Hi armchairs, I just read today's Krugman editorial on the NYT regarding the deregulation of electricity issue in California. As many sharp members of this list do reside in CA, I wonder what their reactions are... Here is an excerpt from Krugman --the complete opinion is in this link: http://www.nytimes.com/2000/12/10/opinion/10KRUG.html "Maybe California power companies aren't rigging electricity prices. But they clearly have both the means and the incentive to do so — and you have to wonder why the deregulators didn't worry about this, why they didn't ask seemingly obvious questions about whether the market they proposed to create would really work as advertised. And maybe that is the broader lesson of the debacle: Don't rush into a market solution when there are serious questions about whether the market will work. Both economic analysis and British experience should have rung warning bells about California's deregulation scheme; but those warnings were ignored — just as similar warnings are being ignored by enthusiasts for market solutions for everything from prescription drug coverage to education."
