Mr. Hebert alleges that his refusal to intervene more effectively is based on an understanding of free market economics. What he ignores is that so much damage is being done to the economies of the western states, in the botched effort to deregulate from decades of monopoly, that it will be a long time before people again trust the mantra of free market philsophy.
I am for free markets and deregulation. I put it to Mr. Hebert that these goals are better accomplished with a bit of wisdom and management than by throwing open the gates on a regulated system without the slightest effort to manage the transition.
I thought it was pretty much common knowledge that Alan Greenspan was and/or is a follower of Aynn Rand's philosophy. Much of that was discussed when he was first appointed to the chair of the Federal Reserve. It has never been a secret.
I have been often suprised at stuff that I never knew, while apparently most others already did. All I can say is that life is often like that; and good luck to you/us. Later
They were personal friends. At least one or two of Mr. Greenspan's essays (concerning the gold standard and such, I believe, yes a glance at amazon.com confirms) appear in her nonfiction her work "Capitalism The Unknown Ideal".
I always admired him for surviving the friendship with her. She was known for going through a lot of tumultuous relationships. I think the fact that he was (and is) a competent hard-working individual of achievement within his field really helped him hold his own with her.
There was a minor scandal a couple of years ago when her chief living disciple attempted to distance himself and other Objectivists from Greenspan for Greenspan's alleged intellectual straying from her philosophy, but he had misread Greenspan's views. I don't know where he stands on her philosophy precisely and exactly. But there was so much tumult and near-religion-type acrimony surrounding her philosophic efforts that I always felt he stood as a bit of an exception in maintaining not only his relations with her but also in maintaining his own competent strong point of view.
The deregulation legislation that capped consumer rates for 4(?) years and mandated production capacity sales and required wholesale purchases through the ISO WAS California's ideal of transitioning to a free market. The transition plan was plain stupid and was a rejection of free markets. It has failed.
When California gets done clowning around with the disaterous rate regulation and supply mandates, California should give some free market policies a try. They most certainly have not yet.
Thanks for a reminder of a more clear-to-the-point-of-view. I think that perhaps I was very excited by the Dem's references to renewable energies (in contrast to the near shutout of sincere references in recent C-Span broadcasts of Industry and Republican comments) and may have somewhat confused this with an overenthusiasm for some other aspects to their proposals.
Still, if there's something I disagree with, it is not any one particular point that anyone has made here, but the thesis that there is "a" cause for the debacle. Everyone seems to know "the" reason for the Western Energy Crisis. I don't know that there is such a thing. Perhaps if one takes a complex philosophic argument, such as offered in Atlas Shrugged (i.e., the inevitable botched management of a politico-economic issue by a society badly in need of waking up to these issues).
One of the things about Greenspan, interestingly, is that on the face of it, it can be argued that his job is inherently a violation of Randian political and personal principles.... that it is not at all consistent with Objectivism to take a job as a de facto "Economic Czar" of a free society. But I think Greenspan's a mature guy who understood going in that he would be working for the day when his job would no longer be necessary. I believe (personally) that he deserves praise for taking the hard road, working with a wide variety of people and moralities (Rand was not a Reagan fan, for example) and accomplishing much. So, the easy criticism of Greenspan ("no advocate of free markets would accept such a position") is in my view somewhat flawed.
Likewise, my working hypothesis is that the easy view of Hebert and the California situation ("no advocate of free markets would allow a dime of rates to be 'confiscated' from the capitalistic electricity generators") is perhaps a misinterpretation of what needs to be understood here, about applying free market philosophies and ideas to the present situation. Thanks for any replies in disagreement.
I recall each state decided to deregulate or not on its own. There were plans for a national deregulation bill in Congress - I don't know what happened to it. Maybe it was adopted or not, I don't think it was acted upon.
California's problem seems to be a result of California politics. Perhaps there needs to be some Federal intervention at his time as their plan has run amuck.
If I built a power plant, seeing the potential shortfall, and taking a risk in financing and building the plant - then being faced with not being paid for the power produced, I wouldn't want someone changing the rules after I took the risk.
Also in the times is a story about alternate power generators not being paid, and getting an injunction to allow them to sell power outside California to parties who would pay the bill. It mentioned California Energy, a geothermal company, run by David Sokol and owned in part now by Warren Buffet. I've followed David Sokols career to some extent and I think he is an honest guy. Seems outrageous to not be paid for the power produced (these Geothermal plants were expensive to build and required heavy financing.
California's Governor, Grey Davis, a so-called liberal Democrat, while perhaps an incremental improvement over the previous Governor, Pete Wilson, a so-called moderate Republican, is looking more and more like a crook. He has been amassing a huge bankroll from major contributions from the Utilities, among other biggies. If anyone is responsible for what is happenning in California, it ain't that Herb guy, or even Greenspan -- who I also dislike, but rather our Governor and our Democratic controlled state legislature, most of whom are apparently also for sale.
No doubt about it, California botched things, big-time and no doubt about it, Davis is a complete shmuck, using the situation as a pretext to sieze corporate assets, ignoring that higher consumer prices would help curb demand, ignoring that he is demanding other states satisfy California's problems, ignoring the absurdity of the rules which have driven the big Two distributors bankrupt, and a third closer to it. Davis sees it as more important to hold consumer prices down to protect his political future than to actually find actual solutions to the problem. I can think of very little that he's done that I approve of. He and Mr. Bush seem to be having a whale of a foot-dragging contest.
I read the geothermal article and I quite agreed... there is no reason to expect a small producer to consider supplying a product for which they are not being paid except in the most extraordinary and very temporary of circumstances. The geothermal company was severely put-upon.
None of this changes, in my view, the fact that FERC could have done more, and should do more, to put the situation in order, pending an improvement in the Western system. That Mr. Hebert's criticisms of Governor Davis's policies have merit does not mean that FERC's tough-luck attitude also has merit. The major power producers (far larger than the geothermal one mentioned in the news) have made so much money that I imagine they can barely higher accountants fast enough to stow away the earnings prior to their corporate reports. Dozens of thousands of jobs have been needlessly lost. Businesses have not only been damaged but needlessly wrecked. The amounts of money Mr. Hebert is talking about refunding are about 9 months late, and probably an order of magnitude or more lower than what might have been warranted.