KRUGMAN!! - Power and Profits

Here he comes again. Paul Krugman has been issuing many statements on the various problems that face the economy in the early days of the Bush administration. Here he takes on the California power problem. His no-nonsense economic analysis is refreshing especially since the only economic information we get on the issue comes from pundits (or blithering idiots, whichever term suits your fancy). The power suppliers (read: massive polluters) with their new-found b-line to the white house are making an all out assault that says a price cap will make things work. Krugman takes this on directly. In his conclusion, he addresses the immediate retort of the power companies that anyone opposing price caps is out of touch or just a liberal hack. "Nobody to the right of Ralph Nader denies that prices have to be allowed to serve a role as "signals" of shortage or abundance, that the profit motive is what makes our economy run. But even now the public rightfully draws a line, fuzzy but real, between profits and profiteering. Natural gas prices that rise in a cold winter are acceptable; $10 a gallon for bottled water after a hurricane is not." It is this kind of common sense addressing of the issues while cutting through the cobwebs of political deceit that will be esepcially necessary as the country fights the downturn and the tax cuts as we wait for the Fed's most recent cuts to turn things around.
- posted by levinson @ 1/24/2001 07:22:00 AM