Self-destruction by deregulation By Tom Murphy News-Chronicle When it comes to government in day-to-day business, less is usually best. Usually. There are times when business - for the good of the general public - needs a harness, short reins and, sometimes, a set of blinders. Most often this is true with utilities. The electric power and natural gas sectors come to mind first. Enron, anyone? California, the entire state, anyone else? Somewhere down the list of corporations that require regulation comes telecommunications. There are arguments pro and con for the next sector, the airlines. World Com/MCI, Global Crossing and Qwest are prime examples of insanity and greed replacing regulation in communications. Deregulation is still raising cain with the airlines. United, one of the largest carriers in the world, is in bankruptcy. The current fuel price situation is certain to force additional lines to the brink. As for regulators, we're fortunate (most of the time) to have the Public Service Commission of Wisconsin overseeing utilities. The iron fist that hammered prior to 1975 or so is gone; but the agency didn't cover it with kid gloves. When Wisconsin Electric Company of Milwaukee (once WEPCO and now just WE) jumped face first into deregulation in the early 1990s, it almost drowned in the financial swamp. The ill-fated, and doomed-from-the-start, merger negotiations with Northern States Power of the Twin Cities nearly did in WEPCO. That time-consuming effort caused the utility to short-shrift its coal-powered generating facilities up and down Lake Michigan. And Point Beach, once the shining example of the nuclear power industry in the midwest, still suffers (although a third party now operates it) from being ignored during the NSP fiasco. The PSCW is doing its best to bring Wisconsin Electric into the 21st century. Wisconsin Public Service Corp., which serves most of Northeastern Wisconsin (WEPCO acquired a lot of the Fox Valley when it bought Wisconsin-Michigan Power) and a healthy portion of Upper Michigan, is much more conservative than WEPCO. That positioning stood its customers well. So when WPSC strayed too far from its basic commodity, power and fuel, and prematurely entered fiber optics, it was helped back to reality by regulators and directors who remembered its charter. So, too, did the PSCW see the future clearly when it sided with WPS and its desire to run another large power line from Minnesota/ Canada into the Wausau area. Objections from landowers (who really lost no land) and self-styled environmentalists failed. We all won. The PSCW can use that same logic to rule in favor of SBC, Wisconsin's largest local phone company, in its fight to get a reasonable return from competitors who piggyback on its wholly-owned lines. Those competitors have access to its lines but pay so little rent that they can resell at a profit. This is not unlike a government forcing General Motors to accept Toyota as a tenant and watch as the competition undercut prices because it had no investment in bricks and mortar. SBC's predecessors in Wisconsin were ordered by regulators to allow competitors to "rent" its unused capacity. This came at a time when technology and SBC investment made the capacity available. and at rates so low that SBC ended up subsidizing its competition. The company's competitors are not all small "10-10" carriers or local/regional operators like TDS. Some are very big. Like MCI, a stepchild of con man Bernie Ebbers of WorldCom infamy, and AT&T. All SBC wants is a reasonable return on its investment: cables, lines, poles, towers, switches, etc. Seems like an easy decision for the PSCW. MORE BANKING Pressured by a few shareholders who care more about political correctness than the real world, Associated Banc-Corp in Feburary named a woman to its board of directors. Ruth Crowley, a vice president of Harley-Davidson, the Milwaukee-based manufacturer, now stands for election to the board at Associated's annual meeting April 28. She was appointed in February to fill a vacancy. We're not among those who think Associated was willfully ignoring women as director's seats became available. Crowley may be the first woman on Associated's board since the company went public. But she's not the first of her gender at the bank with title and, more importantly, power. Decades before Associated was born, its predecessor, Kellogg-Citizens National Bank of Green Bay, counted Lorraine LaChapelle among its leading and best-known officers. Depending on the situation, LaChapelle could be as tough as nails or a soft as Charmin. There's no doubt that if she were with us today, Lorraine would be an ABC director. Curbside: The MacPaul Center in Luxemburg has attracted two new lessees with occupancy expected in late spring. They are Dr. Pat Warpinski, a veterinarian, and a dance and karate studio operated by Lisa Bero. The Center, which opened in December with a Northeast Wisconsin Technical College satellite campus, is just west of the stop light on Highway 54. Broker/owner Mary Rubens said she has room for additional tenants in the building in blossoming bedroom suburb. Murphy, a longtime local business writer, writes a weekly column for This Week. Contact him by calling 920-432-2941, sending mail to P.O. Box 2467, Green Bay, WI 54306-2467 or by sending e-mail to [email protected].