Outrageous Heating Bills Are Steaming Up Americans
"Drivers have been fuming about high gas prices since last fall, and inflation has had Americans up in arms for almost a year now. But neither annoyance prepared people for the recent unpleasant shock of getting the winter's first gas and electric bills.
Soaring heating bills shouldn't come as a total surprise. Last fall, federal agencies warned that heating bills would surge 5% to 50% higher this winter, largely due to the rising costs of fuel. Inflation in general is now running at roughly 7.5% — a 40-year high — with energy prices up 27%, according to the Bureau of Labor Statistics.
But many Americans were caught off guard by heating bills that are outpacing inflation and are much higher than the forecasts anticipated.
"I literally think I gasped," one Minnesota resident said to a local CBS news station after seeing her $350 January heating bill. "I looked back to January [2021], and it was double what it was last year.”
Similar complaints are arising throughout the country.
In Wyoming, residents are reporting heating bills that jumped $100 or more compared to the same period a year ago. Energy officials in Iowa said residential gas bills went up by 106% in December. The natural gas supplier for much of Missouri, Mississippi and Alabama raised prices by 96% this year, and after an especially cold January, people there saw their bills rise by $50 to $150. It's essentially the same story for residents in places such as New Hampshire, Wisconsin, northern California, New York City and Ohio.
Even tropical Hawaii is being affected. Due to rising oil prices, the typical electric bill in the Aloha State is now running $180 versus around $140 last winter.
Why is my heating bill so high?
Power companies say they aren't to blame. They point to rising energy prices worldwide as the reason people are facing massive monthly bills.
"Natural gas prices have skyrocketed globally," Megan McFarland, a spokesperson for Pacific Gas & Electric, explained to an NBC station in California. "We’ve seen a 90% higher cost than last winter," she said, adding, "We’re not making any money off this situation."
Con Edison, which provides gas and electricity in the New York City area, recently sent customers an email stating that the combination of a spike in energy costs with a colder-than-usual January is what's responsible for soaring bills. "Con Edison buys energy on the wholesale market and provides it to customers at the same price we paid without a profit," the message said.
Brendan Conway, a spokesperson for We Energies, an energy supplier in Wisconsin, said recently that the high heating bills in the state should likewise be blamed on rising natural gas prices.
"There just wasn't enough natural gas that was produced during the coronavirus because there wasn't enough need," he said. "And then once that need increased so greatly in the past year or so there wasn't enough supply, so prices have gone up."
Article Feb 2022-- https://money.com/high-heating-bills-2022/
Any thoughts on why you feel heating costs have skyrocketed?
Have you been hit with a high heating bill this winter?"Natural gas prices have skyrocketed globally," Megan McFarland, a spokesperson for Pacific Gas & Electric, explained to an NBC station in California. "We’ve seen a 90% higher cost than last winter," she said, adding, "We’re not making any money off this situation."
Where does our natural gas come from ... ?
Russia and Iran have the most reserves/production of natural gas.
Note: Sun energy is free.
Haven't we tapped into solar energy any more strongly than we have
YET?
what would help us do such a thing?
https://www.bbc.com/future/article/2020 … st-battery
Good batteries installed in solar generated vehicles and solar generated homes? Getting off the electrical grid ... ?All over the place --- Natural gas consumed in Michigan comes from gas and oil fields located primarily in Michigan's Lower Peninsula, the Texas-Oklahoma Panhandle, on and off-shore Louisiana, and Alberta, Canada.
Oh MY, It looks like California gets the prize for skyrocketing heating costs.
I live in San Diego county in sunny southern California. San Diego Gas & Electric has the notoriety of being the highest in electricity rates in the U.S. A double whammy because we are suppose to have the highest gasoline cost too at $6/gallon today.
Though being more dependent on gas for heat, cooking, water heater, and dryer, we suffer through the cost of air conditioning during summer months now coming up. That is if you are lucky to have it. So, home solar is suppose to be the ticket to independence from them. But, I don't know what the buy back is. Besides I have a mobile home and it won't support the panels.
Federal agency confirms San Diego has the highest electricity rates in the country
https://www.cbs8.com/article/money/ampe … 3059f1e0da
We had a gas rate increase this year supposedly from a 25% increase to SDG&E and is passed on. There was sticker shock for many and was in the news frequently.
Noticed a price jump on your SDG&E bill? Customers sound off
https://fox5sandiego.com/news/local-new … sound-off/
For me personally I went on the offensive this year for my utilities and lowered my thermostat to 66ºF, which means it kicks on at 64ºF. I use to keep it at a comfort level where I could wear a T-shirt or maybe a flannel shirt. I spoiled myself. Overall I saved about 26% over 2021 for the winter months, which is inclusive of the rate increase.
But, this summer is when the big battle will begin. I plan to keep my thermostat at 85ºF at first to see how it goes. Of course keep windows open and the front door and use a ceiling fan. Again, I am spoiled because I relied on the A/C before for comfort. So, overall got to as they say tighten the belt.To some extent the "buy back" depends on state law. I just had an estimate done here in Florida and break-even is in about 12 years. The problem for us is I am 74 and my wife is 71. and could very well be dead in 12 years.
