Back during Christmas, I used this space to praise my utility company for sending me free compact fluorescent bulbs. Free is good. Most things, even those ugly light bulbs, are better when they're free.
Markets are better when they're free, too. The idea of the free market has taken a beating lately -- my kids now view The Lorax as gospel. A Free Market is a simple concept that is ingrained in most Americans from birth: build a better mousetrap and the world will beat a path to your door. Of course, the flip-side of that idea is that if you build a rotten mousetrap, you'll quickly go out of business, layoff all of your workers (management will still get nice bonuses paid for with stimulus cash), and the Lifetime channel will make a movie about the experience.
So what do light bulbs have to do with the free market and, more importantly, freedom in general? Well, back in 2007 a little law made its way through Congress that, phased in over time, would make it illegal to manufacture incandescent light bulbs in most wattages. The free market was seen to be at odds with greener interests and Congress decided to shelve the venerable filament bulb in favor of more efficient lighting. And while enforcement of this law was effectively defunded for FY 2012, it's still on the books and voluntary enforcement by the nations retailers seems to be in effect.
Thomas Edison patented his first incandescent lightbulb on January 27, 1880, and by all accounts, it was a heck-of-a mousetrap. So elegant was it's design and so low was its production cost that 132 years later, we're still using the same basic idea to create light. An incandescent light bulb is so cheap that it's disposable, so dependable that we're genuinely shocked when we flip the wall switch and nothing happens. It truly ranks up there with the wheel as an invention that has altered the course of humanity. And like the wheel, we've refined it but we've never found a way to outright replace it.
So perfectly accepted by our free market was Edison's light bulb that it has taken a literal Act of Congress to force us to begin phasing it out.
So, what has Congress given us in its place? Well, the Feds have awarded a grant for the development of an affordable American-made LED replacement for Edison's old favorite. The rub? The only bulb that has come out of the $10,000,000 grant is a $50 LED lamp from Philips. It's not as bright as the bulb we've phased out and it costs 50 times as much. Now, I have a ceiling light in my foyer that uses six – SIX – bulbs. Maybe $300 to replace the bulbs in ONE fixture seems affordable to a Congressman, but it's not to me.
It's not that I'm some Luddite who is too dim to understand the potential inverse relationship between up-front bulb cost and long-term energy cost. I get that. But so far my experience with “green” bulbs has been less than stellar. I have yet to see a compact fluorescent bulb that significantly outlasts an Edison bulb even though the CFL bulbs retail for five times as much. I haven't crunched the numbers, but I don't think I'm getting that increased bulb cost back in light bill savings. I don't feel like making a $50 wager that the LED bulb is going to be any better.
Free Market economics generally demands that a new product must demonstrably provide more value than the product it's replacing for the new product to be a success. In the case of light bulbs, that translates to more life for the same money or proportionately more energy savings from the light bulb to offset its increased cost. We're not seeing it even if it's there. Savings that trickle in don't soothe the sting of a $50 bulb with an unknown lifespan.
When the mousetrap is ready, we will beat a path to that door. Until then, we're just setting ourselves up for another Solyndra, another Chevy Volt, another going out of business, another layoff of workers, another questionable round of bonuses, and another made for TV movie. Meddling with the Free Market is a mistake.