I'm hearing from all quarters that the Summers appointment is dead, but just in case it's not, it's worth pointing out that Summers assured California Governor Gray Davis that Enron was not manipulating the energy markets in 2001 and that reregulation or capping prices would distort the market. He told Davis that Lay was doing "a pretty good job" serving California and that Gray should raise consumer prices and relax environmental controls so more power plants could be built.
Of course, now we know that Enron was manipulating energy prices and withholding electricity from California, and the crisis eventually led to Gray's recall. Whether Summers was sincere with his little mash note to Ken Lay is kind of an interesting question, but a bit besides the point.
STATE BLOGS
