> Can you say, briefly, what you mean by "pure capitalism?"
> To me, pure capitalism would be laissez-faire, within the context of a rights-respecting society.
I mean withOUT the context of a rights-respecting society. The capitalism that we have only respects the rights of others when compelled to do so.
> Sometimes, companies respond by innovating solutions that deliver more value at a lower price.
Yes when there's competition or the consumable isn't a necessity. In many municipalities it's a legal requirement to have running water and/or electricity, particularly if you have children or the elderly in the house; which means not buying is not an option. Utilities are commodity service providers; Southern Company's electricity is no better than Duke Energy's. They do not have any competition because markets have been carved out and consumers do not have a choice. They mostly don't develop the delivery technology, they just purchase it from others (e.g. GE).
With all that in mind, what is the motivation to innovate? So that the customer will be less angry at you as they write you the check each month?
What's the motivation to reduce costs? Lower costs might drive up demand which might put additional strain on infrastructure (look at the issues in Australia) and drive up maintenance costs. Lower costs might also require additional capacity which means capital investments.
The best place for a utility is to convince to you use as little as possible while charging you as much as possible in static fees each month.
> To me, pure capitalism would be laissez-faire, within the context of a rights-respecting society.
I mean withOUT the context of a rights-respecting society. The capitalism that we have only respects the rights of others when compelled to do so.
> Sometimes, companies respond by innovating solutions that deliver more value at a lower price.
Yes when there's competition or the consumable isn't a necessity. In many municipalities it's a legal requirement to have running water and/or electricity, particularly if you have children or the elderly in the house; which means not buying is not an option. Utilities are commodity service providers; Southern Company's electricity is no better than Duke Energy's. They do not have any competition because markets have been carved out and consumers do not have a choice. They mostly don't develop the delivery technology, they just purchase it from others (e.g. GE).
With all that in mind, what is the motivation to innovate? So that the customer will be less angry at you as they write you the check each month?
What's the motivation to reduce costs? Lower costs might drive up demand which might put additional strain on infrastructure (look at the issues in Australia) and drive up maintenance costs. Lower costs might also require additional capacity which means capital investments.
The best place for a utility is to convince to you use as little as possible while charging you as much as possible in static fees each month.