Paul Krugman (NYT): The Road to Ruin

We still don't know what started the chain reaction on Thursday. Whatever the initial cause, however, the current guess is that a local event turned into an epic blackout because the transmission network has been neglected. That is, the power industry hasn't spent enough on the control systems and safeguards that are supposed to prevent such things.

And the cause of that neglect is faith-based deregulation.

In the past, electric power was considered a natural monopoly. It was and is impractical to have companies competing either to wire up homes and businesses, or to build long-distance transmission lines. Because effective competition was impossible, power companies were given local monopolies, and regulated to keep them from exploiting customers.

These regulated monopolies took responsibility for the whole system — transmission and distribution as well as generation. Then came the deregulation movement. It argued that a competitive market could be created in power generation (though not in transmission and distribution), and in much of the country utilities were forced to sell off their power plants.

more...

http://www.nytimes.com/2003/08/19/opinion/19KRUG.html

Just another STUPID fucking move on their part.

There's a reason these industries were regulated monopolies for years and years. Now glaringly evident.

But nooooooooooooo ....... The repubs saw a way to make a couple of fucking dollars, to hell with the public good.

When you put the fox in the hen house, you are sure to end up with dead chickens. Trust the greedy corporations? Not in my life time.

-snip-
Incidentally, there seems to be a weird reluctance to face up to what happened in California. Since the blackout, I've seen national news reports attributing California's woes in part to environmental restrictions, while ignoring the role of market manipulation. Huh? There's no evidence that environmental restrictions played any role; meanwhile, even the Federal Energy Regulatory Commission, which strongly backs deregulation, has concluded that market manipulation played a major role. What's with the revisionist history?

people who have short attention spans and short memories.

Most public choice economists will tell you that market instruments are imperfect. The beauty of these instruments is that if they are not tampered with, they can "learn" their way to greater efficiencies and better solutions.

Unfortunately the Republicans embrace the rhetoric of the market instrument but not the spirit of it; instead they practice corporate welfare tarred in empty market rhetoric.

Most markets and practices are regulated for a reason: Usually that reason is because profit-rabid corporations couldn't be trusted to act in the best interest of the people they are supposed to provide goods and services to, i.e. consumers, i.e. us.

But because Republicans have shifted from being the party of Lincoln and abolition to the party of Lincoln Mercury and corporate perdition, they are institutionally incapable of allowing markets to work the way they are supposed to; instead we have a situation where markets are solely for the benefit of Republican corporate benefactors, markets where the market makers are insulated by tort reform and shift their tax burden to the communities and states where they operate. The corporations are protected from the consumers and thus the market model is broken. It is the Republican plutocracy that protects them.

thanks.