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Cato Daily Dispatch for August 21, 2003

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Electricity Deregulation Debate Heats Up in Montana
New U.N. Resolution on Iraq in the Works
Republicans Discuss Expanding Justice Dept. Powers

Electricity Deregulation Debate Heats Up in Montana

"Six years after the local utility, Montana Power, started selling assets as part of the state's headlong dalliance with the national energy market, various companies in its old hometown, Butte, have laid off employees or even closed because power costs so much," reports The New York Times.

"So even as the Northeast painstakingly ponders what role energy deregulation might have played in last week's crippling blackout, a similar soul-searching is in full cry here. And many people are calling for both tougher regulation and at least a partial return to the good old days of homegrown energy suppliers."

In "The Deregulation of the Electricity Industry: A Primer", Peter VanDoren, editor of Regulation magazine, writes that over the long term, deregulation benefits consumers: "Scholarly evidence suggests that regulation does very little to constrain utility pricing. In the few areas of the country where actual competition exists, electric prices are lower than they are elsewhere. In addition, decentralized natural-gas-fired electric generators seem likely to be a viable alternative to conventional electric service."

New U.N. Resolution on Iraq in the Works

"U.S. and U.N. officials are working on a draft resolution 'that might call on member states to do more,' Secretary of State Colin Powell said today after meeting with U.N. Secretary-General Kofi Annan," according to The Associated Press.

"Discussions on the draft in the Security Council might include 'issues with respect to the role the U.N. might play' in Iraq, Powell said."

In "The U.N. Will Complicate an Iraq Exit Strategy," Ted Galen Carpenter, vice president for defense and foreign policy studies, writes: "The most compelling reason for marginalizing the U.N.'s role in postwar Iraq is to maximize the prospects of a prompt U.S. withdrawal from the country. If the U.N. becomes a major player, we add a party with its own agenda--and that agenda is likely to be an extended nation-building mission. The last thing America needs is to become bogged down in a multiyear effort to try to make Iraq into a model democracy."

Republicans Discuss Expanding Justice Dept. Powers

"As Attorney General John D. Ashcroft begins a barnstorming tour of the country to shore up support for existing anti-terrorism laws, Senate Republicans are discussing legislation that would expand the Justice Department's powers to investigate terrorists and drug criminals," The Washington Post reports.

"Recent drafts of the Victory Act, which carry the names of Sen. Orrin G. Hatch (R-Utah) and four other Senate Republicans, would provide extra penalties for drug dealers alleged to be connected to terrorist groups and would dramatically expand the government's power to seize records and conduct wiretaps in connection with 'narcoterrorism' investigations.

In "Upholding Liberty in America," Cato President Ed Crane and Cato Chairman William Niskanen, write: "America must safeguard its freedoms in the fight against terrorism, but protect itself from pernicious policies that erode freedom in the name of liberty. . . . Today, with the war on terrorism, the opportunities for the state to expand are ubiquitous. Both liberals and conservatives are turning a blind eye to unnecessary usurpations of power, if not openly calling for them."

Jonathan Block, editor, jblock@cato.org