Has shock over Brexit made British politicians, as they say, daft?
With a snap election scheduled June 8, parties on both ends of the political spectrum are discussing energy-price controls.
Labor Party Leader Jeremy Corbyn’s plan to cap average household fuel bills might not be the worst idea in a party “manifesto” leaked to British newspapers on May 11.
The document also calls for nationalization of various industries, governmental control of the electric grid, and creation of a state-owned energy company in every region of the UK.
It also includes a ban on hydraulic fracturing.
These and other proposals suggest Labor believes too much time has passed since the UK last let socialist mistakes ruin its economy.
The party’s leftward departure from sensibility should improve prospects for Conservative Prime Minister Theresa May.
She called the election in a surprise effort to secure her political position in advance of negotiations over Britain’s exit from the European Union, having replaced David Cameron as prime minister without an election last year (OGJ, May 15, 2017, p. 29).
Contrasted with Corbyn’s statist revanche, conservative resolve would be comforting.
May, however, wants to squander the opportunity with an energy-price cap of her own.
Even worse than the idea is the prime minister’s squishy rationale.
Professing to believe in market freedom, she contradicted herself by saying, “If we see that a market that is supposed to be competitive is not truly competitive, then I think it’s right that we support working families by doing something about that.”
The problem of British energy markets in fact results from manipulations favoring renewable energy. When the inevitable costs slammed consumers, the government quit adding subsidies.
But distortion remains. That’s the problem May should address.
Price caps are just a different type of distortion.
May at least acknowledged her departure from conservative principles.
“What matters is not an ideology,” she explained. “What matters is doing what you believe to be right.”
Corbyn could not have said it better.
(From the subscription area of www.ogj.com, posted May 12, 2017; author’s e-mail: [email protected])
Bob Tippee | Editor
Bob Tippee has been chief editor of Oil & Gas Journal since January 1999 and a member of the Journal staff since October 1977. Before joining the magazine, he worked as a reporter at the Tulsa World and served for four years as an officer in the US Air Force. A native of St. Louis, he holds a degree in journalism from the University of Tulsa.