It is the profit motive that leads to the negative outcome in the former case, and the nature of the State as an organisation, combined with the defects of representative democracy, in the latter.
IMHO the optimal enterprise model for an infrastructure utility is neither Public = State, nor Private = For rentier Profit but a networked cooperative of cooperatives. ie a partnership framework for Peer to Peer interaction between producer and consumer.
I set out my conclusions here in 2001 and a blueprint for a Market 3.0
This analysis is now being picked up by influential thinkers such as Michel Bauwens, and others. If you can refute it, I would be interested to read your critique, and your alternative view of the next generation of markets.
I identified and developed in 1998/9 - through a Dot Com I founded - what was essentially a new utility function. ie generic transaction registration. It took years to realise that the problem was that there was no adequate enterprise model for such a utility, or indeed, for any utility.
Many years, and much analysis and development later, I believe that not only could a partnership-based utility model be created but it is, I submit, in the interests of States and Shareholders alike for public and private utilities to use such a model.
And btw, Jake, I spent years working on the emerging electricity and gas markets while at IPE, and remember discussing clearing in Oslo with Nordpool when they were still recording transactions on a white board.
I think I know what works, what doesn't work, and more to the point I now have a pretty shrewd idea WHY it doesn't work, market by market.
And if you require a rationale for unitising electricity you might try reading someone who has essentially done it just to show that it's possible. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Units redeemable in underlying value do not concern securing supply. They secure price, and have no effect on supply.
They are a means of payment complementary to fiat currency - and a genuine store of value, which is why they will be hugely successful in a way that commodity ETFs (ETCs) can never be.
Unitisation is pretty trivial - supermarkets and airlines which issue reward points and air miles are issuing Units.
It's not Rocket Science. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Money is redeemable for anything, from anyone. En un viejo país ineficiente, algo así como España entre dos guerras civiles, poseer una casa y poca hacienda y memoria ninguna. -- Gil de Biedma
I would propose as a starting point membership by energy users and consumers alike of an International Energy Trade Association (defined by use of a transaction registry) and then to build an Energy Pool, Guarantee Society upon that foundation, and apply unitisation within the resulting framework.
I think that you would be hard pressed to find people not prepared to accept a Unit redeemable in energy if such a framework of trust existed.
Note that I see Units redeemable in energy as a global reserve currency. Units redeemable in land rental value would probably comprise most of the value circulating locally. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
