Archive | October 2015

Does it matter where Americans get there news?

Does it matter where Americans get there news?

by Shane Goodrich

Yes it matters, but what matters even more is how one takes the news they are given. Allow me to explain. During the course of the day we are bombarded by a lot of information, people talk about things that are happing in the world, people are telling us what they think is the truth (let’s put aside lying for this short essay), websites, magazines and newspapers are also giving us their view of the what the truth is. We know not all of these sources can be true. How? Because they often contradict each other, the “facts” presented in one place are different than those presented in another. So what matters when it comes to processing the news is making sure we reflect on what we are reading or listening too. What format is the show I am watching? Is it presented as so called “hard news” or is it editorializing? In other words is it an opinion based show like The O’Reilly Factor or is the channel 3 news? Understand what you are watching.

Is it better to have a diversity of sources? Of course it is but practically it may not be possible to always get a good set of sources for any given issue. For example, I try to get my information from a variety of sources. Over the summer I was attempting to get a grasp of the basics of economics. I read four different books on the subject in pursuit of this goal. The books ranged from a more libertarian viewpoint in the case of Basic Economics by Thomas Sowell to hard left in the case of What’s the Economy for Anyway by David K. Batker & John de Graaf. I did this because I wanted to get a balanced view. To get all perspective’s. But realistically this is much too time consuming and tedious for most people. Most people just want to read or watch people they like and tend to agree with. It’s often as much about entertainment as it is education.

So in the end it matters a lot where Americans or anyone else gets their news, it also matters in what context they take that news (watching Bill O’Reilly just for the fun of it is different than basing your political positions on his show) and it matters how many sources people are getting a given idea from. Just remember to think about what you are told, don’t blindly accept the facts.

Shane Goodrich, Co-host and video editor of Local Liberty

Link to Local Liberty video on the same topic here:

How to raise electricity rates while pretending to protect consumers

How to raise electricity rates while pretending to protect consumers

by Ken Mosher

I just received an email from my state representative, Gayle Mulligan, detailing several new laws that took effect on October 1st.  The email highlighted just seven of the new laws, likely out of dozens or hundreds, so one can assume that these are the ones she approves of most.  Some of the seven were fine, either promoting freedom or being neutral, but a few were nothing more than intrusions into our lives via burdensome or nanny-like regulations.

The most shocking (pun intended) of them regarded the available choices for electricity generation rates, by removing choice, of course.  Connecticut has had some of the most expensive electricity in the country for many years.  We currently rank #3; only Hawaii and Alaska have higher rates (http://www.neo.ne.gov/statshtml/204.htm) and we pay 62% more than the national average.  The next higher, Alaska, pays only a tiny bit more than we do.

An article in Forbes magazine claims that since deregulation “wholesale power prices have fallen dramatically…” lowering electricity generation prices over the last ten years (http://www.forbes.com/sites/williampentland/2013/10/13/after-decades-of-doubt-deregulation-delivers-lower-electricity-prices/).  The overall cost of electricity has fallen by a smaller amount because the cost of transmission has skyrocketed.

One sentence in that article stuck out, “To the extent it [the cost of power declining] hasn’t, regulation (not deregulation) is to blame.”  [Ed: even though I quoted that sentence I actually corrected two typos. Inserting [sic] multiple times seemed rude.]

That is, deregulation successfully lowered prices during the last 10 years, but in cases where the price was not lowered as much as the others, regulation was the cause.  The article’s author did not offer any data to back up his statement.

Then along cometh the gift from our state legislatures, a new round of regulation to “protect” us from the evil power companies and the ravages of capitalism.  The problem is that you can’t change economics or human behavior by passing laws any more than you can affect gravity by the same means.

VARIABLE RATE BAN

“After receiving thousands of complaints by electric customers who saw their bill skyrocket through variable rates, Connecticut is now the first in the nation to ban variable rate electric contracts.”

There’s been a tremendous amount of agita among the buyers of electricity since Connecticut deregulated it in 1998, with consumers first able to choose an electricity generation supplier starting in 2000.  CL&P and UI retained ownership of the lines and became known as your delivery supplier.

Note that people are: forgetful, lazy, and stupid, pretty much in that order.  Even though choosing a new generation supplier was incredibly easy, the masses were confused.  It took a very long time for people to switch away from CL&P or UI even though their regulated price was much higher, but eventually the public accepted it.  [Ed: A search for the percentage of customers who have selected an alternate generation supplier turned up only one reference, from 2010, “More than half a million families have switched“.]  But choosing an alternate supplier usually involves a rate that’s valid for a specific period of time; you have to keep track because when the rate period expires your rate might increase.

