Comments on: Kluger Krugman Blog, news, books Tue, 10 Oct 2017 06:01:00 +0000 hourly 1 By: Lawrence Leske Wed, 02 Jun 2004 16:18:36 +0000 As a businessman I would view the FERC fines as a clear signal to continue these price manipulations. A 0.1% legal cost overhead regarding these actions is not only incredibly cheap, but very encouraging of more such actions. Caveat emptor!

By: bramka sms, dzwonki, nokia Wed, 25 Feb 2004 04:14:56 +0000 Well of course these are the values of our time! This is corporate America, dammit, we must protect their profits, or else it will be victory for the terrorists and IP pirates! (But I repeat myself.) What the hell are you, unpatriotic?!

By: green Thu, 29 Jan 2004 12:44:42 +0000 thanks for image・・・

By: Jay Currie Sun, 05 Oct 2003 04:30:31 +0000

Jesse Jordan (the RPI student who ran a search engine and was sued by the RIAA) was, the RIAA claims, liable for $15,000,000 in damages. When you add up the damages claimed against all four of these students (who again had built search engines), the RIAA was asking, on some estimates, for $100 billion dollars. That�s because, under our law as interpreted by the RIAA, downloading one song makes you liable for $150,000. Or, on the RIAA�s view of the law, cheaper to defraud Californian�s of $9 billion than download 10 songs from a p2p server.

I agree with your general point but the numbers seem wrong. The RIAA’s claim is between $750 – $150,000 per song. The lowend number would be the best they would likely do in a non-commercial case. So you would have to have around 1400 offending songs to hit the fine numbers.

Given that the RIAA seems to be settling their claims at around $3000.00 a pop (the term nuisance suit springs to mind) the music biz seems to be gaining some sense of balance.

By: Greg Powell Wed, 24 Sep 2003 14:17:01 +0000 A million dollar fine does seem unconscionably paltry if the price manipulations were true (perhaps the difficulty arising from estimating damages made the FERC wary–no idea). Though a Cal resident I am woefully ignorant of the issues here. Though the FERC settled, my understanding is however that Cal’s claims are still alive. (Perhaps there are some private suits still alive as well.) So not all may be lost. At a minimum those long term contracts should be voided or re-negotiated.

By: steve carter Fri, 19 Sep 2003 23:48:41 +0000 Yes, the big energy companies are “bad.” Yes, they probably should have been fined more. The people most responsible should be jailed, too.

But this is the bit that concerns me: �not including the extraordinarily high prices we now face because of long-term contracts signed at the height of the crisis.�

Why the passive voice? There was someone clearly responsible for signing these long-term deals � the Governor.

Let’s face the facts: Governor Davis sure made it pretty easy for �Big Energy� to screw California. Davis got in way over his head trying to wheel and deal in the energy market. These long-term energy deals that will cost Californians billions are deals for which he must be held accountable.

I don’t mind piling on the big energy companies and Corporate America when they deserve it, but let�s not let the elected the officials � even the ones for whom we have political sympathies � off the hook. �The extraordinarily high prices Californian�s now face because Governor Davis signed ill-advised long-term contracts at the height of the crisis� will likely cost more than the $9 billion Big Energy is on the hook for. Why don�t we sue Governor Davis? (or at least recall him).

Also, let�s watch our logic here, people. Yes, the $1 million fine seems small compared to the other fines cited, but the question is, was the fine just. The answer is �probably not� . But that�s not proved or disproved by the other fines.

I don�t know exactly how much of that $9 billion should be blamed on Davis�s ineptitude or nefarious energy traders. The facts of the case have not really been considered in any of these postings.

By: Shuman Mon, 15 Sep 2003 01:06:34 +0000 The problems in the industry are well-known, but few are proposing viable solutions based on consumer feedback. The Open Music Model is such a system, based on research conducted at MIT:

By: Anonymous Thu, 04 Sep 2003 15:24:06 +0000 Professor,
Can you or your cohorts file a class action suit for the $9 Billion on behave of California consumers? If not, why not?

By: Anonymous Wed, 03 Sep 2003 21:35:30 +0000 Don’t forget about those of us in the other Western states who’ve also seen our electrical rates skyrocket because of the California debacle and its impact on the electricity market. Here in Washington state, my electrical bills are basically twice what they were three years ago.

