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collectivization

Doing Away With Private Utilities Is a Matter of Life and Death

By Ryan Smith - Broke Ass Stuart, January 16, 2019

The toll of this year’s wildfires is the second in as many years to break entirely too many state records, increasing the call to hold private utility companies like Pacific Gas & Electric to the flames of their own making. When the last embers cooled there was no question that the Camp Fire that ravaged Butte County, along with the devastating fires that tore through Malibu and Ventura, were among the most destructive in California history inflicting an estimated $10 billion in property damage. This was only topped, in dollar value, by last year’s devastation where the state suffered an unprecedented $12 billion in direct property damage. From a purely economic standpoint these figures don’t consider the secondary impacts such as loss of tourism, rebuilding and the opportunity cost of once thriving communities no longer capable of any sort of economic activity.

These numbers, already adding up to a truly staggering cost, don’t even touch on the immeasurable human cost. 2017 set a grim toll of 43 confirmed dead, a total that was already greater than all loss of life from the previous decade of California wildfires combined. This past season is on track to double that with a confirmed 89 dead so far. One can only imagine how many more will join them in the coming months and years thanks to the long-term damage from noxious fumes released by this year’s fires. The sheer quantity of toxic particulates in the air during the height of the blaze made Butte County’s air the most hazardous on the planet.

There is little doubt who is responsible for this blaze. The most recent investigations have all but concluded the cause of the fires was due to improperly maintained wiring, property of PG&E, setting a deadly inferno ablaze. In the face of an estimated $30 billion in liability for the Camp Fire, PG&E, earlier this week, filed bankruptcy. They are not alone in such negligence, with SoCal Edison suspected of similarly irresponsible practices in Southern California. Such a failure to perform such basic, fundamental tasks – maintenance of consistent power flow and safety of California’s communities – is astonishing all by itself. Unfortunately this is far from the first time PG&E has screwed up this badly.

In the wake of the 2017 wildfires investigators concluded the most likely cause of an already horrific disaster was PG&E’s inability to do their jobs. Gerald Singleton, an attorney specializing in wildfire cases, argued PG&E’s history shows this was no surprise as the privately-owned utility company has a history of disregarding basic maintenance necessary both for community safety and delivering power. In 2010 PG&E’s lax management piled up until one of their natural gas pipelines exploded, snuffing out the lives of eight San Bruno residents. Their cost-cutting is so extreme that, only two years after the San Bruno disaster, PG&E found they didn’t have enough staff to properly mark all of their gas lines so the company hid the mistake by filing false claims stating they had. This reckless culture even extends to data management as shown by reports from earlier this year where PG&E managed to lose 30,000 people’s personal information in a single data breach.

Viewpoint: What’s Good for the Country? New Owners for GM

By Toni Gilpin - Labor Notes, December 13, 2018

Move over, Mr. Grinch: the executives at General Motors have you beat.

Trump Is Handing Us the Weapon We Need to Avert Climate Catastrophe

By Johanna Bozuwa and Carla Skandier - Truthout, June 26, 2018

A Brief History of Cooperatives in California

By John Curl - Grassroots Economic Organizing, June 11, 2018

COLLECTIVITY IN INDIAN TIMES

For thousands of years the San Francisco Bay Area supported a population of thousands of Ohlones, Miwoks, and Wintuns living in a stable life system based on peaceful collectivity.

Our Best Shot at Meeting Paris Goals? Make Energy Public

By Sarah van Gelder - Yes! Magazine, July 9, 2017

Mayors across the country have vowed to deliver on the goals of the Paris climate accord in defiance of President Trump’s decision to back out. But how can they, realistically, when the national government is questioning climate science and promoting coal, fracking, and pipelines?

Simply put: Make energy public. Instead of privatizing city services, as some policymakers have long advocated, a new report shows that public ownership gives cities and towns the best shot at meeting renewable energy and efficiency targets.

