Author Topic: Market Deregulation?  (Read 2568 times)

Virgil0211

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Market Deregulation?
« on: February 08, 2009, 05:56:44 PM »
This should probably get done. A nice detailed explanation of what exactly happened with "deregulation", and how it relates (or doesn't) to the current financial crisis. Something concise and easily digested.

MrBogosity

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Re: Market Deregulation?
« Reply #1 on: February 08, 2009, 07:07:56 PM »
Economics though, is anything but concise and easily digested.

That's why we see the same kind of pseudoscience: politicians (on both sides of the aisle) have their simplistic version that they can use, along with various platitudes, to support their policies. The real science behind economics is much more complex and nuanced. Just look at my Economic Primer series: you can't boil it down much more than that, and even then you still have people in the comments twisting it, and even denying straightforward observations like Galton's Ox.

Virgil0211

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Re: Market Deregulation?
« Reply #2 on: February 09, 2009, 01:28:24 PM »
Perhaps one that goes over the changes with the "market deregulation" and how it's a bit of a misnomer? I dunno. I guess I'm just throwing out ideas. =P

Atheos5150

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Re: Market Deregulation?
« Reply #3 on: February 22, 2009, 12:40:30 PM »
I don't really know about Market Deregulation....


...I do know about the deregulation for energy companies, from moving to Montana. When I lived in Texas, energy use to be regulated and Montana, it isn't.  It seemed like every 6 months they would increase their rates citing they had no choice.  The funny thing was NorthWest Energy was the only energy providing company and they were constantly bankrupt. 

When I moved back to Texas, I heard they deregulated the energy.  I don't understand deregulating a monopoly such as energy, because it is a necessity.

I know this is off topic.   :-\

MrBogosity

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Re: Market Deregulation?
« Reply #4 on: February 22, 2009, 12:43:46 PM »
Most prices go up like that in an inflationary economy. That means nothing.

The real point is that most forms of deregulation are nothing of the kind; it's corporatism in disguise. The real test is when you said there was only one company: the government is protecting the monopoly.

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When I moved back to Texas, I heard they deregulated the energy.  I don't understand deregulating a monopoly such as energy, because it is a necessity.

Food is a necessity. Should we have a monopoly on groceries?

Atheos5150

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Re: Market Deregulation?
« Reply #5 on: February 22, 2009, 01:01:34 PM »
Most prices go up like that in an inflationary economy. That means nothing.
But they are able to charge whatever they want, and the people have no choice but to pay it.  This was around 2002-2004. 


Food is a necessity. Should we have a monopoly on groceries?

o.O  But I can shop around at different stores to find a price I'll pay and also choose brands and even buy local.  If they monopolized groceries, there would be no competitions on price.  Allowing the price to increase to what ever they want.  I can't shop around for an energy company.

Am I completely wrong on this?  Am I not understanding something?

MrBogosity

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Re: Market Deregulation?
« Reply #6 on: February 22, 2009, 03:42:08 PM »
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But they are able to charge whatever they want, and the people have no choice but to pay it.

That's corporatism for you.

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But I can shop around at different stores to find a price I'll pay and also choose brands and even buy local.  If they monopolized groceries, there would be no competitions on price.  Allowing the price to increase to what ever they want.  I can't shop around for an energy company.

Right. And wouldn't it be much better if you could? To have a choice based on price, or the amount of "green" power, or level of customer service, or downtime during inclement weather, etc.?

The only way to get that is the free market. And the only way to get a free market is to get rid of regulations.

Andy120290

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Re: Market Deregulation?
« Reply #7 on: February 22, 2009, 04:27:43 PM »
Would it not be more appropriate to say that the free market would regulate itself?

MrBogosity

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Re: Market Deregulation?
« Reply #8 on: February 22, 2009, 06:01:01 PM »
True, Andy.

Atheos5150

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Re: Market Deregulation?
« Reply #9 on: February 23, 2009, 12:34:51 AM »
But I thought when they deregulated something, they were removing the 'caps' on what they could charge?

MrBogosity

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Re: Market Deregulation?
« Reply #10 on: February 23, 2009, 06:22:25 AM »
Most of the time, they add as many regulations as they remove.

Take the California power crisis. They blamed it on "deregulation," but while they removed power caps on suppliers, they kept them on the providers. They also had regulations barring the building of new power plants, and restricted the importation of power from other states. (All to help Enron profit, of course.)

So, you had an artificially-low supply, which could not be compensated for by an increase in price. The result was a power shortage and rolling blackouts. No economist worth his salt would have expected any other outcome.