That said, we will probably do it anyway, if we can get the $60,000 price down somewhat.Have I understood that right; $60,000 price for installing solar panels in Florida? Or do you mean $6,000?
I only ask because we had solar panels and a wall battery installed last November at a cost of $13,000, and the ‘buy back’ (break-even point) on that will be less than 10 years.
Well, to summarize the Money article you just posted it seems to boil down to this quote "There just wasn't enough natural gas that was produced during the coronavirus (2020 - 2021) because there wasn't enough need," he said. "And then once that need increased so greatly in the past year or so there wasn't enough supply, so prices have gone up."
Makes sense to me.
Natural gas can be found below the Earth’s surface all over the world. The countries located above the most natural gas are:
Russia
Iran
Qatar
Turkmenistan
United States of America
Saudi Arabia
Iraq
In America, the top five states with most natural gas reserves are:
Texas (26%)
Pennsylvania (18%)
Oklahoma (9%)
Wyoming (6%)
Louisiana (6%)
https://www.api.org/news-policy-and-iss … l-gas-comeNatural Gas Reserves by Country
# Country World Share
1 Russia 24.3%
2 Iran 17.3%
3 Qatar 12.5%
4 United States 5.3%
95 more rows
https://www.worldometers.info/gas/gas-r … y-country/It is very evident by those stats that Russia holds the largest reserves. All so in my view, they hold Europe hostage due to that large reserve. Hopefully, this war in Ukraine alerts the world we need to become less dependent on Russia to supply natural gas.
I love the chart, makes it easy to put one finger on a huge growing problem. Sobering
California has oil. Not allowed to tap into it.
So ....But here’s the reality: Any surge in production in California wouldn’t make a dent in gasoline prices.
The price of oil is set by global market forces and California doesn’t have nearly the influence on supplies as, say, Saudi Arabia. More drilling in California almost surely wouldn’t make a significant difference in price.
"While California is a top-10 oil-producing state, production has been declining since the mid-1980s. CalGEM is tasked with advancing California's goal to become carbon-neutral by 2045.
CalGEM has jurisdiction over more than 242,000 wells, including nearly 101,300 defined as active or idle oil producers. CalGEM's authority extends from onshore to three miles offshore."
Read More:
https://www.conservation.ca.gov/calgem/ … d-Gas.aspxWe must resist whoever it is who dares to interfere with our country's ability to maintain our power / wealth.
Such as:
* Emptying the coffers.
* Opening the borders
* Prohibiting in-country oil production.
Step 1. Identify whoever they are.
Step 2. Vote them out.Yes, it is a Global problem.
In the UK, before the price hike last October, the Government had already put a 20% price cap on electricity and gas, so the Utility Companies couldn’t raise their prices to the consumer by more than 20% last October when gas prices sky rocketed. It meant that this winter the Utility Companies were selling natural gas to household consumers for less than it was costing them; consequently over 30 of the 55 Utility Companies (over 50%) in Britain have gone bankrupt since October.
The UK Government is raising the price cap a further 54% as from tomorrow (1st April), so people will see a sharp rise in their energy bills as from next month.
For me, the 20% increase in the gas bill was noticeable; in December and January (the two most expensive months for heating) my gas bill had leapt to $130. This month has been noticeably warmer, so our gas bill for March is down to less than $65. Then from next week I should be able to turn our central heating off for the summer, so that our gas bill will then be near zero for the next six months, until we put the heating back on again next October.
To try to cushion the high rise in fuel bills the UK Government is giving a $200 grant to every household this April, except for the 20% wealthiest. Then in October the UK Government is giving every household (including the wealthy) a $260 loan, which will be paid back over 5 years!
The UK does produce its own natural gas, which supplies 58% of its needs; with the remaining 42% coming from imports - mostly from Norway but about 3% from Russia. But given the current Russian invasion of Ukraine the UK Government are in the process of making alternative arrangements so that we reduce our 3% imports from Russia to zero by the end of the year.
With only 3% of UK gas being imported from Russia, it’s a relatively painless process to reduce that to zero over the next 9 months; its Germany I feel sorry for, who get 50% of their gas from Russia.
Even before the current crisis the UK Government, has since before 2012, been working towards transitioning Britain from fossil fuels to Renewable Energy; about two thirds of our electricity now comes from Renewable Energy – but given the current crisis that transitioning away from fossil fuels will be hastened.
Even before the current crises the UK Government’s target for phasing out fossil fuels was to:-
• Shut our last remaining coal-fired power station by 2025
• Ban all fossil fuel cars by 2030, and
• Reduce the use of Natural Gas to zero by 2035.
It's all part of the UK’s Government’s target to become carbon net neutral by 2050.
My contribution is having had solar panels and battery installed last November; of which I’m already reaping the benefits e.g. even though it’s only March, our solar panels and battery is providing us with our electricity needs for 22 hours a day; and I’m even exporting surplus electricity to the national grid for up to six hours a day (and getting paid for it).
So Renewable Energy is most certainly the way of the future.It has nothing to do with gas prices, but your post gives a pretty stark indication of what happens when Government meddles in prices. Politicians typically have no care (or understanding) of how prices are set, and don't care - the result this time was bankruptcy for over half of the companies involved in the price fixing scheme.
