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Enron Mail |
One of the issues we have been following with respect to the California power
crisis concerns the role of prospective broader federal involvement in the issue post-inauguration. In the last two days, we have seen two signals suggesting that the Bush Administration will not significantly deviate from the "broker" role played by the Clinton White House: 1. In his confirmation hearing this morning, Treasury Secretary-Designate O'Neill cautioned that "it is not clear that US intervention is needed in California" and that the "Governor must be the first line of defense." 2. A source close to Bush economic advisor Larry Lindsey reported to us yesterday that "there was little that the Federal government could do specifically to help, beyond focusing on national issues (increased production, transmission capacity etc.)." Of course, the Bush Treasury officials are likely to be more cautious with respect to intervention than the Energy team, as was true with the Clinton Administration. Yet Lindsey in particular is unlikely to deviate far from the official Bush view at this stage. Further guidance should be forthcoming with respect to this issue from Energy Secretary-Designate Spence Abraham's testimony tomorrow.
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