
PG&E falsified gas pipeline records for years after deadly explosion - WalterGR
https://www.latimes.com/business/la-fi-pge-safety-investigation-20181214-story.html
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TwoBit
Why would any company with a monopoly make any effort to improve itself? Fines
have zero effect, as they are just passed onto captured customers.

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im3w1l
Because people care about doing a good job. Because they want to be popular in
the community. Because the employees are afraid the law will go after them
personally.

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Gibbon1
I feel like our society discounts these first two motivations in favor of
money and punishment. And those are a very poor substitute a lot of the time.

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WalterGR
What do you mean? Could you expand on that?

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nicoburns
A good CEO of a company is considered to be one that provides the best return
on investment for the companies shareholders (this is often defended as a
morally upstanding attitude, especially in a US context).

If someone is a CEO, and they care about society and about doing a good job,
this will almost always mean passing up opportunities to maximise company
profits. For example, in this case a diligent CEO would ensure that the
company is paying for the maintenance of its equipment.

However, this isn't necessary to maintain revenue given the monopoly position
that the company is in. And thus a company board looking to maximise its
return on investment may choose to replace this CEO with someone who will
prioritise profit over things like societal good and doing a good job.

It is these shareholders that our legal/economic system gives power to. And a
majority of shareholders are amoral entities like pension funds who are not
concerned with ethics, but are simply looking to maximise profit.

Thus our society also takes on these values.

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bluejekyll
How is this not fraud? Fraud is a crime. If someone knowingly falsifies
documents, does that void the protection given by the corporations offer of
limited liability?

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mindslight
Corporate liability protection is what you run into when you go up the
management chain. When you go down the management chain, you end up at the
"fall guy".

The person who signed the falsified reports is likely in the second-lowest
level of employees (the lowest level of management), who was ordered by the
guy above him, who was pressured by the guy above him, who was incentivized by
the guy above him, who was winked at by the guy above him, who concocted the
scheme to please the guy above him, etc. Nobody really wants to see some low
level employee's life ruined and his kids starve simply for being the dummy
who accepted a promotion to sign the reports.

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bluejekyll
Yes, I agree, then it should fall on the CEO, who is responsible for signing
off on all of this activity, like financials.

You’re right that we don’t want the guys in the trucks getting busted for
fraud, but that shouldn’t mean that we allow the upper management to get off.

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int_19h
> You’re right that we don’t want the guys in the trucks getting busted for
> fraud

If they knowingly participated in it, why not? In the military, where
subordination is far stricter, there's still the concept of unlawful orders,
and subordinates are expected to refuse to carry out such orders - and if they
do not, they can be held accountable for that.

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anticensor
Some militaries explicitly lack the concept of unlawful orders and surprise
surprise - they are the least successful ones. Same thing also applies to
businesses. If you do not have a complaint procedure, _you acknowledge you are
incompetent_.

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confounded
As a foreigner who moved to California a few years ago, I’ve always been
puzzled by the existence of PG&E.

Why aren’t the infrastructure parts taken over by the state (or managed by an
accountable non-profit body), and competition encouraged for the customer
facing parts? Or maybe just do that via the state too, if there’s little
commercial interest?

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godzillabrennus
In America we tend to put emphasis on allowing a free market to thrive with as
little state involvement as feasible. It stems from the ideology that the free
market picks winners and losers better than a government. Americans often look
at our own Government as having a reputation for being much worse than a big
company. We tend to ascribe many of the same negative characteristics such as
being slow, wasteful, and lacking accountability.

Therefore Americans tend to prefer that private companies are allowed operate
a business for profit will produce a more desirable product/service for the
market. When they fail a correction in the market should occur and the
business should fail. A competitor should be allowed to fill the void.

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matis140
PG&E is much worse than a private company. It is the weird result of heavy
government regulation on the wrong most ant-competitive ways + lots of
lobbying. PG&E is not subject to any free markets. Cali for example has 3 of
these companies each serving certain regions. When there was completion in the
power market you had multiple companies inside cities all providing different
kinds of service (AC, DC, varying volts/amps) in crazy ways that would result
in most of our modern electronics getting baked. The standards were good. It
is however also difficult to have free market power when your cities heavily
regulate who can put up utility lines and where so poles don't get too ugly or
loaded. There are a lit of reasons what we have is worse than private or
completely public.

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woah
Good thing PG&E makes every usb charger or god only knows what would happen to
our phones

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jaytaylor
At what point does this kind of behavior warrant a replacement of 100% of the
executive staff? How can we make such a mechanism a reality to incentavise and
encourage better behavior?

Utilities are too damn important for the bottom line of humanity to allow
things to continue playing out in the same sad, pathetic, greedy fashion. The
point of having public utilities is to enable a high standard standard of
living so hopefully the really important problems can be solved before it's
too late. PG&E seems to think the primary goal is for the utility company to
be politically powerful and make cush millions for the execs. Sickening.

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chris_va
Well, PGE a pubic company (currently worth about $400/Californian).

It's a free country. If you are a shareholder, or affected by their gross
negligence, feel free to sue them to force a staff turnover.

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alexanderwept
It's not a free enough country that PGE customers can get their electricity
and gas from other vendors.

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chris_va
I acknowledge your point, but to be fair you should also acknowledge that the
status quo was conscious decision by voters (via representatives) to minimize
the cost of power for citizens. That may not have been a good choice, but we
are a long way from a non-free society.