Now back to the email from my state rep, “After receiving thousands of complaints by electric customers who saw their bill skyrocket through variable rates…”

In theory those thousands of customers made an informed decision to sign up for the variable rate, which was cheaper than the fixed rate, knowing full well that it could be adjusted monthly.  They traded the safety of a higher fixed rate for the uncertainty of a cheaper variable rate.  Then they cried and screamed when their variable rate lived up to its name, it varied!  They were caught by surprise, having been used to paying a low variable rate that had rarely varied. They went from feeling superior for getting the better rate to feeling like they were being cheated when their gamble went against them. That is not the behavior of a well-adjusted adult who is used to both the benefits and repercussions of his actions. That is the behavior of a spoiled, entitled brat who suddenly isn’t getting his way! 

For the vast majority of the time the variable rate customers got the best deal, but then a period of extreme price increases in the cost of wholesale power caused rates to explode higher. Fixed rate customers were protected somewhat, until their agreements expired and they found themselves paying 50% more for power.  The variable rate customers, however, saw a huge price increase immediately, with a doubling of their cost not uncommon.

The result was predictable, they screamed bloody murder because the evil electricity providers were gouging them. It never occurred to them that the supplier was also paying double the rate from the wholesalers.  Every politician immediately rushed to the nearest microphone to make one of the standard, uninformed comments.  Power company CEOs were hauled before committees where legislators lectured them on electricity rates.  Can you, cherished reader, imagine being lectured at by Senator Edith Prague, a woman of dubious intelligence who never had an original thought or spoke a sentence with meaning in her entire career as an elected official?

The spike in prices was short lived.  Lucky fixed rate customers were spared a few months at the beginning but then had to choose between new fixed rates between $0.12 and $0.15 per kilowatthour. Then, after a few months, prices began to fall rapidly, to the point where I’m now paying barely over $0.06 on my fixed rate plan.

In response to the outrage of high electricity prices, an outrage that lasted only a few months and that was entirely beyond the control of any of the generation suppliers. Our Connecticut legislators have cooked up a new regulation that will increase the cost of power in our state. Maybe we can even surpass Alaska to retake the number two spot!  (Wait, that would be a bad thing.) The Hartford Courant even agreed with my assessment in an article on October 5.

For the vast majority of the time, choosing a variable rate resulted in lower prices.  Unfortunately the whining of a small but vocal crowd can catch the attention of our nanny-state legislators, and just like nannies they want the whining to stop. So now they have protected the hardworking citizens of Connecticut from selecting the lowest electricity generation rate possible, the variable rate.

The electricity suppliers are not going to suffer. They will protect their bottom line by offering shorter fixed rate terms to guard against sudden price spikes, or their longer terms will be significantly more expensive.  Look forward to it because soon you’ll have to remember to choose a new supplier every 3 or 4 months.  It already happened to me; i was unable to get a fixed rate term longer than 4 months.

The next time you hear someone complaining about government gridlock and a do-nothing congress, gently remind them how lucky they are to have it.  The converse is a well-oiled machine that turns out thousands and thousands of pages of new laws like the USA PATRIOT act and the TSA.

Ken Mosher, former board of education member from Andover, CT

Is “Pork-Barrel” Politics good for democracy?

Is “Pork-Barrel” Politics good for democracy?

by Shane Goodrich

            I am going to answer this question in the context of modern American politics this will avoid any messy definitional issues with the word democracy. If you want to get elected today in America you more or less have to promise stuff. What that stuff is will vary from town to town and state to state but you have to bring the goods. On a small scale this seems logical, we elect politicians to represent us, to take care of our interests. If the local economy is focused on mining we want to make things better for miners, in our case (congressional district 2 in CT) much of the local economy is tied up in military manufacture (in this case submarines) well let’s hope Joe Courtney can up those orders for the subs, we need the jobs!

This sounds all fine and dandy in theory… except when you think about the country as a whole, where are these orders for submarines coming from? Who is paying for this stuff (helpful hint: American taxpayers)? The law that might help miners in one district may cause harm to other occupations in other districts. The country as a whole may not need more submarines (please let’s stop making so many machines of war and destruction) but here in the 2nd district the EB is important. And that is the fundamental tension at play. A senator or congressman has to appease his voter bloc, notice I say voter bloc here as someone like Joe Courtney does not have to pay much attention to the people who did not vote for him, he has to bring the stuff just for those that got him into office. Great democratic representation right there.

As a whole congress has terrible approval ratings, people laugh at things like the bridge to nowhere, but those laughing at these things tend to be outside the purview of the congressman or senator that got the bridge deal done in the first place. If they live outside your district oh well who cares about them. If they did not vote for you, oh well don’t worry about those folks. So is pork barrel politics good for democracy? I think certainly on the whole if you look at America pork barrel spending is not helping us. Those pork projects that are paid for with federal dollars hurt us all. For the moment it’s difficult to see an end to these kind of shenanigans. Perhaps with more education and understanding of the system things might change in the future or perhaps the underlying system needs changing. But for now the pork will keep on coming.

-Shane Goodrich, Co-host & Video Editor of Local Liberty