Listening to California s Governor Gray Davis call for government controls reminds me of Ayn Rand s Atlas Shrugged. If you haven t read this insightful novel, in it the government adds more and more controls to business until finally nothing in the country really works at all. And if they are physically stronger, they have weights added to their backs until they are at the same level as the physically weakest person. We may not be at quite that point, but the controls-no controls battle certainly makes me wonder if these two authors were time travelers who went just a bit into our future. Price controls have never worked well.
Price controls wipe out surpluses and make shortages worse.
And, although Davis presented Bush with a letter, signed by 10 economists, touting price controls, earlier this year 500 economists signed a letter denouncing price caps. Rather than turning to a method that has never worked, the government needs to continue to support our industry. And California needs to reorganize their deregulation plan, facilitate power plant building, and realize that higher prices will help push for energy conservation. For me, the proposed increase of nuclear power is one aspect of the Administration s new energy plan that rings a lot of alarm bells. As a recent letter, published in the Christian Science Monitor, points out, nuclear waste takes about 100,000 years to decay to half of its original activity.