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Ricechex, I'm not sure that your argument totally supports regulation. I take it as meaning there need to be laws in place that strictly enforce anti-collusion so that something like what happened in California would be less likely to happen.
If laws like these are enforced, government regulation is not necessary, as it is in the interest of competing businesses to "regulate" each other.
De-regulation is what gives you as the consumer the option of choosing more than one service provider. Now, I can see where people might like just one provider of a certain service because they don't want to have to make a decision. However, as long as collusion laws are enforced, de-regulation means more competition and thus lower prices. True de-regulation, a true free market, would create enough competition that a company like Enron would not have the ability to cut off half of the power supply to California.
Enron was corrupt plain and simple, but it wasn't the fact that they used de-regulation and the free market to "take advantage" of people. They broke the law.
I have recently started to wonder if, in a true free market economy, corporations as we know them would actually exist. In a theoretical world with minimal government, and no government interference in the market, it seems that corporations could not exist because right now they receive certain benefits from government such as limited liability and so on.
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