Reclaiming Public Services: How Cities and Citizens are Turning Back Privatization,” a study by the Amsterdam-based Transnational Institute, challenges the ideas that governments are ineffective service providers, that private companies are more efficient, and that austerity budgeting and reductions in public service are inevitable.

Cities and towns that want well-run water and sanitation services, low-cost access to the internet, and affordable housing should keep those operations public or run by local nonprofits, the report found. If these services are now private, the institute recommends “re-municipalization.”

The report is based on research involving 1,600 cities in 45 countries that have chosen public ownership over corporate ownership, especially of their energy and water systems. “These (re)municipalisations generally succeeded in bringing down costs and tariffs, improving conditions for workers and boosting service quality, while ensuring greater transparency and accountability,” the report concludes.

Both Hamburg, Germany, and Boulder, Colorado, for example, are making their electric power enterprises public in order to shift to green and renewable energy sources.

In France, 106 cities and towns have taken over their local water systems in the past 15 years, in spite of the fact that France is home to some of the world’s largest private water companies. During that time, the report found that no French cities went the other direction and privatized their water system.

The report focuses on water and energy services, but there are many other services that benefit from local public ownership—some unexpected. The French towns of Mouans-Sartoux and Ungersheim bought farmland and hired local farmers to supply organic produce for school lunches. In India, the Tamil Nadu government opened dozens of public low-cost restaurants run by impoverished women to feed the poor. Argentina privatized postal services in 1997, but just six years later, renationalized the service in response to the private company’s poor service and high prices.

Privatization is tempting; it can provide local governments with short-term cash infusions. What politician doesn’t like to fill a budget hole without raising taxes? But the infusions don’t last. The private companies must pay large sums to their shareholders and executives, which they often do by cutting corners on upkeep, wages, and services, or jacking up customers’ rates. Instead of circulating locally, that money leaves a city’s economy.

According to the report, once a service is turned over to a private company, many cities found it was difficult to maintain accountability. They faced cost overruns, poor service, and violations of contracts. Many found they saved money and improved services when services went back into public hands.

Although family-owned or worker-owned businesses and consumer cooperatives are essential to local economies, some services—like water and sanitation—are best operated at a municipal or regional scale, and multiple providers may not make sense. In cases of these natural monopolies, local public ownership especially makes sense.

Like an ecosystem, a functioning local economy requires diversity. It needs many forms of ownership and types of entities. To thrive over years, each entity must both give and take; they must be in relationship with the people, institutions, and ecosystems that make up each community. When a local economy is dominated by enterprises that work to extract value for Wall Street banks or corporations controlled by absentee owners, communities are drained of their common wealth. It is that concern that drives much of the opposition to big international trade deals, like the Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership, which critics say favor corporate rights over those of local government.

On the other hand, local entities, whether operated by worker-owners, families, nonprofit enterprises, or local governments, seek out multiple bottom lines—multiple benefits for employees, young people, vulnerable residents, and other local enterprises. They also take responsibility for their own human and natural communities. That is how We the People and the natural world can thrive for the long term.

Bringing Power to the People: The Unlikely Case for Utility Populism

By Kate Aronoff  - Dissent, Summer 2017

One glaring omission in the postmortem handwringing about the 2016 election is the fact that most poor people in America—of all races and genders—simply didn’t vote. They were prevented from doing so by a number of structural barriers—voting restrictions, second and third jobs, far-flung polling locations—as well as a lack of excitement about two parties they saw as having abandoned them.

Enter: twenty-first-century electric cooperatives, a perhaps unlikely player in the contest for power between progressives and conservatives in the heart of so-called Trump country in rural America.

If there’s one thing poor, rural communities tend to have in common, it’s where they get their power—not political power, but actual electricity. Over 900 rural electric cooperatives (RECs)—owned and operated by their members—stretch through forty-seven states, serving 42 million ratepayers and 11 percent of the country’s demand for electricity. They also serve 93 percent of the country’s “persistent poverty counties,” 85 percent of which lie in non-metropolitan areas. REC service areas encompass everything from isolated farm homes to mountain hollers to small cities, with the highest concentrations in the South, the Midwest, and the Great Plains. And they might just offer an opportunity to curb the right and the climate crisis alike.

