Crony Capitalists paid their Friends in Government to Ban the Incandescent Lamp

Posted by PITHOCRATES - January 5th, 2014

Week in Review

Competition makes everything better.  For consumers.  That’s you and me.  For it’s that competition that makes business give us more for less.  To please us.  And to persuade us to give them our dollars for their products.  It’s a great system.  It prevents businesses from giving us shoddy goods at high prices.  For if they did they would lose their customers.  And go out of business.  So competition in free market capitalism gets businesses to choose to please their customers.  By giving them more for less.  Which allows them to stay in business.  Unless they have corrupt friends in government (see Industry, not environmentalists, killed traditional bulbs by TIMOTHY P. CARNEY posted 1/1/2014 on the Washington Examiner).

Say goodbye to the regular light bulb this New Year.

… Starting Jan. 1, the famous bulb is illegal to manufacture in the U.S., and it has become a fitting symbol for the collusion of big business and big government.

The 2007 Energy Bill, a stew of regulations and subsidies, set mandatory efficiency standards for most light bulbs. Any bulbs that couldn’t produce a given brightness at the specified energy input would be illegal. That meant the 25-cent bulbs most Americans used in nearly every socket of their home would be outlawed…

Competitive markets with low costs of entry have a characteristic that consumers love and businesses lament: very low profit margins. GE, Philips and Sylvania dominated the U.S. market in incandescents, but they couldn’t convert that dominance into price hikes. Because of light bulb’s low material and manufacturing costs, any big climb in prices would have invited new competitors to undercut the giants — and that new competitor would probably have won a distribution deal with Wal-Mart.

So, simply the threat of competition kept profit margins low on the traditional light bulb — that’s the magic of capitalism. GE and Sylvania searched for higher profits by improving the bulb — think of the GE Soft White bulb. These companies, with their giant research budgets, made advances with halogen, LED and fluorescent technologies, and even high-efficiency incandescents. They sold these bulbs at a much higher prices — but they couldn’t get many customers to buy them for those high prices. That’s the hard part about capitalism — consumers, not manufacturers, get to demand what something is worth.

Capitalism ruining their party, the bulb-makers turned to government. Philips teamed up with NRDC. GE leaned on its huge lobbying army — the largest in the nation — and soon they were able to ban the low-profit-margin bulbs.

When you have collusion between big business and big government you no longer have free market capitalism.  No.  Instead you have crony capitalism.  Where rich people both in business and government collude with each other to make themselves even richer.  While making consumers poorer.

The lamp manufacturers got new laws that forced consumers to pay the higher prices they wouldn’t without a law compelling them to do so.  Making the lamp manufacturers richer.  And the lobbyists poured lobbying money over their friends in government.  Who probably stripped naked and rolled around on it, rubbing that cash all over their naked bodies.  And said God bless global warming.

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