mail
Mickey
Z.
Marriage Insecurity from Sharon to Bush
Bruce
Jackson
News that Isn't News: How the NYT's
Pimps for the White House
August
2 / 3, 2003
Tamara
R. Piety
Nike's Full Court Press Breaks Down
Francis
Boyle
My Alma Mater, the University of Chicago, is a Moral Cesspool
David
Vest
Sons of Paleface: Pictures from Death's Other Side
Neve Gordon
Nightlife in Jerusalem
Uri
Avnery
Their Master's Voice:
Bush, Blair and Intelligence Snafus
Robert
Fisk
Paternalistic Democracy for Iraq
Jerry
Kroth
Israel, Yellowcake and the Media
Noah Leavitt
What's Driving the Liberian Bloodbath: Is the US Obligated to
Intervene?
Saul
Landau
The Film Industry: Business and Ideology
Ron Jacobs
One Big Prison Yard: the Meaning of George Jackson
Thomas
Croft
In the Deep, Deep Rough: Reflections on Augusta
Amadi Ajamu
Def Sham: Russell Simmons New Black Leader?
Poets'
Basement
Vega, Witherup, Albert and Fleming
August
1, 2003
Joanne
Mariner
Stopping Prison Rape
Alex Coolman
Who Moved My Soap: Trivializing
Prison Rape
Steve
J.B.
Prison Bitch
Stan Goff
Injury and Decorum: The Missing Wounded in Iraq
Wayne
Madsen
Europe Unplugs from the Matrix
Robert
Fisk
Wolfowitz the Censor
Elaine
Cassel
Ashcroft Loses Big in Puerto Rico
Website
of the Day
Stop Prisoner Rape
July
31, 2003
Ray
McGovern
The Prostitution of Intelligence
Brian
Cloughley
Wolfowitz's Operative Statement
Sheldon
Hull
The RIAA's Jihad:
The Devil's Music (Industry)
Elaine
Cassel
The Next Time You Crack a Lawyer Joke, Think of These Attorneys
Sheldon
Rampton
and John Stauber
True Lies: Propaganda and Bush's
Wars
Hammond
Guthrie
Speculation Blues
Website
of the Day
Army of One?
Congratulations
to CounterPuncher Gilad Atzmon! BBC Names EXILE Top Jazz CD
July
30, 2003
David
Lindorff
Poindexter the Terror Bookie
Marjorie
Cohn
Why Iraq and Afghanistan? It's About
the Oil
Elaine
Cassel
How Ashcroft Coerces Guilty Pleas
in Terror Cases
Zvi
Bar'el
The Hidden Costs of the Iraq War
Lisa Walsh
Thomas
Killing Mustafa Hussein: Death of a Child, Birth of a Legend?
Sean
Carter
Pat Robertson's Prayer Jihad: God, Sodomy and the Supremes
ND Jayaprakash
India and Ariel Sharon
Steve
Perry
Bush's Top 40 Lies
Standard
Schaefer
Correction about Bloomberg and Outscourcing
Website
of the Day
Bring Them Home Now!
Hot Stories
Dardagan,
Slobodo and Williams
CounterPunch Exclusive:
20,000 Wounded Iraqi Civilians
Steve
J.B.
Prison Bitch
Sheldon
Rampton and John Stauber
True Lies: the Use of Propaganda
in the Iraq War
Wendell
Berry
Small Destructions Add Up
CounterPunch
Wire
WMD: Who Said What When
Cindy
Corrie
A Mother's Day Talk: the Daughter
I Can't Hear From
Elaine
Cassel
Civil Liberties
Watch
Michel
Guerrin
Embedded Photographer Says: "I
Saw Marines Kill Civilians"
Uzma
Aslam Khan
The Unbearably Grim Aftermath of War:
What America Says Does Not Go
Paul de Rooij
Arrogant
Propaganda
Gore Vidal
The
Erosion of the American Dream
Francis Boyle
Impeach
Bush: A Draft Resolution
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August
18, 2003
The California Rip-Off
Revisited
Arnold,
Michael Milken and Ken Lay
By JASON LEOPOLD
Arnold Schwarzenegger isn't talking. The Hollywood
action film star and California's GOP gubernatorial candidate
in the state's recall election has been unusually silent about
his plans for running the Golden State. He hasn't yet offered
up a solution for the state's $38 billion budget deficit, an
issue that largely got more than one million people to sign a
petition to recall Gov. Gray Davis.
More important, however, Schwarzenegger
still won't respond to questions about why he was at the Peninsula
Hotel in Beverly Hills two years ago where he, former Los Angeles
Mayor Richard Riordan and junk bond king Michael Milken, met
secretly with former Enron Chairman Kenneth Lay who was touting
a plan for solving the state's energy crisis. Other luminaries
who were invited but didn't attend the May 24, 2001 meeting included
former Los Angeles Laker Earvin "Magic" Johnson and
supermarket magnate Ron Burkle.
