Ron Wyden

Mr. WYDEN

Mr. WYDEN. I appreciate the Senator yielding. I will be very brief. I say to the Senator, I thank him for all the years he has toiled in the vineyards on this issue. He and Senator McCain have been out week after week for years. I was sworn in as Oregon's first new Senator in more than 30 years on February 6, 1996, around noon. The first official action I took, as Oregon's first new Senator in more than 30 years, was to be a cosponsor of the McCain-Feingold legislation. I just want the record to note that this Senator knows we do not get to this kind of opportunity by osmosis. It does not happen by accident. It happens because we get two Senators such as the Senator from Wisconsin and the Senator from Arizona who, week after week, year after year, do so much to make this action possible. I want the Senator to know how much I appreciate all his leadership.

Mr. WYDEN. I ask unanimous consent the reading of the amendment be dispensed with.

Mr. WYDEN. I thank the Chair. Mr. President, I will be brief. It has been interesting that on the floor of the Senate today no one has spoken in defense of negative ads. The very ads that the media consultants believe are most successful or most likely to win elections have not won a defense. I guess the media consultants in this country are going to have to go back to school if this proposal, as it makes its way down the gauntlet, becomes law, as the Senator from Maine and I hope to make possible. The fact is that this is a stand-by-your-ad requirement. This is a proposal that makes it clear that to get that lowest unit rate, you have to be held personally accountable. What the Senator from Maine did is useful. We believed we had made it clear in terms of linking it to the appropriate Federal election statute. What we just did makes it even more so. I, too, thank the Senator from Kentucky. This is an area in which I have had a special interest since what I think was the harshest campaign in Oregon history in 1995 and 1996. My friend and colleague, Senator Smith, and I believe that race was just completely out of hand. Neither of us could recognize the kinds of commercials that were being run by the end. This is an opportunity to draw a line in the sand and to say the Senate wants to make it clear that we are not going to let candidates disown these corrosive, negative commercials. They are not going to be able to hide any longer if this becomes law. I express my thanks again to the Senator from Maine. There are a number of staff who have put in a huge number of hours: Jeff Gagne and Carole Grunberg of my staff, Michael Bopp with Senator Collins, Linda Gustitas with Senator Levin, Bob Schiff with Senator Feingold, and Andrea LaRue with Senator Daschle. All of them contributed to this effort to make sure that in this country we are no longer subsidizing dirty campaigning. That is what happens today. We are subsidizing the local hardware store owner and the local restaurant owner is subsidizing dirty campaigns, and we are taking a step away from that. With thanks to my colleague from Maine, with a pledge to the Senator from Kentucky to continue to work with him in this area, I express my thanks to him for taking this by voice vote. I yield the floor.

Mr. WYDEN. Mr. President, I have an amendment at the desk.

Mr. WYDEN

Mr. WYDEN. Mr. President, there are 2\1/2\ minutes on our side for the Smith-Boxer-Wyden amendment. I yield a minute and a half of that time to Senator Boxer, and I thank her. I remind our colleagues on this issue affecting the Pacific Northwest, there is a disagreement among the Californians.

Mr. WYDEN. To finish the debate, I yield to Senator Smith, my colleague.

Mr. WYDEN

Mr. WYDEN. Of course.

Mr. WYDEN. I appreciate that.

