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Electricity rates may short out your budget BY TOM KNOX Deregulation of Pennsylvania’s electricity rates is scheduled for 2010.
This will remove rate caps that have been in place for the past 10 years.
Experts predict this action will increase electricity rates to consumers by up to 65 percent, and some consumer advocates argue that the increase will be closer to 100 percent. Some legislators say this could constitute the “biggest tax increase in Pennsylvania history.”
Years ago the electric companies promised that deregulation would create increased competition and savings for consumers. In return for deregulation, the state Public Utility Commission imposed caps on rate increases. Now those caps are scheduled to expire.
The promised rate reductions due to deregulation have not materialized. We now are faced with passing on these increases starting in 2010.
Of the 16 states that have adopted deregulation, none has been successful in providing consumers with the promised lower utility costs. All are in fact doing much worse than states that continue to regulate their power industries as the public utilities they are.
The American Public Power Association observed that “the move to expand so-called ‘competitive’ energy markets has actually raised costs for consumers without the promised technological advances.”
Deregulated consumers in Delaware, Connecticut, Montana, Illinois and Maryland now face some of the highest rates in the nation, which have increased up to 70 percent. Baltimore Gas and Electric Co. sought a 78 percent increase for the city of Baltimore until state lawmakers acted and reduced the initial price spike to 15 percent to 25 percent. Meanwhile, BGE’s parent company, Constellation Energy, doubled its revenues. Its CEO’s compensation is now in the neighborhood of $5 million per year.
Despite its abundance of natural resources, Pennsylvania has some of the highest electricity costs in the nation.
Pennsylvania’s electric companies, meanwhile, are predicting record profits, “charging rate payers up to five times more than what it costs them to generate the power,” according to state Sen. Lisa Boscola, D-Northampton.
With the impending rate increases, the number of families and businesses unable to pay their bills will increase, as will the number of companies that close or relocate to other states. Figures already show that utility shutoffs rose by 37 percent in 2008 as compared to 2007. Haven’t we learned that failed deregulation policies which inflate corporate profits cause the type of harm we are experiencing with the current financial crisis?
I understand the difficult choices facing working families. Pennsylvanians are struggling to pay their bills, make ends meet and keep their jobs through this economic crisis. This understanding comes from my childhood experiences growing up in Philadelphia’s Abbotsford public housing project and depending on public assistance to live.
Is it fair to impose this additional burden on Pennsylvania’s citizens?
Should they now have to choose between proper nutrition, clothing and housing for their family or necessities such as electricity? This is a frightening but altogether realistic possibility.
This latest attempt to gouge consumers should be met with outrage by all Pennsylvanians.
It is time for the representatives of working families and small businesses to act on behalf of their constituents and either reject deregulation or impose restrictions to abate an economic disaster.
History offers compelling evidence of the repeated failure of electricity deregulation to benefit the public. The times are too challenging to allow history to repeat itself and make our state another casualty.
If we act now, we have time to protect the working families of Pennsylvania and ease the effects of these additional economic pains. Therefore it falls to us, the citizens of Pennsylvania, to oppose the greed of the utility companies. It is our responsibility to bind together against deregulation so that no Pennsylvanian ever again has to choose between food and light.
Would-be Pa. governors lining up for 2010 race By PETER JACKSON Associated Press Writer HARRISBURG — Pennsylvanians won’t elect their next governor for two years, but signs are popping up all over that the 2010 campaign is already in progress.
Knox In Miami, state Attorney General Tom Corbett and Patrick Meehan, the former U.S. attorney in Philadelphia, were among gubernatorial prospects from across the country honored as “VIP guests” at the Republican Governors Association meeting this week, according to GOP consultant Mark Holman, who also attended. Both veteran prosecutors have been publicly coy about their political intentions. In Harrisburg, state Revenue Secretary Tom Wolf, a former York County businessman and generous Democratic campaign donor, said he was stepping down after nearly two years in Gov. Ed Rendell’s Cabinet to pursue “another option in public service.” Wolf refused to elaborate, but has previously expressed interest in running for governor. In Philadelphia, businessman Tom Knox, who pumped $12 million of his own money into his 2007 mayoral campaign before he lost the city’s Democratic primary to now-Mayor Michael Nutter, has already put up a “Knox for Governor” Web site. But those are only the most visible manifestations of what could be a crowded campaign. “The race for governor begins probably ... right after the new year,” said Terry Madonna, a pollster and professor from Franklin & Marshall College in Lancaster. In the GOP, Corbett’s political capital was recently reinforced by his decisive statewide re-election victory in a year when Pennsylvania voters dealt Republican presidential nominee John McCain a resounding defeat. Corbett had the benefit of leading a high-profile investigation into allegations that state legislators and their aides funneled millions of dollars of public money and resources into political campaigns. A dozen people connected to the House Democratic caucus face criminal charges, and Corbett has said he anticipates more arrests. Meehan, as chief federal prosecutor for southeastern Pennsylvania, has good-government credentials of his own. He cracked down on corruption in Philadelphia’s city government and oversaw the four-year probe that resulted in scores of criminal charges against once-powerful Sen. Vincent Fumo, D-Philadelphia, whose trial is continuing. Another potential Republican candidate is Pat Toomey, the former congressman who nearly unseated Democratic Sen. Arlen Specter in the 2004 primary and is now president of the conservative Club for Growth in Washington. “He hasn’t ruled it out,” Toomey spokeswoman Nachama Soloveichik said Friday. On the Democratic side, two elected county executives — Dan Onorato of Allegheny County and Don Cunningham of Lehigh County — have been quietly raising money and courting