While Schwarzenegger, Riordan and Milken
listened to Lay's pitch, Gov. Davis pleaded with President George
Bush to enact much needed price controls on electricity sold
in the state, which skyrocketed to more than $200 per megawatt-hour.
Davis said that Texas-based energy companies were manipulating
California's power market, charging obscene prices for power
and holding consumers hostage. Bush agreed to meet with Davis
at the Century Plaza Hotel in West Los Angeles on May 29, 2001,
five days after Lay met with Schwarzenegger, to discuss the California
power crisis.
At the meeting, Davis asked Bush for
federal assistance, such as imposing federally mandated price
caps, to rein in soaring energy prices. But Bush refused saying
California legislators designed an electricity market that left
too many regulatory restrictions in place and that's what caused
electricity prices in the state to skyrocket. It was up to the
governor to fix the problem, Bush said. However, Bush's response
appears to be part of a coordinated effort launched by Lay to
have Davis shoulder the blame for the crisis. It worked. According
to recent polls, a majority of voters grew increasingly frustrated
with the way Davis handled the power crisis. Schwarzenegger has
used the energy crisis and missteps by Davis to bolster his standing
with potential voters. While Davis took a beating in the press
(some energy companies ran attack ads against the governor),
Lay used his political clout to gather support for deregulation.
A couple of weeks before Lay met with
Schwarzenegger in May 2001, the PBS news program "Frontline"
interviewed Vice President Dick Cheney, whom Lay met with privately
a month earlier. Cheney was asked by a correspondent from Frontline
whether energy companies were acting like a cartel and using
manipulative tactics to cause electricity prices to spike in
California.
"No," Cheney said during the
Frontline interview. "The problem you had in California
was caused by a combination of things--an unwise regulatory scheme,
because they didn't really deregulate. Now they're trapped from
unwise regulatory schemes, plus not having addressed the supply
side of the issue. They've obviously created major problems for
themselves and bankrupted PG&E in the process."
A month before the Frontline interview
and Bush's meeting with Davis, Cheney, who chairs Bush's energy
task force, met with Lay to discuss Bush's National Energy Policy.
Lay, whose company was the largest contributor to Bush's presidential
campaign, made some recommendations that would financially benefit
his company. Lay gave Cheney a memo that included eight recommendations
for the energy policy. Of the eight, seven were included in the
final draft. The energy policy was released in late May 2001,
after Schwarzenegger, Riordan and Milken met with Lay and after
the meeting between Bush and Davis and Cheney's Frontline interview.
The policy made only scant references
to California's energy crisis, which Enron was accused of igniting,
and did not indicate what should be done to provide the state
some relief. Cheney said the policy focused on long-term solutions
to the country's energy needs, such as opening up drilling in
the Arctic National Wildlife Refuge and freeing up transmission
lines. That's why California was ignored in the report, Cheney
said.
What's unknown to many of the voters
who will decide Davis's fate on Oct. 7, the day of the recall
election, is that while Cheney dismissed Davis's accusations
that power companies were withholding electricity supplies from
the state, one company engaged in exactly the type of behavior
that Davis described. But Davis would never be told about the
manipulative tactics the energy company engaged.
In a confidential settlement with the
Federal Energy Regulatory Commission, whose chairman was appointed
by Bush a year earlier, Tulsa, Okla., based-Williams Companies
agreed to refund California $8 million in profits it reaped by
deliberately shutting down one of its power plants in the state
in the spring of 2000 to drive up the wholesale price of electricity
in California.
The evidence, a transcript of a tape-recorded
telephone conversation between an employee at Williams and an
employee at a Southern California power plant operated by Williams,
shows how the two conspired to jack up power prices and create
an artificial electricity shortage by keeping the power plant
out of service for two weeks.
Details of the settlement had been under
seal by FERC for more than a year and were released in November
after the Wall Street Journal sued the commission to obtain the
full copy of its report. Similarly, FERC also found that Reliant
Energy engaged in identical behavior around the same time as
Williams and in February the commission ordered Reliant to pay
California a $13.8 million settlement.
Had the evidence been released in 2001
when Davis accused energy companies of fraud it would have helped
California's case and voters may have viewed the governor more
positively. But if FERC were to publicly release the details
of the Williams settlement it wouldn't have jibed with Bush's
energy policy, which was made public instead in May 2001. It's
highly unlikely that Bush, Cheney and members of the energy task
force were kept in the dark about the Williams scam, especially
since the findings of the investigation by FERC took place around
the same time the policy was being drafted.
But Davis was still causing problems
for Lay. California's power woes had a ripple effect, forcing
other states to cancel plans to open up their electricity markets
to competition fearing deregulation would lead to widespread
blackouts and price gouging. For Enron, a company that generated
most of its revenue from buying and selling power and natural
gas on the open market, such a move would paralyze the company.
