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NUMSA’s Submission to NERSA on Eskom’s Application for a tariff increase

By Irvin Jim - NUMSA, November 15, 2017

NUMSA is a manufacturing union and since 2009, the union has witnessed the deep global crisis of capitalism in the manufacturing sector. NUMSA has witnessed hemorrhaging of jobs, plant closures retrenchments the downward variation of conditions and benefits of workers and the casualization of labour. At the centre of this crisis, especially in small, medium-sized companies has been the uncompetitive Eskom electricity tariffs.

The history of job losses can be traced to wrong the ANC government neo-liberal policies such as liberalization of trade, removal of exchange controls, continuous and the maintenance of high interest rates by the Reserve Bank. This situation was worsened the day government made the decision to move Eskom away from its core mandate which was to supply cheap electricity to the economy in order to grow the economy, to electrify communities and to create jobs. This mandate was replaced by a backward government and NERSA with the decision to prioritize their balance sheet, which was nothing more than to chase profits.

NUMSA has consistently called for the nationalization of all commanding heights of the economy and all our minerals. In the case of Eskom, we have consistently made a call that government must nationalize the strategic coal mines that must supply the national grid with cheap quality coal, so that we can escape the continuous exorbitant prices of primary coal, and deliver a competitive electricity tariff. If one were to look at the exorbitant primary coal tariff increases from 2007 to 2016, they are indeed shocking and appear to be a money-making scheme which is not in line with the original mandate of Eskom.

Viewpoint: A Union Plan for Hurricane Repair: Local Hire, Prevailing Wage

By Gordon Lafer - Labor Notes, November 1, 2017

After Harvey, Irma, and Maria, many thousands of homes have been lost and lives wrecked. People in Texas, Florida, and Puerto Rico need decent paying jobs while they try to put their lives back together, and the one industry that will be booming is construction.

San Juan Mayor Carmen Yulín Cruz on Trump, Shock Doctrine & “Disaster Capitalism” in Puerto Rico

By Amy Goodman - Democracy Now, October 31, 2017

AMY GOODMAN: This is Democracy Now! I’m Amy Goodman, with Juan González, as we turn right now to my interview with the Puerto Rican mayor, Carmen Yulín Cruz, the mayor I spoke with on Friday. We sat down together in the Roberto Clemente Coliseum, where the entire mayoral staff is now living. I began by asking her how Hurricane Maria has changed Puerto Rico since it struck the island September 20th.

MAYOR CARMEN YULÍN CRUZ: I think September 20th changed the Puerto Rican reality forever. We live in a different San Juan and a different Puerto Rico, not because of what we’re lacking. The majority of the island is still without any power. Only about 40 to 60 percent of the population has water. That doesn’t mean that it’s good water. We still have to boil it or put chlorine in it to be able to drink it. Medical services are really, really bad because of the lack of electricity. The supplies in the supermarkets are not there yet, so people are having a lot of trouble getting the supplies that they need. But still, the fierce determination of people has not dwindled. And to me, that’s been a very—I would say, a big lesson to learn.

AMY GOODMAN: Can you talk about this public power company, the largest in the United States? Do you think there’s an effort in this time, in the aftermath of the hurricane of—an effort to just privatize it?

MAYOR CARMEN YULÍN CRUZ: Yes.

AMY GOODMAN: For it totally to fail?

MAYOR CARMEN YULÍN CRUZ: Yes, yes.

AMY GOODMAN: And what do you think has to be done about that?

MAYOR CARMEN YULÍN CRUZ: It cannot be privatized. I am—and a lot of people—totally against, because we are a hundred miles long by 35 miles wide. That’s a monopoly. It doesn’t matter how you want to disguise it. It’s a monopoly. And what we’re doing is we’re putting in private hands the decision as to where our economic development is spread, where the sense of equality or inequality will happen. So, power isn’t just about the power grid. It’s also about the ability that the Puerto Rican people may have in the years to come to ensure that there is appropriate economic development and equally divided amongst all the 78 municipalities in Puerto Rico.

AMY GOODMAN: Disaster capitalism, what does that term mean to you? And do you think that’s happening here, using a crisis to accomplish something that couldn’t be accomplished otherwise?