Really hard to understand just how that is good for anyone at all.I understand what you are saying; but from a British point of view, the price hike will cause ‘fuel poverty’ e.g. people having to choose between heat or eat!
The price cap (which is reviewed every six months) was first introduced by Theresa May (Conservative Prime Minister at the time) back in January 2019 to stop unscrupulous Utility Companies from making huge profits at the expense of the consumer.
Therefore, the price cap was already in place when the gas crisis hit the world last October; and in spite of the obvious devastation that it would do to the Utility Companies, the Government stuck to their guns specifically to protect the consumer.
Although over 50% of the Utility Companies have gone bankrupt since October, the remaining Companies are still in business, and most will recover, given time; although few can expect big profits for their shareholders for the foreseeable future.
Where you say “Really hard to understand just how that is good for anyone at all.” The point is, it is good for the consumer in that gas and electricity prices are not as high as they would otherwise have been, so fewer people will suffer ‘fuel poverty’ - That has to be a good thing.Is it? Is it really good for the consumer? The one that had to pay for someone else's electric bill because prices rose too much for them? The ones that were laid off when half the companies died? Is it good for the people to have less than half the competition, competition that keeps prices lower?
All of this, and more, are the point I was trying to make: there is far more to the question than simple high prices hurting people, and governments either ignore those things or pretend they don't exist. Whereupon the long term effect of price controls is not[/] what it was supposed to be.
I have to wonder; did the British government control the price those bankrupt companies [i]paid for their product, or was it just the price the could charge for the product? If the latter, where is the equity, the fairness, the logic in that?Yes it is good for the customer, the sharp rise in gas and electricity bills affects the whole population; all 67 million.
No one is paying for anyone else’s electric bill; under the UK Government scheme, every household except for the 20% most wealthiest are being given $200 grant this April to cushion the rise in fuel bills, and every household (including the wealthy) are being given a $260 loan in October (to pay back over 5 years).
Even the ones who were laid off when over half the Utility Companies went bankrupt have to pay for their electricity and gas like everyone else; so they too will get the $200 grant and $260 loan to help cushion the cost of rising fuel costs.
The way the market runs, there is still plenty of completion to keep prices lower when the market stabilises again; whenever that may be.
A Little History On How We Got To Where We Are Today:-
1. Until the 1980s the supply of gas and electricity to our homes was a ‘Nationalised Industry’, owned and run by the State (Government) e.g. Socialism.
2. Margaret Thatcher, the Conservative/Capitalist Prime Minister at the time, hated ‘Socialism’ in all its forms, and during her time in Office Privatised the gas and electricity industry; using the argument that it would introduce competition, and drive down prices.
3. At first, when the industry was first privatised, there were just six Utility Companies (the Big Six) who were more interested in making big profits for their shareholders than keeping prices low; so not surprisingly, shortly after the Industry was privatised there was a big hike in prices.
4. To combat this, in the year 2000 Lord George Mountbatten, 4th Marquess of Milford Haven (a hereditary peer politician in the House of Lords) used £4 million ($5.25 million) of his own wealth to set up a ‘free’ website service, called Uswitch, which allows people (free of charge) to make a direct comparison between Utility Companies and to switch to Companies offering a better deal.
5. At first, the Utility Companies didn’t like people switching, so at first the Utility Companies set up as many hurdles and obstacles as they could to discourage people from switching Utility Companies.
6. So about 10 years ago the Conservative Government introduced new Legislation to make switching easy, and to make it a legal requirement for Utility Companies to tell their customers if they are not on the cheapest tariff being offered by that Company. So now, if you want to switch Utility Company, all you have to do is go on the Uswitch website, which lists an at a glance table all the Utility Companies cheapest tariffs, chose the Utility Company that best suits you and press the ‘button’; job done. Then by law the Utility Company that you’ve chosen have a legal obligation to do all the Admin work on your behalf, including informing your old Utility Company that you’ve left them, and have all the technical and admin work completed within 17 days; so that within the 17 days, without you having to do anything other than press a button on a website, you’re with a new Utility Company.
7. Such ease in being able to switch Utility Companies opened up the market for lots of new Utility Companies to be created to make an easy buck by just under cutting the Big Six. Because the Utility Companies are not responsible for any infrastructure, all they have to do is just bid for the cheapest gas and electricity supply deals they can get on the open market, and then take your ‘smart’ meter readings remotely, using the national Wi-Fi system, all someone needs to set up a new Utility Company is an office with a handful of staff, an Internet connection, and to employ suitably qualified electrician to be able to install or replace ‘smart meters’ if and when required.
Consequently, even with fewer Utility Companies there are still plenty of competition to compete with the original Big Six, to help keep prices down, once we’re over the current crises and things return to normal; most notably companies like Octopus Energy, founded in 2015, and who now employs 1,600 staff.
Octopus Energy has now become the 4th largest Utility Company because of its popularity with the public.
Unlike the original six, Octopus Energy has a philosophy of putting people before profits, and as such (when the market conditions permit) offers tariffs that fall when wholesale prices of electricity falls e.g. being with Octopus Energy I get an 80% discount on any electricity I use between the hours of 12:30am and 4:30am, which during the winter months when there’s not much sun around, is when I recharge my battery from the national grid to provide me with cheap electricity for a further 8 hours – so during mid-winter I only have to pay for electricity at the full rate for just 12 hours a day.
