California in the 80s:
- California resolves: you must have insurance to drive on the road
- Totally Unexpected Effect: Insurance rates skyrocket, because the consumers MUST buy.
- California's resolves: You can't charge more than $X/month for driver's insurance.
- Totally Unexpected Effect: Insurance companies drop everyone who costs them more than $X/year in payouts
- California resolves: If you sell ANY car insurance in California, you must sell it to some more people that cost MORE than $X/year for only $X/year
- Totally Unexpected Effect: Insurance companies all over California stop selling car insurance at all, since it's a guaranteed money loser.
- California resolves: If you sell insurance OF ANY KIND in California, you must also sell car insurance.
- Totally Unexpected Effect: Large, high margin, highly profitable insurance companies sell all kinds of insurance at giant markups and subsidize their mandated losses on car insurance. All other insurance companies leave the state.
- California resolves: The fact that everyone on the roads is insured is a fine tradeoff for the job losses, commercial losses, tax losses, and exorbitant rates on insurance that isn't car insurance.
- COMMERCIALLY INTERVENTIONIST COLLECTIVISM IS DECLARED A SUCCESS!
California in the 90s:
California resolves to privatize its utilities to reduce corruption and waste, and put the free market and profit motive in place as a controlling force. Surprisingly, it mostly works. Utilities make a profit, and invest in limited-but-efficient infrastructure.
California in the 2000s
- California resolves: Its public utilities' profit margins and "war chests" of emergency cash are "too big", and should be capped, with overages going directly to the state as tax payments.
- Totally Unexpected Effect: California's tax income goes up, and the value of the utilities is largely destroyed.
- California resolves: Its public utilities should be held to account for the effects of their business operations, just like anyone else, even though their financial hands are tied behind their backs in terms of risk management.
- Totally Unexpected Effect: There's no longer any point in carrying insurance against these (statistically certain) events, because any such event will bankrupt the company regardless of any insurance they can afford to buy. They know it is a statistical certainty that an error will be made somewhere, by someone, and they will get sued into bankruptcy.
- Totally Unexpected Event: A mistake is made and a utility is sued into bankruptcy.
- California resolves: These for-profit utilities must be taken from the "irresponsible profit-mongers" and again placed "safely" under the state's management, where efficiency and waste will no longer be of any (misplaced) concern.
Yeah, this is gonna work great.
