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FACTSHEET

Letter to Greenlining Institute RE: Consumer Advocacy

October 29, 1998

Mr. John Gamboa
Executive Director
The Greenlining Institute
785 Market Street 3rd Floor
San Francisco, CA 94103

Dear Mr. Gamboa:

This is in response to your October 15 letter on behalf of "seventeen million lowincome consumers"' in which you state that we should not criticize you for opposing Proposition 9 and that you are not the "'enemy," the utility companies are. These are but a few of a number of assumptions and assertions in your letter which I am writing to correct.

Let's be-in with Proposition 9. Certainly, the Greenlining Institute would have to acknowledge that along with groceries and rent, electricity is a necessity that few low income families simply cannot do without, particularly those on fixed incomes. Nevertheless, when a deal was arranged in Sacramento which required ratepayers to pay off $28 billion of the utility companies-bad debts - approximately $500 per year each year for every ratepayer through 2002 -- the Institute was not at the table to protect this pillaging of those who can least afford to pay exorbitant electric rates.'

Two years later, a handful of citizen organizations have managed to scrape together the resources to place an initiative on the ballot which will force utility companies to bear the burden of at least some of their own investment mistakes. According to an internal analysis by the state Energy Commission, Proposition 9 will lower utility bills between 24 and 37% for California ratepayers. What does the Greenlining Institute do with this rare opportunity to back an initiative that will lower rates for all ratepayers in the state, including and especially the poor?

It stands with PG&E and the other utility companies against Proposition 9. And what is the Greenlining Institute's excuse for denying the people it claims to represent a significant cut on their utility bills? According to your letter, you believe Proposition 9 threatens the utilities' affirmative action policies.

It is to give you the benefit of the doubt -- which likely you do not deserve -- to say that you must not have read the initiative. Prop. 9 does not address affirmative action in any manner, directly or indirectly. There is no choice to be made between rate savings under Prop. 9 and affirmative action, unless you are referring to some private quid pro quo that you have arranged with the utilities in which PG&E has threatened it will terminate its affirmative action plans unless Prop. 9 is defeated. In other words, PG&E's agreement to be a socially responsible corporation comes with a $28 billion price tag that everyone must pay. If that is the threat that the company has made to you, that should be an indication of the one-sided and unempowered nature of the collaboration you have engaged in.

Your snide reference to "15 cents" savings per day for the poor is incorrect on its face: Prop. 9 will save residential ratepayers $250 per year, according to independent analyses. In any case, your dismissal of even a few pennies a day reveals that you have little empathy for those for whom every penny counts. Indeed, many great battles have been fought over modest amounts, as a reading of the history of the farm workers struggle led by Cesar Chavez would illustrate.

Or, could the reason for your opposition to Prop. 9 simply be that over the last three years, the states three utilities have won your loyalty with a lucrative "partnership" based on at least $300,000 of ratepayer money they have given you, according to PUC records, such that you are unwilling to bite the hand that feeds you - even as that hand crushes the state's ratepayers?

It doesn't really matter what the explanation is, John. This is but the latest in a series of deplorable betrayals by you and Bob, always accompanied by racebaiting letters in which you insist that white consumer advocates don't know how to protect the poor.

Time and again, it is the same. Shortly after Proposition 103 is approved by the voters, you stand with Insurance Commissioner Roxani Gillespie to say that 103 was a failure and will never survive a court challenge. (The truth is, it's delivered $1.2 billion for motorists and blocked $20 billion in rate increases). A few years later, you are standing with that great friend of the poor and minorities, Governor Pete Wilson, and the insurance companies, in support of no fault legislation that would have rendered poor people second class citizens with unconscionably low benefits, without even requiring that insurers end their redlining practices. It's 1996, and you are standing beside Insurance Commissioner Quackenbush and State Farm, in a public relations bonanza in which State Farm promises to sell $2.2 billion worth of auto insurance policies to the urban poor as a strategy to counter implementation of Prop. 103's requirement that territorial rating be ended. And, of course, after Quackenbush and State Farm milk the public relations benefits of your news conference, the commitment is never kept.

