Oct 19, 2010 || World News

Tuesday, October 19, 2010

Obama's Farewell Address

http://www.humanevents.com/article.php?id=39421

Obama's Farewell Address

Posted 10/19/2010 ET

It was an unseasonably mild day for Washington in January, 2013. Barack Hussein Obama stood presidentially but grimly in a dark overcoat, unadorned by a Presidential flag and unaccompanied by his wife. She had prior holiday commitments on the Costa del Sol in Spain, where it was known she had several good and welcoming friends.

For the Obamas and for the left in America, the unthinkable had happened. We who had finally gotten who 'we had been waiting for,' were not waiting for anything anymore but the departure of he who had brought America hope and change. So much hope and change had been delivered in the President's four years that the country had become almost unrecognizable, which was judged to be wonderful in some quarters, though not so much with the majority of the American people. Thus, the crowd, vastly fewer in number than at his inauguration, was preparing to hear the Farewell Address of President Barack Hussein Obama.

(This introduction was accompanied by a gentle crossing of the President's left hand, with his middle finger extended, and pausing, while it crossed his face. It was a gesture often used by the President during his Administration, thought to be a somewhat odd and/or nervous gesture on the part of the former Executive. This movement of his finger happened with a disconcerting frequency during the President's Farewell Address).

Obama began with a gracious 'shout out' (unknown exactly, what that is) to thank everyone who had served him so faithfully, but he seemed to soon realize that most of them were long gone. After thanking Rahm Emanuel, Anita Dunn, Van Jones, Larry Summers, Christina Rohmer, Desiree Rogers, Peter Orzag and General James Jones, among others, he just sort of…gave up.

Then, the unforgettable words of the Farewell Address of Barack Obama began thus:

"The American people have spoken, and must be responded to. But before this huge mistake on the part of the electorate goes into effect, I want to be sure that you understand the colossal error that you folks have made.

As you know, I came here to heal, not just the planet but the nation, and you, the American people, did not allow me to thus heal our very sick planet and our deeply troubled country. I came here to give the people of this nation hope, and you refused to accept that hope in bringing about a better nation. I came here to change the innumerable wrongs that this country has and still perpetrates in oppressing not only its own people, but so many peoples of other nations in the world, and you refused to allow me to affect this change. I came here to cleanse the nation of the many evils and incompetencies of the preceeding Administration, and you would not let me finish in dispensing with these in creating a better nation. I came here to raise America's status in the eyes of the world, and even though America's friendships with our enemies' rulers were growing by leaps and bounds thanks to my efforts, you would not let me complete this process. I came here to bring about elevating the status of the world of Islam to our own level and hopefully beyond to make our Muslim brothers and sisters all that they can be, and you aborted that necessary effort.

I came here to fundamentally transform the United States of America, and you rejected the fundamental transformation that would have made America truly great for the first time in its history.

By rejecting me, and the good I had just started to bring to you, you have sealed your fate in languishing in the putrefaction of the status quo in America. It is true that many of you believed, and many of you agreed that "Yes, We Can," or could have, but it was those who cling to their religion, their guns and their bitterness, who won out. They won because the amount of lies and distortions spread through the land about me and what I wanted to do to help the United States of America become the land it could be, and now never will be, was unprecedented.

They won because of the relentless and unjustified hostility of the Congressional Republicans, who categorically and universally refused to allow me and my Administration do what was necessary to help the American people. They won because of the unceasingly vicious and untrue things said about me and my Administration on Fox News, and all over the airwaves by those who always wanted me to fail. They won because those representing special interests, corporate greed and racist behavior were permitted to triumph in this land.

My and my Administration's efforts to heal all that is wrong in America was most likely the last and greatest effort to bring America into the world community, and try to strip it of its overweening, arrogant and imperialistic ways. This failure, and I cannot sugar coat this, will bring about dire consequences to this nation and its people. Without my leadership, Americans will continue to severely wound our beloved and beleaguered planet; the race divide in our nation will grow even greater; the poor will become poorer and the rich become richer; the citizenry will become sicker; the good government can do will now be kept from happening because of the peoples' refusal to fund such necessary operations; and one of the most magnificent accomplishments of the many of my Administration, achieving health care for all Americans for the first time in our nation, will be relegated to the trash heap of history.

With my departure as your President, without my guidance, our nation's misguided majority will become sicker, fatter, stupider, more racist, more divided, more homophobic, more Islamophobic, more arrogant and more isolated from the rest of the world than ever before. It is a tragedy that I can no longer prevent because the power to help this nation, to make it what it could be, has been wrested from the hands of the only man who could do it.

Future generations will look back at this grave mistake in the course of America's history and will weep with remorse for this tragic reversal of fortune for America.

There is, however, a positive future I can promise you, and that is to tell you that I am not saying goodbye, but au revoir.

That's French for I'll be back.

The people who voted against my maintaining my leadership are losing their majority in America, and they are doing this sooner rather than later. This can be described, especially by a mutt like me, as justice, as the oppressors – the white man - who abound and have abounded in America since its inception are about to be ruled, rather than rule. And those who will be taking over from them understand full well why the coming one-world government is the only thing that will work to achieve what is necessary for the betterment for all mankind.

When this one-world government takes over, as it is we who the world has been waiting for who will rule, as the world will turn to me. And as I have always done, when called upon I will be there for those who need me.

To provide the hope that only I can, I will accept this challenge, a challenge started but left unfinished due to the actions of the fickle populace of the United States of America. I stand ready to lead this one-world government, and resume my work on behalf of the folks; only this time it will not be solely for the benefit of the American people, but for the benefit of all mankind. America will finally become what it should be, which is one nation among many, with none of the undeserved attributes of a nation above others. There is no such place for any nation in the new world order, which, Allah be praised, I will lead.

So this is not goodbye, which I know buoys many of you as it should, and to you I say, keep the faith. We will be back, and soon, and we will put the United States of America where it truly belongs. And to my faithful, you will again be where you belong, which is at the forefront of this new ruling order, where we all can again, heal the planet, lower the oceans, bring health care to everyone, stop corporate greed, bring our Muslim brethren into the global prominence they deserve, open individual nations' borders, especially those of the oppressive United States of America, and bring all people of the world together in love, peace and harmony.

I take this opportunity to say to the world that the hope and change I could have brought to America, and in their ignorance refused, that I can bring to you, and is in fact now destined for you, the world community. This wondrous effort is no longer being made exclusively for the ungrateful people of the United States of America, it is now directed at a more grateful world.

Thank you, Allahu Akabar, and a bientot. The last is French for be with you soon."

I now wish the best of luck to President Christie and Vice President Palin.

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Is the EPA Trying to Murder the USA?

Environmental Protection Agency, Carol Browner is a dedicated Socialist, but Lisa Jackson is a bounce-off-the-walls enviro-wacko

Is the EPA Trying to Murder the USA?

By Alan Caruba Monday, October 18, 2010

Day after day the news arrives regarding some new announcement by the Environmental Protection Agency that is often so bizarre that it seems a parody of regulation, science, and common sense.

Most people don't have time to pay attention to the cast of characters setting the agency's agenda but these days that includes the president's top environment advisor, Carol Browner, a former EPA director under Bill Clinton, and Lisa Jackson, the current administrator, an acolyte of Browner and, if possible, more obsessed with destroying the nation than her former boss.