supporters for months. Onorato was re-elected last year, while Cunningham, Rendell’s former secretary of general services, faces a re-election campaign next year as the gubernatorial race heats up. Also seriously considering a campaign is Jack Wagner, who was re-elected as state auditor general in the Nov. 4 election. The former state senator from Pittsburgh said he would make a decision in the first few months of 2009. The primary will be in May 2010 and, he said, “you would certainly have to be out front publicly a year in advance of that.” Less talked-about prospects include state Treasurer Robin Wiessmann, a Democrat who is stepping down in January when she completes the term she was appointed to fill in January. She said a campaign for governor or lieutenant governor is among “a number of career options” she is considering. Joe Scarnati, the Senate president pro tempore who became first in the line of succession to Rendell following the death of Lt. Gov. Catherine Baker Knoll on Wednesday, said his short-term agenda does not include serious consideration of a gubernatorial campaign. “As an elected official, I would look awful terrible to say that I never considered it,” the Jefferson County Republican said. “I think about it, but there’s an awful lot of issues to consider and it’s way too early for me to make a comment.” Blues' merger wrong: More, not less, competition is key to costs. By Tom Knox Former CEO of UnitedHealthcare of Pennsylvania The proposed merger between Pennsylvania's two largest Blue Cross plans will further limit competition across the state. The best way to lower the rising cost of health-insurance premiums for Pennsylvanians is through increased competition - not less. Link to full article: http://www.philly.com/inquirer/opinion/29734354.html
Knox definitely in for 2010 governor's race
By Dan Hirschhorn Knox, the millionaire Philadelphia businessman, told PolitickerPa.com Wednesday that he started raising money last week for a Democratic run in 2010, and that his first fundraiser was scheduled for Sept. 25 in Philadelphia. Knox considers a run for governor By Thomas Fitzgerald; Inquirer Staff Writer Businessman Tom Knox's unsuccessful campaign for mayor of Philadelphia drained about $12 million of his personal fortune and entangled him in nasty personal attacks, but he still may not have had enough of electoral politics.
Knox is considering running for governor of Pennsylvania in 2010, believing that his outsider status and message of change will sell statewide.
"Just because I lost, I'm not going to go away," said Knox, who finished second to Michael Nutter in the five-way Democratic primary in May.
If he runs, Knox would start from a position of strength in the Philadelphia media market, where he became a household name thanks to nonstop TV ads.
"Everybody saw those commercials," Knox said. "We did a little polling after the race. My positives are extremely high, and my negatives are in the single digits. Not everybody voted for me, or could, but they liked me."
Gov. Rendell's second term expires in 2010 and he is not eligible to run for reelection, leaving an open seat and no obvious heir in either party. Already, several Democrats and Republicans are exploring campaigns.
On the Democratic side, a number of Rendell's top fund-raisers held a Philadelphia event last week for Allegheny County Executive Dan Onorato, hoping to build a consensus to avoid a bitter primary. But Lehigh County Executive Don Cunningham, a former Rendell cabinet officer, has also been raising cash and making connections.
And considering candidacies are Auditor General Jack Wagner, who shares an Allegheny County base with Onorato, and State Sen. Robert Mellow of Lackawanna County in Northeastern Pennsylvania.
"We're talking about an election that's 30 months away here. It's really just silly to talk about clearing the field or trying to consolidate support for a candidate," said Cunningham, who wrote a protest letter to the organizers of the Onorato reception. "It's undemocratic. Quite honestly, just because a few inside power brokers want it to be that way doesn't mean it's going to occur."
Knox, a deputy mayor for government efficiency in Rendell's first term as Philadelphia mayor, is a longtime insurance executive who made a fortune turning around a variety of troubled companies and selling them. He said he also was considering running for U.S. Senate against Republican Sen. Arlen Specter in 2010, though Knox added that he was leaning toward the governor's race because the position fits his executive experience.
He would instantly become a formidable force because of his presumed ability to infuse large sums of his own cash into a campaign. Knox has said his personal fortune is north of $100 million.
"It probably costs more to run for governor than I have to spend," Knox said, who estimated it would take $30 million to win. "I will put in a good piece of that, but I'm going to have to raise a substantial amount of money [from others] this time."
Knox was initially dismissed by Philadelphia politicos, but he changed minds by putting up $10 million of his own money and surging to the lead with an early TV onslaught. He railed against the city's Democratic establishment, promising to rid City Hall of corruption, a message that ultimately benefited Nutter, who also preached reform but who was an experienced city councilman.
"Right now, running as an outsider versus the culture in Harrisburg would be very appealing," said pollster Terry Madonna of Franklin and Marshall College. "Confidence in the legislature is low, [many] people think the state is heading in the wrong direction, and it's a very unsettled political environment. Three years out, it's hard to say what could happen, but at this point, only a fool would rule out anyone."
Strange things have happened in governor's races, and early favorites often stumble. Democrat Milton Shapp, a businessman from Montgomery County, seemed to come from nowhere in 1971 to win the state's top office. In 1994, Republican Attorney General Ernie Preate was the choice of pundits, but Tom Ridge, a previously obscure GOP congressman from Erie, wound up winning it all.
There are potential downsides to a Knox run. Many of his business deals were scrutinized during the mayor's race, especially the high-interest "payday" loans made by a bank he owned.
Knox said he would make a decision next year. He already apparently has overcome one hurdle.
On the night he lost the primary, his wife, Linda, said she hoped the political bug would not bite her husband in the future. "I'm going to bite him if he runs again," she said.
Knox said his wife still was not thrilled with politics but had given her blessing.
"She has already told me that if I decide to run, she'll be behind me," he said. "The woman is a saint. She's the best thing I have going for me, and she'd make a great first lady." |