Fearing that Davis would take steps to
re-regulate California's power market that Lay spent years lobbying
California lawmakers to open up to competition, Lay recruited
Schwarzenegger, Riordan, Milken, and other powerful business
leaders like Bruce Karatz, chief executive of home builder Kaufman
& Broad; Ray Irani, chief executive of Occidental Petroleum;
and Kevin Sharer, chief executive of biotech giant Amgen.
The 90-minute secret meeting Lay convened
took place inside a conference room at the Peninsula Hotel. Lay,
and other Enron representatives at the meeting, handed out a
four-page document to Schwarzenegger, Riordan and Milken titled
"Comprehensive Solution for California," which called
for an end to federal and state investigations into Enron's role
in the California energy crisis and said consumers should pay
for the state's disastrous experiment with deregulation through
multibillion rate increases. Another bullet point in the four-page
document said "Get deregulation right this time -- California
needs a real electricity market, not government takeovers."
The irony of that statement is that California's
flawed power market design helped Enron earn more than $500 million
in one year, a tenfold increase in profits from a previous year
and it's coordinated effort in manipulating the price of electricity
in California, which other power companies mimicked, cost the
state close to $70 billion and led to the beginning of what is
now the state's $38 billion budget deficit. The power crisis
forced dozens of businesses to close down or move to other states,
where cheaper electricity was in abundant supply, and greatly
reduced the revenue California relied heavily upon.
Lay asked the participants to support
his plan and lobby the state Legislature to make it a law. It's
unclear whether Schwarzenegger held a stake in Enron at the time
or if he followed through on Lay's request. His spokesman, Rob
Stutzman, hasn't returned numerous calls for comment about the
meeting. For Schwarzenegger and the others who attended the meeting,
associating with Enron, particularly Ken Lay, the disgraced chairman
of the high-flying energy company, during the peak of California's
power crisis in May 2001 could be compared to meeting with Osama
bin Laden after 9-11 to understand why terrorism isn't necessarily
such a heinous act.
A person who attended the meeting at
the Peninsula, which this reporter wrote about two years ago,
said Lay invited Schwarzenegger and Riordan because the two were
being courted in 2001 as GOP gubernatorial candidates. A week
before the meeting, Davis signed legislation to create a state
power authority that would buy, operate and build power plants
in lieu of out-of-state energy companies, such as Enron, that
the governor alleged was ripping off the state.
For Enron's Lay, the timing of the meeting
was crucial. His company was just five months away from disintegrating
and he was doing everything in his power to keep his company
afloat and the profits rolling in.
It wasn't until Enron collapsed in October
2001 and evidence of the company's manipulative trading tactics
emerged that FERC began to take a look at the company's role
in California's electricity crisis. Since then, memos written
by former Enron traders were uncovered, with colorful names like
"Fat Boy" and "Death Star," that contained
the blueprint for ripping off California.
Enron's top trader on the West Coast,
Timothy Belden, the mastermind behind the scheme, pleaded guilty
in December to conspiracy to commit wire fraud and has agreed
to cooperate with federal investigators who are still trying
to get to the bottom of the crisis.
California is still demanding that FERC
order the energy companies to refund the state $8.9 billion for
overcharging the state for electricity during its yearlong energy
crisis. But FERC says California is due no more than $1.2 billion
in refunds because the state still owes the energy companies
$1.8 billion in unpaid power bills.
Davis, who refused to cave in to the
demands of companies like Enron even while Democrats, Republicans
and the public criticized him, was right all along. Maybe Californians
ought to cut Davis some slack.
Jason Leopold
spent two years covering California's energy crisis as bureau
chief of Dow Jones Newswires. He is currently working on a book
about the crisis. He can be reached at: jasonleopold@hotmail.com
Weekend
Edition Features for August 16 / 17, 2003
Flavia Alaya
Bastille
New Jersey
Jeffrey St. Clair
War Pimps
Saul Landau
The Legacy of Moncada: the Cuban Revolution at 50
Brian Cloughley
What Has Happened to the US Army in Iraq?
William S. Lind
Coffins for the Crews: How Not to Use Light Armored Vehicles
Col. Dan Smith
Time for Straight Talk
Wenonah Hauter
Which
Electric System Do We Want?
David Lindorff
Where's Arnold When We Need Him?
Harvey Wasserman
This Grid Should Not Exist
Don Moniak
"Unusual Events" at Nuclear Power Plants: a Timeline
for August 14, 2003
David Vest
Rolling Blackout Revue
Merlin Chowkwanyun
An Interview with Sherman Austin
Adam Engel
The Loneliest Number
Poets' Basement
Guthrie, Hamod & Albert
Book of the Weekend
Powerplay by Sharon Beder
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