January 14, 2014

Crony capitalism is why we can't buy 100, 60 or 40 watt incandescent lightbulbs.

Crony capitalism isn't just a catch phrase.  It effects all of us and not for the better.  The best example is the ordinary light bulb, the incandescent light bulb that we've all used for years.  On Jan 1, 60 and 40 watt bulbs were banned.

The Washington Examiner discusses how Industry, not environmentalists, killed traditional bulbs.. The competition among  Industry giants life GE, Phillips and Sylvania kept the cost of light bulbs low and the profits as well.  But they couldn't get consumers to buy their fancy halogen, LED and fluorescent bulbs which were more expensive and delivered much higher profits.    People preferred the far cheaper light bulbs that worked perfectly well, that delivered a warm, more aesthetically pleasing light and that didn't have mercury in them which in the new bulbs practically required a haz mat team if a bulb broke so extensive were the precautions that had to be taken.

So the industry giants got behind

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.
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Light bulb manufacturers whole-heartedly supported the efficiency standards. General Electric, Sylvania and Philips — the three companies that dominated the bulb industry — all backed the 2007 rule, while opposing proposals to explicitly outlaw incandescent technology (thus leaving the door open for high-efficiency incandescents).

This wasn't a case of an industry getting on board with an inevitable regulation in order to tweak it. The lighting industry was the main reason the legislation was moving.

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.

Kimberly Strassel  The Year of the Washington Power Grab  It's corporate cronyism.

In ObamaWorld, winners and losers are chosen by the federal government.

This past year will be remembered for many things, but let 2013 be hailed mainly for this: It was the year that the genius of George Orwell's "Animal Farm" became clear in America. Efforts to centralize control in the name of "fairness" have led to a society that is ever more at the mercy of a federal power—one that decides who does and does not succeed. The winners are favored special interests, political cronies and wealthy lobbyists. The losers are everyone else.
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Indeed, in ObamaWorld, many millionaires, health-care buyers, energy companies, subprime dealers, political groups, and bird killers are more equal than others. Our new elite is ever more defined by who has the best pull with the administration. So long as government grows, so too will this government-created inequality.  They didn't like the 'efficient' bulbs which were far more expensive, sometimes 20x as expensive that were slow to warm up, cast a cold light and contained a small amount of mercury,

60% Still Oppose Government's Light Bulb Ban

Only one-in-four Americans support the ban on conventional 40- and 60-watt light bulbs in the United States that went into effect January 1, and the same number say they or someone they know stocked up on the old bulbs beforehand.
Posted by Jill Fallon at January 14, 2014 10:44 PM | Permalink