California is the most populous state in the US, with 27 million people and has the sixth largest economy in the world. It is the richest part of the richest and most powerful nation on Earth. Like all First World economies, it needs and expects an uninterrupted power supply. California has close to 1,000 generation facilities, capable of producing 55,000 Megawatts from a variety of fuels. In 1996, the state passed a law liberalising the electricity market, as of 1998. Within three years of commencement, California is the laughing stock of not only the rest of the US, but of the world. Huge companies have either gone bankrupt or face financial ruin; power blackouts have become the norm for both industry and the public.

The details of what has gone so horribly wrong need not concern us too much. It's the usual story of huge corporations privatising the profits and socialising the costs. The deregulated generators ratcheted up their prices astronomically; the retailers were prohibited from doing likewise to their captive customers. So these greedy companies were left with huge bills to pay to those higher up the food chain. The result has been chaos. How appropriate that California, the state that gifted Ronald Reagan and Reaganomics to the world, should now reap that particular whirlwind. New Zealand adopted the mumbo jumbo of Reagan and Margaret Thatcher more enthusiastically than any other country, repackaging it as our very own Rogernomics.

The end result was Max Bradford's "reforms" (service to die waiting for, soaring prices, huge profits for TNCs such as TransAlta). In 1998, central Auckland was blacked out for weeks because the scandalously run down system collapsed. There is a corporate direct connection to the California shambles. The National government broke up Electricorp into several generators, and sold 40% of Contact Energy to Edison Mission Energy, part of the Edison International Group (which owns power plants in 13 US states and six countries, as well as a phone company in Switzerland and a cable company in Mexico).

Sister company, Southern California Edison (SoCal Edison), is one of the major utilities in California to have refused to pay its multi-billion debts to the generators and gone into bankruptcy (as a political manoeuvre to force the State government to write off their bills, whilst being allowed to keep their profits). The NZ connection was only mentioned in passing by the supine business media here, and the only politicians to comment were the Greens. Jeanette Fitzsimons, Green co-leader, called upon the Government to buy Edison's 40% stake in Contact. "We have a once in a lifetime chance to get it right before Mission Energy sells to yet another private offshore owner" (Press, 9/1/01: "Greens target Contact stake"). Any such sale hasn't happened yet; the Government has certainly done nothing about buying (let alone nationalising or expropriating) this very recent loss from the grossly diminished stock of publicly-owned assets. And the shambles that is the Californian power supply system just keeps going on as the laughing stock of the world. The lights have (quite literally) gone out on the shimmering chimera that is deregulation and privatisation.