Browner is a dedicated Socialist, but Jackson is a bounce-off-the-walls enviro-wacko for whom real science is a great nuisance while pseudo-science is a blunt instrument with which to impose a regime that will destroy the economy and take down the whole nation.

At the heart of the EPA's latest initiatives is the thoroughly debunked theory of "global warming"; that carbon dioxide (CO2) is "causing" it, and that human beings are producing too much CO2 by using various forms of energy such as coal, oil, and natural gas. All three assertions are utterly and completely false.

As you read this, the Earth's atmosphere is composed of 76.55% nitrogen, 20.54% oxygen, 0.91% argon, and 0.0389% carbon dioxide. Of the so-called "greenhouse gases", the largest is water vapor—clouds.

When the EPA recently announced it had lifted the cap on how much ethanol had to be mixed with gasoline to increase the consumption mandates in the 2007 energy bill from 10% to 15%, it set off a firestorm of resistance. At the last count, more than 90 companies and trade associations have filed legal challenges.

The ethanol mandate was and is bogus. When mixed with gasoline, ethanol actually produces more CO2. It reduces the mileage per gallon and, in the process, damages automobile engines because it is corrosive. Made primarily from corn, it drives up the cost of countless food products. Its use is solely dependent on government mandates and subsidies. It is moonshine.

While companies and jobs depart the United States, the government flushes billions down the green toilet subsidizing ethanol, wind and solar energy.

The EPA has been asserting the right to regulate CO2, claiming that the 1970 Clean Air Act permits this. It does not.

When the State of Texas protested, The Wall Street Journal noted that Ms. Jackson was "threatening to punish Texas and other green dissenters with a de facto moratorium on any major energy or construction projects." The Obama EPA is not run by touchy-feely tree huggers. "Put bluntly," said the Journal, "this coercion is illegal."

In an October 10 editorial, the Journal warned, "the EPA decision to strip permitting authority from the states is tantamount to a ban on major construction or building expansion—not merely Texan refineries, but any kind of carbon-heavy utility, industrial production, manufacturing plant or even large office buildings."

The authority it claims would enable the EPA to shut down every kind of industrial activity or construction project nationwide.

We have witnessed the damage the Obama administration's moratorium on oil drilling in the Gulf of Mexico has wrought. Despite two court rulings that it was illegal, the administration ignored them and, only when it concluded that the moratorium might cost Democrats votes in the midterm elections, was it lifted.

This is the most anti-energy administration in the nation's history and it poses a grave threat to the economy.

CNSnews.com reported on a June 3 EPA statement, noting that "Tough new rules proposed by the Environmental Protection Agency restricting greenhouse gas emissions will 'slow construction nationwide for years'—but will only reduce global temperatures 0.0015 (15 ten-thousandths) of a degree Celsius in the next century."

Mother Nature is already reducing worldwide temperatures as the result of a natural cooling cycle that began around 1998. We are more than a decade into a cycle that some meteorologists fear could become a new Little Ice Age.

A GOP minority report on the EPA's greenhouse gas emission reduction proposals estimated than more than 800,000 jobs would be put at risk with no evidence of any environmental benefit.

In January, the EPA proposed lowering the ozone national ambient air quality standards from 75 parts per billion (ppb) to between 60 and 70 ppb. A study by the Manufacturer's Alliance/MAPI declared that the EPA's proposed revision of the "primary" (health based) standard would have "devastating economic impacts."

The study estimated the new ozone standard would impose compliance costs of $1.013 trillion between 2020 and 2030 with a resulting reduction of GDP of $687 billion by 2020. They estimate 7.3 million jobs would be lost by 2020.

Ozone and carbon dioxide levels, and even levels of airborne dust are the Trojan horse the EPA is using to wreak havoc on an already fragile economy and rising levels of unemployment.

If the EPA is permitted to have its way, in ten years the economy will have been effectively destroyed. This all-encompassing federal agency gives daily evidence of trying to murder the United States of America.

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Alan Caruba Bio

Alan Caruba Most recent columns

Alan has a daily blog called Warning Signs. His latest book is Right Answers: Separating Fact from Fantasy.

Alan can be reached at acaruba@aol.com
Older articles by Alan Caruba

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A Different Slant on Obama

Subject: A Different Slant on Obama

One 82-year-old lady loves Obama and she may have a very good point. She says that Obama is amazing, and is rebuilding the American dream! She gives us an entirely new slant on the "amazing" job Obama is doing, and she says that she will thank God for the President. Keep reading for her additional comments and an explanation.

When discussing Obama, she says:

1. Obama destroyed the Clinton Political Machine, driving a stake through the heart of Hillary's presidential aspirations - something no Republican was ever able to do.

2. Obama killed off the Kennedy Dynasty - no more Kennedys trolling Washington looking for booze and women wanting rides home.

3. Obama is destroying the Democratic Party before our eyes! Dennis Moore had never lost a race. Evan Bayh had never lost a race. Byron Dorgan had never lost a race. Harry Reid - soon to be GONE! These are just a handful of the Democrats whose political careers Obama has destroyed. By the end of 2010, dozens more will be gone. Just think, in December of 2008 the Democrats were on the rise. In the last two election cycles, they had picked up 14 Senate seats and 52 House seats. The press was touting the death of the Conservative Movement and the Republican Party. However, in just one year, Obama put a stop to all of this and will probably give the House - if not the Senate - back to the Republicans.

4. Obama has completely exposed liberals and progressives for what they are. Sadly, every generation seems to need to re-learn the lesson on why they should never actually put liberals in charge. Obama is bringing home the lesson very well:

Liberals tax, borrow and spend.

Liberals won't bring themselves to protect America.

Liberals want to take over the economy.

Liberals think they know what is best for everyone.

Liberals are not happy until they are running YOUR life.

5. Obama has brought more Americans back to conservatism than anyone since Reagan. In one year, he has rejuvenated the Conservative Movement and brought out to the streets millions of freedom loving Americans. Name one other time when you saw your friends and neighbors this interested in taking back America!

6. Obama, with his "amazing leadership," has sparked the greatest period of sales of firearms and ammunition this country has seen. Law abiding citizens have rallied and have provided a "stimulus" to the sporting goods field while other industries have failed, faded, or moved off-shore.

7. In all honesty, one year ago I was more afraid than I have been in my life. Not afraid of the economy, but afraid of the direction our country was going. I thought, Americans have forgotten what this country is all about. My neighbors and friends, even strangers, have proved to me that my lack of confidence in the greatness and wisdom of the American people has been flat wrong.

8. When the American people wake up, no smooth talking teleprompter reader can fool them! Barack Obama has served to wake up these great Americans!

Again, I want to say: "Thank you, Barack Obama!" After all, this is exactly the kind of hope and change we desperately needed!!

November 2nd is HUGE!!!!

Please encourage others to Vote.............forward this onward, if you like.

European Commercials Are Definitely The Best

Just across Germany's northern-most border with Denmark you'll find an incredible superstore called Fleggaard. There, you can buy everything you need - tubs of gummi bears, cases of wine, industrial strength dishwashing soap - at prices 30% cheaper than you'll find in Denmark.

