10-05-07

Hi friends, this is Harry Blalock; General Manager for radio stations KZMI & KCNM. It's that time once again to take a look at the issues of the week, and to offer some Food For Thought.

In case you haven't heard, it's now official and has become law. Commonwealth Utilities Corporation now has to lower the electricity rate for residential customers down to .17 cents per kilowatt-hour. It doesn't matter how much they are having to pay for fuel or what the actual cost of producing the electricity is, the legislature has decided in their infinite wisdom that CUC should only charge residential customers .17 cents per kilowatt-hour. If you know anything about business or profit and loss statements you're probably wondering what these legislators were thinking by doing this.

For you to fully understand the rationale of what they did, you need to know the history of the situation. A disgruntled citizen decided he didn't like how much he had to pay for electricity and decided to form a group to put pressure on the lawmakers. Greg Cruz formed Tao Tao Tano, a group that he claims has thousands of members, all of which he also claims are voters. So Mr. Cruz with a couple of his supporters in tow marched up to the legislature and told the politicians that unless they passed a bill lowering the electricity rates for residential users down to .17 cents per kilowatt-hour, that he and his group would vote them all out of office.

Unfortunately some of the members of our legislature have not always been known for their mental prowess, in other words they're not always the sharpest tools in the shed. They actually believed that Mr. Cruz had the thousands of supporters he claimed, and that he could actually influence their vote in the upcoming election. Now you need to keep in mind that Mr. Cruz never went up to the legislature with thousands of supporters, he never even had 100 with them, he had a few. And it's also important to note that at all the rally's for Tao Tao Tano, they have never had more than 100 people show up for any of them, while several of them had less than 20 people show up. So why the legislature would allow themselves to be pushed around by a group with a fictitious membership is beyond my comprehension.

But this group of people who constantly refer to themselves as honorable decided that the threat of losing their jobs was more important than making sure that the government run utility company could actually continue to operate and pay their bills under this new fee structure. There were no cost studies done of how much it actually costs to produce a kilowatt-hour of electricity, they didn't want to cloud the issue by doing any fact finding or checking with CUC. They were thinking about one thing and one thing only, and that is what they would be doing after the election if they weren't re-elected. But wait a minute, wasn't it a conflict of interest for every single one of them to vote on this bill in the first place? After all, aren't they all residential customers of CUC as well? So here they were voting on a bill that would personally benefit each and every one of them. And they have the audacity to call themselves honorable? Maybe they need to look up the definition of honorable in Mr. Webster's dictionary.

So both the House and Senate passed this bill lowering the cost of electricity for residential customers down to .17 cents per kilowatt-hour. The bill then went to the Governor for his signature or veto. The Governor and Lt. Governor were adamant that there is no way CUC could continue to operate full time if the residential rate was lowered to .17 cents. They said the utility would not be able to afford to buy enough fuel to run the power plants on a full time basis. They said it would amount to about 2 months a year that the utility company would not be able to buy fuel to put in the generators. If you factor that into your daily operating schedule, it means you would not be able to operate 1/6th of the time, or in other words, it would require a 4 hour total blackout every single day of the year. One of the other alternatives would be to further increase the cost of electricity to business owners. But businesses are already closing down all over because of the escalating power costs. To further increase the cost of doing business here in an already severely depressed economy would only chase away the few businesses that are left, and guarantee that we would never see another new business open up on island. The Governor said that to sign this bill into law would be fiscally irresponsible and would revert back to deficit spending, which is illegal. The Governor vetoed the bill saying that the government simply could not afford to subsidize the cost of electricity for residential users.

Tao Tao Tano was not about to give up though; they were keeping constant pressure on the legislators about overriding the Governor's veto. They continued their threat of not voting for any legislator who didn't support an override of the Governor's veto. So this week, this spineless bunch we have elected to the legislature did the irresponsible and self-serving thing and voted to override the Governor's veto of this bill, making it law. They offered no solutions as to how CUC is supposed to be able to continue paying personnel and paying for the fuel to operate the generators, I guess they figured it's not their problem. The only thing they cared about was that Tao Tao Tano was now happy with them, and supposedly the "thousands" in their membership would now vote for their re-election. Yes, these politicians of ours really are that simple minded and short sighted. And I find it absolutely amazing that all 16 members of the House in attendance for that session voted for the override. Congressman Absalon Waki was not in attendance, but said he would not have voted for the bill. And I've been trying to call the legislature all morning to find out who the other Congressman was that wasn't in attendance for the vote, but can't get anyone at the legislature to answer their phones. Senator Maria Frica Pangelinan was absent for the Senate session on Rota where they Senate voted to override the Governor's veto on the CUC residential reduction bill. Congressman Arnold Palacios, who says the legislature will now work with the administration to cut other programs so that the government can subsidize the cost of electricity for residential customers, authored the bill.

So if you're a residential customer of CUC who is now thrilled about the new lower electricity rates, you can thank Greg Cruz who bluffed and pretended that Tao Tao Tano had thousands of members when in reality they are lucky to have a couple dozen, and you can also thank all the incumbents in the legislature that voted for this override, with the exception of Congressman Absalon Waki and Senator Maria Pangelinan. But you will also have to blame the same people when we start experiencing rolling blackouts because CUC doesn't have the money to pay for fuel. You can also blame them for each business we lose as a result of the increased cost to the business sector, and for the businesses that aren't willing to try staying in business without constant, reliable power. You can also blame them when you don't see any new businesses willing to come here because we don't have reliable power and the cost of it is just way too expensive for businesses now. When the business has to cut back and you lose your job as a result, you can also thank Mr. Cruz and this bunch of self-serving politicians.

Since the legislature thinks that government should be subsidizing the cost of electricity for residential users, I think the only decent thing of them to do would be to completely give up their salaries, office operating budgets and subsistence allowances. After all, if they really believe that strongly about the residential customers having cheaper electricity, and about cutting funding to other government programs to help compensate for it, shouldn't they begin cutting at home? Let's truly turn this into a volunteer legislature, let them serve out of the goodness of their hearts and not accept a single dime from the taxpayers for anything. If they need to travel in the future, it can be on all the frequent flyer miles they have racked up on the taxpayers dime. If they can find secretary's willing to work for free, they can have an office staff. The legislature has already grumbled about the Administration's proposed 2008 budget because it cuts their office budget from $155,000 down to $60,000 a year. But now based on their override of the Governor's veto for lowering the residential rate for CUC customers, I believe the legislature should forfeit all of their funds and contribute them to the CUC shortfall that they are responsible for. If they are serious about cutting other programs to make up for the mess they have just created, they can single-handedly solve the problem by just becoming volunteers and not using any taxpayer money at all. They could also all just take the next two years off; we probably wouldn't even notice they were no longer there.

The legislature has created one of the biggest messes ever this time around, it will be interesting to see how they come up with a plan to make ends meet now. I encourage you to remember all of this when it comes to casting your vote in November.

I'm Harry Blalock, thanking you once again for giving me a generous slice of your valuable time, and allowing me to share my Food For Thought.

For more thoughts, pictures and observations, feel free to visit my personal blog at www.saipandiver.blogspot.com