The Coastal Post - February, 1997

Smogcheck Debacle And Beyond

By Michael S. Lovett

For those of you who are unaware of the State of California's Smog Check II debacle, the story goes something like this:

In May, 1996, Karen-Lee Bixman printed a story in Volume I, Issue IV edition of her The Investigative Reporter, entitled "The EPA's War Against Your Car." She closely examined the policies and tactics behind the newly-designed auto emissions testing scheme fostered by the Environmental Protection Agency (EPA) administered by an emission analyst company known as Envirotest.

The EPA's plan was to toughen the state's automobile emission requirements against "gross polluters." Cars marked as such by road-based "remote sensing units" (affectionately referred to as "smog dogs" or "butt sniffers" ) would receive an ultimatum: either revitalize your car or have it condemned. Those wishing to contest the initial determination could be re-evaluated at specified locations. However, even with repeated testing, the failure rate for older cars by new EPA standards was nearly 100%, and repairs, if allowed, were arbitrarily granted and extremely cost-prohibitive.

Continuing her investigations, Ms. Bixman discovered that the new reformulated gas praised by governmental and EPA-type pundits alike as a cleaner-burning, less emission-producing fuel is a far more lethal mixture than the old gasoline and does little if anything to clean the air of offensive emissions and vapors. In fact, supplemental analyses from other sources report adverse mechanical and health conditions resulting from its use. Deterioration of plastic and rubber fuel lines and carburetor parts have been affirmed. This obviously causes fuel leaks, reduces engine efficiency and promotes dangerous motoring conditions. Accordingly, the blame of increased engine fires and decreased mileage has been attributed to the new fuel and medical authorities have begun to warn people about its extreme toxicity.

Seemingly, this new gas has been devised to deliberately mess with a car's performance. Nevertheless, the state, by compelling consumption, is literally forcing the average mode of conveyance to become a gross polluter with the upshot that regardless of physical condition, most cars are obviously doomed to fail the new emission standards. Unable to make the grade, they will be refused by the DMV for registration. From there, local authorities, cracking down on unregistered vehicles, will certainly employ various and draconian measures of impoundment.

What happens to these confiscated automobiles? According to Ms. Bixman, once seized, the cars are to be crushed and their smog-producing potential would be sold for pollution credit to brokers who in turn could sell the credit to energy producers like PG&E.; These producers would then be able to extend their generating capacity by contractual right. But as the reader has probably already determined, eliminating vehicle emissions while allowing an increase of industrial pollution doesn't change much in regard to cleaner air. Further, how would the future of the electrical services and products market be affected if most of California's labor force were effectively barred from being able to get to work?

After Ms. Bixman's findings were given substantial air time on radio talk show KSFO, Sacramento lawmakers were twice besieged by an army of aggravated car owners who forced the state legislature to put Smogcheck II on hold-but the war is far from over. For those of you who are interested, contact Lee Rogers, Melanie Morgan, or Geoff Metcalf c/o KSFO, 560 AM, (415) 808-5600 or Karen-Lee Bixman, POB 2747-298, Huntington Beach, CA 92648, (714) 847-7534.

Why would the state embark upon a program that would knowingly cause such pain and grief to the majority of California people? This writer believes that Smogcheck II is just the tip of a political and economic iceberg.

Back in September and November of 1996 there were a couple of interesting articles written by Greg Lucas of the Chronicle and Chris Kraul of the Examiner. Briefly, these writers commented upon the legislative deregulation of the sale of electricity done with the intent "to increase competition" and to "lower prices" for California business concerns and residents under what lawmakers call Mandatory Centralized Power Pool or "PoolCo." A following review by Chronicle Economic Editor Jonathan Marshall discussed how PG&E; has become the "first customer of a 'new service' that will let utilities use the Internet to sell surplus capacity on their power lines. The number of long-distance power deals will begin to soar as utilities, power marketeers and independent power producers buy and sell electricity in a deregulated market."

This restructuring idea goes back a few years when dozens of sun, wind, fossil fuel, geo-thermal, hydroelectric, atomic and bio-mass energy producers, marketeers and other interested parties, including the Sierra Club and U.S. Environmental Protection Agency, wishing to consolidate their commercial interests, presented a plan to the Public Utilities Commission of the State of California (PUC). Official evaluations resulted in the publication of several documents of political and economic import. In brief, these documents assess the feasibility of such a merger, and recommend a rough course for further rule-making and study of the restructuring of California's electrical services industry and marketing potential. (See: "Proposed Policy Decision Adopting a Preferred Industry Structure" before the Public Utilities Commission of the State of California, documents R.94-09-04-931 and I.94-04-032; April 20, 1994, and "Customer Choice through Direct Access: Charting a Sustainable Course to Competitive Electric Services Industry: from the California Public Utilities Commission, San Francisco, May 24, 1995.)

Opponents of Smog Check II will be interested to note that though chronicled referral is scant, it appears that the California Energy Commission (CEC) and the California Air Resources Board (CARB), collaborating with regional Air Quality Management Districts and the California Environmental Protection Agency (CEPA), were given responsibility for the development research objectives and the power to recommend legislative and administrative initiatives to encourage certain clean-air purposes. "Techniques these entities, along with legislative cooperation, could employ are tax credits, tax incentives, emission reduction credits, and CARB LEV [Low Emission Vehicles] type mandates."

On its face, deregulation seems as American as apple pie: competition, a better product, a higher standard of living. But by December, 1996, the San Jose Mercury News noted that the city of Palo Alto was in danger of losing tax revenue from electrical sales by being forced to lower their already competitive kilowatt-hour charge to comply with the new deregulation-a move that would not actually lower rates for residential customers, but would reduce the city's budget and in turn adversely effect city services. (December 15, 1996)

Does this sound eerily familiar? Will Smogcheck II and its parent PoolCo continue the same reorganization patterns as the banking business, demonstrated in the early years of this century? Will commercial agreements backed by energy credits circulating between corporate and other franchised interests become the basis for a worldwide system of currency exchange? Even as this article was being written, the Mercury News stated, on January 11: "The Pacific Rim exchange is part of a grand plan." The 115-year-old Pacific Stock Exchange (PSE) is positioning itself for the millennium with grand plans to become a financial gateway for not only the West, but for the entire Pacific Rim. Among the PSE's innovations have been trading of very small California company stocks, a move which hasn't take off, and trading in Southern California smog credits, which appears to be a success."

In light of the above, does Smogcheck II and the electrical services restructuring in California make more sense now that Congress plans to reform Social Security by investing the nation's retirement money in the stock market? Stay tuned.