Click here: http://www.m2film.dk/fleggaard/trailer2.swf <http://www.m2film.dk/fleggaard/trailer2.swf>

Democrats Make a $250 Pitch to Senior Voters

Same song, second verse.

Can't get better so its gotta get worse.

Democrats Make a $250 Pitch to Senior Voters

Scotty Starnes | October 19, 2010 at 1:19 PM | Tags: buying votes, COLA, cost of living adjustments, Democrats, Harry Reid, inflation, Nancy Pelosi, President Obama, social security | Categories: Uncategorized | URL: http://wp.me/pvnFC-39k

If you can't win voters over with your failed, bankrupting America policies, buy their vote. This is the tactic Democrats are using for November. They couldn't pass a budget before the election but they are trying to figure out a way to pay 52 million Social Security recipients $250, since senior citizens have gone two years without a 'cost of living adjustment, (COLA), for the first time in the history of Social Security.

If you can't fool them, buy them off.

CNSNews.com reports:

Democrats are making a pre-election pitch to give Social Security recipients a one-time payment of $250, part of a larger effort to convince senior voters that their party, and not Republicans, will best look out for the 58 million people who get the government retirement and disability benefits.

The $250 check is meant to make up for a second year without a cost-of-living increase due to low inflation.

President Barack Obama has urged Congress to approve the $250 payment. House and Senate Democratic leaders Nancy Pelosi and Harry Reid say they will bring up the legislation when lawmakers return for the lame-duck session in November. In the meantime, Democrats are using the proposal to augment their campaign pitch that Republicans would undermine Social Security.

"Instead of helping seniors," Pelosi's office said, "Republicans, backed by their allies on Wall Street, are threatening to privatize and cut Social Security, just as they tried to do under President Bush."

Liberal Factcheck.org exposed this lie, but then again, Democrats are know to use facts or logic when trying to buy votes.

Added Reid, "The only thing standing in the way of America's seniors receiving this critical support are Senate Republicans."

Actually, 12 Democrats and one independent who aligns himself with Democrats joined 37 Republicans in blocking the $250 bonus when Senate voted on the issue last March. Two of the Senate Democrats who voted against it then, Michael Bennet of Colorado and Russ Feingold of Wisconsin, are engaged in tough campaign battles to keep their seats.

Democratic leaders in the House never brought the issue up for a vote. Obama first asked Congress for the $250 payment last February.

"It's clearly a last-ditch election-year Hail Mary," said Michael Steel, a spokesman for House Republican leader John Boehner of Ohio. If supplementing the incomes of seniors was really a priority, he said, Democrats would have acted on it before they adjourned for the campaign.

Democrats may have the votes in the House to push through the measure, although still unanswered is how they plan to cover the estimated $13 billion to $14 billion cost of giving $250 to each of more than 50 million Social Security beneficiaries. Obama hasn't offered any suggestions and the Senate measure last March was rejected 47-50 primarily because it would have stacked the cost on top of the nearly $12 trillion federal debt.

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Re: What is the likelihood that the Congress will see this as a good reason to review the effect of the minimum wage on jobs in the USA mainland?

"Mrs. Pelosi came under fire in 2007 when the debate over the minimum wage was revived. The initial legislation covered the Northern Mariana Islands but not American Samoa. Republicans said that smelled fishy, since Del Monte, the parent company of StarKist's cannery, had headquarters in San Francisco, in the district Mrs. Pelosi represents. One Web-based news outlet even leveled a charge that Mrs. Pelosi's husband was invested in Del Monte....."

On Tue, Oct 19, 2010 at 1:51 PM, dick <rhomp2002@earthlink.net> wrote:

http://www.washingtontimesmail.com/rnjrfcwcnqypyqlbpkfncpyftvpccgwhkynscbrtwtkvwv_zrfsflwpbrzd.html

Who knows, they might find out that it has the same effect on the mainland as it does in the island territories of the Pacific.

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Re: Meghan McCain Slams Christine O'Donnell Seen as 'Nutjob'

There is no help for Tom. He refuses to read, look at the facts, and just continues to spew out hatred.

No need to worry about me paying off Tom's mortgage, he hasn't taken the time to even read the article(s)!!

On Tue, Oct 19, 2010 at 1:49 PM, dick <rhomp2002@earthlink.net> wrote:

You keep saying those things and they are all lies. Saying something without providing proof and when someone calls you on it you just wash, rinse, repeat does not make what you say true - and it is not. Almost to the point where I just delete your messages as being nothing but BS.

On 10/19/2010 01:43 PM, Tommy News wrote:

The GOP created the meltdown, ignored the American people, started
unwarranted wars, took us from a $236 billion dollar surplus to $1.3
trillion dollar deficit, and now tells us they are the ones to fix it!
Even though they have no plan!

A return to the failed GOP Bush policies is no plan, which will only
fail yet again.

On 10/19/10, Keith In Tampa<keithintampa@gmail.com> wrote:

Yes, Tommy, the articles totally debunk the horse hockey that you wrote.

On Tue, Oct 19, 2010 at 12:27 PM, Tommy News<tommysnews@gmail.com> wrote:

Thanks for all this.

On 10/19/10, MJ<michaelj@america.net> wrote:
> The Myth of Energy Deregulation

Monday, November 07, 2005
by Adam Summers

While the initiatives on the upcoming November 8 California special

election

ballot backed by Governor Arnold Schwarzenegger have been receiving all

of

the media attention, another initiative that addresses an important
issue

is

being overlooked. Proposition 80, the so-called "Repeal of Electricity
Deregulation and Blackout Prevention" initiative, would make some
significant and detrimental changes in the state's energy policy.

The fact that even a government regulatory body such as the California
Public Utilities Commission (PUC) is actually against a measure that

would

increase its regulatory powers should tell you something right off the

bat

about the merits of Prop. 80.

California energy consumers are currently served by one of three types
of
providers: investor-owned utilities (IOUs), local publicly-owned
electric
utilities, and independent electric service providers (ESPs). Before the
state's "deregulation" experiment of the 1990s was suspended in 2001

during

California's energy crisis, customers could choose to purchase their
electricity services directly from ESPs through "direct access"

contracts,

rather than through an intermediary such as the local IOU or public

utility.

Proposition 80 Would Reduce Consumer Choice and Increase Costs

Proposition 80 would permanently prevent all customers receiving

electricity

services from an IOU from switching to an ESP, effectively eliminating

any

new direct access (existing direct access contracts would be

grandfathered

in).[1] Thus, under Prop. 80, instead of having the option to buy
electricity directly from independent producers, consumers would have no
choice but to buy their electricity from utilities. By effectively
eliminating an entire class of providers, the state has stifled

competition

(and would continue to do so), thereby leading to higher prices and,

likely,

lower-quality service.

The effect of this provision on prices would be significant. ESP

customers

include hospitals, local governments, the California State University
system, several University of California campuses, community college
districts, and local school districts. The nonpartisan Legislative

Analyst's

Office (LAO) estimates that the UC system alone saves about $12 million

per

year by purchasing its electricity from a lower-cost independent

provider.

