Wed., Jun. 6, 2001

Make deregulation magically disappear

Daily Record Staff

Step right up. Step right up, folks, and see this magic potion everybody’s talkin’ about. It’s magic. That’s right. Right here in Pennsylvania.

If you buy a bottle of this potion, you’ll have electricity at a cheaper price. That’s one of the benefits, folks. Cheaper utilities altogether. And guess what else? Better service, that’s what.

It’s in this fancy bottle labeled “deregulation.” Can you see that, kids? That’s a big, fancy word for “Government, butt out.” Yes, indeed. The free market. That’s what it is. Put some electricity into this magic “deregulation” bottle, and it comes out cheaper and more efficient ...

That “magic potion” isn’t quite what it seemed.

Deregulation is actually more like a placebo for consumers than an elixir for high energy costs in Pennsylvania.

A study released last week by the Keystone Research Center and commissioned by the AFL-CIO Utility Caucus found that Pennsylvania utility companies have gotten richer since deregulation — and state residents have suffered.

Among the findings:

Complaints to state utility companies doubled from 1994-99.

Electric outages lasted about 30 minutes longer in 1999 than they did five years earlier.

Utility companies decreased their work force by nearly 15 percent in that same period but paid their CEOs 76 percent more in inflation-adjusted dollars from 1994-99.

Those companies made a combined profit of $16 billion in five years and invested less than $1 billion of those profits in utility infrastructure, such as power plants, facilities and transportation and communication systems. Deregulation in California has struck out with a loud thud. Pennsylvania lawmakers were a little smarter when preparing our state’s potion, but the problems Californians face reflect back on deregulation as a bad avenue for utility companies.

Pennsylvania lawmakers need to evaluate this report’s findings and make available to consumers the utility reports of these companies for regular examination. If infrastructure isn’t improved and profits continue to override prices, legislators need to step in and change this course.

Magic, of course, is never really magic. This time, it’s a fancy bottle of energy potion that has less in it and costs more than it did before.

http://www.ydr.com/opinion/1edit1010606.shtml

-- Martin Thompson (mthom1927@aol.com), June 08, 2001