“Lynne Kiesling is a technocrat whose theories come alive in the governmental domain. She believes she has melded the free market and government planning in electricity. By playing classical liberal in other respects, she has fooled many free market types, while collecting many academic positions for her contra-capitalist views.”
Statism in classical-liberal garb is the story of electricity specialist Lynne Kiesling. This post documents her exchange with Travis Fisher, director of energy and environmental studies at the CATO Institute. She shows her style but avoids the fundamental arguments of markets-versus-government in electricity. My interpretation of Kiesling as contra-capitalist concludes this post.
This exchange occurred with a post by Todd Snitchler, head of the Electric Power Supply Association.
Fisher (to Kiesling): in a recent piece you attempt to reconcile designed markets with a Hayekian approach. I don’t think such reconciliation is possible. I think removing legal privileges and allowing for organic competition is the way to go. We should discuss ways to allow true competition rather than trying to force organized markets through the lens of Austrian economics. To me, the two are incompatible.
Kiesling: Then we disagree. And a deep reading of Hayek’s works, not just (1945) and the Road to Serfdom, supports my interpretation. RTO market designs and governance have not evolved to adapt to changing conditions and resource mixes, largely because their institutions are regulatory constructs. But if you throw the baby out with the bath water then you lose the physical and economic benefits of a connected AC network, as Michael Giberson said above.
Fisher: who is suggesting throwing out the baby with the bath water? And what does that even mean in the electricity context?
PS – why would you assume 1) I’ve only read the Hayek works you cited (you have to realize how condescending that is) and 2) Hayek is the only Austrian economist relevant to this discussion? Both are false.
Kiesling: If I have drawn incorrect inferences from your statements I apologize. LinkedIn is not the place for textual exegesis. Please do not interpret this as condescending, but rather as a time saver on a busy weekend — I’ve published research relevant to these questions in places like Review of Austrian Economics and Advances in Austrian Economics, and those papers reflect my analyses well.
Fisher: I agree social media is not the right place to have deep conversations. But are you interested in joining me at a forum at Cato on these issues? I can work around your schedule
AND she disappeared…. In fact, I doubt Lynne would dare get in front of free market academics and try to explain why a centrally planned wholesale electricity market (ISOs/RTOs) does not suffer from the knowledge problem and the governance problem, as she recently seems to have (finally!) admitted. And her latest:
[The Texas blackout of] February 2021 provided a traumatic challenge to the operational and regulatory institutions of the past 15 years, and in my opinion since then, the Texas legislature and ERCOT have made many wrong decisions and have politicized grid operations, market operations, and business decisions. ERCOT needs reform, but not in the direction they have gone.
Politicized grid decisions? Governance issues? So after-the-fact, a “classical liberal” admits to the very things that cautioned against her argument for turning over a major economic segment to politicians and bureaucrats? And she still refuses to define what a free market is in electricity–“I will not dance to your tune,” she told me in an exchange.
Kiesling vs. Classical Liberalism
Note the condescending nature of Kiesling, who sees herself as the Grand Dame of electricity in the classical liberal tradition. This is not the first time she has short-changed Fisher in a social media exchange with the …. I’m too busy ruse. This is but one of several methods she employs to duck basic debate and assert superiority to her opponents.
I am laboriously documenting (step-by-step) her fake classical liberal bona fides:
Why, might one ask? The answer is actually pretty obvious. Lynne Kiesling is a technocrat whose theories come alive in the governmental domain. She believes she has melded the free market and government planning in electricity. By playing classical liberal in other respects, she has fooled many free market types, while collecting many academic positions for her contra-capitalist views.
But in this quest, she is the personification of scientism and the fatal conceit. She is Adam Smith’s woman of system. F. A. Hayek would see through all this. Ronald Coase would have dismissed her transaction cost argument for electricity statism. It is time to stop the evasion and engage in a real debate about the free market and government intervention in electricity. Let’s debate a Cato or anywhere else, Lynne.
 Kiesling endorses Doug Lewin, a paid voice for forced energy transformation in the Texas power market.