CALIFORNIA'S BILL COMES DUE.(ISSUES & INSIGHTS)(EDITORIALS)

"Terror" is the catchword of the day, so less important problems have faded from view -- such as Rep. Gary Condit, D-Calif., and budget surpluses. But some things have faded that shouldn't. California's energy crisis, for instance.

After the Sept. 11 terror attacks and a cool summer that kept energy use down, few people are talking about the Golden State's energy crunch anymore.

That's lucky for California Gov. Gray Davis. But too bad for everyone else, because the crisis is far from over.

Just last Friday, state Treasurer Phil Angelides warned that California could face a budget deficit of up to $10 billion unless regulators let the state sell $12.5 billion in bonds to pay for energy used last year.

In nearly the same breath, Angelides accused the state's Public Utilities Commission of fighting an "energy war" that's basically over.

Sorry, Mr. Angelides, but it isn't over. The $12.5 billion will have to be paid off. How? Through higher taxes and less spending on things people really want, like education.

If the state had just let prices adjust to the market last year, as we and many mainstream economists suggested, there would be no crisis today -- no need to float billions in bonds. We'd have weathered the storm -- with lower taxes -- because consumers, ...