In politics and on Wall Street, sudden access to large sums of other people's money can awaken an aura of self-regarding genius in the previously uncelebrated dullard. This process is intensified by the echo chamber of sycophants and parasites hovering around the prince like a swarm of black flies. What follows is a verbatim transcript of Peter Darbee's bizarre, rambling explanation of the thought process behind Proposition 16, delivered at PG&E's March 1, 2010 Investor Conference in New York with the elan of someone about to spend a political "education" war chest of $25 - 35 million.
The raw audio can be found at 2:39:21 through 2:44:09 of the March 1, 2010 webcast, accessible after registration on the investors page of PG&E's web site.
QUESTION FROM THE FLOOR: Just a general question on the proposition you're focused on. I'm just curious, kind of, as to why use the political capital on that proposition now versus everything else going on. Just what was the decision making behind that and what's the real -- a little more color to the benefit of, of that proposition getting done?
PETER DARBEE: Sure. Back when we were in the midst of the SMUD battle, which cost us between $10 and $15 million to defend, I spoke with Nancy McFadden (editor's note: a PG&E Senior Vice President) and said, you know, in this situation it wasn't required that the voters have a vote.
She said 'No it wasn't.' We actually kind of maneuvered the SMUD Board into saying 'all right, we'll let the voters vote on this' and of course they did and voters rejected that. And so I said, you know, it seems to me that it be appropriate to that there, that the voters be able to vote in every situation, which to date they haven't had to, whether its municipalization or with community choice aggregation. So I said why don't you go off and work on that awhile and see what you can come back to us with in that regard?
And so this is now, SMUD was I think five years ago. So this was about 18 months, maybe two years later, she said 'we think we have an idea and this is it: that we have an initiative."
We'd sponsor it and it would require a vote of the electorate, which seems imminently feasible, you know, and appropriate that the electorate, as opposed to government bureaucrats, would make the decision that, that voters would vote on whether they want a change in their utility.
And so she made that proposal at that time and we considered it and we looked at the different things in front of us and one of the thoughts was we're aiming towards a June election and that it was a more favorable time to do it than as opposed to a November election. As the time approached it also occurred to us that people aren't very pleased with the job that government is doing these days in general, you know, across the board.
And so it was an appropriate time for there to be a referendum: do we think it's appropriate for government to take over utilities? Of course most of them have no experience in that regard and they haven't done such a good job of managing those things that they do have experience in managing. So that, that was a second factor that drove it to us.
And the idea was to diminish, you know, rather than year after year different communities coming in as this or that and putting this up for vote and us having to spend millions and millions of shareholder dollars to defend it repeatedly, we thought that this was a way that we could sort of diminish that level unless there was a very strong, you know, mandate from voters that this was what they wanted to do.
The polling at the time showed that first of all initiatives usually fail, affirmative initiatives usually fail. And in the preliminary voting, polling on this, before education which is the two ways these things are done, it didn't quite get to 51% but I think it was high 40's. After their education, the numbers became very strongly and positive in the favor of an initiative. Voters liked it. And as this has become, you know, more generally the awareness has increased out there among the voting populace after a discussion about it, it looks like we have a very good shot of winning on it.
So it was really a decision about could we greatly diminish this kind of activity for all going forward rather than spending $10 to $15 million a year of your money to invest in this. The answer was yes! The June time frame looked ideal and in the context of what everything that is happening with government today -- the dysfunctionality of it -- we concluded that it was a very ideal time!
The result is going to be there's going to be some flap. It will take place between now and June. And then the voters will have their ability to make their case one way or another. And then, presumably, you know, we'll mend any broken fences after that.
(Photo credit: Darbee, Genesis Photo Agency)