By now, the pattern is clear. An issue of public importance arises, usually involving corporate abuses or other questionable activity. The corporate institutions and their political allies are vulnerable, often under intense scrutiny; they seek legitimization and credibility, for which they are willing to pay. And there you are, ready to provide the cover, always in the name of minorities and the poor. Your organization has become expert in exploiting the legitimate needs of the poor and minorities, using poverty and oppression as leverage against the perpetrators. However, your efforts are always devoid of more than a few crumbs at most for the poor, symbolic gestures that are a cheap price for the utilities, insurance companies and banks to pay to obtain a seal of approval from self-appointed representatives of the poor.

Which leads me to refute the assumption explicit in the many presumptuous letters you have directed our way over the years: that you represent the interests of the poor, low income and minorities. After nearly a decade of watching your activities, we are convinced that your assertions, while they may have proven useful for big corporations, are not the reality now, if they ever were. The Greenlining Institute is a letterhead collection of organizations; the Institute itself has no discernible base in any community of color.

Indeed, the record of endless corporate negotiations, collaborations and tradeoffs by your organization deserves closer scrutiny, and I invite you to provide evidence that anyone other than your organization has significantly benefited from your activities.

I am well aware of your recent comments about "white" consumer advocates, referring to me. I will put our record of work and success on behalf of the under-represented, minorities and the poor against your record any day.

- We worked with legitimate community organizations like SCLC, SCOC, the NAACP and the Western Center to write and pass Proposition 103, which ends the discriminatory scourges of redlining, territorial rating, and rate gouging, as well as applies the Unruh Civil Rights Act to insurance companies. You were nowhere to be found in that landmark fight; nor have you fought, as we have, for its implementation for the last ten years, battling your allies Gillespie, Wilson, and Quackenbush.

- We fought 1996 Propositions 200,201 and 202, which would have deprived the under-represented of full compensation for their injuries and blocked their right of access to the courts - do I need to tell you how important that access has been in the history of civil rights? Other than a belated statement against the measures - and only after you considered supporting at least one of them -- you were nowhere to be found in the battle against them.

- We fought your ally Mr. Quackenbush's Proposition 213 on the November 1996 ballot, another effort to eradicate the rights of injured people on low incomes who cannot afford excessively-priced insurance to have their day in court, when they are in an accident which is not their fault. Other than a news release or two, you were nowhere. We sued to invalidate this grotesquely inequitable law; other than lending your name to that lawsuit, you have done no work on that litigation that we are aware of.

- We wrote and cosponsored Proposition 216 on the November 1996 ballot, a health care reform law which would have delivered millions of dollars to health care programs benefiting those on low or fixed incomes. As with the reforms of 103, these provisions were primarily addressed to low income people, but posed significant political risk. We took the risk. Why weren't you with us?

Proposition 9 is but the latest in a long series of efforts we have waged for justice and equality. You are not even in the game when it comes to these issues, and your constant insistence that you are authorized and better able to speak for minorities and the poor in this state is both an insult to the diversity of the people to whom you are referring and unmerited on the facts.

Which leads me back to the statement in your letter that you are not the enemy. The insurance, HMO, utility and other industries cannot hide the fact that they are the opponents of much of what we do. But they would like to. And Proposition 9 is merely the most recent example of you servicing their need for cover. What does that make you?

In the past, I have tried to overlook the profound concerns and matters I have raised in this letter, in light of the fact that there are so few individuals and organizations devoted to protecting the public interest. However, your opposition to Proposition 9 is extraordinary and repulsive and has convinced me that you and your organization are not amonog those dedicated few. If you care to disabuse me of that conclusion, I would be willing to extend you the courtesy of a meeting.

Sincerely,

Harvey Rosenfield

Copies sent to signers on October 15, 1998 letter


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