According to Mike Florio, an attorney for The Utility Reform Network

(TURN,

one of the chief proponents of Prop. 80 that helped craft the measure),

the

ability of consumers to purchase electricity directly from independent
service providers "destabilizes the whole business … and we'll truly be

at

the mercy of the gods of the free market."[2] How dare people be able to
choose whom they want to do business with! I suppose TURN hired Mr.

Florio

not for his legal expertise, but rather by the sheer providence of the
"free-market gods."

Proposition 80 Would Impede Innovation and Efficiency

Another provision of Prop. 80 would prohibit the broader implementation

of

"dynamic pricing" of electricity without the consent of the consumer.
Currently, all but the largest energy consumers pay a flat rate for
electricity that does not vary by the time of day. Clearly, energy use
is
not constant throughout the day, however. There are certain "peak" hours

of

the day when consumers use lots of electricity, and "non-peak" hours
when
they use very little. The costs of providing electricity vary

accordingly.

As such, the IOUs have submitted proposals to the PUC to charge all
consumers higher rates during peak hours and lower rates during non-peak
hours. This price discrimination would be accomplished through the use
of
high-tech "smart" meters.

In addition to making good sense one should pay more for something
when

it

is in higher demand dynamic pricing would encourage conservation via

the

pricing mechanism. Dynamic pricing would be a more efficient system

because

higher prices would discourage some from consuming such a scarce
resource
while ensuring that those who place the highest value on energy use are
still able to consume it. Similarly, those who have some flexibility
over
when they consume their energy would be encouraged to utilize it during
non-peak hours, thus placing less strain on the system.

Allowing the consumer to opt out of a dynamic pricing model would be
like
forcing a hotel owner to offer customers the choice of the nightly room

rate

or an average of the nightly room rates throughout the week. Since
significantly more people stay at hotels during the weekend, rates are

much

higher on Friday and Saturday nights. The average weekly rate, however,
would be higher than normal weekday rates but lower than normal weekend
rates. The cheaper "opt-out" weekend rates and higher weekday rates
would
encourage even more people to stay during the weekend and fewer to stay
during the week. The result would be a shortage of hotel rooms during
the
weekend and a loss of revenue for the hotel owner. No wonder demand

strains

the electrical grids during hot summer days.

Environmental Issues

Under current regulations, energy producers must increase the portion of
energy derived from renewable energy sources such as solar, wind, and
hydroelectric by one percent per year until 2017, when 20 percent of

the

energy produced must come from these sources. Proposition 80 would
accelerate this deadline to 2010. Interestingly, some environmentalists
oppose Prop. 80 because a provision requiring a two-thirds vote of the
Legislature to amend the measure could make it more difficult to
increase
the renewable energy standard in the future.

According to the LAO's analysis, Prop. 80 would also require that "the

first

priority for IOUs in procuring new electricity is to be from
'cost-effective' energy efficiency and conservation programs, followed
by
'cost-effective' renewable resources, and then from traditional sources

such

as fossil fuel burning power plants."[3] Of course, if renewable energy
sources and energy efficiency and conservation programs were truly "cost
effective," producers would already be utilizing them in higher numbers
because it would make them more profitable. This clearly is not the
case.
Forcing companies to invest significant amounts of their scarce
resources

on

more costly energy-production methods, which make up a relatively small
share of total energy production (for good reason), will only ensure
that
costs and, ultimately, consumers' electricity bills remain higher

than

necessary.

As new technologies and energy-production methods are developed, this
may
change, but for now, it is best for both producers and consumers to
focus

on

the most efficient means of producing energy. Of course, if consumers

demand

"cleaner" energy, in a truly free market, producers will have an

incentive

to provide it. Indeed, after Pennsylvania successfully implemented its
electricity deregulation effort in 1999 (without the pitfalls
experienced

by

California), 20 percent of consumers chose to switch to suppliers of

"green

power," despite the fact that they had to pay a small premium to do so.
Proposition 80 eliminates this choice, instead demanding that all

consumers

support the higher cost of investing more in renewable energy whether

they

want to
or not.

Misconceptions Over Electricity "Deregulation" in California

Some blame deregulation for the rolling blackouts, soaring spot market
prices, and utility bankruptcies that sprang from the energy crisis of

2000

and 2001. But this anger is misplaced. California has never experienced

true

deregulation. The "deregulation" implemented in 1996 left price controls

in

place and created "artificial" markets ripe for manipulation and

disparities

between supply and demand.

By setting price caps below market prices, California limited the
profitability of the industry. When wholesale energy costs increased,
the
price caps prevented energy producers from passing them on to consumers.
Wholesale prices rose dramatically for a number of reasons: natural gas
prices rose, hot weather in the Southwest increased demand, a relative

lack

of water in the Northwest minimized the production of hydroelectric

energy,

and pollution-control permits, which allow industrial companies that

produce

less pollution than allowed by regulations to sell the difference as
"credits" to higher-pollution-producing companies, rose ten-fold, from
$4

to

$40.

The price caps additionally discouraged potential producers from
entering
the market and increasing competition, and they discouraged existing
producers from investing profits in adding capacity, of which

Californians

were (and continue to be) in dire need. As a result of the price caps
and
pressure from politicians and environmentalists, the building of plants

and

transmission lines slowed dramatically and energy producers were not
able

to

keep up with demand, particularly in the Silicon Valley, where the

booming

computer and "dot-com" industries led to even sharper increases in
electricity demand.

After the big three investor-owned utilities Pacific Gas& Electric,
Southern California Edison, and SEMPRA (San Diego Gas& Electric) were
forced to sell many of their fossil-fuel-burning generators to private
firms, regulators prohibited them from entering into long-term contracts
with these firms, forcing them to rely upon the much more volatile
short-term and spot markets. In addition, California forced generators

and

utilities to trade power through the Power Exchange, a state-run pool.

While that requirement was designed to give every company the same

wholesale

price for power, it also guaranteed that they would be unable to

negotiate

lower-priced power on their own. The California rules essentially barred
utilities from buying power on the futures market, meaning they were

unable

to lock in supplies and prices.[4]

This is as if Wal-Mart and Marshall Field's were forced to acquire their
goods from a non-profit, state-run pool that would guarantee that they

would

acquire the goods for the same price. Wal-Mart never would have been
able

to

develop its efficient and innovative purchasing and distribution system,
meaning it could not generate savings to pass on to customers in the
form

of

lower prices.

At the time of the increase in wholesale prices, PG&E and Edison were

still

in the deregulation "transition" period, and thus still subject to PUC

rate

regulations. As a result, PG&E went bankrupt and Edison teetered on the

edge

of insolvency. To add insult to injury, when the government stepped in
to
purchase electricity on behalf of the struggling IOUs to try to quell
the
crisis, not only did it do so at the height of the emergency, when
energy
prices were highest, it locked in these prices with long-term contracts
costing billions of dollars.

The Natural Monopoly Justification for Regulation

The main argument against the full privatization of public utilities
such

as

electricity and water service is that such industries are "natural
monopolies." That is, they require such high fixed costs (it is easier
to
start a new restaurant than to invest in the infrastructure for a new
electric grid) that it is inefficient for there to exist more than one
producer in a particular location. This, it is feared, will lead the
producer to engage in price gouging.

