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Australia’s Recent Power Market Crisis and the Struggle for Public Ownership

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.

(TUED Working Paper #14) Beyond Disruption: How Reclaimed Utilities Can Help Cities Meet Their Climate Goals - Video Discussion

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). 

Solidarity With Mexico's Fight For Energy Sovereignty

Against a Climate Popular Front

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.

Green Structural Adjustment in South Africa: A War On Workers and Climate

Texas’s Power Woes Are Just the Latest Reminder of the Danger of Privatization

By Donald Cohen - Truthout, February 17, 2022

Texas dodged a bullet earlier this month when its statewide power grid, operated by the Electric Reliability Council of Texas (ERCOT), held up during a drop in temperatures. But that’s not because state leaders, particularly Republican Gov. Greg Abbott, learned anything from last year’s horrific storm.

As Truthout’s Candice Bernd reported last week, not only did 70,000 Texans still experience power and utility services outages during the recent cold snap, but fracked gas production also saw its biggest dip in production since the February 2021 grid failure, revealing the industry’s continued vulnerability to extreme weather.

Last year, Winter Storm Uri blanketed the entire state with freezing temperatures and snow for several days, causing record energy demand. This forced ERCOT to tell energy providers to cut power as they tried to avoid a total collapse of the energy system. Nearly 5 million people lost power and at least 246 died as a result of the storm.

The latest freeze was a more typical Texas cold front. Local power outages were caused mainly by downed power lines due to trees and ice. Still, Abbott is claiming that the system is more reliable and resilient than it’s ever been.

Experts disagree. “The thing about [this month’s freeze] is, we passed the test, but it was also a really easy test, and we didn’t pass it with perfect scores,” Michael Webber, Josey Centennial Professor in Energy Resources at the University of Texas, told Truthout’s Bernd. “There’s a lot of people who had problems with their power, and there was still the gas production drop, so I think we shouldn’t take away too much false confidence that we’re all good now.”

Texas’s energy system is controlled by a complex mix of public and private actors, including the nonprofit ERCOT, oil and gas companies, the Texas Railroad Commission, and others. The details don’t matter as much as what makes the state’s system unique: It’s independent; not connected to the country’s two other national grids, the Western Interconnection and the Eastern Interconnection; and not subject to federal oversight.

This has allowed it to become one of the country’s most marketized systems, according to Johanna Bozuwa, director of the Climate and Community Project. It’s heavily deregulated, designed to allow for intense competition in the retail sale of electricity. As one portfolio manager at a financial firm put it, it’s a “Wild West market design based only on short-run prices.”

Workers Can’t Wait: Just Transition Now – Building Global Labour Power For Climate Justice

Unions and Climate Change: Toward Global Public Goods

Green Unionism against Precarity

By That Green Union Guy - IWW Environmental Union Caucus, January 1, 2022

Editor's Note: all but one or two of the links in this article link to multiple articles, located on the IWW Environmental Union Caucus site, categorized by topic. Therefore, it is to the reader's interest to explore all of the articles brought forth by each link, at their convenience (and that body of information is ever evolving over time).

An edited version of this article appears in New Politics 72.

In a real sense, under capitalism, all workers are "precarious", meaning that they can be downsized, replaced, deskilled, outsourced, etc. It's simply a matter of degrees.

The ultimate peak in precarity is "gig work" (which has actually always existed; the names simply keep changing, but the concept is the same).

Unions represent a check against precarity, though this occurs on a graduated scale. The stronger the union, the less the workers' precarity.

Union strength manifests in various ways: it can result from a well organized, international, militant democratic union (ideal, but rare, with few real world examples, such as ILWU, and the IWW, of course), though more often than not it's a result of concentration of elite craft workers in skilled trades unions, which represents a strong guard against precarity, but only for workers in the union, in which case, solidarity is limited.

Other checks against precarity include high demand for skilled craft workers in rare supply, High demand for hard to replace workers (such as workers that required skilled credentials, such as teachers or transport workers), or tight labor markets (which exist in our semi-post COVID-19 world, due to a combination of factors spelled out in the Vox article).

This is nothing more than class struggle 101, as expertly phrased by Karl Marx, et. al.

There are new forms of precarity emerging due to climate catastrophe (brought on by capitalism). Workers find themselves facing new health and safety hazards and/or threats to their working environment.

Covid, Climate Change: Is the World Ready for “Global Public Goods”?

By Sean Sweeney - New Labor Forum, January 2022

Covid-19 has provided a stark reminder that today’s world is both scarred by grotesque levels of inequality and populated by billions of vulnerable people. However, it has also stimulated renewed interest in “global public goods” (GPGs) and how this foundational idea might be utilized to address a range of social crises, including climate change.

Global public goods is a nice phrase, but what does it mean? The basic idea is simple: no person can be excluded from using the “good” in question. At the mundane or everyday level, streets and parks fall into the public goods category. At the global level, a stable climate would qualify, as would the means to achieve and sustain it.

A guiding principle for a GPG approach to climate protection can perhaps be expressed in one sentence: increasing emissions anywhere endangers people everywhere; reducing emissions anywhere benefits people everywhere. If this principle holds true, then the means of implementation will also either be themselves public goods or they will, almost by definition, be designed to serve the public good.

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