“It may appear easier for Board members to file for Chapter 11 – shifting the burden of dealing with the myriad issues that will face the Board and placing it squarely on the shoulders of the Bankruptcy Court and the companies’ advisors – but it will destroy value for the Company and in particular its shareholders – the only groups to which you owe a duty.” (Emphasis added).
Part of a statement by Blue Mountain Hedge Fund, a major shareholder of PG&E stock. Of course, for them it is all about their money, not the 86 people dead in the Camp Fire or the 14,000 who lost their homes.
A Note To Readers
The California Department of Water Resources is the largest consumer of electricity in the state. It is also the fourth largest producer of electricity, with its five hydroelectric generating plants and four hybrid pumping/generating plants. The State Water Project moves millions of acre feet of water hundreds of miles in a system of dams, aqueducts, pipelines and canals, powered by 20 pumping plants.
Thus, the water infrastructure system of the state, which integrates three river systems (the Sacramento, the San Joaquin, and the Colorado), is really a water/electricity system.
Now, with both the Colorado River reaching record low flows– threatening both the water supply for millions in California and generating of electricity from Hoover Dam–, the shutting down of the San Onofre nuclear power plant scheduled in just a few years, and now the coming bankruptcy of PG&E, the state is heading for serious crisis, whether anyone wants to recognize it or not.
Especially since the criminal enterprise Enron bankrupted PG&E in 2001 and facilitated the entry of Arnold Schwarzenegger into the governor’s office, the state is now the number one state in the country for poverty (with 45% of the children in the state below or near the poverty line), and ranks near the bottom in educational outcomes. Housing costs has driven tens of thousands to sleeping in the streets (53,000 in Los Angeles alone), and the cities in the country with the worst kept streets are San Francisco, Oakland and Los Angeles.
The new governor, Gavin Newsom, likes to cite the fact that the state has more than a $20 billion surplus now, without really explaining how, after Arnold had left the state $27 billion in debt, we went from negative to positive. Well, just like the European Union has imposed vicious austerity on the countries of that organization, the state’s citizens have been given the same treatment. Maybe that has something to do with the state being at or near the bottom in educational performance of its students.
And a positive budget surplus in California depends on billionaires and their stock portfolios, and the top one percent of tax payers in the state pay almost half of the income taxes collected. A state report from last March said, “A moderate recession, like the dot-com bust, could lead to a $40 billion budget problem. A more mild recession might result in a $20 billion budget problem.” A crash like 2007-2008 is not even considered in that report, despite the reality that the present financial bubble is much larger and more volatile than the housing bubble of the crash.
In this week’s report
We have gotten a lot of rain and snow this week, so the first section below reports on that.
This week two topics dominate: First the announcement by PG&E that it will be filing bankruptcy. And second, the developing crisis on the Colorado River. My introduction to those two sections suffice and I need not say more here.
Finally, I include the link for the second class in the LaRouche PAC series now ongoing. The second class title is: “Science — not Mathematics! — is Key to the Economy.”