Also, another tariff Octopus Energy offers is one where the cost of the electricity you use changes every 30 minutes and is based on fluctuating wholesale prices e.g. you pay most between 4pm and 7pm when demand is high, and least at 4am when demand is low; and occasionally at times, prior the current energy crisis, when wholesale prices would go negative at 4am (when supply far exceeds demand) Octopus Energy would actually pay you to use electricity – as explained in the video below:-
Octopus Energy: Agile Tariff - Get Paid To Use Electricity! How It Works: https://youtu.be/bjcqGu0ib5w
Moving onto your last point; it is only the Utility Companies that have had their prices that they can charge customers capped. The Energy Suppliers are not capped, which means that the British Oil Companies, like SHELL, have been making obscenely high profits for selling their North Sea Gas to the Utility Companies at Global prices.
Because of the massive profits the British oil companies have made out of the global energy crisis, the Opposition Parties in Parliament have been lobbying the Government to do a ‘win fall’ tax on the British Oil Companies so that the revenue from that tax can be passed onto the Utility Companies to alleviate their financial crisis.
It wouldn’t be the first time the UK Conservative Government has done a win fall tax; they did it on the baking industry about ten years ago. But this time the Conservative Government has given a flat ‘no’ to the idea of a win-fall tax on the oil industry because they want the British oil industry to use their profits to invest in ‘Renewable Energy’, which they are doing – So from the Government’s view point, not imposing a win-fall tax on the oil industry so that their profits can be invested in Renewable Energy is ‘short term pain’ for ‘long term gain’.To me, $200 seems like a drop in the bucket. What is your normal utility bill there? Ours ranges from $150 to $500/month.
The Government (Ofgem) increased the price cap by 20% on the 1st October 2021, due to the current gas crisis, and increased by a further 54% as from the 1st April 2022 e.g. the limit imposed on what Utility Companies can charge domestic customers for gas and electricity.
According to Ofgem (Office of Gas and Electricty Markets) (The Official Government Regulator) the average household gas and electricity bill prior to April 2022 was $139 per month; and as from 1st April 2022 is now $215 per month.
Yes the $200 is a drop in the bucket, by raising the price cap Ofgem is allowing average fuel bills to increase by $909 per year; so people who are already on a tight budget are going fill the pinch.Understood.
Another question, because a big deal has been made of it. When we think of utility companies in America, we think of thousands of employees each. Since your arrangement is different, do you know how many people are impacted if one of yours goes out of business?Good question; it depends on the size of the Utility Company.
For example the Big Six back in 2008 had 99% of the share of customers between them, that had fallen to 70% by 2019; as the smaller, new Utility Companies started to entice customers away from the ‘big six.
Basically the Big Six have the lion share of employees: The Big six being:-
• British Gas (who also supply electricity these days) employs 28,000 staff
• EDF employ 11,717 people
• e-on employees 9,400 staff
• npower employ 5,700 staff
• Scottish Power employ 5,500 staff, and
• SSE employ 11,691 staff
However, the other Utility Companies (except of Octopus Energy) are currently much smaller, and thus employ far fewer staff.
Octopus Energy is now the 4th largest Utility Company (serious completion to the original big six), and employ 1,600 staff.
Of the 30 Utility Companies that have gone bankrupt this winter, the largest was Bulb Energy (they were the 7th largest Utility Company, and employed 1,000 staff. But typically all the other Utility Companies who have gone bankrupt this winter are much smaller, and employ fewer staff e.g. Bristol Energy (went bust in Jan 2022) employed 200 staff, and Pure Planet (went bust in October 2021) employed just 79 staff.
Your description of the UK government's price controls struck a cord.
Your government institutes price controls to `protect the people', and that action bankrupts over half of the suppliers of the controlled product.
Then, your government hands out other peoples' money to `ease the pain'.
That doesn't seem like a good thing to me, do you see your description differently?
[EDIT] Oops. As I scrolled I see Wilderness has already addressed that "price control" point. As usual, I am a day late and a dollar short. ;-)
GAYeah, being British, I do see it differently to how you express it.
Although it is a Conservative Government they have taken action to ‘protect the people’, albeit at the expense of business. Over 50% of the Utility Companies may have gone bankrupt, but the remaining Companies have survived, and will survive; albeit, it’ll take some while before they become profitable again.
The action the Government has taken is specifically to reduce the level of ‘fuel poverty’ e.g. people having to choose between ‘heat and eat’, a subject that the British Government takes seriously.
* What if my energy supplier goes bust (2019)? https://youtu.be/ZxeVVBN32mA
* Bulb: Britain's seventh biggest energy supplier collapses into administration (Nov 2021) https://youtu.be/6EPey5gOdao. . . and there is that difference again.
I read your ". . . ‘protect the people’, albeit at the expense of business," as saying "the people" are different from "businesses." Following that would be the inference that businesses are not people. I think businesses are people.
I don't mean to create a tangent to the topic, I was just noting a basic tenet that gets ignored.
GABusinesses are not people, businesses are run by people and businesses employ people; if that’s what you meant?
