Speaker 1: Well, we are supposed to be on hiatus to produce
Speaker 1: the next season, but stuff keeps happening that they just
Speaker 1: can't leave alone.
Speaker 2: I'm Tracy Townson.
Speaker 3: We begin to MTV News at noon today with breaking
Speaker 3: news the arrest of Ohio House Speaker Larry Householder.
Speaker 1: That news is sending shockwaves through the political world.
Speaker 4: Today, Ohio House Speaker Larry Householder says he will not
Speaker 4: resign on the same day of his arrest on bribery charges.
Speaker 4: Federal prosecutors say his arrest is just one piece of
Speaker 4: a complicated puzzle for.
Speaker 5: Today to announce the arrest of Larry Householder, a Speaker
Speaker 5: of the House the state of Ohio, and four other
Speaker 5: defendants for racketeering in relation to what is likely the
Speaker 5: largest bribery money laundering scheme ever perpetrated against the people
Speaker 5: the state of Ohio.
Speaker 3: Last week, the FBI arrested Ohio's Speaker of the House,
Speaker 3: Larry Householder. He was the architect of a piece of
Speaker 3: legislation called HB six, which passed last year in July
Speaker 3: July twenty nineteen. That bill was widely recognized as a
Speaker 3: terrible piece of energy policy. It essentially gutted Ohio's renewable
Speaker 3: and energy efficiency laws and incentives and bailed out several
Speaker 3: coal and nuclear companies. Today, we have on UC Santa
Speaker 3: Barbara political science professor Leah Stokes, who wrote about this
Speaker 3: law in her book on corrupt utilities called short Circuiting Policy.
Speaker 3: Stokes wrote that this law in Ohio is a multi
Speaker 3: billion dollar gift to First Energy, a private electric utility
Speaker 3: that has resisted climate policy for decades. In her recent
Speaker 3: Vox article about the current scandal, Stokes wrote, it turns
Speaker 3: out it was a gift paid for with sixty one
Speaker 3: million dollars in bribes. This story is nuts, and there's
Speaker 3: probably no one in the country who knows more about
Speaker 3: it than Lea Stokes right now. So we're excited to
Speaker 3: talk to her. We'll have that conversation right after this
Speaker 3: quick break from today's sponsor.
Speaker 1: Lea Stokes. We are so glad you're here. What the
Speaker 1: heck is happening in Ohio right now?
Speaker 6: Well, it goes back way farther in time. I first
Speaker 6: started working on this in twenty thirteen, and at that
Speaker 6: time a different legislator who I wonder when his day
Speaker 6: of reckoning is coming, named Bill Sites. He was working
Speaker 6: to try to get rid of the renewable energy and
Speaker 6: energy efficiency laws that had been passed in a bipartisan
Speaker 6: way in Ohio, and he was actually working with somebody
Speaker 6: named Sam ren Dazzo, who at the time was a
Speaker 6: lobbyist for the industrial energy.
Speaker 2: Users of Ohio, basically a.
Speaker 6: Big industrial company consumer of electricity that includes probably fossil
Speaker 6: fuel companies and as it does in many states, manufacturers
Speaker 6: that kind of thing. Well, fast forward if your Sam
Speaker 6: Rendazzo is now the head regulator at the Ohio Public
Speaker 6: Utilities Commission, which you're just like really anyway, they were
Speaker 6: trying to gut the renewables and energy efficiency laws to
Speaker 6: some degree.
Speaker 2: John Kasick was opposed to that, although.