There are several problems with this rationale, not the least of which
is
the notion that "public utilities" somehow constitute a unique set of

goods

that must be "protected" by government intervention. As economist Murray
Rothbard noted in Power and Market:

The very term "public utility" … is an absurd one. Every good is useful

"to

the public," and almost every good … may be considered "necessary." Any
designation of a few industries as "public utilities" is completely
arbitrary and unjustified.[5]

High capital costs certainly will limit the number of actual and

potential

providers, but there is still a profit motive in a free market that

creates

opportunities for lower-cost producers. In addition, it is important to

note

that markets are not static; technological innovations may allow for
additional competition in the future.

Another misconception opponents of free markets have concerns the very
understanding of the nature of competition. Even if there is only one
producer of a certain good or service in town, this does not mean that

the

producer is "gouging" customers through monopolistic practices. Indeed,

just

because he is the sole supplier today does not mean he will be the sole
supplier tomorrow. As economist Thomas J. DiLorenzo explains:

If competition is viewed as a dynamic, rivalrous process of
entrepreneurship, then the fact that a single producer happens to have

the

lowest costs at any one point in time is of little or no consequence.
The
enduring forces of competition including potential competition will
render free-market monopoly an impossibility.[6]

In other words, even if there happens to be only one current provider of

a

particular good or service, in a free market that provider is held in

check

by the mere threat of competition if he charges prices that are too

high

or provides poor service, there will be an incentive for a competitor to
come in and take market share from him by offering lower prices or
better
service.

The rules change, however, when government regulation erects barriers to
entry or otherwise suppresses competition. In addition to the many
government regulations purportedly enacted in the "public interest,"

there

are numerous instances where private-sector businesses have been able to
successfully lobby policymakers to use the power of government to

establish

barriers to competition and protect them from existing or potential

rivals.

Unlike the free-market case, there is no possibility of these
monopolists
losing out to lower-cost providers (barring the elimination of the
regulations), and they are able to "exploit" consumers. These are the

truly

harmful monopolies. Thus, the only "bad" monopoly is a
government-created

or

government-preserved
monopoly.

Conclusions

Proposition 80 would be a step backward for California. It would
restrict
consumer choice, discourage competition, and impose more of the kinds of
regulations that got the California power industry into trouble in the

first

place.

As awful as Proposition 80 is, however, there is good news. It is

trailing

in recent public opinion polls, and even if it should end up passing it

is

likely to be discarded by the courts. It was removed from the ballot on

July

22 by the Court of Appeals in Sacramento because the court found that,
according to the state constitution, the PUC's authority can only be
increased by the Legislature, not by initiative. The initiative was

restored

a few days later by the California Supreme Court, which did not offer an
opinion on the merits of the case but felt that the public should have

the

chance to vote on the initiative before the legal challenge is heard.
(Of
course, if voters reject the measure, this will be a moot point and the
courts will not have to waste their time on it a fact that surely was

not

lost on the Supreme Court.)

Politicians and regulators forced a sham of a "deregulation" scheme upon

the

energy industry in California, and then blamed the free market when it
inevitably failed! The problem was not too much free-market competition;

it

was too much regulation (despite the "deregulation" doublespeak). The

real

solution to California's energy problem is to eliminate price caps and

all

government regulation, thereby removing barriers to entry, fostering
competition, offering consumers maximum choice, and affording providers

the

greatest incentives to increase capacity and best serve their customers.

Adam Summers is a policy analyst for the Reason Foundation
(asummers1@san.rr.com). Comment on the blog.

[1] This option was suspended during the electricity crisis of 2000 and
2001, but is scheduled to be reinstated when the last of the power

contracts

signed on behalf of the IOUs by the Department of Water Resources
expires

in

2015.

[2] Carrie Peyton Dahlberg, "Electricity proposition crackles: Will

prices

go up? Will it avert an energy crisis? It all depends on who's talking,"
Sacramento Bee, October 15, 2005,
http://www.sacbee.com/content/politics/story/13717834p-14560232c.html(free
registration required).

[3] California Secretary of State, Official Voter Information Guide,
Statewide Special Election, November 8, 2005, p. 52,
http://www.ss.ca.gov/elections/bp_nov05/voter_info_pdf/entire80.pdf .

[4] Terry Maxon, "Power Woes Unlikely in Texas, Officials Say," Dallas
Morning News, January 19, 2001, cited in Lynne Kiesling, "Getting
Electricity Deregulation Right: How Other States and Nations Have
Avoided
California's Mistakes," Reason Foundation Policy Study No. 281, April

2001,

p. 18, http://www.reason.org/ps281.pdf.

[5] Murray N. Rothbard, Power and Market: Government and the Economy,
(Kansas City: Sheed Andrews and McMeel, 1977), p. 76,
http://mises.org/rothbard/power&market.pdf. Now integrated into Man,
Economy, and State.

[6] Thomas J. DiLorenzo, "The Myth of Natural Monopoly," The Review of
Austrian Economics, Vol. 9, No. 2 (1996), p. 44,
http://mises.org/journals/rae/pdf/rae9_2_3.pdf.

http://mises.org/daily/1954

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--
Together, we can change the world, one mind at a time.
Have a great day,
Tommy

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What is the likelihood that the Congress will see this as a good reason to review the effect of the minimum wage on jobs in the USA mainland?

http://www.washingtontimesmail.com/rnjrfcwcnqypyqlbpkfncpyftvpccgwhkynscbrtwtkvwv_zrfsflwpbrzd.html

Who knows, they might find out that it has the same effect on the
mainland as it does in the island territories of the Pacific.

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Re: Meghan McCain Slams Christine O'Donnell Seen as 'Nutjob'

You keep saying those things and they are all lies. Saying something
without providing proof and when someone calls you on it you just wash,
rinse, repeat does not make what you say true - and it is not. Almost
to the point where I just delete your messages as being nothing but BS.

