Wednesday, April 20, 2005

More price controls?

More price control

It was reported on Radio Era this morning that the natural gas companies are looking to hike their prices. The government sees a conspiracy in this so the PM has informed them that they cannot raise them more than a set rate, a rate set by the government. It looks like price control for the natural gas industries too.

It is hard to understand why they are doing this. The comments suggest that it might have to do with the elections in 06. But that would be buying the election in the way that Yanukovych tried to buy the presidency (at least it was one leg of his plan to buy the presidency.) Yuschenko appealed to the crowd with ideas and they followed him. Is he now looking to buy them for the Rada elections? I would think Yuschenko could see the inconsistency.

The other idea is that Moroz is behind it all. That is plausible but I think Yuschenko didn’t cave into him to select him as PM, why would he need to cave in on this sort of thing, especially in the face of his promises to rationalize and modernize the economy? I think Moroz had his couple of picks and is a non-issue now. Other things must be afoot. What those are I have no idea. But the movement does not seem to be in the right direction.

5 comments:

Anonymous said...

I'm afraid that you're on the right track. The gas proce controls look like a populist move with the elections in mind (and to do SOMETHING popular, considering that the government hasn't exactly been firing on all cylinders.) Looks more like the old command-administrative system than market econ. Shortages to follow.

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