Speaker 6: Certainly not enough, and so they only managed to freeze
Speaker 6: the roll back of the energy efficiency and renewable energy laws,
Speaker 6: but it still put huge damage in the industry. And
Speaker 6: at the same time, Keith Faber, who was another part
Speaker 6: of the legislative leadership at the time, he put in
Speaker 6: a budget bill a rider, a sort of line item
Speaker 6: that changed the setback rules for wind turbines, which basically
Speaker 6: means how far from a property line or a building
Speaker 6: does a wind project need to be and that completely
Speaker 6: gutted the wind energy industry in Ohio. And John Kasik
Speaker 6: as governor, could have line item vetoed that changed, but
Speaker 6: he didn't. And so there was all these shady things
Speaker 6: going on to try to mess up renewables and energy
Speaker 6: efficiency in Ohio. And who's interest did that serve? It
Speaker 6: served First Energy and AEP and other utilities interests because
Speaker 6: they had all these exis existing plants, coal plants, nuclear
Speaker 6: plants that they needed to keep operating. And if they
Speaker 6: were being forced to build new clean energy renewables, then
Speaker 6: how are they going to keep that stuff working? And
Speaker 6: at the same time, Ohio was also going through this
Speaker 6: electricity restructuring and suddenly a lot of the plants that
Speaker 6: First Energy and AEP had invested in were struggling financially.
Speaker 6: I mean they literally were losing money in the market
Speaker 6: every time they operated. So with all that going on,
Speaker 6: First Energy started to lobby the Trump administration actually to
Speaker 6: get a bailout for their coal plants, and they tried
Speaker 6: that for several years around sort of twenty seventeen. In fact,
Speaker 6: the Energy and Policy Institute, a wonderful watchdog of utilities,
Speaker 6: has shown that the First Energy corporate jet has flown
Speaker 6: to DC over thirty times since the trumpetministration began, and
Speaker 6: that Rick Perry, the former Secretary of Energy, has probably
Speaker 6: met with the CEO of First Energy. So they were
Speaker 6: lobbying very heavily the Trump administration and as possible that
Speaker 6: this is where the Firk minimum Offer price rule came from.
Speaker 6: This is basically a coal plant subsidy that was put into.
Speaker 2: The rules a couple of years ago.
Speaker 1: Now.
Speaker 6: Anyway, so they're doing all these corrupt things and it
Speaker 6: wasn't quite paying their bills, and so they decided to
Speaker 6: get a bailout on the agenda at the beginning of
Speaker 6: twenty nineteen when Larry Householder became the Speaker of the
Speaker 6: House of Representatives in Ohio, and that's when things really
Speaker 6: started to pick up.
Speaker 1: Okay, so what exactly was HB six, What was this
Speaker 1: bailout legislation?
Speaker 6: Yeah, so in twenty nineteen, when Larry Householder became Speaker,
Speaker 6: it was actually a really big fight for him to
Speaker 6: get that role.
Speaker 2: People may not know this.
Speaker 6: But Larry Householder was Speaker before and he ended up
Speaker 6: leaving that role because of an FBI investigation in sort
Speaker 6: of these allegations of corruption, this cloud of corruption surrounding
Speaker 6: him back in the early two thousands, so he wasn't
Speaker 6: a popular pick. But what happened was all of the
Speaker 6: candidates running for the House of Representatives who supported Larry
Speaker 6: Householder suddenly had a lot of campaign money. They were
Speaker 6: doing very well in their elections, and people noticed that
Speaker 6: it was all of the candidates who had that money,
Speaker 6: the shadowy support, who ended up voting for Larry Householder.
Speaker 6: So he won the role of Speaker, and with that power,
Speaker 6: he began to do the bidding of First Energy. First
Speaker 6: Energy at that time had spun off its generation assets,
Speaker 6: its nuclear and coal plants that were these are projects
Speaker 6: that weren't really doing very well. They were losing money financially,
Speaker 6: and they'd put it in this new company called First
Speaker 6: Energy Solutions. That company has now rebranded into Energy Harbor.
Speaker 6: It's a way that these utility companies try to avoid scrutiny.
