California Crisis, Part Two.

• Author: Weintraub, Daniel

It's hard for a deliberative legislature to respond to the urgency of a crisis. This proved true in California this year.

A year ago, Keith Richman was practicing medicine in the San Fernando Valley north of Los Angeles. About the only the thing the 47-year-old internist knew of electricity was that when he flipped the switch in his office, the lights came on.

Today the freshman Republican assemblyman has become an expert in electricity--how it's generated, sold and conserved. In May he could be found shuttling between the governor's office and the suites of his Democratic colleagues in the California Legislature as they tried to help hammer out a compromise plan to rescue a utility from the edge of bankruptcy.

"It's been interesting," the burly former college baseball pitcher said during a break from the negotiations.

Richman is far from alone in that assessment. California's 120 legislators--one-quarter of them in their first terms--have been thrust into the center of a crisis such as this state has never seen before. A deregulation law gone awry left the state vulnerable to sky-high electricity prices and frustrating shortages. When a retail rate freeze drained the utilities of cash and destroyed their credit worthiness, the governor declared an emergency and put the state in the position to buy power for its residents. But that simply turned the spigot on the state's general fund, draining a $6 billion surplus in five months. And even that was not enough to prevent rolling blackouts from sweeping the state.

Fighting through partisan rancor and a dysfunctional relationship with their governor, the state's lawmakers have inched toward a solution, or a series of them. There have been fits and starts, ideas that seemed great that ended in the trash bin, even the distraction of a big-rig truck with a suicidal driver at the wheel smashing into the side of the capitol as the Assembly wrapped up its work late one night. But the Legislature has trudged on. It doesn't have much choice.

The crisis has forced the Legislature, in the words of Assembly Speaker Robert Hertzberg, to throw out all the rules and start over again.

"None of what I call the laws of political physics work in this event," Hertzberg said. "They're very, very different.

"Normally, you've got a problem in education, or a fire or flood or an earthquake. You respond. You can debate. You can put in 100 bills on it.

Different committees fight for jurisdiction. And as quickly as you can move, you come up with a solution. But by and large it's a oneway street. We make a decision. The press can criticize and the public may not like it. But the power of government is what it is. You can throw us out at the next election if you want."

But in this case the Legislature could not act alone. Wall Street was looking over its shoulder, and the utilities' creditors were standing by, ready to pull the plug at the first sign of weakness. The Federal Energy Regulatory Commission had control over much of the problem and veto power over some of the solutions. Court cases threatened to throw the entire...