Mr. WYDEN. I thank my colleague. I will make a couple of additional arguments on my time. I know colleagues want to speak, and I certainly want to give them the opportunity. Today as we listen to this discussion, perhaps the central argument that has been advanced by some, that the amendment Senator Smith and I offer is unwise, is the argument that somehow what we are going to do is force California utilities into bankruptcy. I will take just a minute to say why I don't think that is the case and, in fact, why I think our legislation is an incentive to bring about the kinds of negotiations that everybody on the west coast would like to see. As our colleagues know, there is an effort underway in California to look at a comprehensive solution which presumably would involve repaying in full everyone who is owed money for sending power to California. That is about $12 billion in total. This amendment involves a few hundred million dollars owed under the emergency order plus debt owed to government agencies. The total, of course, is only a fraction of what is owed by California. The question that is central is, How is it possible that California can go out and work on a deal to pay $12 billion in full but ensuring repayment of several hundred million dollars, as Senator Smith and I are calling for, is going to force California utilities into bankruptcy? I want to come back to this one last point before yielding, regarding the effort that Senator Smith and I are pursuing. As I touched on earlier, this comprehensive approach to repaying those who are owed money under discussion in California involves about $12 billion in total. It just seemed to me to not be credible to say that California can work out a deal to pay $12 billion in full, but somehow ensuring repayment of several hundred million dollars is going to force the California utilities into bankruptcy. My view is that other creditors truly believe they are going to be fully repaid under this $12 billion comprehensive solution. They would not risk forcing California utilities into bankruptcy. Other creditors will only be concerned about our amendment if, in fact, they don't think there is enough money to pay everybody back. The amendment requires that Bonneville Power and other governmental agencies be repaid so that ratepayers and taxpayers don't end up holding the bag if these for-profit California utilities go into bankruptcy to avoid their debts. It does not--I repeat this--put these government agencies at the head of the line. It only keeps their current place in line to ensure that they would be repaid at some point. All of us in this discussion are hopeful that there is not going to be a bankruptcy proceeding. I am prepared to work as one Senator--and I know Senator Smith is as well--with our California colleagues to put in place a comprehensive agreement so that this amendment does not come into play. I see my colleague from the State of California on the floor. I want to repeat that again. I am prepared to work with her, as I sought to do for several weeks now, to make sure that California can have every opportunity to put in place a comprehensive agreement so that this particular amendment never comes into play. But if that doesn't happen, and if there is a bankruptcy filing, and there isn't enough money to pay back everybody, then it seems to me that the people's power--the power that belongs to these public entities deserves an opportunity to get a fair shake in a chapter 11 proceeding so that our constituents are not shellacked as part of an effort to be good neighbors. I yield the floor at this time.

Mr. WYDEN. Mr. President, again to set the record straight, when my colleague came to the floor tonight, the first thing she said was, what do the two private utilities affected by this think? That is clearly what this debate is all about in terms of those who are opposed. Yes, Southern California Edison and PG&E are opposed. The crowd who botched the job of energy deregulation, the State of California, is prepared to oppose something such as this. My colleague from California said this is a dangerous amendment. What is really dangerous is what California has already done to the American people because the fact is, what California has already done to the American people is put in a set of energy decisions that have great implications for the whole country, not just those in the West. The President of the Senate is from Nevada; I am from Oregon. It will have ripples all the way through our country. That is what California has already done. The crowd that has botched this and engaged in this conduct, by my calculation, is pretty close to political malpractice if you look at how they went about deregulating energy, deregulating only one part in one way, leaving another part alone. Now they come to the floor of the Senate and they say, trust us even though they have already been dickering about it for months and months; we are going to be able to put together a $12 billion comprehensive settlement. But you in the Pacific Northwest and the public entities that Senator Boxer talked about, despite the fact that these organizations involve just a few hundred million dollars as part of a $12 billion plan, trust us because everything will work out in the end. That is a bit too much to swallow. Tomorrow when we vote --and we are open to working with our colleague from California this evening--I hope the Senate will stand with Senator Smith, Senator Boxer, and myself. We are of the view that our amendment is about simple, basic fairness. Nobody is given a preference in bankruptcy under this legislation. In fact, no one in the course of this debate that has gone on now for several hours has once pointed to any language in the amendment that provides a preference to Bonneville or anyone else. I wrap up by way of saying I will assume my colleague from California misspoke. The Bonneville Power Administration is for this. We have been working with them constantly. The Northwest Power Planning Council is for this. Bonneville Power, for example, is faced with a situation where they will have to make debt repayment before long. They badly need this money. So this is about the small public entities in California that Senator Boxer spoke about. It is about the municipal energy entities all up and down the west coast. You bet southern California is against us on this. I hope my colleagues will stand with Senator Boxer and Senator Smith and I at 10:30. I will again invite my colleague to discuss this further. I will respond to any other arguments. Whenever she finishes, perhaps I can make my closing arguments and we can wrap this up. Would my colleague like me to yield to her?

