Friday, January 03, 2014

Corporate Greed Killed the Incandescent Light Bulb

Timothy P. Carney:
For more than a century, the traditional incandescent bulb was the symbol of American innovation. Starting Jan. 1, the famous bulb is illegal to manufacture in the U.S., and it has become a fitting symbol for the collusion of big business and big government.

The 2007 Energy Bill, a stew of regulations and subsidies, set mandatory efficiency standards for most light bulbs. Any bulbs that couldn't produce a given brightness at the specified energy input would be illegal. That meant the 25-cent bulbs most Americans used in nearly every socket of their home would be outlawed.
 . . .

Competitive markets with low costs of entry have a characteristic that consumers love and businesses lament: very low profit margins. GE, Philips and Sylvania dominated the U.S. market in incandescents, but they couldn’t convert that dominance into price hikes. Because of light bulb’s low material and manufacturing costs, any big climb in prices would have invited new competitors to undercut the giants — and that new competitor would probably have won a distribution deal with Wal-Mart.

So, simply the threat of competition kept profit margins low on the traditional light bulb — that's the magic of capitalism. GE and Sylvania searched for higher profits by improving the bulb — think of the GE Soft White bulb. These companies, with their giant research budgets, made advances with halogen, LED and fluorescent technologies, and even high-efficiency incandescents. They sold these bulbs at a much higher prices — but they couldn’t get many customers to buy them for those high prices. That's the hard part about capitalism — consumers, not manufacturers, get to demand what something is worth.

Capitalism ruining their party, the bulb-makers turned to government. Philips teamed up with NRDC. GE leaned on its huge lobbying army — the largest in the nation — and soon they were able to ban the low-profit-margin bulbs.
[emphasis added]
H/T Byron York


MAX Redline said...

Worse yet, they fixed things so that Americans can't import them, either.

Oh, but they last so much longer!

If you're 80 years old and your incandescent bulb burns out, do you really want to pay $10 or more for an LED that'll last 20 years?

T. D. said...

Fortunately, you and I won't have to worry about that with our stash. Whenever I go down and take one out I smile at the big inventory.

However, for those who don't have a stash, and for those who turn their lights on and off a lot (like our family does in the dining, kitchen, bathroom, bedroom and utility room areas) the curly lights do burn out quickly besides the irritating flicker some of them have.

As for long lasting bulbs, some of the incandescents in our basement have lasted over a decade (maybe two). I can't remember the last time they were changed.

MAX Redline said...

Loller, TD. Yes, I still have a stash in the garage.

T. D. said...

Max, you were one of the good counselors who pushed me to increase my originally much more limited stash. Thanks!

Now I have enough to help out some of my friends and relatives too. Though I'm going to have to start keeping track of how many we use in a year. It doesn't seem like all that many, but I need to pay attention to see how generous I can be.