Editorial: Trying to sway a regulator

Tuesday, May 29, 2001 | 9:48 a.m.

It simply is outrageous that the country's largest electricity company tried to bully the nation's top federal regulator into getting its way on a key decision involving electric deregulation. The New York Times reported Friday that this happened earlier this year when Curtis Hebert, chairman of the Federal Energy Regulatory Commission, received an unsettling phone call. On the other end of the line was Kenneth Lay, the head of Enron Corp.

Lay laid out a stunning deal for Hebert. If only Hebert would change his views on electric deregulation -- agreeing with the corporation's support for a national push for retail competition in the energy business -- Enron would continue to support him in his job. Hebert, who told the Times he was offended by the offer, refused Lay's entreaty. Enron has extensive and influential ties to the Bush administration, and considering the way the corporation throws its weight around Washington, Hebert correctly worried that his job may be in jeopardy because of Lay's influence with the White House. According to the Times, Lay has weighed in on other commission appointments with the White House and had access to those who were writing the administration's energy task force report.

Vice President Dick Cheney, the architect of the White House's energy task force, has said that while Hebert will stay on the commission, Bush will take away his chairmanship and give it to another member. Bush administration officials acknowledged that they willingly listen to Enron's recommendations, but that they don't necessarily always agree with the corporation. But in this case, it appears that Enron got its way.

Ironically, Hebert is a free-market advocate who usually shares Enron's views on less regulation. For that matter, Hebert has been a disappointment as a regulator, frequently bowing to the wishes of energy producers instead of pursuing policies that adequately protect the interests of small businesses and consumers. Still, Enron has crossed the line by seeking to inappropriately influence the decision of a regulator. Then again, maybe Enron's actions shouldn't be too surprising in light of the current climate in Washington where the Bush White House unfortunately has signaled its reluctance to use regulation to curb market abuses and protect the environment.

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