Mr. WYDEN. I think we will have some back and forth. But certainly the major points I have been interested in making have been made. I am happy to be sure that we are fair to all of our colleagues and that we move expeditiously.

Mr. WYDEN. Would you like me to yield or do you wish your own time?

Mr. WYDEN. Reserving the right to object, just to ask the leader a question: Is it the leader's desire that this amendment be voted on tonight?

Mr. WYDEN. I withdraw my reservation.

Mr. WYDEN. I have.

Mr. WYDEN. I respond briefly to the point the Senator is making. It seems to me the Senator makes an interesting point and certainly raises some interesting legal questions. The scenario just described is what Senator Smith and I seek to prevent by keeping our amendment narrow, to involve government entities. In other words, if you were to broaden the scope of the amendment to all kinds of other parties, it seems to me the case would be more credible that perhaps you could have a scenario where you were driven into bankruptcy. That is why we kept it narrow. We believed keeping it narrow gave people an incentive to negotiate and increase the prospect that we wouldn't have this calamitous situation that the distinguished chairman of the committee is so correct to say would be bad for all.

Mr. WYDEN. Will the Senator yield?

Mr. WYDEN. Mr. President, I wish to be in the queue here on an amendment on which I have worked with Senator Smith, and Senator Boxer would like to make a quick comment. I will yield back. I thank the Senator from Utah for his courtesy. I yield the floor.

Mr. WYDEN. I thank my friend, the distinguished Chair. I am mostly interested in getting in the queue to offer an amendment with Senator Smith. I would like to yield to Senator Boxer for a moment because I know her time is short. She has consulted with us on this amendment. I would like to yield to her for a quick moment.

Mr. WYDEN. Mr. President, I ask unanimous consent to speak for 1 minute.

