Topic: Maximum role of Government? - page 6. (Read 28705 times)

They can't either. They just know that they put out X, and you used Y, so they charge you, because you contracted with them. And as long as the total of all the Ys add up to less than or equal to X, they're OK.


1, they're doing nothing a sufficiently motivated rich individual or private charity couldn't do, and arguably more efficiently.
2, we would have wind turbines, and other clean sources of energy, when they became cost effective (ie: oil prices raised to the point that turbines, even with their low initial efficiency become worthwhile)

Have a look at the response above yours. MoonShadow explains it rather well.

I mean how do you differentiate the power you generate from the power the power company generate? Can't do it, unless you have a separate circuit.

I do however still want an explanation about why why that thing you're saying should happen doesn't happen. Why don't we see competition in these areas? Why doesn't the market "fix it" all by itself?
Another interesting fact: clean energy is only happening because of government sponsoring. They're "wasting" money by helping people set up wind turbines and other renewables and while doing so sponsoring technology development in these areas. The first wind turbines that went up cost more energy to produce than they gave during their lifetime, now they give a net surplus. Left to the free market we wouldn't have as much wind power as we do today, reducing the CO2 emissions for everybody. 

Then why don't more people set up panels or other generation systems? Look into it yourself, You could turn a bill into a profit stream. And how do the power companies differentiate? They don't. They come check the meter, and however much you have used, that's what they charge you for.

If you have never seen one generator running in one back yard, with extension cords running to three or four neighbors during a power outage, then you have never really seen this kind of activity in practice.  I have seen it happen on the fly, as a refrigerator takes very little power to run in 24 hours, but most residential refrigerators need to have power at least 10 minutes of every hour to maintain temps.  What people in hurricane country will do, is freeze gallon jugs of seawater for a couple days prior to the hurricane, (they get a warning after all) and will keep those jugs in their freezer to maintain cold between opprotunities to share power.  One decent sized genset can run the compressors on several refrigerators for a straight hour in the morning, in the heat of mid-day, and once more just before dark and the cold mass of the saltwater jug in the freezer and a freshwater jug (or several) in the refrigerator will carry the temps till daylight.  In this way, the cost of capital is lower, because only one guy needs to own the genset; and the costs of fuel are lower, because larger gensets & non-coincidental load sharing are more efficient ways of electrical generation.  The normal way this kind of ad-hoc transaction occurs, is that the neighbors who piggy-back off of the generator owner's genset are providing the (majority) of the gas for this arrangement, while the owner provides the genset and the scheduling.  It is also fairly normal for clothes washing (not machine drying) to be schedualed in a like manner.

If this kind of arrangement were cheaper/better overall as compared to the massive economies of scall that the power company enjoys, we would see this kind of thing happen all the time.  We might yet.

Free but not unregulated. And you can sell power to the power companies if you follow certain rules in setting the equipment up. I think that has to do with protecting the grid from faulty equipment.
And how would you be able to differentiate your power from any other power if you sent it over the regular grid. You'd have to have your own grid to distribute it to your neighbour.

Wait, why can't I hook to the grid? It's a free market, isn't it?

If that question was for me then yes, I think so. I doubt that you are allowed to use circuits connected to the grid though.

If I install solar panels and have excess, can I sell my power to my neighbor?

Funny thing is, if you look at the papers written about this, they do talk about barriers to entry but never about artificial barriers of entry which is what you're suggesting. The barriers are high cost of building power plants and infrastructure. Those barriers would remain even in your utopian "free market". So what you have is a few big players with no interest of competing and no new players interested in joining, which screws the customer even more than a monopoly does, because now you have the illusion of choice and nobody to hold responsible.

You're deliberately twisting my words. What you have is NOT the free market. What you have is a government established oligopoly, which is supported by regulation costs making the barrier to entry too high. You can't just 'pick another rich guy', it has to be somebody who has a reason to enter the market aside from marginal profits 10 years down the line.

Fine, pick another rich guy. Point is that whatever you're saying will happen isn't happening.

The difference being what in another market? Pay and you get service. Pay little to the monopoly and get service, compared to pay a lot to the "free market" to get service. In the example we're talking about. So the free market is a tyranny now? Or is it the fact that I get to choose which of the big players I will give my money that makes it better than paying a little to one I have no choice in.

Why would Branson care? It's not his itch to scratch. Billionaires have other things to do than jump on every single profit opportunity. They go for the big fish. It's the little guys that take care of the local problems.

And yes, a government sponsored monopoly isn't only comparable to tyranny, it is tyranny. In your own words:And besides, you can indeed remove a tyrant. It's been done before, just takes a little work.

Oh come on. You don't think Richard Branson could pay whatever fee to break into a market if he wanted to? Why doesn't he, or someone similar go in there and undercut the others? It's what should happen according to you. The real world just seems to disagree with your theory.

A government sponsored monopoly isn't comparable to tyranny. You can replace the government every four years if you want. You have power over a government.

You're missing the point. The point is not the compliance with the rules, the point, and the barrier to entry, is proving compliance. Licensing fees, inspection fees, all sorts of regulation-related costs. Startups often can't afford to pay these costs, which is why there's no new players. No new players means the existing ones are free to soak the customers as much as they want.

And in this specific instance, with a responsible monopoly, which got broken up into a cartel, yes, the customers were better off. A benevolent tyrant is usually better than a democracy, too, but that doesn't mean we should support tyranny.

So, no rules then? If companies can't be bothered to follow rules when there's punishment waiting for those who break the laws, you expect them to follow rules they don't have to?

But what about the broken up monopoly that resulted in a oligopoly with higher prices? Surely it was better for the consumer to have a monopoly, no?

Free market: (n) A market unencumbered by regulation or taxation.

Not to say there aren't rules, but those rules are not enforced by a state, they're followed voluntarily. Ratings organizations could rate which companies do the best job in various areas.

So then it's better to keep a monopoly run by the state, since you have a few politicians to punish?

I'd like to know what you consider a a free market? No rules at all, or can you have a few rules in place, such as rules about waste disposal? Employee safety?  Are those the things that you claim keep competition out?

Ahh. Yup, looks like the same thing happened in your case... they sold all their stuff to their buddies, and then set up barriers to entry. The market needs to be completely free for competition to work. If they're in a 'walled garden' of regulation, it makes it real tough for new players to enter. If no new players can enter, the existing companies can screw the customers as much as they want.

So no competition is better than a little competition? The market isn't "free" in your sense. It's free in the "everyone's free to compete and here are the rules" kind of way. It has turned into an oligopoly and no player is undercutting another because they make a ton of money, and no new player have emerged. I'm not sure how long anybody's supposed to wait for the market to fix problems like these, but 15 years is more than enough don't you think?

1) It would have to be below their price (or else you're making them money).
2) What's stopping them from not selling to you?