neoliberalism

By staff - Trade Unions for Energy Democracy, December 2022

This TUED Working Paper was written to inform discussion at the launch of “TUED South” meeting that took place in Nairobi, Kenya, during October 11th-13th, 2022.

In the weeks following the meeting, it was revised to reflect the discussions that took place. The Nairobi meeting occurred at a time of geopolitical turbulence due to the war in the Ukraine. In many countries, energy has become front page news as prices rise and the major economies rush to secure new sources of gas, coal, and oil. Energy-related anxieties have been accompanied by growing concerns about climate change. The year 2022 produced several headline-making extreme weather events, with devastating floods in Pakistan and in South Africa’s KwaZulu-Natal province together claiming the lives of more than 2,000 people and leaving hundreds of thousands of poor people homeless. Europe’s record-breaking heatwave and wildfires killed 16,000 people, and China’s summer produced a heatwave more severe than any in recorded history.

Today it is widely recognized that the impact of climate change on the poorest countries is already more severe than it is for the richer countries, and that inadequate public services are contributing to its many damaging effects.

In 2019 the UN’s Special Rapporteur on extreme poverty and human rights noted “hundreds of millions will face food insecurity, forced migration, disease, and death.”

Climate change is a huge threat to jobs, livelihoods, and security to workers everywhere. But it is the working class and poor people of the South who will be hit the first and the hardest.

Download this document (PDF).

By Sun-Chul Kim, Seungmin Ryu, Sandra Van Niekerk, and Tom Reddington, et. al. - KPTU, KCTU, and Public Services International, November 17, 2022

Strengthening quality public services in the Global South should be a key priority ofinternational climate finance. Important lessons can be taken from the COVID-19 pandemic. To protect people from the deadly virus governments of all persuasions have had to take back control of privatised public services and rein in international supply chains designed to maximise profit.

This study aims to assess the degree to which international climate finance strengthens universal quality public services in developing countries. It focuses on the case study of the Green Climate Fund to assess whether the concerns of workers and communities have been heeded.

Download a copy of this publication here (PDF).

By staff - Trades Union Congress, September 27, 2022

Commenting on the announcement today (Tuesday) by Labour leader Keir Starmer of proposals for a new publicly owned energy champion called Great British Energy, TUC General Secretary Frances O’Grady said:

“This is a big, bold move that will cut bills and secure our energy future.

“This new national energy champion can provide high-quality jobs to every corner of the UK.

“And it’s about time the public shared in the profits of British energy.”

Editors note

- TUC report ‘Public ownership of clean power: lower bills, climate action, decent jobs’: A recently published TUC report set out an approach for the creation of a publicly owned national energy champion. The report is here: https://www.tuc.org.uk/research-analysis/reports/public-ownership-clean-power-lower-bills-climate-action-decent-jobs

By R.C. Smith - PhD Dissertation, September 1, 2022

Oil and finance have long played central roles in defining how the global economy has developed and this is especially true of the modern neoliberal economic system. One factor of their relationship that is often unexamined is how oil industry profits and liquid capital influence the developments of finance. Understanding their relationship during the modern period first requires understanding this petrocapital cycle, how it influences economic development, and the ways that its rise to prominence in the 1970s transformed the global capitalist financial system.

We are living in a world that has been shaped by the demands of oil and finance. Under the neoliberal capitalist order these two sectors enjoyed central roles in setting the pace of the global economy. Shocks in the price of oil, as recent events like the record-high oil prices experienced following Russia’s 2022 invasion of Ukraine have reminded us, tend not to stay confined to the fuel pump and radiate throughout our economic system. One particular avenue of influence that is often not seen but is widely felt is the reinvestment of oil profits in global financial markets. This question was first thoroughly examined in Mahmoud el-Gamal and Amy Myers Jaffe’s Oil, Dollars, Debt, and Crises: The Global Curse of Black Gold which traced the relationships that formed the endogenous petrocapital cycle, which is the reinvestment of the profits reaped by oil exporters in financial markets and how this changed global credit and financial markets. The Real Oil Shock builds on their earlier work by digging deeper into the birth of this process in the Oil Shocks of the 1970s. It will do this by examining how OPEC’s windfall capital fundamentally changed financial markets, practices, and the creation of money.

What The Real Oil Shock is examining is not a new phenomenon in economic history. The human experience abounds with instances where dramatic redistributions of wealth and resources created significant changes in the existing social and economic order. An excellent example comes from the Spanish colonization of the Americas. Exploitation of gold, silver, and other precious metals in the Americas provided the Spanish monarchy with an enormous windfall of liquid capital. This was spent by the Spanish monarchy on projects of the state, fighting wars, and expanding their influence in Europe. This put increasing quantities of Spanish doubloons in circulation outside of domestic markets. Spanish gold had become the capital for Dutch, English, and French merchants for financing their own commercial, industrial, and colonial enterprises whose activities were the foundation of early modern capitalism in Europe.

