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Price controls cause shortages

Example #2378...

Political analyst Rosendo Fraga said Argentina's energy woes date to a 2002 economic crisis, when regulators froze rates for home utility bills just after the peso devalued more than 70 percent against the dollar. Since then, far less revenue has been available for upgrading and building plants and other infrastructure.

"A lack of investment in the energy system, in great part generated by the freeze on utility rates, has created a situation which soon or later could explode," Fraga said.

Many factories went idle this week when distributors shut off or reduced gas supplies to give priority to homes. Government regulators also ordered an 800-megawatt electricity cut nationwide for four hours Wednesday night, which led to sporadic blackouts in the capital.

At a shampoo and detergent factory in suburban Buenos Aires, executive Alberto Rodriguez said workers had to race to meet production goals after one outage.

"The lights went out for several hours," Rodriguez said. "To a greater or smaller extent, we are all suffering from a lack of energy and gas."

It's much worse in the People's Republic of Hugo though...

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Comments

Price controls cause shortages ... even back in the days of the Emperor Diocletian!

HA happy birthday
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