Nominally democratic, RECs have the ability to transform a sizable chunk of America’s energy sector—one of the highest-polluting parts of our economy. Servicing ratepayers whose top agenda may not be climate change, the push to integrate renewables into RECs’ energy mix nonetheless grounds the transition away from carbon-intensive fuels in something more material: energy bills. Member-owner reformers dotting the map of red and rural America are already waging fights over their cooperatives on two fronts: for basic representation and for energy efficiency. Their work—combining a zeal for small-d democracy with one for bringing down emissions—could hold the key to making sure the transition away from fossil fuels includes some of the poorest places in the country on the ground floor. Crucially, it could also help extend our much heralded clean energy revolution beyond liberal enclaves like New York and California. If successful, reformed RECs could give progressives a much needed foothold in places the Democratic Party has long since abandoned. They might also help greens refocus fights onto pocketbook issues.

Understanding the RECs’ radical potential, however, means understanding their history. Rural electrification was intended to accomplish one goal: to serve people neglected by the private sector. At the start of the Great Depression, some 90 percent of rural homes lacked electricity. For private utilities (the only game in town at the time) extending power lines to customers spread out over tens or hundreds of miles simply wasn’t worth the cost—especially considering that the vast majority of those potential customers happened to be poor.

Corbyn calls for “public, democratic control and ownership” of energy in order to transition to renewables

Jeremy Corbyn speech to Alternative Models of Ownership Conference - Trade Unions for Energy Democracy, February 11, 2018

Disclaimer: The IWW does not organizationally participate in electoral campaigns, but while we remain skeptical of the efficacy of Corbyn's call for nationalization absent a militant, rank-and-file, independent workers' movement, the proposal he lays out hereis something that could inspire such a movement to organize around.

It is a pleasure to close today’s conference which has shown once again that it is our Party that is coming up with big ideas.

And we’re not talking about ideas and policies dreamed up by corporate lobbyists and think tanks or the wonks of Westminster, but plans and policies rooted in the experience and understanding of our members and our movement; drawing on the ingenuity of each individual working together as part of a collective endeavour with a common goal.

Each of you here today is helping to develop the ideas and the policies that will define not just the next Labour Government but a whole new political era of real change.  An era that will be as John said earlier  radically fairer  more equal  and more democratic.

The questions of ownership and control that we’ve been discussing today go right to the heart of what is needed to create that different kind of society.

Because it cannot be right, economically effective, or socially just that profits extracted from vital public services are used to line the pockets of shareholders when they could and should be reinvested in those services or used to reduce consumer bills.

We know that those services will be better run when they are directly accountable to the public in the hands of the workforce responsible for their front line delivery and of the people who use and rely on them.  It is those people not share price speculators who are the real experts.

That’s why, at last year’s general election, under the stewardship of Shadow Business Secretary Rebecca Long-Bailey, Transport Secretary, Andy McDonald  and Environment Secretary, Sue Hayman, Labour pledged to bring energy, rail, water, and mail into public ownership and to put democratic management at the heart of how those industries are run.

This is not a return to the 20th century model of nationalisation but a catapult into 21st century public ownership.

The failure of privatisation and outsourcing of public services could not be clearer.

The Case for Nationalizing Elon Musk

By Kate Aronoff - In These Times, February 8, 2018

On Tuesday, Elon Musk launched some stuff into space. The SpaceX Falcon Heavy rocket was shot into the Solar System, tailed by a Tesla Roadster blasting David Bowie songs, reportedly the fastest car ever to be released into orbit. Each Falcon launch is only expected to cost around $90 million—a bargain in the world of extraterrestrial exploration. 