Speaker 6: They changed their names all the time, but it was
Speaker 6: called First Energy Solutions at that time. And what they
Speaker 6: that was owned by a hedge fund and a bunch
Speaker 6: of hedge funds, and these investors really wanted to get
Speaker 6: their money back, and so it started to seem like
Speaker 6: they were putting money a few million dollars, let's say,
Speaker 6: into lobbying and potentially even into campaign ads. So an
Speaker 6: organization called Generation Now popped up on the scene, and
Speaker 6: nobody really knew where this organization came from, and they
Speaker 6: were spending money on mailers to people saying that HB six,
Speaker 6: this law, which was a bailout for nuclear and coal plants,
Speaker 6: that this had to be passed, and that you know,
Speaker 6: it was so in the interests of Ohio wins and
Speaker 6: if you weren't for it, it was because you you know,
Speaker 6: the Chinese government was corrupt and somehow involved in Ohio's
Speaker 6: energy system, which just completely bonkers. The Chinese government has
Speaker 6: absolutely nothing to do with anything. And it passed, and
Speaker 6: I mean, I'm telling you, the legislative session was done,
Speaker 6: everybody had gone home, and First Energy just kept saying,
Speaker 6: we need that money, you know, we got to get
Speaker 6: that money, and they also kept changing how much money
Speaker 6: they needed exactly, and the law ended up getting written
Speaker 6: in a way that First Energy Solutions would never need
Speaker 6: to open up their books or explain what they were.
Speaker 2: Going to do with this money.
Speaker 6: So they ended up calling a last minute vote which
Speaker 6: actually Governor DeWine, a staffer from his office initially was
Speaker 6: going to get a state taxpayer funded plane to go
Speaker 6: pick up the legislators to bring them back to the
Speaker 6: state House so that they could vote on this last
Speaker 6: minute corporate bailout. That's how crazy it was. And by
Speaker 6: narrow margins, householder delivered the votes and the bailout went
Speaker 6: into effect. Now, even though it passed into law, a
Speaker 6: bunch of advocates who thought this was a terrible corporate
Speaker 6: bailout for polluting dirty coal plants, they tried to do
Speaker 6: a ballot initiative basically in Ohio, if you pass a law,
Speaker 6: you've got I believe it's sixty or ninety days, I
Speaker 6: can't remember which one, where you can collect a bunch
Speaker 6: of signatures for the people of Ohio and that allows
Speaker 6: you to get it on the ballot so that the
Speaker 6: people can vote to overturn that law that was passed.
Speaker 6: And so a bunch of groups, including in fact some
Speaker 6: fossil fuel interests, because they didn't like the bill for
Speaker 6: other reasons, they started to try to collect signatures and
Speaker 6: these signature collectors suddenly were being literally physically assaulted on
Speaker 6: the street by people that nobody knew who they were.
Speaker 6: There were these mailers going out saying that if you
Speaker 6: signed the petition, the Chinese government would have your personal information. Again,
Speaker 6: completely bonkers, you know. In fact, these petition signers were
Speaker 6: being bribed the people collecting the signatures to get rid
Speaker 6: of the signatures or to go home early.
Speaker 2: I mean literally, they were.
Speaker 6: Like, hey, are you collecting signatures? We'll give you some
Speaker 6: money to stop doing it, or hey, how many signatures
Speaker 6: do you have? If you tell us how many signatures
Speaker 6: you have, will give you money because we need to
Speaker 6: know how close you are to having enough signatures. And
Speaker 6: people were like, where's all this money coming from? You know,
Speaker 6: who has all this money to do anti democratic organizing?
Speaker 6: And shockingly, in the face of all that opposition, the
Speaker 6: advocates did not get enough signatures for their ballot initiative.
Speaker 6: And HB six's a terrible corporate bailout remains in law.
Speaker 6: And it was kind of an open secret that Larry
Speaker 6: Householder was involved in all of this. We all knew
Speaker 6: because somebody was funding his speakership by getting all these
Speaker 6: people elected. You know, somebody was funding all this political
Speaker 6: activity to stop the ballot initiative effort, and well, we
Speaker 6: discovered this week when the FBI arrested Larry Householder I
Speaker 6: believe at his farm in Ohio, that it was Larry
Speaker 6: Householder and First Energy this whole time, and that they
Speaker 6: had been funneling over sixty million dollars into this organization
Speaker 6: called Generation Now and a bunch of shady sort of
Speaker 6: front groups to do all of this corrupt activity.
