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Contributors
K. Lloyd Billingsley - Contributor
[Courtesty of Pacific Research
Institute]
K. Lloyd
Billingsley is Editorial Director for the Pacific
Research Institute and has been widely published on topics
including on popular culture, defense policy, education reform,
and many other current policy issues. [go to Billingsley index]
 California
Christmas List
More Choices
Through Market-Driven Policies…
[K. Lloyd Billingsley] 12/24/03
Gasoline
prices have dropped 48 cents since September to their lowest
point in a year, an average of $1.57 a gallon
according to AAA. This comes as a practical holiday gift for
Californians, who depend on their cars. It also provides a
lesson for legislators.
Lawmakers tend to clam up when prices are low, like global warming
alarmists during deep-freeze winters. But when prices rise, politicians
have a habit of calling for price controls and fulminating against
oil companies. During the recent election, Lt. Gov. Cruz Bustamante
called for price controls on gasoline, prompting the Sacramento
Bee to pronounce this the dumbest idea of all candidates. As
the article noted, it's an issue of supply and demand.
Supply is a problem nationwide. Refineries are dwindling - just
149 last year, down from 324 in 1981, according to the Federal
Energy Information Administration. It's an even greater problem
in California because few out-of-state refiners make gasoline
that meets the state's clean-air regulations.
Legislators can improve supply and keep prices low by rejecting
the folly of price controls, making it easier to build new refineries,
and ignoring environmental lobbyists who would like to see gasoline
prices in the range of $3-5 a gallon.
The market is also doing a good job of keeping prices low on
cell phones. Companies are tripping over themselves to offer
consumers good deals, lowering prices 69 percent over the past
decade. But those consumer gains are now under threat from the
California Public Utilities Commission, whose regulatory schemes
would mean fewer companies entering the market, fewer choices,
higher prices, and more inconvenience for consumers. Analysis
by the Law and Economics Consulting Group estimates that the
new regulations would amount to a 20-percent tax increase, in
addition to the 20 percent already tagged on to their monthly
bill.
Legislators should allow the market to work in this burgeoning
area. They can also, as in the energy field, review existing
regulations for effectiveness and punitive effects on consumers.
The rule should be: if it isn't broken, don't break it.
Repairs should
be limited to what does need fixing - California's government
education monopoly. The system delivers bad products
at high prices, especially school facilities, as the Pacific
Research Institute will show in the forthcoming study No
Place to Learn. It takes
six
years
to build a school, often more, and the price will always be as
expensive as possible. Meanwhile, student achievement remains
low, revealed by the high remediation rates in math and English
by the very students who are supposed to be the best. The monopoly
system - unaccountable, wasteful, and corrupt - leaves parents
and students with few choices.
Legislators can fix that by allowing those trapped in failing
schools to attend any school in the state. In the long run, legislators
should establish full educational choice for all Californians
as a matter of basic civil rights.
For legislators the lessons should be clear. More market-drive
policies will expand choices and make life better in the golden
state.
copyright
2003 Pacific Research Institute
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