Cheney blames Davis for crisis

'They knew over a year ago they had a problem'

Zachary Coile, Chronicle Political Writer   

Washington -- Vice President Dick Cheney, in his most blunt and partisan assessment yet of California's energy crisis, faulted Democratic Gov. Gray Davis for failing to act quickly enough and called the state's purchase of nearly $6 billion worth of energy "a harebrained scheme." 

Cheney, the administration's point man on energy issues, went on a pair of Sunday morning news shows to help sell a national energy plan that President Bush proposed last week. The discussion inevitably turned to California. 

"They've bankrupted the biggest utility in the state, destroyed the state's credit rating and squandered a significant portion of the state's financial surplus in a harebrained scheme to try to use the state to purchase power," the vice president told Tim Russert of NBC's "Meet the Press." 

A spokesman for Davis responded that the vice president's remarks yesterday were "grossly misinformed" and meant to divert attention from the administration's neglect of the state and its power woes. 

"The Bush administration has refused to address California's problem, and now they're washing their hands of it," Davis spokesman Steve Maviglio said. 

The tit-for-tat remarks culminated a week that has seen an escalation in the war of words between the Democratic governor and the Republican White House. The two administrations are increasingly engaging in a blame game as they confront a worsening crisis with enormous political stakes for both sides. 

Responding to critics -- including Davis -- who say the White House has done little to help California, the vice president pointed the finger back at the state's top Democratic official. 

"They knew over a year ago they had a problem, and Gray Davis refused to address that problem," Cheney said. "(They) kept putting it off and putting it off and putting it off, with the notion that somehow price caps could be maintained. 

"Now, today, where are they in California? Well, rates are having to go up. The PUC just had to increase the rates themselves in California. They've got rolling blackouts, they've had some already. They'll have them across the state this summer," Cheney said. 

Cheney's remarks referred to the state's purchases of almost $6 billion worth of energy, which began after the major utilities could no longer afford skyrocketing wholesale prices for energy. 

Earlier this month, the Democrat-controlled California Legislature approved a bill, opposed by GOP lawmakers, to issue $13.4 billion in bonds to repay the state's general fund to avoid making deep cuts in other state programs. 

KEEPING THE LIGHTS ON

"That's the governor keeping the lights on," Maviglio said. "Because of the failure of the federal government to act (to impose price controls), the state had to move to keep the lights on." 

Governor Davis suggested that by refusing to ask federal regulators for price caps, Bush was effectively allowing price-gouging by oil and gas producers in his home state of Texas. Cheney dismissed the allegation last week as "goofy." 

CALIFORNIA A BAD EXAMPLE

In speeches on his energy plan, the president has mostly used California as an example to the nation of what not to do. He warned last week that the state's blackouts were a preview of what other states could face if the country doesn't boost energy supplies. 

Some California Republican leaders have warned Bush, who will visit Southern California later this month, to soften the administration's rhetoric on the energy crisis to avoid being seen as unsympathetic to the state's plight. 

Cheney explained yesterday that the administration opposes even short-term price controls because they could discourage energy suppliers from selling energy into California and building more plants in the state.