Understanding Government

San Bruno, CA October 2010

Assailing federal and state regulators, San Francisco’s city attorney is threatening to file a federal lawsuit both the U.S. Pipeline and Hazardous Materials Safety Administration and the California Public Utilities Commission for lax oversight, regulatory capture and a cozy relationship with Pacific Gas & Electric Co., according to reporting by Jaxon Van Derbeken of the San Francisco Chronicle.  “The public is at risk because the mandates of federal law have not been followed by PG&E or enforced” by regulators, [San Francisco City Attorney Dennis] Herrera said, adding, “it has become increasingly clear that regulators bear some fault here and were either asleep at the switch or too cozy with the industry they are supposed to regulate.”   Herrera said the goal of the suit he intends to file is to prompt regulatory authorities to do their job or be forced to do so — under court-ordered supervision.

The preliminary letter faults state regulators, charged with enforcing federal rules, of understaffing and relying on utilities to police themselves. A major natural gas transmission line, buried beneath the suburb of San Bruno, ruptured in October. An explosion and resulting inferno killed eight people and incinerated 38 homes.

Unfortunately, this was not the utility’s only recent infrastructure failure resulting in fatalities.

If Herrera’s letter can’t cajole state regulators into doing their jobs, the lawsuit will seek a court order forcing federal regulators to step in, presumably with greater effect.  He should be careful what he wishes for. Regulatory capture is as old as the Sherman Anti-Trust Act and the Interstate Commerce Commission and 19^th century railroads. The revolving door between industry and regulators has gone from aberration to enshrinement among political and business elites.

Efforts to prevent another massive fleecing of the public by Wall Street banksters have largely faded away to nothing. But  that was about money. This is about lives.