Tuesday, May 17, 2005

Prediction: UK Blackouts In the Next Twenty Years

Greed. For countless people worldwide the word can’t be said without a sneer at free markets and an implicit call for government regulation. Technically meaning “desire beyond need” or “desire beyond merit,” today’s commentators have mutated it to “desire beyond some arbitrary point.”

No where is this more clear than at the Isle of Man Today Newspapers where a recent article trumps new laws that cap power prices. The article demonized producers, calling them “greedy suppliers” after “excessive profit.”

What the article fails to tell you is that this will likely lead to an England energy crisis similar to the one we saw in California a few years back. You probably heard that those blackouts were actually caused by deregulation and corporate greed. You were wrong. While the wholesale price of energy (the price companies charged one another) was deregulated, the retail price (the price consumers pay) remained artificially deflated. Companies did not have a reason to build new power plant (not that other regulations made such construction viable).

I have no idea where this line is that makes legitimate compensation “excessive” or “too much.” I don’t even know why wanting more than what you have is inherently evil. I do know that greed generates the incentive to keep the power flowing. If you think capping energy prices is going to help a country’s most downtrodden, then you better be ready to sit in the dark.

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