On 10/19/2010 01:43 PM, Tommy News wrote:
> The GOP created the meltdown, ignored the American people, started
> unwarranted wars, took us from a $236 billion dollar surplus to $1.3
> trillion dollar deficit, and now tells us they are the ones to fix it!
> Even though they have no plan!
>
> A return to the failed GOP Bush policies is no plan, which will only
> fail yet again.
>
> On 10/19/10, Keith In Tampa<keithintampa@gmail.com> wrote:
>
>> Yes, Tommy, the articles totally debunk the horse hockey that you wrote.
>>
>> On Tue, Oct 19, 2010 at 12:27 PM, Tommy News<tommysnews@gmail.com> wrote:
>>
>>
>>> Thanks for all this.
>>>
>>>
>>>
>>> On 10/19/10, MJ<michaelj@america.net> wrote:
>>> > The Myth of Energy Deregulation
>>>
>>>> Monday, November 07, 2005
>>>> by Adam Summers
>>>>
>>>> While the initiatives on the upcoming November 8 California special
>>>>
>>> election
>>>
>>>> ballot backed by Governor Arnold Schwarzenegger have been receiving all
>>>>
>>> of
>>>
>>>> the media attention, another initiative that addresses an important
>>>> issue
>>>>
>>> is
>>>
>>>> being overlooked. Proposition 80, the so-called "Repeal of Electricity
>>>> Deregulation and Blackout Prevention" initiative, would make some
>>>> significant and detrimental changes in the state's energy policy.
>>>>
>>>> The fact that even a government regulatory body such as the California
>>>> Public Utilities Commission (PUC) is actually against a measure that
>>>>
>>> would
>>>
>>>> increase its regulatory powers should tell you something right off the
>>>>
>>> bat
>>>
>>>> about the merits of Prop. 80.
>>>>
>>>> California energy consumers are currently served by one of three types
>>>> of
>>>> providers: investor-owned utilities (IOUs), local publicly-owned
>>>> electric
>>>> utilities, and independent electric service providers (ESPs). Before the
>>>> state's "deregulation" experiment of the 1990s was suspended in 2001
>>>>
>>> during
>>>
>>>> California's energy crisis, customers could choose to purchase their
>>>> electricity services directly from ESPs through "direct access"
>>>>
>>> contracts,
>>>
>>>> rather than through an intermediary such as the local IOU or public
>>>>
>>> utility.
>>>
>>>>
>>>> Proposition 80 Would Reduce Consumer Choice and Increase Costs
>>>>
>>>> Proposition 80 would permanently prevent all customers receiving
>>>>
>>> electricity
>>>
>>>> services from an IOU from switching to an ESP, effectively eliminating
>>>>
>>> any
>>>
>>>> new direct access (existing direct access contracts would be
>>>>
>>> grandfathered
>>>
>>>> in).[1] Thus, under Prop. 80, instead of having the option to buy
>>>> electricity directly from independent producers, consumers would have no
>>>> choice but to buy their electricity from utilities. By effectively
>>>> eliminating an entire class of providers, the state has stifled
>>>>
>>> competition
>>>
>>>> (and would continue to do so), thereby leading to higher prices and,
>>>>
>>> likely,
>>>
>>>> lower-quality service.
>>>>
>>>> The effect of this provision on prices would be significant. ESP
>>>>
>>> customers
>>>
>>>> include hospitals, local governments, the California State University
>>>> system, several University of California campuses, community college
>>>> districts, and local school districts. The nonpartisan Legislative
>>>>
>>> Analyst's
>>>
>>>> Office (LAO) estimates that the UC system alone saves about $12 million
>>>>
>>> per
>>>
>>>> year by purchasing its electricity from a lower-cost independent
>>>>
>>> provider.
>>>
>>>> According to Mike Florio, an attorney for The Utility Reform Network
>>>>
>>> (TURN,
>>>
>>>> one of the chief proponents of Prop. 80 that helped craft the measure),
>>>>
>>> the
>>>
>>>> ability of consumers to purchase electricity directly from independent
>>>> service providers "destabilizes the whole business … and we'll truly be
>>>>
>>> at
>>>
>>>> the mercy of the gods of the free market."[2] How dare people be able to
>>>> choose whom they want to do business with! I suppose TURN hired Mr.
>>>>
>>> Florio
>>>
>>>> not for his legal expertise, but rather by the sheer providence of the
>>>> "free-market gods."
>>>>
>>>>
>>>> Proposition 80 Would Impede Innovation and Efficiency
>>>>
>>>> Another provision of Prop. 80 would prohibit the broader implementation
>>>>
>>> of
>>>
>>>> "dynamic pricing" of electricity without the consent of the consumer.
>>>> Currently, all but the largest energy consumers pay a flat rate for
>>>> electricity that does not vary by the time of day. Clearly, energy use
>>>> is
>>>> not constant throughout the day, however. There are certain "peak" hours
>>>>
>>> of
>>>
>>>> the day when consumers use lots of electricity, and "non-peak" hours
>>>> when
>>>> they use very little. The costs of providing electricity vary
>>>>
>>> accordingly.
>>>
>>>> As such, the IOUs have submitted proposals to the PUC to charge all
>>>> consumers higher rates during peak hours and lower rates during non-peak
>>>> hours. This price discrimination would be accomplished through the use
>>>> of
>>>> high-tech "smart" meters.
>>>>
>>>> In addition to making good sense one should pay more for something
>>>> when
>>>>
>>> it
>>>
>>>> is in higher demand dynamic pricing would encourage conservation via
>>>>
>>> the
>>>
>>>> pricing mechanism. Dynamic pricing would be a more efficient system
>>>>
>>> because
>>>
>>>> higher prices would discourage some from consuming such a scarce
>>>> resource
>>>> while ensuring that those who place the highest value on energy use are
>>>> still able to consume it. Similarly, those who have some flexibility
>>>> over
>>>> when they consume their energy would be encouraged to utilize it during
>>>> non-peak hours, thus placing less strain on the system.
>>>>
>>>> Allowing the consumer to opt out of a dynamic pricing model would be
>>>> like
>>>> forcing a hotel owner to offer customers the choice of the nightly room
>>>>
>>> rate
>>>
>>>> or an average of the nightly room rates throughout the week. Since
>>>> significantly more people stay at hotels during the weekend, rates are
>>>>
>>> much
>>>
>>>> higher on Friday and Saturday nights. The average weekly rate, however,
>>>> would be higher than normal weekday rates but lower than normal weekend
>>>> rates. The cheaper "opt-out" weekend rates and higher weekday rates
>>>> would
>>>> encourage even more people to stay during the weekend and fewer to stay
>>>> during the week. The result would be a shortage of hotel rooms during
>>>> the
>>>> weekend and a loss of revenue for the hotel owner. No wonder demand
>>>>
>>> strains
>>>
>>>> the electrical grids during hot summer days.
>>>>
>>>>
>>>> Environmental Issues
>>>>
>>>> Under current regulations, energy producers must increase the portion of
>>>> energy derived from renewable energy sources such as solar, wind, and
>>>> hydroelectric by one percent per year until 2017, when 20 percent of
>>>>
>>> the
>>>
>>>> energy produced must come from these sources. Proposition 80 would
>>>> accelerate this deadline to 2010. Interestingly, some environmentalists
>>>> oppose Prop. 80 because a provision requiring a two-thirds vote of the
>>>> Legislature to amend the measure could make it more difficult to
>>>> increase
>>>> the renewable energy standard in the future.
>>>>
>>>> According to the LAO's analysis, Prop. 80 would also require that "the
>>>>
>>> first
>>>
>>>> priority for IOUs in procuring new electricity is to be from