Speaker 1: Okay, So now that Householder has been arrested along with
Speaker 1: a few of his cohorts, it sounds like what happens
Speaker 1: to this HB six. Does it automatically get put back
Speaker 1: on the ballot for a vote or get repealed? What
Speaker 1: kind of happens there?
Speaker 6: Well, a lot of people, for example, Lisa Friedman in
Speaker 6: the New York Times, A lot of people are asking,
Speaker 6: how is this a legit gitimate law if it was
Speaker 6: passed based on corruption.
Speaker 2: I mean, let's be.
Speaker 6: Clear, Larry Householder got five hundred thousand dollars half a
Speaker 6: million dollars of personal benefits as part of this sixty
Speaker 6: million dollar scheme. We're talking about three hundred thousand dollars
Speaker 6: to pay down a legal conflict that he was having
Speaker 6: in his legal fees. One hundred thousand dollars towards his
Speaker 6: vacation home in Florida, which he wasn't keeping up with
Speaker 6: the taxes on, and another one hundred K ninety seven
Speaker 6: thousand specifically for his own re election efforts. So he
Speaker 6: was personally benefiting, personally enriching himself based on this money.
Speaker 6: And so how is it legitimate that he passed this law?
Speaker 6: And he really did, I mean, he got the votes,
Speaker 6: he worked very diligently for six months to do this.
Speaker 6: And then how is it legitimate that the public didn't
Speaker 6: have any say because there was thirty eight million dollars
Speaker 6: put into literally physically assaulting, bribing petition signatures collectors. I mean,
Speaker 6: so a lot of people are saying HB six is
Speaker 6: not a legitimate law. It was never a legitimate law,
Speaker 6: quite frankly, because it was a corporate bailout and it
Speaker 6: was paid for by the same corporation that it was
Speaker 6: benefiting from the money.
Speaker 2: So Governor DeWine.
Speaker 6: Had called for Larry Householder to resign as Speaker, but
Speaker 6: he had not called for the bill to be overturned
Speaker 6: or for the legislature to meet and try to overturn
Speaker 6: and change HB six. So I called him out on
Speaker 6: that other advocates have to and today he didn't about
Speaker 6: face and said, oh, I do think we should revisit
Speaker 6: this law. And you know what I'm asking is there's another.
Speaker 2: Guy named Larry. His name is Larry Abhoff and he's
Speaker 2: the Senate President.
Speaker 6: And Larry Obhoff has called for Larry Householder's resignation, but
Speaker 6: again as not called HB six to be overturned. And
Speaker 6: let's be clear, Larry Allpoff also took money from First Energy.
Speaker 6: Governor Dwine took money from First Energy. Most legislators in
Speaker 6: the state of Ohio have taken money from First Energy.
Speaker 6: And I think that we have to ask ourselves why
Speaker 6: is any politician taking utility money. It is so corrupting
Speaker 6: it should not be okay.
Speaker 1: And we're talking about this First Energy private utility that was,
Speaker 1: you know, essentially paying off politicians to try to get
Speaker 1: this legislation passed. What exactly do they get out of it?
Speaker 1: I know there's been some talk of nuclear plans being
Speaker 1: kept open maybe longer than they should have been. What
Speaker 1: all did they get for this investment?
Speaker 2: Yeah, it's a return on investment issue.
Speaker 6: If you are a hedge fund that has bought First
Speaker 6: Energy Solutions. You think, look, let's put a few million
Speaker 6: dollars into this, we'll get a couple billion in return.
