Lack of Illumination

Sharon Beder has an important and controversial story to tell in "Power Play," her new book on electricity privatization from Edison to Enron.

Her thesis is that electricity privatization has always been a confidence game. Corporations have convinced the public and elected officials that public control of electricity is inefficient, uneconomic, and even un-American. If the public and the government aren't convinced, the electricity companies just buy them. Once in control, the corporations manipulate markets, waste resources, and make a hash of everything.

Ms. Beder begins in the late 19th century, when the Edison Electric Light Company electrocuted dogs in an effort to prove that its direct-current system was better than alternating current. She then moves through the general corporate malfeasance of the early 20th-century electricity tycoons who bought up newspapers, organized phony tea parties where hired ladies would spread the gospel of privatization, and even wrote kindergarten textbooks describing the wonders of their product.

Eventually she comes to the 1990s and the privatization wave that has swept a good part of the country, including New York State. She focuses particularly on California, where Enron, along with other power companies, manipulated privatized markets and caused blackouts and huge financial woes for the state. According to Ms. Beder, their tactics included creating false congestion problems and shutting down power plants for surprisingly frequent "maintenance" during times of high electricity demand, creating OPEC-like shortages. This not only caused prices and profits to spike, it also convinced the media and governor of an impending crisis. Coincidentally or not, once the fearful state had bought into a long-term contract at above-market rates, the plants needed less maintenance.

After documenting the crash of Enron's stock and then its own deserved blackout, Ms. Beder moves to Britain, where Margaret Thatcher led the mother of all modern deregulation efforts, then to Australia, and then to the developing world. In these countries, more than in the section on the United States, she focuses on the well-funded conservative think tanks and intellectual movements that created the political momentum for privatization. Here, she partly lives up to her introductory claim that "This book is not so much about why electricity privatisation is a bad idea -- although it provides plenty of evidence to show that it is -- but about how and why policy makers came to think of it as a good idea."

Toward the very end of the book, Ms. Beder writes an interesting chapter on Enron's predictably unhelpful construction and management of a major power plant in India. There, as in the United States, the company bought control of political figures and wreaked profitable havoc in the local economy before it was shuttered in 2001. Enron placed Clinton's Indian ambassador, Frank Wisner, on the board of an affiliated company after he backed the project, giving a bit of bipartisan flair to a company that provided many of the campaign planes for the Bush administration in 2000.

Frustratingly, however, no matter where or when, Ms. Beder's characters are always the same. The corporations are always greedy, the politicians gullible, and the public duped. It's a challenge to find a single positive sentence or sentiment in the entire book.

Still, that's not necessarily the worst thing about "Power Play." Privatization can divide liberals and conservatives as much as any issue short of abortion. A persuasive case that electricity privatization is necessarily bad would have huge implications for international development and local economics too, particularly in a city like New York, where a monthly Con Edison bill can rival rent costs in other parts of the country.

Ms. Beder does take a few steps in that direction. She notes, for example, that electricity markets don't work like, say, the market for toothpaste. An imbalance between supply and demand in the latter market might lead to overstocked warehouses and coupons in the newspaper. An imbalance in the former can fry the power grid.

Moreover, there are huge societal costs to mismanaged electricity, both when it comes to environmental and social considerations. Blackouts can spoil economies and livelihood. Coal plant emissions can foul the air. Without careful regulation, corporations have few incentives to factor these costs into production and management decisions.

But Ms. Beder's book is much stronger on polemics than persuasion. She writes in a strident tone that seems to assume the absolute belief of her readers. Convinced of their loyalty, she has left out, or crudely dismissed, any evidence of privatization's success.

Aggravating the problem, Ms. Beder seems to have played very fast and loose with her research. Early on, for example, she writes that it's a common tactic for electricity companies to dig for dirt on unfriendly politicians. Her source, according to the footnotes, is the website of an organization called "Nebraskans for Peace," an organization whose homepage is currently selling "Cat Lovers Against the Bomb" 2003 calendars.

It's also not reassuring when 32 of the first 35 footnotes in chapter four come from the same book and the rest rely on a handful of other secondary sources. Combine the jarring tone with the patchy research that backs it up, and "Power Play" often reads like a term paper written in an undergraduate political science class for a left-wing professor who grades mainly on ideology.

Mr. Beder doesn't provide any narrative structure or interesting characters to hook in a general interest readership. She seems to want to appeal to the policy and academic crowds. But given her Manichean worldview and lack of substantiation, "Power Play" is unlikely to light up those worlds, either.