By: Dennis Wed, 03 Sep 2003 18:37:20 +0000 What about this law:

Amendment VIII
Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.

By: Ed Lyons Wed, 03 Sep 2003 17:21:41 +0000 Well, sure the laws should be changed. But law becomes a candidate for change more quickly when it offends our values. (well… maybe the values of the powerful) Lots of things about IP law are ridiculous, but no one in power seems to mind.

(I think that FERC could honestly say the following in their defense:

– FERC doesn’t have the power to get the scalps of the energy companies even if they wanted to. (Not sure they do anyway)
– The politicians in Sacramento had a huge role in making this a crisis before big energy took advantage
– The energy companies were mostly gaming a system everyone knows to be vulnerable to this kind of thing)

What are the value statements our leaders are making in the case of California’s power crisis and copyright law?

When it came to California, the powerful said, “We value the market, the current system and the big companies we have enfranchised more than the consumers of California.” (But, to be fair, this point of view is made very clear in the bio of the Chairman of FERC on their website.)

When it comes to things like copyright law, the powerful say, “We value the rights of intellectual property holders more than those who want to steal it.” (The fact that it’s even phrased that way and not “more than the society that will inherit it” is why we’re losing)

So yes – it is about values.

By: Anonymous Wed, 03 Sep 2003 06:23:04 +0000 Well of course these are the values of our time! This is corporate America, dammit, we must protect their profits, or else it will be victory for the terrorists and IP pirates! (But I repeat myself.) What the hell are you, unpatriotic?!

By: Thomas Wed, 03 Sep 2003 02:41:48 +0000 I hate to get all lawyerly and all, but aren’t there two questions involved here: what does the law require, and what should the law be?

I’d hate for someone to think that there’s something wrong with the legal system (or the regulatory system) that could be fixed by actors with better character, or smarter judges (or regulators), or something like that.

Don’t like the limits on FERC? Change the (very old) law. Don’t blame the values of our time or any other.

By: Eric Anderson Wed, 03 Sep 2003 01:15:33 +0000 several thoughts…

1. Nice to see Jill Sobule get a mention, in passing. She is one of the artists who kindly lets people sample her music via free MP3 downloads on her website,, and also This works nicely. I bought one of her albums and intend to buy more when I have opportunity. Which leads me to believe that the RIAA war to the death against P2P is more about control than lost profits. Whichs leads me to the second item:

2. Is it downloading a song that makes one liable for $150,000 damage? I thought RIAA was intending (at present) to sue UPloaders, not the downloaders. If you have nothing in your shared music directory on KaZaa, we have been led to believe that you are not a target. Or so I thought. Have I missed something?

3. Who can disagree with Michael that people have lost a sense of right and wrong? I see a perfect symmetry between a government that slaps major defrauders on the wrist, and by the same token won’t allow the Decalogue posted in an AL courthouse. I agree, the society has come loose from its moorings.

Still, deregulation has advantages and disadvantages. So does regulation. It all depends on the trade-offs one chooses. But obviously when foxes regulate and police the chicken coop, the chickens (us) are bound to get plucked and eaten. As a Christian I am more concerned that the commandments against lying and stealing be practiced in government than that they be displayed. Since Bush has made a point of his Jesus-centeredness, he really needs to focus closer attention on the moral implications of some of these regulatory decisions. “Hy-pocrisy and men-dacity,” as the line goes, doesn’t play well with me.

By: Brad Taylor Wed, 03 Sep 2003 00:13:19 +0000 I am occasionally accused of being too simplistic in my views on certain issues. That is probably true in this case also. I think that one of the most basic functions of government is to protect it’s citizens. The citizens of California have certainly not been protected by this decision. If a government is failing at one if it’s most basic functions, to protect it’s own citizens, then that government is not functioning properly. I’m sure that my ‘simple minded’ view doesn’t account for the many different reasons and technicalities of why something like this can happen, but that’s the way I see it.

By: Michael Ducker Tue, 02 Sep 2003 20:37:16 +0000 Wow. Never really thought about it that way. Every day I see more evidence that things are currupt in washington, and that somehow people have lost all sence of whats right and what’s wrong.

By: Mike Liveright Tue, 02 Sep 2003 19:09:58 +0000 Good article … I am Emailing it to my representatives asking them to request the FERC to review their finding and to charge the energy companies triple damages of both the direct costs and the higher contract costs, I guess around $200B