Wednesday, September 21, 2005
Marty Cohen as ICC Chair? Awesome
Governor Blagojevich hit a home run today in appointing one of the nation's most successful consumer advocates to Chair the ICC that regulates utilities. I would like to think Pat Quinn whispered in Rod's ear for this one. This move ensures that electric and phone rates will be fair in the state. Great move.
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4 comments:
I couldnt agree more, DJ. Many of blago's decisions are often overlooked (or discredited as media stunts), even though the decisions are clearly in the interest of the working people of illinois. hopefully these same people will come to realize that this guy is in their corner and will fight for what is in their best interest (as he always has).
I think Leader Jones would be disappointed to see that one of his staffers is taking a different position than he is.
Telecom rates have been in free fall. A bigger issue than rate regulation for telecom may be making transitions easier for people that worked for telecom companies that went out of business due to dereg and competition and acquisitions and etc. Transition could be tax breaks, re-training assistance and grants, etc
the energy industry is a little different. rates are high. i guess this fall and winter could be tough. high rates might dampen the economy (people have high energy bills and less money for other stuff). if energy companies do not get to charge high rates, they will not build capacity or have an incentive to build capacity or have resources to build capacity. investments in energy capacity are super-complicated (need to know about volatility, uncertainty, long lead times, big #s)
one more:
until the price of a barrel of oil reaches its historical all-time high in real terms (adjust for inflation), i do not think oil companies will not run out and build refineries.
a high would be around $80 to $90 per barrel.
the price of a barrel of oil is currently murky. there have been lots of traders and speculators having an unclear effect on oil price (see Goldman Sachs recent earnings release and what drove the big increase in profits). you also have the U.S. fed govt easing all kinds of regulations post-katrina in an effort to lower price. these two forces make it hard to know what a true "market" price would be for a barrel of oil. OPEC currently has the faucet turned on full blast (unlike the 1970s). We in the U.S. have to hope this continues. The Saudis may currently be easing on buying U.S. treasuries and may be investing in the Saudi stock market.
the natural gas business is different. i do not know as much about this.
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