Speaker 6: If you look at the FBIFA David, the people working
Speaker 6: in this conspiracy literally described the money as unlimited. They said, look,
Speaker 6: we have as much money as we need because they
Speaker 6: understood what the benefit would be. The return on investment
Speaker 6: is sixty million for a few billion dollars. I mean,
Speaker 6: there's so much focus on the nuclear bailout, which is
Speaker 6: about one point three billion dollars, but there's a whole
Speaker 6: other bailout for several coal plants that were in this
Speaker 6: bill that's probably more about two times as large as
Speaker 6: the nuclear bailout. So I estimate that it's something like
Speaker 6: three billion dollars that we're talking about here. And keep
Speaker 6: in mind that a few days after HB six was
Speaker 6: put into law, a spokesperson for First Energy said, oh,
Speaker 6: that Samus coal plant that we were planning to shut down,
Speaker 6: we don't need to shut it down anymore. And their
Speaker 6: CEO of First Energy Solutions, John Judge, had said that
Speaker 6: if we get that bailout money, we will have forty
Speaker 6: to fifty million dollars to put into to the Samus
Speaker 6: coal plant. So this is a coal plant bailout that's
Speaker 6: keeping the Samus plant open and several of OVEK plants
Speaker 6: open as well. So you know, a lot of focus
Speaker 6: has been on the nuclear plants, but it's really a
Speaker 6: coal bailout in my view.
Speaker 1: Okay, And then I know you wrote a whole book
Speaker 1: about corrupt utilities and how they have shaped policy for years.
Speaker 1: But where does this kind of fit into that? Where
Speaker 1: does this fit into the larger issue of utilities being
Speaker 1: influenced by various companies to shape energy policy in their favor.
Speaker 6: It's called short circuit policy, and it's about how corrupt
Speaker 6: the utilities are.
Speaker 2: And there's a fascinating.
Speaker 6: History of the electric utility sector. Way back in the
Speaker 6: early twentieth century. There was a person named Samuel Insul
Speaker 6: and he's actually the guy who came up with the
Speaker 6: way our utility system works. He invented the idea of
Speaker 6: a monopoly utility that had a public utility commission that
Speaker 6: would oversee it at the state level. And you know,
Speaker 6: there are quotes from that time that say, for you know,
Speaker 6: a decade, he was the most powerful business operator in
Speaker 6: the United States. And that really is how it is
Speaker 6: state by state. These companies are often the most powerful
Speaker 6: company in a given state. If you take Arizona Public Service,
Speaker 6: for example, you know they are extremely corrupt. They have
Speaker 6: spent over fifty million dollars on elections for their own regulator,
Speaker 6: fighting against a clean energy ballot initiative. And you know,
Speaker 6: it's hard to get clear on how terrible they are
Speaker 6: because they are funding the campaigns of a lot of
Speaker 6: politicians in that state, and a lot of community groups,
Speaker 6: you know, soccer clubs, probably United Way campaigns, you know,
Speaker 6: social welfare organizations. These groups take money from utilities, and
Speaker 6: so they end up being a kind of octopus that
Speaker 6: has its tentacles in all different parts of the state.
Speaker 6: And so I think it's hard for people in a
Speaker 6: given state to get clear on how corrupt and problematic
Speaker 6: these monopoly utilities are. And then across the whole country,
Speaker 6: because there's so many different utilities in different states, it's
Speaker 6: hard for people to get the same sort of big
Speaker 6: picture as they would for a company like Exon that
Speaker 6: operates across the whole country and the world, or Chevron.
Speaker 6: You know, these companies like Southern Company are in a
Speaker 6: couple states, or First Energy, right and they're also changing
Speaker 6: their names all the time, right, Or they have subsidiaries,
Speaker 6: so you've got Southern Company as the parent corporation, but
Speaker 6: then they've got Georgia Power, for example, or Alabama Power,
Speaker 6: and so it's a really complicated area that makes it
Speaker 6: hard for people to pay attention. But I'm hopeful that
Speaker 6: we're in a moment right now where the corruption is
Speaker 6: just so blatant that maybe we'll start to get more
Speaker 6: attention on really proper oversight and limits on spending from
Speaker 6: utilities on political activity.
Speaker 1: Okay, that's it for this time.
Speaker 3: Check out Lee's book is fantastic, a real deep dive
Speaker 3: into how electric utilities have been architects of climate denial
Speaker 3: and have really picked favorites when it comes to energy sources.
Speaker 3: I thought I knew a lot about utility corruption, and
Speaker 3: I learned a ton reading this book.
Speaker 1: So check that out. We'll stick a link in the
Speaker 1: show notes. Thanks for listening, and we'll see you next time.