MAYOR CARMEN YULÍN CRUZ: You know, I wish I had never been introduced to that term. Also the shock, shock treatment, right? Using the chaos to strip employees of their bargaining rights, rights that took 40, 50 years for the unions to be able to determine. That is something very important. And it just means taking advantage of people when they are in a life-or-death situation. It is the most—an absolute mistreatment of human rights. It means that the strongest really feed off the weakest, until everything that’s left is the carcass.

As Elon Musk Proposes Taking Over Power Authority, Puerto Ricans Demand Community-Owned Solar Power

By Amy Goodman and Juan González - Democracy Now, November 1, 2017

AMY GOODMAN: So, as the governor announced they were going to try to cancel this Whitefish Energy contract, on Sunday, we were in the offices of Ángel Figueroa Jaramillo. He is the head of UTIER, the electrical workers’ union in Puerto Rico. We were asking him about Elon Musk’s proposal to make Puerto Rico a model of sustainable energy. I asked him how to rebuild the devastated grid, if it’s possible, in a more sustainable way, and whether solar power has to mean privatization.

ÁNGEL FIGUEROA JARAMILLO: [translated] First, the complexity of the electrical system of Puerto Rico, it’s a totally isolated system. A system with a large amount of demand poses a major challenge in terms of looking at the possibility of solar power for powering the whole country. It’s very complex. It requires many studies, a lot of analysis, many evaluations. And the people of Puerto Rico can’t wait for all of that right now. Now, that doesn’t mean that Puerto Rico doesn’t have to look very seriously at the possibility of the transformation towards solar power. Nonetheless, the transformation that UTIER believes is most appropriate is—are solar communities. The communities themselves should appropriate that system. It’s not that we will become a commodity for renewable solar energy.

AMY GOODMAN: Are you interested in meeting with Tesla, Elon Musk or his representatives to figure out what a solar solution or a sustainable solution would be for Puerto Rico?

ÁNGEL FIGUEROA JARAMILLO: [translated] Yes. Yes, of course. Of course, yes. We have to meet and search for alternatives to transform the country. This doesn’t mean that we’re against—I mean, in favor of this becoming privatized. I believe that we have to meet and have a dialogue. We have to search for alternatives. But we are very clear: All the alternatives have to be owned by the community.

AMY GOODMAN: That’s Ángel Figueroa Jaramillo, the head of UTIER, the electrical workers’ union in Puerto Rico.

Head of Puerto Rico Electrical Workers’ Union Demands Corruption Probe of Whitefish Energy Contract

Ángel Figueroa Jaramillo interviewed by Amy Goodman - Democracy Now, October 28, 2017

AMY GOODMAN: This is Democracy Now!, democracynow.org, The War and Peace Report. I’m Amy Goodman, with Nermeen Shaikh.

NERMEEN SHAIKH: We turn now to Puerto Rico, where Governor Ricardo Roselló announced on Sunday that he was instructing Puerto Rico’s Electrical Power Authority, known as PREPA, to cancel its controversial $300 million contract with the tiny Montana-based company Whitefish Energy. The governor’s move came after enormous pressure and scrutiny of the contract to reconstruct Puerto Rico’s electrical power grid devastated by Hurricane Maria. Whitefish Energy is based in the tiny hometown of Interior Secretary Ryan Zinke. The head of the private equity company that backs Whitefish, Joe Colonnetta, was a Trump campaign donor. Meanwhile, Whitefish CEO Andrew Techmanski argues his company’s ability to mobilize quickly was vital to winning the contract.

AMY GOODMAN: All of this comes as a leaked copy of the no-bid contract sparked even further outrage last week, when it was revealed that the terms barred penalties for work delays and prohibited the project from being audited by any U.S. government agency.

Well, Democracy Now! went down to Puerto Rico over the weekend, and I got a chance to sit down yesterday, on Sunday, with the head of UTIER, the Puerto Rico electrical workers’ union, Ángel Figueroa Jaramillo. We sat down in his office just as Governor Roselló was speaking. I began by asking him what he thought of the governor’s announcement that he will be canceling the contract, that he’s calling for the cancellation of the contract with Whitefish Energy.