Yeah, 1000’s of jobs in the Energy Industry have been lost this winter, and that is likely to rise to tens of thousands as Companies who have survived lick their wounds, and streamline their business e.g. one surviving Company is talking about shedding 20% of its workforce this summer as part of its re-organisations, and OVO Energy intend to cut 1,700 jobs this summer.
But we still get back to the question of ‘The Greater Good’:-
• Reducing the impact of ‘Fuel Poverty’ (the choice between ‘eat or heat’) for millions of Brits, or
• Allowing Energy Utility Companies to raise their prices to levels that people can’t afford, just to save tens of thousands of jobs.
It’s a balance of millions against tens of thousands; which to me it seems a ‘no brainer’; especially when you consider that in the UK the unemployment rate is low, just 3.9%, and we do currently have a Labour shortage because of Brexit; so many displaced workers will quickly find new jobs – And while they are looking for work, and for those that don’t find it easy to find new employment, the Welfare State in Britain is quite reasonable.
And at the end of the day, for those Utility Companies that survive, they are going to be leaner, fitter and stronger (more cost effective) than ever before; which can't be a bad thing.
1.1 million older people in the UK could experience fuel poverty over the winter (Nov 2021) https://youtu.be/lkGvE_ypBEYYours is a rationalization that doesn't work for me.
You say businesses aren't people but then say they are run by people, as in owned or controlled. A business doesn't make decisions, people do. I do understand the concept of seeing a business as an entity, it works, symbolically and conceptually, but, your perspective gives that entity a personality—to be blamed or praised. To be allied or pitted against `workers'. The "business is nothing more than a tool used by people. Businesses are people.
Even without checking it, your "Fuel Poverty - `eat or heat'" point seems exaggerated. Could it also be described as a probable `heat less and eat less' season? If that might be the reality, how does that affect your millions vs tens of thousands" rational when it might be more accurate to say hundreds, (or tens(?)), of thousands against tens of thousands?
A "greater good" rationalization is always one of degrees. It always needs more support. To then couple that with your `what don't kill you makes you stronger' thought, (the utility companies), pushes us further apart. Your perspective seems to be workers against owners. People vs. People.
And then, the 2021 1.1 million number. That was a projection. Given that the winter season is nearly over, and that the price hikes are recent, could that projection be unreliable now? If so, would lower numbers affect your 'greater good' reasoning?
GAI caught that millions vs tens of thousands as well - it seems completely unrealistic that millions of people will freeze to death, and be buried, because of high electric bills. Particularly in a socialistic country.
Would it not have been better to subsidize either the business or the customers rather than provide for the tens of thousands without any income at all (they lost their jobs when the business went under)? Or is simply not fashionable to give money to business as that business is the enemy of the people?In England the official Government definition of ‘fuel poverty’ is:-
“Fuel poverty in England is measured using the Low Income Low Energy Efficiency (LILEE) indicator. Under this indicator, a household is considered to be fuel poor if:
• they are living in a property with a fuel poverty energy efficiency rating of band D or below and
• when they spend the required amount to heat their home, they are left with a residual income below the official poverty line
There are 3 important elements in determining whether a household is fuel poor:
• household income
• household energy requirements
• fuel prices
https://www.gov.uk/government/collectio … statistics
By UK Government definition we are talking about millions in fuel poverty, the latest Government States is for 2020 e.g. it takes time to compile and publish such stats, so there is always a time lag.
But according to the UK Government’s own official statistics for 2020, there were an estimated 13.2% of households (3.16 million people) in fuel poverty in England under the Low Income Low Energy Efficiency (LILEE) metric, down from 13.4% per cent in 2019 (3.18 million people).
In England, by Government Definition, ‘fuel poverty’ means that if you pay your fuel bill you are living below the official ‘poverty line’ e.g. you’re having to make a choice between eating or heating – so it’s not an exaggeration (by Government definition).
And fuel poverty does kill; according to Government Official data from the ONS (Office of National Statistics); in the winter of 2018 there were nearly 46,000 excess winter deaths amongst people aged 65 and over as a result of poor housing, high energy prices and ill health.
The number of staff who have so far lost their jobs might not be as high as you imagine. For example, Bulb energy, the largest Company so far to go bankrupt, and was the 7th largest Utility Company, employed 1,000. The other Companies employed far fewer staff, for example Bristol Energy employed 200 staff, and Pure Planet employed just 79 staff.
No, the 1.1 million if anything is an underestimate; look at the Official UK Government statistics on fuel poverty for 2020 above.
Why Energy Poverty in the U.K. is a Growing Problem: https://youtu.be/60OKiFZVvB8
"one surviving Company is talking about shedding 20% of its workforce this summer"
Not so much as labor savings, but one must also consider maintenance savings. California about burned to the ground a year or so ago...because of lack of maintenance caused by electric prices so low the company could not do it. And the result was whole towns destroyed by fire.
Artificially cutting prices very often (almost always) leads to consequences that the politicians, sitting in their plush chairs in total ignorance of what that business pays for, does not consider.Maintenance isn’t a factor in this case; in the UK the Utility Companies who supply the electricity and gas to the consumer (householder) carry out just a paper exercise – they don’t physically supply electricity and gas to your home; that’s the responsibility of others.
Utility Companies are not responsible for the network of powerlines, cables or substations, or gas pipes that enter the home (that’s the responsibility of the Distribution Companies).
