Bush administration officials repeated Enron’s claims that California’s problems were caused by the state’s “flawed” deregulation plan—which was not “free market” enough—and strict environmental standards, which limited the construction of new power plants. Bush and Vice President Dick Cheney publicly opposed price controls, insisting that any such moves would be a disincentive for power companies to operate in the state.
Several weeks after the memos were written outlining the company’s strategy to manipulate California’s market, Enron CEO Kenneth Lay—the largest single contributor to Bush’s political career—successfully prompted the Bush administration to appoint free-market advocate Pat Wood as the head of the Federal Energy Regulation Commission. Once in place, Wood resisted the implementation of price controls for months while the crisis spun out of control.
After FERC was finally pushed to restrict price hikes in late April 2001 Cheney denounced the move, telling the Los Angeles Times, “Price caps are not a help. They take us in exactly the wrong direction.” After reiterating that only free market policies could resolve California’s problems, Cheney added, “I’ve never seen price regulations that I’ve felt very good about. If I had been at FERC, I would never have voted for short-term price caps.”