On the plus side, you can now easily get solar + batteries + inverters as an
alternative :). Costs more, though.

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luckydata
PG&E is one of the greatest threats to safety and health of Californians. The
state government should do something soon about them, ideally, take them over
and turn them into a non-profit. We already bail them out anytime they have a
problem, but their incentives are completely out of whack with the public
interest.

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twblalock
The problems with PG&E were caused by the government giving it a monopoly.
Making it non-profit won't help. The only thing that will help is competition.

Until there is competition people will have no alternative but to pay PG&E for
power every month, so PG&E has no incentive to improve. If they get fined
they'll just make that money back from their captive customers.

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tkel
The problems aren't unique to PG&E. Any company for which profit is the
primary motive, they will seek to minimize costs. And safety is very
expensive. Which is why PG&E has been directly implicated in the deaths of
over 120 people and made homeless tens of thousands of people only in the last
2 years. I needn't get into why open markets aren't viable for many industries
e.g. roads, utilities, water treatment.

Eliminate the profit motive, and the service will be cheaper, safer, and
directly accountable to the people. The utility can operate at cost and not
jack up rates to pay shareholders or an $8M CEO salary. If there are any
profits, they will be funneled directly back into the utility.

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hueving
>they will seek to minimize costs. And safety is very expensive

If that were true, we wouldn't have private airlines because planes would be
falling out of the sky every day and nobody would fly.

Increase fines for negligence or make sure they can be sued (IIRC California
makes it difficult to sue PGE) if you want to fix the problem. Don't do
something as stupid as making it government run so it either becomes extremely
expensive, extremely unstable, and/or a tax burden for the state.

>Eliminate the profit motive, and the service will be cheaper, safer, and
directly accountable to the people.

Eliminate the profit motive and nobody will be incentivized to improve
anything. This will likely make it much more expensive in the long term. The
military has no profit motive either and they spend money like it grows on
trees.

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fyfy18
In the UK a lot of infrastructure (e.g. energy, fixed-line telecommunications,
railways) is run by for-profit companies that are heavily regulated by the
government, but the service to consumers is provided by separate for-proft
companies (sometimes owned by the same group who controls the infrastructure)
which compete on price and the service they provide.

From a consumer point of view this is good, as you have a choice over which
provider you use. On the other hand the actual service you get is going to be
the same from either provider, taking internet as an example, if you use the
common infrastructure the speed you can get will be the same from all
providers, and the only difference is in price and artificial limitations like
data usage. Maybe electricity is a better example, as the electrons you
receive will be exactly the same no matter which provider you use.

Although the infrastructure is run for-profit, there is only so much than can
be done on its own. The government regulations also limit upgrades, as they
favour spending on underserved areas. This means even if you live in the most
remote part of the UK you can probably get broadband internet (>1mbit), but in
major cities you are getting much slower speeds than what other parts of
Europe can provide (often no more than 70mbit).

Most of the infrastructure was inherited when it was privatised 20-30 years
ago, so all they have really done is run the infrastructure rather than build
it out. A good comparison is mobile telephone infrastructure, which in the UK
is exclusively owned, built and run by for-profit companies with minimal
government oversight.

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Reason077
> _In the UK a lot of infrastructure (e.g. energy, fixed-line
> telecommunications, railways) is run by for-profit companies that are
> heavily regulated by the government_

With the exception of HS1/Channel Tunnel, the vast majority of the UK's fixed
rail infrastructure (stations, tracks, land, etc) is publicly owned.

The train operating companies (TOCs) are, with some exceptions, privately
owned. But because of the way they are franchised and regulated there is
little competition between them, so it's quite different to the electricity or
internet markets.

> _taking internet as an example, if you use the common infrastructure the
> speed you can get will be the same from all providers_

Not necessarily. Although each provider may share a common "last mile"
infrastructure, ie the lines that run to your house, they must each arrange
their own equipment and backhaul in the local exchange where that line
terminates. Not all backhauls are equal and some providers perform better than
others, especially at peak times.

> _Maybe electricity is a better example, as the electrons you receive will be
> exactly the same no matter which provider you use._

Every unit of electricity you use has to be generated somewhere - and not all
sources are equal. As a consumer, I might place a premium on low-carbon
electricity, and choose a provider which promises to purchase only from wind
turbines and other low-carbon sources.

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mistrial9
two more links:

[https://www.reuters.com/article/us-cpuc-pg-e-
us/california-r...](https://www.reuters.com/article/us-cpuc-pg-e-
us/california-regulator-opens-case-against-pge-for-falsifying-pipeline-safety-
records-idUSKBN1OE01S)

[https://www.opb.org/news/article/npr-pge-falsified-gas-
pipel...](https://www.opb.org/news/article/npr-pge-falsified-gas-pipeline-
safety-records-regulators-say/)

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hemantv
Unless people are made individually responsible for their actions. The fines
are easy way when you get caught.

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mrhappyunhappy
The same PG&E responsible for drinking water contamination with hexavalent
chromium? Interesting. At some point monopolies and mismanaged companies
should probably be dissolved and negligent management directly responsible
imprisoned.

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foobar1962
> At what point does this kind of behavior warrant _inprisonment_ of 100% of
> the executive staff?

Fixed that for you.

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WalterGR
It’s iMprisonment.

I’m going to delete this comment... No need to reply.