And neither are the Utility Companies responsible of the supply of electricity and gas on that network (that’s the responsibility of the National Grid Company).
In the UK, if a Utility Company that you are with goes bust overnight, and ceases trading, you get no interruption in supply; you still continue to get gas and electricity. And then in the first instance it’s up to the Government to sort our which Utility Company you should pay for that supply, and if you don’t like who the Government chooses for you then you shop around and switch to another Utility Company of your choice.I more or less agree with Wilderness in one aspect (don't let it go to your head, lol), that price manipulation (to make it more general) is never a good thing. There are many other ways to skin that cat.
In the instant example, I would think it be better that the gov't had done two things: one, put rules in place to prevent the inevitable price gouging and two, give the affected people a supplement to cover the higher costs.
I have the same problem with our minimum wage, it artificially interferes with the market. Instead, we have an "Earned Income Tax Credit" which acts as a "minimum wage" but without the bad market effect. Unfortunately, Congress cannot see its way clear to enact a meaningful EITC, so minimum wage it is.How would you design an EITC, (what would make it "meaningful) and why not simply put it into the welfare dept. directly rather than a semi-hidden tax benefit?
Yes, that would drive up welfare costs enormously, but at least it would be transparent and we would all know what we're paying.I don't think we have a "welfare" department. We have laws that provide social assistance.
Expanding EITC is easy, in my opinion. Those who want a $15 minimum wage to have a livable income for doing full-time work make the assumption them minimum annual income needed by a single person to live without being in economic distress is $ 31,200.
- Compare that to the median income for full-time workers of $56,287 (according to the 2020 Census table A-4)
- Compare that to the 2020 poverty threshold of $13,465.
It is easy to see a $15 wage is closer to being impoverished that earning what the 50th percentile American earns. That is why $15/hr seems to be a reasonable number.
Right now a person with no children who earns less than $21,430 qualifies for EITC. All they need to do is raise that threshold to $31,200.
In one fell swoop, you have people that work full-time receiving a living wage, albeit partly from public assistance, AND the minimum wage that inhibits business growth, is gone. No muss, no fuss and a significant decrease in gov't bureaucracy.
Actually, for decades the elderly (over 75) and people of Welfare benefits do potentially get help towards heating their homes. If you’re over 75 you automatically get the ‘Winter Fuel Payment’; but if you’re on welfare benefits whether you actually get any financial help from the Government to help pay for heating, and if you do, how much is dependent on the weather in your area; as elaborated on below.
WINTER FUEL PAYMENT
The Winter Fuel Payment was introduced by the Labour (Socialist) Government in 1997.
In the UK, if you are over the age of 75 then you will automatically get paid by the Government up to $394 each November as your ‘Winter Fuel Payment’.
COLD WEATHER PAYMENT
The Cold Weather Payment was introduced by Margaret Thatcher (then Conservative Prime Minister) in 1988.
If you’re on welfare benefits then if between November and March the temperature in your area falls below freezing 0c (32f) for more than 7 consecutive days then you’ll automatically get $33 ‘Cold Weather Payment’ for each day that the temperature remains below freezing.
I had to read up on "Earned Income Tax Credit" because we use alternative methods in the UK:-
1. We do have the ‘Legal’ Minimum Wage in the UK, which applies to all workers, including immigrants. The current legal minimum wage in the UK is $12.47 per hour.
2. We don’t have the ‘Earned Income Tax Credit’ but we do have the ‘Tax Allowance’ that everybody gets; the amount you earn before you start paying tax – currently the tax allowance is set at $16,497, which means that the first $16,497 that you earn is ‘tax free’.
3. To help unemployed people looking for work, as well as getting your unemployment benefits, and any other benefits that you are entitled to e.g. housing benefit (where your local government pays your rent for you), you’re also entitled to the ‘Jobs Seekers’ Allowance if you can prove that you are actively seeking employment, the job seekers allowance is $424 per month.
4. Then people who are working, but on low income, are entitled to ‘work allowances’ e.g. where the Government pays you benefit while you are on a low income; as an incentive to encourage the unemployed to seek employment because on even low paid jobs they’ll be financially better off than they were when they were claiming unemployment benefit.
The reverser of the coin is that unemployed people who don’t actively seek re-employment for no good reason e.g. they’re not disabled, then they will have their unemployment benefit reduced after a set period of time.
And I would argue that business, especially corporate businesses are not people even though they are made up of people. And granted, for practical matters, some businesses, but not all, are granted certain rights for legal purposes (and personally, I think the Conservative Court has gotten carried away in giving businesses human rights.
But at the end of the day, businesses are not humans, no more than rocks are.I have to go with GA here; from the WalMart CEO to the mom and pop corner grocery to the employees of GM, businesses are people. It is people that are hurt when a business closes, even temporarily (a tornado, perhaps?) and it is people that are hurt when a business closes and their investment and business income dries up. It makes no difference whether those people are billionaires or retirees with an IRA they are living off of, they are people. The paper fiction of a "person" composed of bricks, machines and thousands of people is just that; a fiction. Useful, but a fiction.
But I do think that we have probably gone overboard in considering businesses as people in the legal sense.The "employees of GM," are clearly people. GM itself is not. At best it is the chairman and CEO who run the company. The people are nothing more than machinery to GM. If GM could do it all with machines, they would.
