Power Crisis Is the Least of Our State’s Problems

If Gov. Gray Davis’ characterization of California’s “energy nightmare” is accurate, Californians had better prepare for a lot of sleepless nights. The current challenges related to electrical power are the tip of the iceberg for a state that has failed to make the necessary investments to maintain its infrastructure and support its growing population.

California will survive its “energy crisis.” In the short run, until prices fall, the state has no choice but to use its financial power and the leverage afforded under its existing agreements to strike the best possible bargain with the utilities and provide that minimum combination of rate increases, loans and guarantees necessary to maintain their access to credit.

But electrical power is merely part of the wider set of challenges to our future arising from a lack of planning, insufficient public investment and a deteriorating climate for private investment.

During the 25 years following World War II, California was first among states in per capita spending on public infrastructure. This investment in turn stimulated unprecedented levels of private investment and propelled Californians to the highest per capita income in the nation.

In contrast, during the ensuing 25 years, California has lived off its seed corn. Its expenditure on public infrastructure plummeted to last among the states.

As a result, the rate of private investment declined; per capita income fell below the top 10, and California now has the third greatest disparity between rich and poor.

During the next 25 years, California’s population will increase by 20 million people. In short we will grow an entire New York state.

Unless we radically change the management of our public institutions and invest in a long-term and comprehensive strategy to support this growth, a spike in electricity rates and a few brownouts will be the least of our problems:

* Our public health care system is already on life support. In 20 years, more than 10 million Californians will be 60 years or older. Without significant investment, as our population ages and its long-term health care needs increase, many of our citizens will be unable to access even emergency care.

* Our public schools are ranked in the country’s lowest decile. The recently implemented “reforms” are mere Band-Aids for a failed system requiring radical surgery. The physical infrastructure needs alone are staggering. Ninety percent of our 8,000 public schools require repairs. Merely to keep pace with growth, we need to build one classroom per hour over the next five years.

* Our transportation system, as any commuter knows, is inadequate for our current needs. Traffic delays now cost Californians more than $15 billion annually. Yet, California is dead last nationally in per capita spending on transportation. If we are traumatized by the current increase in our electric bills, imagine the cost, let alone the road rage, arising from the anticipated 60% increase in traffic over the next 25 years.

* Water, like electricity, is one of those things that we tend to take for granted. Yet the history of California is the history of a people who have gone to extraordinary lengths to secure water resources to meet the needs of a growing population. Much of our water system is antiquated and in need of significant repair, yet the many issues regarding the availability of water and the cost to meet the needs of 20 million more people remain unaddressed.

It is troubling to hear public officials responding to the energy shortage in isolation, as something related solely to the state’s decision to deregulate the utilities. Irrespective of the ultimate ownership or control of our power plants, we are a net importer of electricity because we failed to plan for our growth and pursue policies that would attract sufficient private investment to our state.

Failure to confront the imperatives of a growing population and create a climate conducive to private investment over the past 25 years has yielded across-the-board systemic deterioration of our infrastructure and stagnation of personal productivity as well as income.

Continued failure to meet our responsibilities and face the challenges of accommodating our future growth will only accelerate that decline.