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> All around the country you can see regulated rates that are too low and drive out investment. A great example is water utilities. Almost everywhere, water rat

> All around the country you can see regulated rates that are too low and drive out investment. A great example is water utilities. Almost everywhere, water rates are far lower than they should be, and as a result water infrastructure is crumbling, customers are drinking water through lead pipes that haven't been replaced in a century, etc. It's too simplistic to blame this on government regulation. The rest of the world also regulates utilities, and far from all of it has the crumbling water infrastructure problem.

rayiner 10y ago
> It's too simplistic to blame this on government regulation. The rest of the world also regulates utilities, and far from all of it has the crumbling water infrastructure problem. I'm not blaming the fact that government regulates utilities. I'm pointing out that using government regulation to simply drive prices lower is bad in the long term. Government regulation can work when prices are set at levels that balance investor incentives and consumer welfare. Doing that is really hard. When the U.K. privatized British Telecom, it created a regulated monopoly (now BT Openreach) that owned the wires into peoples' houses. They spent a lot of time and intellectual energy into determining how to set BT Openreach's rates. As a result, that monopoly is more profitable than say AT&T (even including AT&T's lucrative wireless division). Unsurprisingly, BT Openreach has aggressively built out FTTN in the U.K. whereas U.S. telephone providers have been trying to limit investment in their networks.