Mr. WYDEN. Mr. President, I want to respond just for a few minutes to my colleague from California. I think she knows I admire her enormously. I think the Record will show the distinguished Senator from California and I agree on a vast majority of the issues that come before the Senate. What is troubling about the argument that is advanced before the Senate tonight is that after State officials in California botched the job of deregulation--by the way, this was not Senator Feinstein; Senator Feinstein did not do that, but State officials in California botched the job--now the message is, the public entities and those responsible to taxpayers are just supposed to trust folks in California to hope everything is going to work out. Given the hardship we are facing in the Pacific Northwest, that is just a little much to swallow; it is hard for this Senator to swallow, despite the fact that I have great respect for my colleague from California. I think tonight we have seen--certainly over the course of the last hour--that there is a sharp difference of opinion between California's two Senators on this matter. Senator Boxer worked with us in close consultation. She is in support of this amendment. She believes it is going to help bring folks together in the West for a comprehensive solution. I think what she is saying is she does not want her State to be a scofflaw. She does not want her State to, in effect, be a deadbeat in the course of this whole discussion as the State of California asks the distinguished new Senator from Virginia to be part of an effort--and myself and others--to come up with a comprehensive solution to this question. The distinguished Senator from California started her presentation by reading from some letters from private utilities in California and, in particular, focused on the fact that Southern California Edison is in opposition to this amendment. The fact is, the Washington Post noted this recently. Southern California Edison actually passed along nearly $5 billion in net income to its parent, Edison International, which used the money to pay dividends to its shareholders and to repurchase its own stock. So what you have is a private company, Edison International, that my colleague cites tonight as the reason the Senator from Virginia and other colleagues should vote against the bipartisan Smith-Wyden amendment because we are individuals who ought to be concerned about Southern California Edison first. I want Southern California Edison to get a fair shake. That is why we made very clear in our amendment that no one would get a preference if, in fact, you had the worst case scenario of an actual bankruptcy unfolding in the State of California. I just do not want Southern California Edison and a handful of these private interests to get a free ride. I do not know how it passes the smell test. I think this is why Senator Boxer agrees with us on this matter. How we can say to the people of the Pacific Northwest, who, in effect, got these glowing thank-you letters from Senator Feinstein, that somehow they are not going to be repaid, even though it involves only a few hundred million dollars, may not be a big deal to California, but it is a huge deal to the ratepayers in our area. We are concerned. We always have to make debt repayment to the Federal Government. These sums make a real difference. So I am very hopeful, as our colleagues overnight reflect on the debate that is being held on the floor of the Senate, that they will stand with Senator Smith, Senator Boxer, and myself rather than with Southern California Edison, which has been busy sending billions of dollars overseas, when all the rest of us on the west coast have been trying to figure out how to get through a very difficult situation. Mention was made of the fact that this amendment requires out-of- State generators to be paid in full before other creditors are paid. Our amendment does no such thing. It does no such thing. It only deals with a fraction of the debt that is owed by California utilities. It only requires the debt be repaid at the end of a bankruptcy proceeding when a plan of reorganization is put in place. If the worst case scenario takes place, which we believe our legislation helps to avert, then we will have a measure of fairness in the consideration of how to handle that situation. Senator Feinstein also quoted from out-of-State generators. These are the companies that the Governor of California has called profiteers. Those are not my words; those are the words of the Governor of California. So I am sure my colleagues, by this point, are awfully confused about the back and forth. But I do think Senator Feinstein has framed the debate well. On one side are the interests of those directly responsible to taxpayers, those who have no shareholders, nobody who can absorb the cost, nobody who can be involved in some kind of sleight-of-hand arrangement where you can send billions of dollars overseas. The people who are supporting Senator Boxer, Senator Smith, and myself, and others, do not have those kinds of shareholders involved in those multibillion-dollar deals that were reported in the Washington Post. They are standing up for taxpayers. They are the ones who would be helped by this bipartisan amendment. It is very clear, on the basis of the letters that have been read in opposition, that on the other side are the interests of these private utilities. I ask unanimous consent that the Washington Post article outlining Southern California Edison's program to send $5 billion overseas be printed in the Record.

Mr. WYDEN. On the other side of our amendment are exactly those kinds of interests, those kinds of powerful private interests. Various letters have been read into the Record tonight. Yes, those who oppose us are utilities that transferred billions of dollars to the shareholders and parent companies and, frankly, don't seem to think that there is anything wrong with doing that while stiffing Bonneville Power, the western power administration, itty-bitty municipal utilities, and others. The reason we have been able to put this bipartisan amendment together is that we have fashioned a narrow approach to ensure that these public entities get a fair shake. We have fashioned an approach that is not going to put in peril a comprehensive effort in the State of California to deal with this power situation. In fact, we believe that it will create incentives to actually bring parties together and to avert the kind of doomsday scenario that all of us in the Senate want to prevent. The lines are drawn very well. On one side you have Senator Smith and Senator Boxer and myself, and on the other side you have Southern California Edison and those representing a handful of multibillion- dollar private interests that were intimately involved in creating this problem in the first place. I don't think the Senate ought to be asked, in effect by those who botched the job at the State level several years ago, to just trust them. We ought to take a practical step such as this that is going to bring the parties together. Senator Feinstein said: Well, this is without precedent. The fact is, the botched job that California did on energy deregulation is what is without precedent. If we are going to talk about setting precedents this evening, what we ought to talk about is the fact that in the State of Virginia they didn't go about the task of deregulating energy this way. Certainly, we didn't do it that way in my State. We believe in markets. We don't believe in saying, well, you can do one thing for wholesale and another thing for retail, but if everything doesn't work out, come to the Senate and if somebody tries to make sure you get a fair shake when you are sending power under Federal order, we will fight it. We don't say things such as that. We say you have to be fair to all parties. That is why I am particularly pleased to have the support of Senator Smith and Senator Boxer.

Mr. WYDEN. I did not understand the comments of my distinguished colleague.

Mr. WYDEN. I understand that.

Mr. WYDEN. I thank my colleague.