First Issue: Financial
How should the company produce energy and make money?
How should the company control its finances and profits?
The company builds plants, sells assets and reduces operating costs to
increase profits and inefficiency. There should be no government
intervention. For example, Mirant sold its Philippine operations last
year to another firm.
(Strengths) Efficiency and profit are good for a
company under economic liberalism. The company can fund its operations
over the long run and help environmental and social causes.
Too much focus on efficiency and profit can lead to a great deal of
change and cost cutting. There is more work for a few talented people
and no work for the many less qualified people. Growth and income are
(Solutions) The government has
control of some industries, goods and public utilities. The company
abides by the rates and programs of the government. For example, Mirant
sells the electricity it produces to the government at fixed rates.
State control would be necessary to make the country and the citizens
well off. Financial security would be more important than large profits
or high efficiency.
(Weaknesses) The state may need to subsidize some
plants of the company if they are not profitable. The company may
become less efficient because it may tend to rely on the government
rather than improving its own technology and operations.
The company builds plants where it is profitable. The local government
supports the company's programs. For example, Mirant has built plants in
rural communities. Both the company and the local communities benefit.
By acting rationally, the company produces much energy and profit. In
the same way, citizens have jobs and opportunities. Each actor benefits
from behaving on self-interest.
(Weaknesses) Because actors behave
mostly on self-interest, the greater good may become sacrificed. Little
costs, such as pollution and taxes, may cost the company and destroy the
communities over the long run.
state owns the entire company and controls the production and labor. The
profit made from the company is reinvested in the country. For example,
Mirant financially supports its own foundation in the Philippines.
The country benefits from state ownership because income is reinvested.
The state controls the economy so livelihood and goods would become
stable and affordable to many.
(Weaknesses) Those who want to work
for profit cannot own their own business or have large incomes and
property. Instead of benefiting from much innovation and free
enterprise, the country suffers from the lack of good choices and