As I was walking along the street the other day, a child drew me to his mothers attention.

That man's got feet.

Legislation on electricity supply creates a new situation in place of the old one. One may have a regulated approach rather than a free market approach, but there are many different ways to regulate the supply of electricity, and legislation may make a change from one method of regulation to another. Equally, the free market is not the law of the jungle. If criminality is creeping into a free market approach, for example cutting the wires of rival companies, then new laws will be needed to combat this and the legislation maintains a free market.

The drama that attracts public interest arises with bolder changes. If a free market approach is replaced by regulation this is called regulation or nationalisation. If a regulatory approach is replaced by a free market approach this is called deregulation or privatisation.

Since the retail prices are set by the government of California the new system is a regulated one. As was the old system. The regulations were reformed to introduce elements of fantasy and make believe into the supply of electricity. But even A state of gloom,an article in the Economist for Jan 20th 2001, which details the price controls and regulations uses the word `deregulation'.

It is as if regulation and deregulation are the only two of the four possibilities that anyone can see. Since the old system was one of regulation, the legisation was not introducting regulation in place of the free market. Since it is not regulation it must be deregulation.