Tell me, assume GM comprised of 100% robots (smart ones for sure) from the CEO on down, and it produced the same products. Would you consider GM a person then? With the technology we have today, that is not an inconceivable idea anymore.If it is the chairman and CEO (along with millions of stockholders), well, they are all people too. Just as the mom and pop of that little grocery store on the corner are. Being the top of a mega-corporation does not somehow make them less than human. Or are you trying to demonize people like me that own stock in large corporations and make us not human?
Yes, if there were a business owned and operated solely by robots then it would not be a person at all. But who would own that business (machines own nothing)?
Of course, while not inconceivable, it is far, far in the future that something like GM, with it's manufacturing plants, could go all robot. Technology is nowhere that point yet, although it may be one day.Yes, the chairman, etc are people - but GM is not. Stockholders can always sell their stake. Nathan's point was that in America, to use your skewed example, there might be 10,000 people will be hurt with GM (assuming the gov't didn't help them as well), but there are millions more that will helped with the alternative. The Greater Good.
Now let's get realistic. Pick a normal utility company, say Clay Electric in Florida. They have have 474 people that MIGHT be hurt. That is a more reasonable number to compare to the millions that will be helped. Further, most of those will be hired by Florida Power & Light as their service expands when they take over Clay's customers.OK - we have a difference in terminology and reasons for calling a business people. Forget it.
But would it not be better to either subsidize the electric companies, or it's customers, rather than drive them to bankruptcy? That way no one gets hurt, and the only real damage is to the tax base and the philosophy that all businesses are evil. Both of which will occur anyway - the first by subsidizing those that lost their jobs and the second with the assumption that it was the fault of business that it went under."But would it not be better to either subsidize the electric companies," - Yes, I agree and made it to Nathan. I think his response was that the current Conservative gov't doesn't like that idea.
To be honest, it is very difficult to translate similar terms between political systems. Clearly, Conservatives in England have a very different point of view than Conservatives in America. I don't think we have an equivalent to their Labor Party.
I believe Nathan described their Liberal Party but I forget what it was. I wonder if England has an equivalent to our current Democratic Party in regard to philosophy.
Ditto with the Trump Republican Party. I think I remember Nathan talking about a similar radical Right party in his country who, I think, were the real soldiers in the fight for that ill-conceived notion called Brexit that has done such damage to the British economy.Yeah, though the names are similar, the parties across the pond are far from what we recognize from the name (or philosophy applied such as liberal and conservative).
Yeah, the ‘right-wing’ of the Conservative Party (they call themselves the ERG) is the radical element in the Conservative Party that pushed for Brexit; the ERG have many similar politics to the Trump Republican Party, and it was the ERG who was instrumental in putting Boris Johnson in power as Prime Minister. Although Boris Johnson has filled his Cabinet (Senior Government positions) with ERG members, Boris Johnson is not a ERG himself – he’s a maverick, which makes him unpredictable.
Yes we do have a political party similar to your Democratic Party; in the UK it’s called the Liberal Democrats, and although they only win 10% of seats in the National Elections, they do rather well in local Government Elections. There are 333 Local Governments in England, of which 27 are controlled by the Liberal Democrats.
The Labour Party was created by the Trade Unions in 1900 as their political wing. Labour first came to power as a Government in their landslide victory in 1945; which surprised everyone as it was assumed the Conservatives would win because Winston Churchill (Conservative Party Leader) was a ‘war hero’. Following their victory in 1945 the Labour Party in 1948 introduced the ‘Welfare State’ (as we know it today), and the NHS (free healthcare for all at the point of use).
The Labour Party formulates its Political Policies at its Annual Conference; the share of the voting on Labour Party Policy being a third of the votes to Labour Members (members of the public who pay a prescription to join the Labour Party), a third of the votes to Labour Politicians; and a third of the votes for policy making to the Trade Unions themselves – putting the Trade Unions in quite a powerful position when Labour wins a General Election and becomes Government.
The Red Flag - Labour Party (UK) Conference 2019: https://youtu.be/N5z-ds-bkhg
With reference to the above; remembering that political colours are the reverse in Europe to what they are in the USA e.g. in Europe Red stands for Socialism (blood and victory), while Blue stands for Conservatism (Royalty, stemming from the time when blue was the rarest and most expensive pigment, only affordable by the elite).
Also, the Red Flag Song (a revolutionary song) is the Official Anthem of the British Labour Party, and is always sung at the end of their annual Conference.
One difference between Conservatives in Britain and America is which beneficiary takes priority. In Britain, it seems the people do. In America, it is business. That is one bright dividing line between American Conservatives and American Liberals.
One of the main factors governing this was the creation of the Electoral Commission in 2001 by the then Labour (Socialist) Government. The Electoral Commission is an independent agency that regulates party and election finance and sets standards for how elections should be run.
The Electoral Commission prohibits political parties from being financed by businesses and wealthy individuals, so that Governments don’t have an invested financial interest in showing favouritism to businesses e.g. so that politicians are not in the pockets of Industry; and the Electoral Commission sets strict spending limits on ‘election campaigns’ so that election campaigns are affordable to all political parties, including small political parties. The Election Commission also stipulates how much air-time political parties are allowed for ‘party political parties’, so that all political parties, including small parties, have an equitable amount of air-time for political broadcasts during elections.