Download this document (link).

By Olivia Weeks and Marc Edelman - The Daily Yonder, August 26, 2022

Marc Edelman is a writer and Professor of Anthropology at Hunter College. In his work, academic and otherwise, Edelman investigates what he terms the underdevelopment of rural America. In a 2021 paper entitled “Hollowed out Heartland, USA” he writes “Rural decline is not simply the result of deindustrialization spurred by free trade, the farm crisis, or automation and robotization. Since the 1980s, financial capital has developed imaginative new ways to strip and seize the assets present in rural zones, whether these be mutually-owned banks, industries, cooperatively-owned grain elevators, local newspapers, hospitals, people’s homes, or stores located in towns and malls.” In the wake of the fiscal austerity agenda enacted by financial and political elites in the late 20th century, the vast majority of the wealth created in America’s countryside “has accrued to shareholders in corporations and financial institutions headquartered in a handful of distant, economically dynamic urban centers.” The financialization of the American economy, especially in those places furthest from economic hubs, can be extremely opaque. But its repercussions – many of which are often seen as causes and effects of backwardness and small-town decline – are all around us.

We discuss the destabilizing effects of such uneven development, the parallels between rural and urban landscapes of decline, and the political choices that sacrificed rural prosperity to urban agglomeration, below.

By Sean Sweeney - New Labor Forum, July 18, 2022

How can the world end energy poverty in the Global South and simultaneously reduce greenhouse gas emissions to fight climate change? In 2021, 860 million people had no access to electricity. [1] Today, a third of all humanity lacks access to reliable power. Roughly 2.6 billion people heat their homes with polluting fuels and technologies, and using traditional stoves fueled by charcoal, coal, crop waste, dung, kerosene, and wood.2 The majority of families in the Global South are today able to turn on an electric light—and therefore have “access to electricity” for at least some hours in the day—but for many that is as far as it goes. For other basic needs, dirty and perhaps life-threatening energy continues to be the norm.

The urgency of providing energy to the great numbers of people in the Global South who lack it runs headlong into the necessity to divert climate disaster by reducing worldwide carbon emissions. It is this challenge that sits at he center of current debates on “sustainable development.” For some years, the standard answer from the climate policy world has been the following: the Global South is well positioned to “leapfrog” the phase of centralized energy and jump feet first into the transition to modern renewables, in the same way as mobile phones have proliferated in the developing world without first having to install traditional land-line infrastructure.3 Whereas large nuclear, coaland gas-fired power stations and hydroelectric dams take years to build, by comparison wind, solar, and battery technologies are small, easy to install, and, the argument goes, increasingly affordable. Rural communities without electricity can set up stand-alone “micro- grids,” so there is no need for traditional transmission and distribution grids which are expensive and inefficient. The Global South—which refers broadly to Africa, Latin America and the Caribbean, the Pacific Islands, and the developing countries in Asia—is blessed with so much sun and wind, there is no reason why energy poverty cannot be consigned to history relatively quickly.4

That is the good news. The bad news is that it is not happening, and there are few signs that it will.

By staff - Trade Unions for Energy Democracy, July 8, 2022

This past June 15th, Australia’s Electricity Market Operator (AEMO) announced the suspension of wholesale electricity spot markets in all regions covered by the country’s National Electricity Market (NEM). The NEM typically provides 80% of Australia’s electricity, mainly in developed coastal areas around the eastern third of the country.

The market suspension came in response to soaring wholesale electricity prices and serious shortages in supply — a combination of factors that, according to AEMO, made it “impossible to continue operating the spot market while ensuring a secure and reliable supply of electricity for consumers” in line with national regulatory requirements.

Key unions in Australia have recognized for years that the NEM does not serve the interests of unions, working people, or the public in general. According to Michael Wright, acting national secretary of the country’s Electrical Trades Union (ETU):

The ETU has been sounding the alarm about the NEM for years. This vindicates our long-held concerns that the market is broken and beyond repair.

The experiment in synthetic markets, trying to deliver essential public services through profit-motivated, tax-avoiding multinational energy corporations, has failed shockingly.

Similarly, Colin Long, Just Transitions Organizer for Australia’s Victorian Trades Hall Council (VTHC), points out that such markets only function when they ensure profits for private owners and investors. As Long states in a background document he has written on the current crisis:

The NEM [like other market-based systems] is designed to deliver electricity in a way that is profitable to generators, mostly privately-owned, not in a way that maximises public or social benefit to Australians.

As Long further explains:

Privatisation was supposed to lead to lower prices for consumers. In fact, the opposite has occurred. Reinstating public ownership would eliminate rentier behaviour by transmission and distribution companies and the need to concede to the profit demands of big overseas investors. It would enable us to plan the energy system transformation, with a clear schedule for closure of fossil fuel generators to give certainty to workers, their communities and electricity grid managers. It would enable us to schedule fossil fuel generation replacement by renewables in a way that guaranteed supply, efficiency and reduced cost – and ensures we meet decarbonisation targets. It would enable us to ensure that workers are guaranteed a just transition to new opportunities and new industries.

