Editor Note: The post below, published at MasterResource in June 2009, has profound challenges for the notion that self-interested business underinvests in energy efficiency, giving a “market failure” rationale for government investments in and mandates for energy efficiency. This post introduced the term conservationism to differentiate government conservation from market conservation. It also documents the market failure of Joe Romm’s shuttered nonprofit, the Center for Energy and Climate Solutions.

“Enter the energy outsourcing model of energy service companies (ESCOs) in the 1990s, widely heralded as a ‘new economy’ breakthrough and a new feature of ‘natural capitalism’. Enron Energy Services (EES), in particular, the energy outsourcing division of the late Enron, was the next great thing…. ‘ESCOs are DEFINITELY the future,’ exclaimed Joe Romm. ‘I intend to work with the big ones to transform the market, which I think will take about two or three years.’

“Enron, and no one more than Ken Lay, time and again pledged allegiance to free enterprise, deregulation, privatization, and competition. Come the implosion, that rhetoric was taken at face value. If Enron was capitalism, then capitalism was prone to flim-flam, deception, and even fraud.”

“Enron was a paragon of crony capitalism and a master of politicized regulation. Like no other company in history, Enron leveraged non-market government opportunity in myriad and sustained ways that ultimately came at the expense of consumers, taxpayers, and investors.”

“Classical liberals applauded the fact that the market, not regulators, exposed and ruined Enron. True enough, but the broader point and the deeper moral of the story is this: Enron and Ken Lay, as they were and became, would not have existed in a truly capitalistic economy.”

“Economists may not know much. But we know one thing very well: how to produce surpluses and shortages. Do you want a surplus? Have the government legislate a minimum price that is above the price that would otherwise prevail…. Do you want a shortage? Have the government legislate a maximum price that is below the price that would otherwise prevail.”

– Milton and Rose Friedman, Free to Choose (1979), p. 219.

Tomorrow (October 5, 2016), a book seminar will be held at Resources for the Future [register here] to revisit the lessons from the 1970s energy crisis. Panic at the Pump: The Energy Crisis and the Transformation of American Politics in the 1970s by Meg Jacobs will receive comments from three RFF scholars.

The Princeton historian and author usefully provides a good deal of archival documentation surrounding the ill-fated attempt by federal authorities to regulate the price and allocation of crude oil and oil products in the 1971–1981 era. …

The following questions and answers were posted by The Atlas Society in conjunction with their upcoming Atlas Summit next week. Other posts at MasterResource on the philosophy of Objectivism and its application to energy can be found here.

Elsewhere, Alex Epstein of the Center for Industrial Progress is fully engaged in the climate and energy debates, employing the philosophy of Ayn Rand and her belief that truth is objective, discernible, and applicable to matters of everyday life. Through the work of Bradley and Epstein, Rand’s voice from decades ago resounds in today’s discussions of man’s need for plentiful energy.

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Five Ayn Rand Questions for Robert Bradley

1) Tell us who you are? What’s the couple of sentence summary of what you do and what you’ve done?

I am a classical-liberal intellectual, or at least a student of classical liberalism.…