The Electoral Commission will scrutinise all finances spent on elections, and will prosecute if any politician or political party breaches its spending limits on an election e.g. the Election Commission fined the Conservative Government £17,800 ($23,240) in 2021 because the Prime Minister (Boris Johnson) accepted a £52,801.72 ($69,237) donation from a wealthy sponsor for refurbishing his flat (apartment) at 10 Downing Street (10 Downing Street being the UK version of the White House). And the Election Commission also fined the Conservative Government £70,000 ($91,787) in 2017 for overspending in the 2015 General Election by £118,124 ($154,890). In 2018 an ex Conservative MP, who had defected to the UKIP party was given a six months suspended sentence for election fraud in 2017.
The other factor is that the main political parties have to appease their supporters if they wish to win the next General Election:-
• For the Conservatives, traditionally their voting base is strongest amongst the elderly (grey) vote and in rural areas. About two thirds of voters over the age of 65 tend to vote Conservative.
• For Labour, traditionally their voting base is strongest in the working class towns’ e.g. northern England, and in the cities including Bristol and London. About two thirds of voters under the age of 25 tend to vote Labour.
The only reason the Conservatives won the 2019 General Election is that they were able to nab votes from the traditionally Labour stronghold in the towns across northern England; and to stay in power the Conservatives will need to try to hold onto those gains in the North by appeasing the working class voters in those areas.
Also, to retain their votes in the elderly, which they will need to do if they wish to stay in power the Conservatives also need to appease the elderly; which is the main reason why the Conservative Government put the ‘triple lock’ on the State Pension when they came to power in 2010.
The triple lock is whereby the State Pension is increased each year by whichever is the higher of the three criteria below:-
• The annual rate of inflation
• The annual average rise in wages, or
• 2.5% if it’s higher than the above two criteria.
The triple lock is going to benefit me when I reach State retirement age this summer:-
• I took early retirement at age 55, and my current net civil service pension (which is indexed linked) is currently $16,137 per year after tax.
• My Carer’s Allowance, which is paid by the Government for looking after my wife, is currently $4,752 per year after tax.
• And my State Pension, when I get it this summer, will be $9,795 after tax.
So from this summer my total net income will be $30,684 which is more than I was earning when I was in full time employment in middle management in the civil service. My total annual living cost is approximately $18,000 a year, so as from this summer I’ll have far more wealth than I know what to do with!
In the UK Carer’s Allowance is where the Government pays you if you are an official carer for someone who is disabled or partially disabled; in this case my wife gets $4,088 disabled allowance per year from the Government mainly because of back problems. And as she gets the disability allowance, then as her carer I get the carer’s allowance.
One little amusing quirk in benefits is the £10 ($13) Christmas Bonus that the Government gives to people who are on Social Benefits such as the disability and carers allowance; people on welfare benefits e.g. unemployment benefit, don’t get the bonus.
The £13 Christmas bonus was started by the Conservative Government back in 1974, as a gesture of good will’, and every Government in power ever since (regardless to politics) have carried on with the practice, so although it’s not a legal requirement it has now become a ‘tradition’!
I am surprised the UK gov't didn't bail out those producers who went BK because of gov't policy.
In the UK it’s the Socialist Government (Labour) that has a track record of bailing out businesses e.g. nationalisation. While the British Conservative Government don’t like bailing out businesses, even when businesses fail because of Government policy. For examples:-
• During the 1980’s Margret Thatcher (then Conservative Prime Minister) decimated the British manufacturing base (supply chains to the coal industry) by closing down the coal mining Industry in Britain as a way of destroying Britain’s most powerful Trade Union; the cascade effect was millions becoming unemployed for around ten years as Britain transitioned from an Industrial based economy to a service industry based economy.
• In the past few years, an estimated 80,000 jobs were lost in the financial hub (7,500 from London) due to Brexit; as financial institutions, including banks, relocated their headquarters to mainland Europe (EU). Likewise, an estimated 140,000, one sixth of employees in the car industry, lost their jobs due to Brexit as car manufacturers relocated to mainland Europe (EU).
• The NHS (which employees 1.3 million) lost 100,000 doctors and nurses due to Brexit because workers from the EU have left Britain and returned to the EU; similar situation with agriculture and the leisure and tourist industry e.g. around a third of fruit was left to rot on British farms last couple of years because they didn’t have the usual seasonal workers from the EU; and the UK Conservative Government, with its new strict ‘immigration policy’ since Brexit, refused to give visas to seasonal workers because they are unskilled workers?
So yes, the British Conservative Government can be reckless at times!
One difference between British politics and American politics is that in the UK it is illegal for businesses to finance politicians or political parties; laws put in place and policed by the Electoral Commission to prevent any British Government from being obligated to show favouritism to industry; which seems a little ironic when 33% of policy making by the Labour Party is governed by the Trade Unions e.g. the Labour Party being the political wing of the Trade Unions.
The Electoral Commission is an Independent Agency (not answerable to the Government, but answerable to Parliament only) that ‘Regulates’ political parties and election finances, and sets standards for how elections should be run.
What does the Electoral Commission do? https://youtu.be/T5mg5OceG-I
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