An unnatural disaster hits Puerto Rico's schools

By Monique Dols and Lance Selfa - Socialist Worker, October 28, 2017

MORE THAN one month after Hurricane Maria devastated Puerto Rico, a battle over the future of the island's schools has emerged. As this article was being written, only 119 out of a total of 1,113 schools had opened.

The Federación de Maestros de Puerto Rico (FMPR)--a teachers' union which has organized against school closures and attacks on public education for many years--charges Education Secretary Julia Keleher with unnecessarily delaying the opening of hundreds of schools in order push for privatization. The FMPR has called for Keleher's resignation.

By October 24, school was back in session for a small portion of children in particular areas in and around the two major cities of San Juan and Mayaqüez. But in other educational districts, Keleher has postponed the opening of schools indefinitely.

There's no doubt that in a number of localities, classes must be postponed while schools are rehabilitated, and electricity and water are restored.

When we arrived at the Escuela de la Comunidad Marcelino Canino Canino in Dorado, about 20 miles west of San Juan, we joined a "brigade" of more than a dozen teachers, parents, students and local supporters of the FMPR and the Partido Independentista de Puerto Rico (Puerto Rican Independence Party or PIP). The brigade had been at work for hours trying to clean up the school.

During Hurricane Maria, the school, which sits in a flood plain between two rivers, endured heavy flooding. In many classrooms, muddy water almost reached the ceiling. On classroom walls, we could see the marks left behind after the floodwaters receded.

The brigade filled dozens of shopping carts with waterlogged and moldy school supplies and books--in some cases, having to scrape them off the concrete floors--before dumping them in a huge, open-air pile outside the school. Hundreds of rusted desks and filing cabinets lined the entrances to the school.

This was just another example of ordinary working people organizing themselves to fill the vacuum after the government abandoned them. Yet again, the work of people like those on the brigade at Escuela Canino gave the lie to Donald Trump's insulting tweet saying that Puerto Ricans "want everything to done for them."

Disaster capitalism rages in Puerto Rico

By Keith Leslie - Socialist Action, October 26, 2017

“The only thing we need now is a hurricane.” These were the words of a financial advisor in Puerto Rico this summer, anticipating the business opportunities the devastation of a hurricane would produce.

This framework—which understands disaster as an opportunity for profit—is not unusual. As Naomi Klein showed in her famous book, “The Shock Doctrine,” capitalism exploits both natural and manmade disasters as a chance to tear down social reforms, privatize public services, and implement neoliberal economic policies.

From the Pinochet dictatorship in Chile to post-Katrina New Orleans, we have seen the program and tactics of disaster capitalism persist and expand. Today, we can see the same forces seeking to bring disaster capitalism to Puerto Rico in the aftermath of Hurricanes Irma and Maria.

The most immediate disaster capitalist proposals for privatization came after Hurricane Irma. The storm did not hit Puerto Rico directly, but knocked out power to more than a million people. The executive leadership of the Puerto Rico Electric Power Authority, PREPA, warned that the island might face power outages for six months or more. This immediately prompted calls for the privatization of PREPA on the grounds that it was inefficient and incompetent. In fact, PREPA was able to restore power for most of its customers within a few weeks.

PREPA’s current executive leadership was installed through an agreement with its creditors after the previous, anti-privatization administration was ousted. Four of the board’s seven members had signed a letter in June calling for PREPA’s privatization. The Electrical Industry and Irrigation Workers Union, which represents PREPA’s workers, accused the leadership of exaggerating its estimates and delaying the deployment of available workers to promote the prospects of privatization.

Hurricane Maria, with a far more devastating impact on Puerto Rico, has likewise intensified the disaster capitalist pressure. The calls for PREPA’s privatization have intensified. They have also been joined by the likes of Elon Musk, the CEO of Tesla, who has attempted to put a green veneer on this push by proposing to build a renewable grid in Puerto Rico—but on a privatized basis.