Scientific American gawked, “Elon Musk Does It Again,” praising the “bold technological innovations and newfound operational efficiencies that allow SpaceX to not only build its rockets for less money, but also reuse them.” That view—shared by several other outlets—fits comfortably with the Tony Stark-like image Musk has crafted for himself over the years: a quirky and slightly off-kilter playboy genius inventor capable of conquering everything from outer space to the climate crisis with the sheer force of his imagination.

One of Musk’s long-term goals is to create a self-sustaining colony on Mars, and make humanity an interplanetary species. He hopes to shoot two very wealthy people around the moon at some point this year. Musk has invested an awful lot of public money into making those dreams a reality. But why should Americans keep footing the bill for projects where only Musk and his wealthy friends can reap the rewards? Enter: the case for nationalizing Elon Musk, and making the U.S. government a major stakeholder in his companies.

The common logic now holds that the private sector—and prodigies like Musk, in particular—are better at coming up with world-changing ideas than the public sector, which is allegedly bloated and allergic to new, outside-the-box thinking. Corporations’ hunt for profits and lack of bureaucratic constraints, it’s said, compel cutting-edge research and development in a way that the government is simply incapable of. With any hope, more of these billionaires’ breakthroughs than not will be in the public interest.

The reality, as economist Mariana Mazzucato argues in her 2013 book The Entrepreneurial State: Debunking Public vs. Private Sector Myths, is very different. Many of the companies that are today considered to be headed by brilliant savants—people like Steve Jobs and, yes, Elon Musk—owe much of their success to decades of public sector innovation, through repackaging technologies developed over the course of several decades into new products. Take the iPhone, essentially a collection of Defense Department research and National Science Foundation-grant projects packed into one shiny machine.

“The prospect of the State owning a stake in a private corporation may be anathema to many parts of the capitalist world,” Mazzucato writes, “but given that governments are already investing in the private sector, they may as well earn a return on those investments.”

Bringing Power to the People: The Unlikely Case for Utility Populism

By Kate Aronoff  - Dissent, Summer 2017

One glaring omission in the postmortem handwringing about the 2016 election is the fact that most poor people in America—of all races and genders—simply didn’t vote. They were prevented from doing so by a number of structural barriers—voting restrictions, second and third jobs, far-flung polling locations—as well as a lack of excitement about two parties they saw as having abandoned them.

Enter: twenty-first-century electric cooperatives, a perhaps unlikely player in the contest for power between progressives and conservatives in the heart of so-called Trump country in rural America.

If there’s one thing poor, rural communities tend to have in common, it’s where they get their power—not political power, but actual electricity. Over 900 rural electric cooperatives (RECs)—owned and operated by their members—stretch through forty-seven states, serving 42 million ratepayers and 11 percent of the country’s demand for electricity. They also serve 93 percent of the country’s “persistent poverty counties,” 85 percent of which lie in non-metropolitan areas. REC service areas encompass everything from isolated farm homes to mountain hollers to small cities, with the highest concentrations in the South, the Midwest, and the Great Plains. And they might just offer an opportunity to curb the right and the climate crisis alike.

Nominally democratic, RECs have the ability to transform a sizable chunk of America’s energy sector—one of the highest-polluting parts of our economy. Servicing ratepayers whose top agenda may not be climate change, the push to integrate renewables into RECs’ energy mix nonetheless grounds the transition away from carbon-intensive fuels in something more material: energy bills. Member-owner reformers dotting the map of red and rural America are already waging fights over their cooperatives on two fronts: for basic representation and for energy efficiency. Their work—combining a zeal for small-d democracy with one for bringing down emissions—could hold the key to making sure the transition away from fossil fuels includes some of the poorest places in the country on the ground floor. Crucially, it could also help extend our much heralded clean energy revolution beyond liberal enclaves like New York and California. If successful, reformed RECs could give progressives a much needed foothold in places the Democratic Party has long since abandoned. They might also help greens refocus fights onto pocketbook issues.