Readers who would like a copy of Long’s background document can contact him at clong@vthc.org.au.

Both ETU and VTHC are part of the TUED network, and have played key roles in advancing the project.

By Sean Sweeney, et. al. - Labor Network for Sustainability, May 31, 2022

Web Editor's Note: this webinar discussion focuses on TUED Working Paper #14. Some of the arguments made by the presenters seem to frame advocates of locally controlled, decentralized distributed energy as "unwittingly plaing into the hands of neoliberalism", which is a debatable position (and one that some of the other attendeees push back on). 

By various - Trade Unions for Energy Democracy, April 19, 2022

By Graeme Goossens - Candian Dimension, April 18, 2022

I can’t forget those crisp November mornings. I’d stand respectfully still, a Scout’s red sash across my shoulder. I remember the veteran steadying himself with his cane, standing as straight as he still could, crying silently as the “Last Post” rang out.

“How many of you would have fought?” Ms. Allen had asked our class.

Every tiny hand was raised.

The heroism of the Second World War was etched into my memory.

For the left, there are few national myths fit for duty, but author, activist and organizer Seth Klein has called up the the greatest conflict in history to serve as the key parable in the fight against global warming. Just as Canada mobilized for the war, it must now mobilize for climate change. Klein’s recent book, A Good War: Mobilizing Canada for the Climate Emergency, published by ECW Press in September 2020, makes a powerful case against defeatism and timidity.

Yet despite his impressive call to action (A Good War spent 12 weeks on the CBC Books non-fiction bestseller list), Klein misinterprets Canada’s wartime history and misunderstands the capitalist state. Ultimately, his cross-class strategy cannot deliver climate justice.

Klein’s vision of climate politics is unapologetically state-centric. The stunning wartime transformation of the Canadian economy, vigorously directed by the federal government, proves what is possible. Such a transformation can simultaneously create a more equal society, a development good in itself, while winning public support for a difficult program. And if this seems unimaginable in today’s political climate, Klein argues the war teaches us that public opinion can be shifted through bold leadership from actors primarily, but not exclusively, in the state.

A Good War is written for political impact and as such, Klein gets quickly to the point. The book is structured as a series of lessons we can learn from the wartime experience, introduced in boldface for those too busy to read to the end.

His central argument is a historical comparison: Canada’s success during the Second World War demonstrates what is possible and necessary in our fight against climate change today. So why has such a mobilization not yet been repeated in our contemporary struggle against runaway global warming? Here Klein casts a villain in his story. Though he considers picking the fossil fuel industry, he instead settles on what he terms the “new climate denialism” as the key impediment.

Previous denialism dismissed the science on climate change, but today, our primary enemy is a “way of thinking and practice” that accepts the science while obfuscating its implications. This must be overcome through bold leadership. For Klein, Canada demonstrated such leadership in its fight against fascism. Now, he argues, we must wield it again.

Bold leadership, in his view, must seek to rally the public onside. As in the Second World War, this will involve propaganda, but also efforts to combat the inequality which corrodes a sense of common cause. Wartime plans for post-war social democracy must be echoed by today’s Green New Deal. Klein believes economic barriers can be overcome through a massive expansion of state planning. The government should spend whatever it requires and tax as necessary, but also intervene directly through regulation and the creation of new Crown corporations. Concrete ideas such as a jobs guarantee, a federal high-speed rail network and an inheritance tax add texture, but Klein’s argument does not hang on policy specifics.

In part, his text reads as a direct plea to progressive lawmakers. “This book is an invitation to our political leaders,” he writes in the preface, “to reflect on the leaders who saw us through the Second World War and consider who they want to be, and how they wish to be remembered.” The work was researched through a series of interviews with Canadian politicians, activists and academics. He questions parliamentarians and ministers from various parties on the barriers they face, quotes their responses, and replies in good faith. Central to his rebuttal is a poll commissioned for the book demonstrating strong support for emissions mitigation. “The public,” he argues, “is ahead of our politics.” His role for social movements is ultimately to shift our politicians.

A Good War stands at the cutting edge of progressive climate politics. Along with closely related proposals for a Green New Deal, the climate movement has finally identified a program both adequate for the scale of the challenge and capable of assembling a coalition to achieve it. The book should be lauded for making clear that only the state can coordinate transformation at the speed and scale required.

Yet while A Good War is correct that only the state can bring emissions to zero, Klein is wrong to assume that the state can show the markets who’s boss. And because he misunderstands the capitalist state, he proposes a cross-class coalition aiming to inspire “bold leadership” in our elites. Klein’s program is solid, but this strategy cannot win. Capitalists will fight a just transition tooth and nail, and we cannot overcome their resistance in alliance with them.