One of the key objectives of advocates of PREPA privatization is the breaking of the electrical workers’ union. Musk has a history of opposing union drives at Tesla and elsewhere. The fiscal control board installed in Puerto Rico by Washington has invoked a legal provision that would allow it to approve public-private partnerships with almost no public or environmental review.

Of course, Hurricanes Irma and Maria were not the start of austerity and privatization programs in Puerto Rico. Even before the hurricanes, Puerto Rico faced a debt of $74 billion—more than 70% of its GDP—as well as nearly $50 billion in unfunded pension liabilities.

In 2016, the U.S. Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act, or PROMESA. PROMESA established a fiscal control board with broad authority over Puerto Rican finances and over its elected government.

The main causes of this debt crisis include massive tax breaks for corporations and wealthy individuals in Puerto Rico. Restrictions on the Puerto Rican government and economy due to its status as a U.S. colony have also contributed. This includes the Jones Act, which restricts non-U.S.-flagged ships’ ability to ship goods to Puerto Rico but also extends beyond it: when Puerto Rico attempted to raise taxes on large corporations that imported goods, Walmart successfully sued to block the tax in a U.S. federal court on the basis of federal law.

Nonetheless, the austerity program in Puerto Rico has fallen squarely on the poorest and most vulnerable: the fiscal control board has cut public health spending by a third, lowered the minimum wage for workers below the age of 24 to $4.25 an hour, raised utility bills, cut the public pension system, and closed public schools.

The hurricanes, however, have enabled the intensification of this ruling-class offensive. Demands for the cancellation of Puerto Rico’s debt by the U.S. Congress have been bluntly rejected. In fact, the majority of the disaster relief allocated to Puerto Rico by the House is in additional loans of more than $5 billion, rather than grants, as is typical for disaster relief to U.S. states. In the same bill, the House cancelled $16 billion in loans for the National Flood Insurance Program—but not a dollar of Puerto Rico’s debt. Such “disaster aid” will only indebt Puerto Rico further and expand the austerity demands from the fiscal control board.

Puerto Rico Still in the Dark: the Case of Whitefish Energy and Million Dollar a Year Lineman

By Roy Morrison - CounterPunch, October 25, 2017

Lights, cell service, sewer and water treatment plants came back on quickly in Florida and Houston after hurricane Maria. But Puerto Rico still remains largely in the dark one month later, with power restored to only 20% of the island.

Mutual aid from the nation’s utilities saved the day in Texas and Florida. 5,000 utility workers rushed in to restore power. Under mutual aid, workers earn normal wages, around $1,300 a week ($70,000 a year) plus expenses for linemen, the costs to be repaid from rates collected by the local utility that was helped. The system worked spectacularly well in Houston and Florida.

But in Puerto Rico little has been accomplished so far. PREPA (Puerto Rico Electric Power Authority) rejected the offers for mutual aid stating that as a bankrupt company it could not guarantee repayment to helping utilities. Instead, PREPA signed a $300 million dollar contract with Whitefish Energy, an unknown two person firm from Whitefish Montana to restore much of Puerto Rico’s power. Whitefish Montana, by coincidence, is also the home of Secretary of Interior Ryan Zinke. One of Zinke’s sons reportedly worked for Whitefish Energy as a summer flagger.

What’s most interesting are the labor rates to be charged by Whitefish for the 300 lineman it plans to bring to Puerto Rico to work as sub-contractors disclosed in a Oct. 23, Washington Post story. Lineman will be paid $319 an hour, and nightly accommodation fees of $332 a worker ,plus $80 food allowance. This should mean over one million dollars a year per lineman (if they work ten hours a day for six days a week with two weeks vacation) just for wages.This means $300 million for 300 lineman.

Mutual aid, in contrast would mean lineman would be paid $70,000 a year, plus $30,000 living allowance or $100,000 a year. $300 million should pay for 3,000 mutual aid lineman, not 300 lineman under the gold plated Whitefish Contract.

Something smells really fishy about this deal.

Meanwhile Americans in Puerto Rico remain without lights, without water, without sewage treatment, without cell service, without proper medical care while the owners of tiny Whitefish Energy become very rich men indeed.

