I really do have to stop going through these old files.  

Hard to believe the California Energy Crisis with the interesting names was over 3 years ago.  Hardly anyone remembers it anymore, almost like it never even happened.   Pretty apropos since the energy bill which not really an energy bill passed this week.  

We are an amazing country now in our ability to forget all the outrages, and just move right along.   Here are 3 articles on the topic.  I used to have the audios of the executives just laughing over their coup, but I can’t find them now.

Smoking Fat Boy by Paul Krugman
Smoking Fat Boy

SYNOPSIS: It is now almost certain that energy companies in California manipulated prices, but no politician seems to want to prevent it from happening again

An old joke: A farmer hears suspicious noises in his henhouse. “Who’s there?” he calls out. “Nobody here but us chickens,” replies the thief. Satisfied, the farmer goes back to bed.

That about sums up the behavior of federal regulators during California’s electricity crisis. As I’ve been pointing out for more than a year, there is powerful circumstantial evidence that market manipulation played a key role in that crisis. Energy companies had the motive, the means and the opportunity to drive prices sky-high. And the crisis exhibited exactly the features you would expect if market manipulation was playing a big role: much of the state’s generating capacity stood idle even as wholesale electricity prices went to 50 times normal levels.

Death Star and Fat Boy
Death Star and Fat Boy

The gang that looted California is coming to a state near you.
The traders used fraudulent maneuvers to which they gave juvenile but revealing nicknames: “Death Star,” “Fat Boy,” “Ricochet,” and “Get Shorty.” (The point of such pseudo-combat names for intra-company operations, of course, is to impress bosses and colleagues with one’s mercantile ruthlessness.)

Briefly, here’s how a few of the scams worked:

“Death Star”: Enron would overschedule its expected power transmissions to create the illusion that the state’s grid would be overloaded, then receive state payment for “relieving” the congestion. The beauty of this con, the company’s memos noted, is that “Enron gets paid for moving energy to relieve congestion without actually moving any energy or relieving any congestion.” It’s the sort of protection deal that would make Tony Soprano proud.

“Fat Boy”: This scam (aka “Inc-ing”) also involved overscheduling power transmission — for example, to a company subsidiary that didn’t really need all of it. Then Enron would sell the “excess” power to the state at a premium.

“Ricochet”: Also called “megawatt laundering” (by analogy to money laundering), Ricochet was the power equivalent of a real-estate land flip: buy in-state power cheaply, flip it out-of-state to an intermediary, then re-sell it to California at a highly inflated “imported” price.

Shorty is Alive and Well
Shorty is Alive and Well

“It turns out from internal documents made public last week that Enron energy traders pursued strategies they dubbed “Fat Boy,” “Death Star” and “Get Shorty” to manipulate wholesale electricity prices at the height of California’s energy crisis, in order to inflate profits.

The state of California reckons that complicit companies may have looted as much as $30 billion during a six-month period in late 2000 when local energy prices rose ten-fold.”

“The Bush administration is scrambling to show that it has behaved according to the old Texas dictum often attributed to Senate majority leader Lyndon Johnson before he became president: “If you can’t drink their whiskey, screw their women and still vote “no,” you don’t belong in politics.”

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