Airkuldâ€¦youâ€™re making my point for meâ€¦.donâ€™t need to reply muchâ€¦
But in the case of the energy industry, that's not the case. The goverment is already in the business model big time. The problem is that the goverment has stifled competition and created a market that can be easily manipulated by the handful of players in it. That market will be manipulated to it's fullest legal extent ( and then some probably) to maximize share price, that's management's job. If the goverment doesn't even out it's heavyhandedness with restricting competition on the supply side with consumer protections on the demand side, the consumer loses big time. That is simple economics.
So I agree with the "let free markets be free", but energy is not even close to being a free market, it's too highly regulated on the supply side to allow new competition, new capacity to enter the market and bring prices down.
For any industry, the more government regulation, restrictions and requirements you haveâ€¦i.e. the more government involvement, they less competitive it becomes, the costs to consumers increase and are subject to higher fluctuations. No new production is started.
You can drill as much as you want, where ever you want, it's not gonna help much. You don't pump crude oil into your car. It's the lack of refining capacity and competition that hurts the consumer.
Increasing refinery capacity is also part of the problem. But WHY have there been no new refineries built in California in the lastâ€¦ohâ€¦20 or so years? Mostly it is due to environmental restrictions, but also, if there isnâ€™t sufficient oil available to process, why build? We donâ€™t drill for new oil for the same reasons. But consider a regulated energy industry.
What incentive would there be for an existing oil company to build a new refinery? Profits are set and controlled by the government. Ultimately, the government would need to build and operate more refineries to attempt to maintain gas prices at some arbitrary level THEY determine. In an extremely regulated industry, why would anyone want to start a NEW oil/energy company? Competition decreases, as marginal companies canâ€™t expand and go out of business or are bought up by larger ones or the government.
Weâ€™re complaining because gas prices are high, and yes, oil companies are making profits. But regulating them isnâ€™t the answer. The answer is to find ways to make it easier for oil companies to produce more gas. That means removing restrictions on building refineries and drilling for new oil. The same is true for any â€˜essentialâ€™. When we argue that â€˜essentialâ€™ industries should be controlled by the government, â€˜for the common goodâ€™, we are asking for Socialism. The list of â€˜essentialsâ€™ will expand from gasoline to electricity, to natural gas, then on to water, followed by milk, bread, meat, all food items etc in a never ending spiral. Eventually, the government will decide how MUCH of a commodity (like gas) each person NEEDSâ€¦..and THAT will expandâ€¦..before you know itâ€¦.
Each according to his ability, each according to his needsâ€¦â€¦
I said this already..sounds like a broken record.
The American People are extremely selfish in a sense. We use our hard won and protected freedom to â€˜grabâ€™ all we can. â€œHe who dies with the most toys, WINSâ€ is a very American type analogy. When people see someone making a ton of money, the first question they ask isâ€¦â€How do they DO thatâ€™. and there is some desire to do the same thing. But government regulations stifle our ability to do that. Why do you think so many jobs and businesses are leaving California? Part of it is our high standard of living, but the other, bigger part, is related directly to how DIFFICULT it is to have a MANUFACTURING facility in this state. And THAT is directly related to the massive amount of California State regulations.
I donâ€™t like the higher gas prices better then anyone else, but I canâ€™t support more government, at the long term expense of our personal freedoms.
The energy industry saw an example of what they could expect wioth the electricity crisis. A wholesale rip off occured, and FERC did nothing to correct it. Far more profits were reaped than were ever recovered through fines, etc. It's a no brainer to try to game the market as much as possible.
One of the biggest contributing factors to the above is, again, related directly to how difficult it is to build more electrical generating capacity in this State.