Understanding the RECs’ radical potential, however, means understanding their history. Rural electrification was intended to accomplish one goal: to serve people neglected by the private sector. At the start of the Great Depression, some 90 percent of rural homes lacked electricity. For private utilities (the only game in town at the time) extending power lines to customers spread out over tens or hundreds of miles simply wasn’t worth the cost—especially considering that the vast majority of those potential customers happened to be poor.

Our Best Shot at Meeting Paris Goals? Make Energy Public

By Sarah van Gelder - Yes! Magazine, July 9, 2017

Mayors across the country have vowed to deliver on the goals of the Paris climate accord in defiance of President Trump’s decision to back out. But how can they, realistically, when the national government is questioning climate science and promoting coal, fracking, and pipelines?

Simply put: Make energy public. Instead of privatizing city services, as some policymakers have long advocated, a new report shows that public ownership gives cities and towns the best shot at meeting renewable energy and efficiency targets.

Reclaiming Public Services: How Cities and Citizens are Turning Back Privatization,” a study by the Amsterdam-based Transnational Institute, challenges the ideas that governments are ineffective service providers, that private companies are more efficient, and that austerity budgeting and reductions in public service are inevitable.

Cities and towns that want well-run water and sanitation services, low-cost access to the internet, and affordable housing should keep those operations public or run by local nonprofits, the report found. If these services are now private, the institute recommends “re-municipalization.”

The report is based on research involving 1,600 cities in 45 countries that have chosen public ownership over corporate ownership, especially of their energy and water systems. “These (re)municipalisations generally succeeded in bringing down costs and tariffs, improving conditions for workers and boosting service quality, while ensuring greater transparency and accountability,” the report concludes.

Both Hamburg, Germany, and Boulder, Colorado, for example, are making their electric power enterprises public in order to shift to green and renewable energy sources.

In France, 106 cities and towns have taken over their local water systems in the past 15 years, in spite of the fact that France is home to some of the world’s largest private water companies. During that time, the report found that no French cities went the other direction and privatized their water system.

The report focuses on water and energy services, but there are many other services that benefit from local public ownership—some unexpected. The French towns of Mouans-Sartoux and Ungersheim bought farmland and hired local farmers to supply organic produce for school lunches. In India, the Tamil Nadu government opened dozens of public low-cost restaurants run by impoverished women to feed the poor. Argentina privatized postal services in 1997, but just six years later, renationalized the service in response to the private company’s poor service and high prices.

Privatization is tempting; it can provide local governments with short-term cash infusions. What politician doesn’t like to fill a budget hole without raising taxes? But the infusions don’t last. The private companies must pay large sums to their shareholders and executives, which they often do by cutting corners on upkeep, wages, and services, or jacking up customers’ rates. Instead of circulating locally, that money leaves a city’s economy.

According to the report, once a service is turned over to a private company, many cities found it was difficult to maintain accountability. They faced cost overruns, poor service, and violations of contracts. Many found they saved money and improved services when services went back into public hands.

Although family-owned or worker-owned businesses and consumer cooperatives are essential to local economies, some services—like water and sanitation—are best operated at a municipal or regional scale, and multiple providers may not make sense. In cases of these natural monopolies, local public ownership especially makes sense.

Like an ecosystem, a functioning local economy requires diversity. It needs many forms of ownership and types of entities. To thrive over years, each entity must both give and take; they must be in relationship with the people, institutions, and ecosystems that make up each community. When a local economy is dominated by enterprises that work to extract value for Wall Street banks or corporations controlled by absentee owners, communities are drained of their common wealth. It is that concern that drives much of the opposition to big international trade deals, like the Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership, which critics say favor corporate rights over those of local government.

On the other hand, local entities, whether operated by worker-owners, families, nonprofit enterprises, or local governments, seek out multiple bottom lines—multiple benefits for employees, young people, vulnerable residents, and other local enterprises. They also take responsibility for their own human and natural communities. That is how We the People and the natural world can thrive for the long term.

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