Dan Walters: Davis vs. Lynch -- or is the feud a charade to shield the governor?
When Gov. Gray Davis named political operative Loretta Lynch to the state Public Utilities Commission -- and insisted that she become the PUC's president as well -- it was in keeping with Davis' long-established mode of personally controlling major political levers. 
All of that occurred, however, before California was plunged into the "energy crisis," an infuriatingly complex amalgam of politics, economics, power supply and distribution, and such uncontrollable factors as the weather. 
When the first strains were felt 1 1/2 years ago, Davis and Lynch reacted, as one might expect, in tandem and, as later experience proved, poorly. They refused, in effect, to intercede with some steps -- such as long-term, low-price supply contracts and perhaps small rate increases -- that would have prevented the situation from deteriorating into a crisis. 
Last January, when the financial plight of the privately owned utilities brought the threat of major power blackouts, Davis and Lynch were forced to act. But within a couple of months, the previously inseparable partners began cleaving apart, at least publicly. 
At Lynch's behest, the PUC enacted a stiff rate increase while Davis claimed that she and the PUC had acted on their own, without his knowledge. It was widely seen at the time as a ploy, one that would bring about a rate boost that every authority knew was necessary, without forcing Davis to publicly change position. 
Since then, the two have continued to act in seemingly divergent ways. The PUC stepped into the political stalemate over Southern California Edison, for example, working up a secret deal that apparently will protect the utility from bankruptcy without having to win legislative approval. And the PUC has opposed the authority sought by the Davis administration to finance bonds that would pay for past and future state power purchases. 
Administration officials are publicly critical of Lynch and the PUC and circulate stories that Davis considers her to be an impediment. One version had Davis dumping her as president of the PUC in favor of a friendlier member. And PUC officials insist that Lynch is just acting to preserve the historic independence of the agency, first created nearly a century ago as a bulwark against the out-of-control Southern Pacific railroad. 
A lengthy article in Monday's Los Angeles Times traced the history of the Davis-Lynch relationship and, in effect, endorsed the conventional wisdom that the two erstwhile political allies had grown apart under the strain of the energy crisis. 
That may be true, but the intensity with which that interpretation of events is being peddled makes one suspicious that it's just another ploy aimed at protecting the governor's backside from the fallout of his less-than-deft handling of the energy situation. Polls indicate that it's the primary reason why his public approval rating has dropped dramatically this year, thus making his re-election next year less than certain. 
By doing the deal on Edison -- supposedly without Davis' knowledge -- Lynch saved the governor from a huge embarrassment. He had gone to the mat for the utility but was rebuffed by a Legislature dominated by his own party. He had called a special legislative session on Edison but had been told that he would lose again. 
Holding up approval of the administration's bond-power contract scheme is often cited as the most powerful evidence of a schism between Davis and Lynch, but she may be doing the governor a big favor in that arena as well. The contracts signed by the administration are much too expensive and, if implemented, will cost ratepayers billions of extra dollars over the next decade. Davis needs to dump them, but if he acts directly, he'll have to admit that he made a mistake. If the PUC continues to hold up the necessary authority, he can use that as a lever to force suppliers into whittling down prices, or even abandoning the contracts altogether -- without having to take responsibility for reneging. 
Maybe Davis and Lynch are feuding, but it could all just be a charade to fool the public and protect the governor.