Among the oddities of human "society" in general - and with a sad
but corresponding direct analogy in capitalism, is the fact that
the most important and vital "survival" functions are often left
uncontrolled, with little training or oversight, and largely left
to the whims of unqualified but supposedly "trustworthy"
individuals (those who have foregone the profit motive) who are
"supposed" to accomplish very important procedures for the good of
us all, but pretty much on their own initiative (or lack thereof).
To wit: parenting and power generation.
How much high level training do prospective parents really get?
Hey - this is arguably the single MOST important function in
society, and yet any uneducated drug addict can, and often do,
participate in parenting and to more than their fair share ....
or, correspondingly, how much effective oversight and dynamic
innovation is really given to, or expected from, the "utilities"
who are responsible for power generation? All of commerce depends
on cheap power, yet the power companies are often so "tight" and
over-regulated that they generally only attract those slackers who
cannot get hired elsewhere (ok that is hyperbole, but there is
some truth to it).
We cut off the profit potential, want them to cut costs to the
bone, hire underpaid staff, and yet we expect innovation and
efficiency. This kind of dead-end game doesn't work well in the
USA (although it does work better in Europe).
If the power industry were run like the semiconductor industry,
would we be in this mess? Would we have even had a TMI - if
somewhere along the line, government had made the job of power
generation dependent on how well it was performed ? We might not
have a Moore's Law in that industry, as that is a peculiarity of
reverse economy of scale - but surely there is a middle ground -
for motivation. By that I mean a middle ground of incentives and
disincentives - which allows some profits for the best ideas and
innovation, and some deduction of pay for failure - instead of
all-profits for even the most-corrupt (i.e. - the Enrons, and
there were many just as guilty as Lay & Co. who did not have their
hands quite so far in the till).
Thinking about the situation with nuclear power in the '70s in the
USA is a story of almost unbelievable incompetence, but the blame
is not so much on the industry itself as on government and
capitalism as a whole. When we decide to make an industry a
"utility" and an over-regulated one at that - then it is almost
like you are saying - this job is not important enough to do
correctly.
Capitalism needs a different kind of motivating influence for
electric utilities. This can be done, but the real culprit as
always is ourselves - i.e. capitalists wanting "government" to go
away and not intervene - even where they should. Consequently US
society as a whole is to blame for not stepping in and thinking
this problem out before it got out of hand. Plus, "government" as
a rule - absolutely hates to deal with disincentives - especially
in the pay of middle management. However, often that is what works
the best in these situations. Government doesn't have to do the
actual work - just provide the framework for risk, rewards, and
some kind of effective 'punishment' for mediocrity. Did anyone at
TMI get their pay docked?
Otherwise, without some motivation - why should bureaucrats at TVA
care, when they are not held accountable when a plant started in
1973 does not become operational until 1995. It wasn't their
fault - you've got the Sierra Club, the snail darter, GE and the
PACs, Jane Fondle, Congress and so-on to blame, and with
ultra-cheap hydro as a backup - who cares if things slow down to a
crawl? Not a single worker at TVA was docked a nickel in pay
because of what was maybe, in total, a $15 billion boondoggle.
... so why should those bureaucrats care at all if the
ratepayers - who had the lowest power rates in the USA, now have
near the highest, because the interest on those bonds (taken out
when prime was over 10%) ends up accounting for 75% of the cost of
electricity. It is not a big exaggeration to say that between TVA
and WOOPS ;-) which was nearly the identical boondoggle in
Washington/Oregon that for every $100/month the ratepayer is
forking over nowadays - supposedly for "power," $50 is going to
the bankers and bondholders for past incompetence - and not for
the real "cost" of generating power at all. Bizarre.
Hey if you borrow a billion at 10%, then that initial debt doubles
every 7 years, and 21 years later that billion dollar plant has
now rung up 8 billion in actual cost to the ratepayer(because you
have to borrow the interest as well until the plant begins to
function) of which 7 billion is interest alone (had not rates gone
down somewhat during that time).
This could be the saddest chapter in the economic history of the
USA - and that was before Enron even came on the scene, to turn
plain incompetence into a case study in high-level criminality.
Wow. Talk about a power-rant. Did I forget to offend anyone today
?
Jones
