Preside Or Lead?

Book excerpt: This is a book of essays that addresses a species of regulation: the regulation of our public utilities. These providers of electricity, gas, telecommunications, and water support our local, regional, national, and international economies. Our lives depend on their performance. Defining and demanding that performance is the job of regulators. Regulators set standards, compensate the efficient, and penalize the inefficient. These standards, compensation, and penalties align private behavior with the public interest. In my 30 years' close-up experience working with regulators, I have been consistently impressed by the power of personal attributes. The public battles feature the parties, their hired experts, and their attorneys. But when the record closes and deliberations begin, the focus shifts to the commissioners. Case outcomes are determined not only by facts, law, and policy, but also by commissioners' attributes--attributes like purposefulness, decisiveness, independence, creativity, ethics, and courage. These attributes, or their absence, influence the actions of regulators--such as whether they "balance" and "preside" or whether they set standards and lead. And even the most purposeful, educated, decisive, and independent regulators--those who make the tough calls and take the right actions--face obstacles: the forces of self-interest and provincialism that can undermine the high purpose of regulation.