>>>> 'cost-effective' energy efficiency and conservation programs, followed
>>>> by
>>>> 'cost-effective' renewable resources, and then from traditional sources
>>>>
>>> such
>>>
>>>> as fossil fuel burning power plants."[3] Of course, if renewable energy
>>>> sources and energy efficiency and conservation programs were truly "cost
>>>> effective," producers would already be utilizing them in higher numbers
>>>> because it would make them more profitable. This clearly is not the
>>>> case.
>>>> Forcing companies to invest significant amounts of their scarce
>>>> resources
>>>>
>>> on
>>>
>>>> more costly energy-production methods, which make up a relatively small
>>>> share of total energy production (for good reason), will only ensure
>>>> that
>>>> costs and, ultimately, consumers' electricity bills remain higher
>>>>
>>> than
>>>
>>>> necessary.
>>>>
>>>> As new technologies and energy-production methods are developed, this
>>>> may
>>>> change, but for now, it is best for both producers and consumers to
>>>> focus
>>>>
>>> on
>>>
>>>> the most efficient means of producing energy. Of course, if consumers
>>>>
>>> demand
>>>
>>>> "cleaner" energy, in a truly free market, producers will have an
>>>>
>>> incentive
>>>
>>>> to provide it. Indeed, after Pennsylvania successfully implemented its
>>>> electricity deregulation effort in 1999 (without the pitfalls
>>>> experienced
>>>>
>>> by
>>>
>>>> California), 20 percent of consumers chose to switch to suppliers of
>>>>
>>> "green
>>>
>>>> power," despite the fact that they had to pay a small premium to do so.
>>>> Proposition 80 eliminates this choice, instead demanding that all
>>>>
>>> consumers
>>>
>>>> support the higher cost of investing more in renewable energy whether
>>>>
>>> they
>>>
>>>> want to
>>>> or not.
>>>>
>>>>
>>>> Misconceptions Over Electricity "Deregulation" in California
>>>>
>>>> Some blame deregulation for the rolling blackouts, soaring spot market
>>>> prices, and utility bankruptcies that sprang from the energy crisis of
>>>>
>>> 2000
>>>
>>>> and 2001. But this anger is misplaced. California has never experienced
>>>>
>>> true
>>>
>>>> deregulation. The "deregulation" implemented in 1996 left price controls
>>>>
>>> in
>>>
>>>> place and created "artificial" markets ripe for manipulation and
>>>>
>>> disparities
>>>
>>>> between supply and demand.
>>>>
>>>> By setting price caps below market prices, California limited the
>>>> profitability of the industry. When wholesale energy costs increased,
>>>> the
>>>> price caps prevented energy producers from passing them on to consumers.
>>>> Wholesale prices rose dramatically for a number of reasons: natural gas
>>>> prices rose, hot weather in the Southwest increased demand, a relative
>>>>
>>> lack
>>>
>>>> of water in the Northwest minimized the production of hydroelectric
>>>>
>>> energy,
>>>
>>>> and pollution-control permits, which allow industrial companies that
>>>>
>>> produce
>>>
>>>> less pollution than allowed by regulations to sell the difference as
>>>> "credits" to higher-pollution-producing companies, rose ten-fold, from
>>>> $4
>>>>
>>> to
>>>
>>>> $40.
>>>>
>>>> The price caps additionally discouraged potential producers from
>>>> entering
>>>> the market and increasing competition, and they discouraged existing
>>>> producers from investing profits in adding capacity, of which
>>>>
>>> Californians
>>>
>>>> were (and continue to be) in dire need. As a result of the price caps
>>>> and
>>>> pressure from politicians and environmentalists, the building of plants
>>>>
>>> and
>>>
>>>> transmission lines slowed dramatically and energy producers were not
>>>> able
>>>>
>>> to
>>>
>>>> keep up with demand, particularly in the Silicon Valley, where the
>>>>
>>> booming
>>>
>>>> computer and "dot-com" industries led to even sharper increases in
>>>> electricity demand.
>>>>
>>>> After the big three investor-owned utilities Pacific Gas& Electric,
>>>> Southern California Edison, and SEMPRA (San Diego Gas& Electric) were
>>>> forced to sell many of their fossil-fuel-burning generators to private
>>>> firms, regulators prohibited them from entering into long-term contracts
>>>> with these firms, forcing them to rely upon the much more volatile
>>>> short-term and spot markets. In addition, California forced generators
>>>>
>>> and
>>>
>>>> utilities to trade power through the Power Exchange, a state-run pool.
>>>>
>>>> While that requirement was designed to give every company the same
>>>>
>>> wholesale
>>>
>>>> price for power, it also guaranteed that they would be unable to
>>>>
>>> negotiate
>>>
>>>> lower-priced power on their own. The California rules essentially barred
>>>> utilities from buying power on the futures market, meaning they were
>>>>
>>> unable
>>>
>>>> to lock in supplies and prices.[4]
>>>>
>>>> This is as if Wal-Mart and Marshall Field's were forced to acquire their
>>>> goods from a non-profit, state-run pool that would guarantee that they
>>>>
>>> would
>>>
>>>> acquire the goods for the same price. Wal-Mart never would have been
>>>> able
>>>>
>>> to
>>>
>>>> develop its efficient and innovative purchasing and distribution system,
>>>> meaning it could not generate savings to pass on to customers in the
>>>> form
>>>>
>>> of
>>>
>>>> lower prices.
>>>>
>>>> At the time of the increase in wholesale prices, PG&E and Edison were
>>>>
>>> still
>>>
>>>> in the deregulation "transition" period, and thus still subject to PUC
>>>>
>>> rate
>>>
>>>> regulations. As a result, PG&E went bankrupt and Edison teetered on the
>>>>
>>> edge
>>>
>>>> of insolvency. To add insult to injury, when the government stepped in
>>>> to
>>>> purchase electricity on behalf of the struggling IOUs to try to quell
>>>> the
>>>> crisis, not only did it do so at the height of the emergency, when
>>>> energy
>>>> prices were highest, it locked in these prices with long-term contracts
>>>> costing billions of dollars.
>>>>
>>>>
>>>> The Natural Monopoly Justification for Regulation
>>>>
>>>> The main argument against the full privatization of public utilities
>>>> such
>>>>
>>> as
>>>
>>>> electricity and water service is that such industries are "natural
>>>> monopolies." That is, they require such high fixed costs (it is easier
>>>> to
>>>> start a new restaurant than to invest in the infrastructure for a new
>>>> electric grid) that it is inefficient for there to exist more than one
>>>> producer in a particular location. This, it is feared, will lead the
>>>> producer to engage in price gouging.
>>>>
>>>> There are several problems with this rationale, not the least of which
>>>> is
>>>> the notion that "public utilities" somehow constitute a unique set of
>>>>
>>> goods
>>>
>>>> that must be "protected" by government intervention. As economist Murray
>>>> Rothbard noted in Power and Market:
>>>>
>>>> The very term "public utility" … is an absurd one. Every good is useful
>>>>
>>> "to
>>>
>>>> the public," and almost every good … may be considered "necessary." Any
>>>> designation of a few industries as "public utilities" is completely
>>>> arbitrary and unjustified.[5]
>>>>
>>>> High capital costs certainly will limit the number of actual and
>>>>
>>> potential
>>>
>>>> providers, but there is still a profit motive in a free market that
>>>>
>>> creates
>>>
>>>> opportunities for lower-cost producers. In addition, it is important to
>>>>
>>> note
>>>
>>>> that markets are not static; technological innovations may allow for
>>>> additional competition in the future.
