Ken:
It also must be recognized that politicians “game” the system, as well. Beginning in the 1930s Congress “gamed” the system to encourage a housing boom, first by the creation of Freddie Mac and then later Freddie Mae. Then, in the 1990s, Congress insisted that 50% of the loans “guaranteed” by these quasi-state institutions be for “low-income” and “disadvantaged” buyers. These requirements helped create a “housing bubble” which eventually collapsed when borrowers who weren’t able to meet their obligations began to default in large numbers. This collapse triggered the collapse of financial institutions that had either been forced to play the game, or encouraged to do so by the ephemeral lure of quick profits—sort of like a government-sponsored pyramid scheme.
The problem with government “regulations” and “regulators” is that you have politicians gaming the system, as well. That’s the traditional fox guarding the hen house syndrome, a situation that results in pyramid schemes. Politicians (and regulators are politicians, too) don’t “officiate the game,” they play it for their own political advantage. (Not all politicians are venal, but far, far too many are.)
I’d rather put my faith in true free enterprise—with its historic ups and downs—than in politicians and bureaucrats who, given too much power, have a historic bad habit of turning into commissars and politburos. Socialism (Marx's "intermediate step" to Communism) is not the answer, it is a major part of the problem. History seems to indicate that all socialist systems tend to collapse economically from an erosion of self-motivation and entrepreneurship and government control of citizen creativity. The government can’t solve problems when it is a major part of the problem.
Best,
Government intervention in any part of the economy usually tends to stifle or dampen someone's interests in the private sector to the advantage of others, it never pleases everyone all of the time. The problem with electricity is it's extremely political with the consuming public. They and private businesses alike will demand the government intervene if our electricity system is threatened by a rate crisis or a reliability crisis, both of which are looming in the US. The public has been spoiled with bargain consumer rates and outstanding reliability for decades, where the real failure by politicians and regulators of rate designs has been their tendency to keep a lid on rate growth that would otherwise have funded the now badly needed capacity expansions, grid maintenance, and R&D in utility engineering of Smart Grid technologies.
The problem with totally unregulated markets is that left to their own ups and downs, the gaps between the rich and poor gets wider and wider over time. Remember what the French citizens ultimately did to their rich elite during the French revolution. There's an old saying in Japan that the fatest pigs are always the first to be slaughtered.