Civic engagement is easy if your sources of revenue and profit are protected by the government.
A perfect example is the utility industry. According to the Orange County Register, they were the top political campaign spenders over the past five years, with Pacific Gas & Electric first, followed by Sempra Energy, parent of San Diego Gas & Electric, and Edison International, the parent of Southern California Edison. Altogether, according to the Register, they spent $105.3 million on political contributions, general lobbying and lobbying Public Utilities Commission.
And there is more where that came from, no doubt. Recent legislation guarantees electric utilities billions in new revenue from Californians. In order to increase renewable energy, the law requires them to accomplish "widespread transportation electrification" through projects "deploying electric vehicle charging infrastructure."
Utilities like PG&E are submitting hundreds of millions of dollars in rate hike proposals for such projects. Since the PUC sets ratepayer hikes, with regulators and the regulated having cozy relationships, the danger is that ratepayer hikes will be doled out without too much of a hassle.
As Mark Chapin Johnson, adjunct professor of political science at Chapman University, noted to the OC Regisster about PG&E:
“They answer to the state through the PUC, not their shareholders. Yes, shareholders may have some equity value and dividends, but revenues and profits are set and controlled by the PUC, hence whenever PG&E wishes to contribute vast sums of ratepayers’ monthly payments to the political process, all PG&E needs do is gain permission to raise rates with the PUC to cover such contributions. Public shareholders or ratepayers have no say in the process. Is this a great system or what? Talk about incestuous!”
But utility companies are not the only ones to use financial engagement, protected by government guaranteed markets, to buy political cover.
Last year, health insurance companies spent $56 million to defeat Prop. 45. Sponsored by Consumer Watchdog, it would have given the insurance commissioner the power to regulate health insurance rates the way that auto, home and business rates are in California. It would have allowed the commissioner to make health insurance companies justify their rate hikes under penalty of perjury, and to reject excessive rate increases. Thirty-five states have already enacted such laws, but not California. Without protection, premiums are rising for some consumers astronomically. In Santa Cruz, employers are seeing a stunning 85 percent increase in the cost of their group health insurance plan in 2016.
Nationwide, insurers this year are expected to reap more than $1 trillion from government programs Medicare and Medicaid, versus $400 billion from private insurance
Unsurprisingly, the next-largest donors in political influence over the past five years, according to the Register, were health care insurers and providers. The three largest – Kaiser Permanente, Wellpoint/Anthem Blue Cross and Blue Shield – spent $96.2 million.
Great system indeed.