>>>>
>>>> Another misconception opponents of free markets have concerns the very
>>>> understanding of the nature of competition. Even if there is only one
>>>> producer of a certain good or service in town, this does not mean that
>>>>
>>> the
>>>
>>>> producer is "gouging" customers through monopolistic practices. Indeed,
>>>>
>>> just
>>>
>>>> because he is the sole supplier today does not mean he will be the sole
>>>> supplier tomorrow. As economist Thomas J. DiLorenzo explains:
>>>>
>>>> If competition is viewed as a dynamic, rivalrous process of
>>>> entrepreneurship, then the fact that a single producer happens to have
>>>>
>>> the
>>>
>>>> lowest costs at any one point in time is of little or no consequence.
>>>> The
>>>> enduring forces of competition including potential competition will
>>>> render free-market monopoly an impossibility.[6]
>>>>
>>>> In other words, even if there happens to be only one current provider of
>>>>
>>> a
>>>
>>>> particular good or service, in a free market that provider is held in
>>>>
>>> check
>>>
>>>> by the mere threat of competition if he charges prices that are too
>>>>
>>> high
>>>
>>>> or provides poor service, there will be an incentive for a competitor to
>>>> come in and take market share from him by offering lower prices or
>>>> better
>>>> service.
>>>>
>>>> The rules change, however, when government regulation erects barriers to
>>>> entry or otherwise suppresses competition. In addition to the many
>>>> government regulations purportedly enacted in the "public interest,"
>>>>
>>> there
>>>
>>>> are numerous instances where private-sector businesses have been able to
>>>> successfully lobby policymakers to use the power of government to
>>>>
>>> establish
>>>
>>>> barriers to competition and protect them from existing or potential
>>>>
>>> rivals.
>>>
>>>> Unlike the free-market case, there is no possibility of these
>>>> monopolists
>>>> losing out to lower-cost providers (barring the elimination of the
>>>> regulations), and they are able to "exploit" consumers. These are the
>>>>
>>> truly
>>>
>>>> harmful monopolies. Thus, the only "bad" monopoly is a
>>>> government-created
>>>>
>>> or
>>>
>>>> government-preserved
>>>> monopoly.
>>>>
>>>>
>>>> Conclusions
>>>>
>>>> Proposition 80 would be a step backward for California. It would
>>>> restrict
>>>> consumer choice, discourage competition, and impose more of the kinds of
>>>> regulations that got the California power industry into trouble in the
>>>>
>>> first
>>>
>>>> place.
>>>>
>>>> As awful as Proposition 80 is, however, there is good news. It is
>>>>
>>> trailing
>>>
>>>> in recent public opinion polls, and even if it should end up passing it
>>>>
>>> is
>>>
>>>> likely to be discarded by the courts. It was removed from the ballot on
>>>>
>>> July
>>>
>>>> 22 by the Court of Appeals in Sacramento because the court found that,
>>>> according to the state constitution, the PUC's authority can only be
>>>> increased by the Legislature, not by initiative. The initiative was
>>>>
>>> restored
>>>
>>>> a few days later by the California Supreme Court, which did not offer an
>>>> opinion on the merits of the case but felt that the public should have
>>>>
>>> the
>>>
>>>> chance to vote on the initiative before the legal challenge is heard.
>>>> (Of
>>>> course, if voters reject the measure, this will be a moot point and the
>>>> courts will not have to waste their time on it a fact that surely was
>>>>
>>> not
>>>
>>>> lost on the Supreme Court.)
>>>>
>>>> Politicians and regulators forced a sham of a "deregulation" scheme upon
>>>>
>>> the
>>>
>>>> energy industry in California, and then blamed the free market when it
>>>> inevitably failed! The problem was not too much free-market competition;
>>>>
>>> it
>>>
>>>> was too much regulation (despite the "deregulation" doublespeak). The
>>>>
>>> real
>>>
>>>> solution to California's energy problem is to eliminate price caps and
>>>>
>>> all
>>>
>>>> government regulation, thereby removing barriers to entry, fostering
>>>> competition, offering consumers maximum choice, and affording providers
>>>>
>>> the
>>>
>>>> greatest incentives to increase capacity and best serve their customers.
>>>>
>>>> Adam Summers is a policy analyst for the Reason Foundation
>>>> (asummers1@san.rr.com). Comment on the blog.
>>>>
>>>> [1] This option was suspended during the electricity crisis of 2000 and
>>>> 2001, but is scheduled to be reinstated when the last of the power
>>>>
>>> contracts
>>>
>>>> signed on behalf of the IOUs by the Department of Water Resources
>>>> expires
>>>>
>>> in
>>>
>>>> 2015.
>>>>
>>>> [2] Carrie Peyton Dahlberg, "Electricity proposition crackles: Will
>>>>
>>> prices
>>>
>>>> go up? Will it avert an energy crisis? It all depends on who's talking,"
>>>> Sacramento Bee, October 15, 2005,
>>>> http://www.sacbee.com/content/politics/story/13717834p-14560232c.html(free
>>>> registration required).
>>>>
>>>> [3] California Secretary of State, Official Voter Information Guide,
>>>> Statewide Special Election, November 8, 2005, p. 52,
>>>> http://www.ss.ca.gov/elections/bp_nov05/voter_info_pdf/entire80.pdf .
>>>>
>>>> [4] Terry Maxon, "Power Woes Unlikely in Texas, Officials Say," Dallas
>>>> Morning News, January 19, 2001, cited in Lynne Kiesling, "Getting
>>>> Electricity Deregulation Right: How Other States and Nations Have
>>>> Avoided
>>>> California's Mistakes," Reason Foundation Policy Study No. 281, April
>>>>
>>> 2001,
>>>
>>>> p. 18, http://www.reason.org/ps281.pdf.
>>>>
>>>> [5] Murray N. Rothbard, Power and Market: Government and the Economy,
>>>> (Kansas City: Sheed Andrews and McMeel, 1977), p. 76,
>>>> http://mises.org/rothbard/power&market.pdf. Now integrated into Man,
>>>> Economy, and State.
>>>>
>>>> [6] Thomas J. DiLorenzo, "The Myth of Natural Monopoly," The Review of
>>>> Austrian Economics, Vol. 9, No. 2 (1996), p. 44,
>>>> http://mises.org/journals/rae/pdf/rae9_2_3.pdf.
>>>>
>>>> http://mises.org/daily/1954
>>>>
>>>> --
>>>> Thanks for being part of "PoliticalForum" at Google Groups.
>>>> For options& help see http://groups.google.com/group/PoliticalForum
>>>>
>>>> * Visit our other community at
>>>> http://www.PoliticalForum.com/<http://www.politicalforum.com/>
>>>> * It's active and moderated. Register and vote in our polls.
>>>> * Read the latest breaking news, and more.
>>>>
>>>
>>> --
>>> Together, we can change the world, one mind at a time.
>>> Have a great day,
>>> Tommy
>>>
>>> --
>>> Thanks for being part of "PoliticalForum" at Google Groups.
>>> For options& help see http://groups.google.com/group/PoliticalForum
>>>
>>> * Visit our other community at
>>> http://www.PoliticalForum.com/<http://www.politicalforum.com/>
>>> * It's active and moderated. Register and vote in our polls.
>>> * Read the latest breaking news, and more.
>>>
>>>
>> --
>> Thanks for being part of "PoliticalForum" at Google Groups.
>> For options& help see http://groups.google.com/group/PoliticalForum
>>
>> * Visit our other community at http://www.PoliticalForum.com/
>> * It's active and moderated. Register and vote in our polls.
>> * Read the latest breaking news, and more.
>>
>
>

--
Thanks for being part of "PoliticalForum" at Google Groups.
For options & help see http://groups.google.com/group/PoliticalForum

* Visit our other community at http://www.PoliticalForum.com/
* It's active and moderated. Register and vote in our polls.
* Read the latest breaking news, and more.