Money for Nothing

Everything old is new again, at least in the current political climate.

One of the prouder programs of Franklin Roosevelt's New Deal entailed paying farmers not to grow crops; the government decided that they wanted to shore up food prices (so farmers could make a better living) and this was accomplished by paying farmers to let their fields lie fallow. This bizarre idea emanating from the Roosevelt "brain trust" mirrored other New Deal notions such as paying workmen to dig holes that other workmen would then fill in-ostensibly to provide employment . Well, this is the new Rooseveltian era...

According to this AP story in the Kansas City Star, the State of Missouri is planning to allow electric companies doing business in the state to slap a charge on consumers for, drumroll please, not using electricity!

Yes, you heard that right; local power companies complained about the money they are losing as a result of conservation efforts and intend to pass those losses along to the consumer. The assumption is that by avoiding the construction of new plants that would be needed if demand were not curtailed, consumers will ultimately pay less.

This bit of dirty pool is intended to backdoor a rate increase that failed back in June. AmerenUE, supplier of electricity to much of eastern Missouri, had sought to change existing law so as to pass on the cost of building a new nuclear plant to consumers. They asked the Missouri Public Service Commission to allow them to hike rates, and the public-tired of high and ever increasing costs-rose up in one of those occasional groundswells of popular anger. That anger stemmed from the poor job Ameren did in minimizing power outages statewide in 2008 and early 2009; it was widely suspected that Ameren (and the other power companies) had failed to use record profits to update the grid and that they footdragged on restoring power so they could ask for this $226 million rate hike.

Now, businesses exist to make money, and the utility companies are no exception-nor should they be. The problem is that the industry has been strangled by government regulation. Rates are fixed by the government bureaucrats, new power plants must be approved, must meet the standards set by state and federal mandates, and competition is eliminated as the power companies are granted a monopoly in their regions by government dictate.  In a free system, the utility companies would compete to supply power, and costs would be passed on indirectly.

But, much like what happened in California in 2000-2001, the utility companies are being squeezed by the government. (Read about what happened here.)This push for the "soft path" means more capital has to be spent on "renewable" energy or conservation. Notice that this bill (which Democrat governor Jay Nixon praises by claiming "To save power is the equivalent of making power") pushes for "smart meters" that will allow the utility company (meaning ultimately the government) to reduce or shut down your power usage. The utiility in Kansas City says it has distributed programmable thermostats to 34,000 customers.

So, the government will control our thermostats, indirectly charge us for not using power, and will push for less energy to be produced. We are witnessing the Great American Brownout! One of the prime measures of wealth is energy usage; under the New New Deal America is becoming impoverished-and are being made to pay for nothing. Cap-and-trade is one example of creating a market for nothing, and this follows the same path. Americans are continually being asked to pay more for less at a time when the public needs every dollar they earn. This sort of foolishness turned the Depression into the Great Depression.

I wonder how much they can charge for not selling electricity to the Hooverville's that will spring up?

(hat tip to writer Jack Kemp-not the late politician.)