Power for Puerto Ricans, Not Private Investors

By Johanna Bozuwa - Common Dreams, October 23, 2017

“The whole of Puerto Rico is like this. I don’t think we are the only ones like this… We will survive,” Jose Torres, a resident of Puerto Rico, told an NPR reporter in late September. As a diabetic without access to medicine, he’s been working hard to keep up his blood sugar levels. Not an easy task when his fridge and stove don’t have power.

It has been almost a month since Maria devastated Puerto Rico. Since then, most of the island’s 3.4 million residents have been without electricity or running water. The power grid was effectively destroyed, with only 7 percent back online to date. This means that the entire system, from generation to distribution, will need to be rebuilt. The question now is: how?

While the unfolding human catastrophe on the island takes precedence, in the longer-term Puerto Rico has the opportunity to revolutionize their electricity system. Powered by renewables, a resilient and sustainable system can be built that genuinely puts the Puerto Rican people in charge of their energy. But, instead, the government is threatening to privatize electricity and bring in mainland investor-owned utilities to do the job. Elon Musk’s proposal for Tesla to power the island with renewables could be just the accelerant privatization needs.

Maria hits a Puerto Rico already in Crisis

Lackluster relief efforts in the wake of Maria are indicative of the United States’ treatment of the commonwealth as a second-class citizen. In direct contrast with aid packages to Texas and Florida that got equally pummelled by recent storms, Puerto Rico’s aid has been slow and relatively ineffectual so far. President Trump even blamed Puerto Rico for its inability to rebuild and threatened to cut off aid.

For one hundred years Puerto Ricans have had an uneasy relationship with the United States—while citizens, they lack any voting power in Congress and the US has effectively pushed the island into a state of economic depression through unfair trading rules, limited self-governance, and lack of access to the same benefits as other Americans. For decades, Puerto Rico mostly survived off tax breaks that brought American corporations onto the island to avoid federal corporate taxes. In the ‘90s, President Clinton got rid of those tax breaks. With it came the mass exodus of mainland corporations. This has contributed to a situation where the commonwealth is $70 billion dollars in debt and 45 percent of its residents live in poverty.

Trade rules effectively limit the island from buying goods not from the US mainland. During the New Deal, that meant  79 cents out of each dollar paid in wages was spent importing food, clothing, fuel, and other goods, effectively sending all the injected cash right back to the mainland corporations. During Maria, it meant other countries were stopped from shipping aid that the country so desperately needed for days. This included one of the major things they needed: fuel.

Puerto Rico relies almost totally on imported oil, which is one of the most polluting, least efficient fuel types. Only 2 percent of all electricity is generated from renewables. Electricity is also prohibitively expensive, costing 21.4 cents/kWh in comparison to 11 cents/kWh on the mainland. Much of this difference is because so much energy needs to be imported. It also means that when the island is cut off from shipments, it doesn’t have access to its fuel source.

The Debt Before the Storm

By Lance Selfa - Socialist Worker, September 26, 2017

THE SOCIALIST German playwright Bertolt Brecht once wrote that "famines do not simply occur; they are organized by the grain trade."

A similar observation could be made about Puerto Rico today. Replace "famine" with "natural disaster," and the "grain trade" with "U.S. colonialism," and you have a succinct summation of the human disaster that is unfolding on the island today.

Puerto Rico is reeling in the aftermath of landfalls by two huge hurricanes, Irma and Maria, in the space of a few weeks. As this article was being written, most of the island remained without electricity, and 70,000 residents could be in danger if the damaged Guajataca Dam failed. People all over the island are contending with flooding and food shortages--malnutrition and outbreaks of disease are real possibilities.

Any area that suffered the blows of two powerful hurricanes in succession would face major challenges.

But Puerto Rico isn't just any area. It is a colony of the United States--its oldest, in fact.

Over the last two decades, Puerto Rico's economy has been systematically degraded while Wall Street and European capital loaded up its public sector with more than $70 billion of unpayable debt.

As a result, the basic infrastructure of the island--its health care, water and power systems--were already in the grips of a desperate crisis before the hurricanes hit. For ordinary Puerto Ricans, life under successive austerity regimes had become increasingly intolerable--and it will only become more so now.

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