Holy Earth!
By Michael Hasty
Power Grab
It is hard to understand why the American people are so intent on throwing away their power of self-government. But that is precisely the trend we are witnessing; and it is a trend that is accelerating.
In a recent column in the International Herald Tribune, veteran reporter William Pfaff wrote that "... the inauguration of George W. Bush confirms a fundamental change in the nature of US government. Government has become the instrument of a segment of American society: corporate business. [And] the overwhelming majority has been content to see this happen."
Noting that business interests have always been a dominant force in American political life, Pfaff continues, "What is new about the situation today is that a seemingly irreversible mutation in the American system has occurred...Moneyed interests now finance not only the winners of national elections but also most of the losers. This is part of the enlarging domination of American life by business corporations and their values, which are those of material aggrandizement, a phenomenon accompanied and promoted by the circuses and gladiatorial contests provided by the most important US industry of all, entertainment, which now showcases elections and even wars as entertainments."
Regular readers of this column will recognize some familiar themes in Pfaff’s observations. The fact that they appear even in an Establishment publication like the Tribune is a sign that these concerns are being felt by a larger segment of the population than simply a small circle of environmental "radicals" . Considering that Thomas Jefferson thought that the primary purpose of government was to "curb the excesses of the moneyed interests," what’s surprising is that Pfaff’s opinions aren’t more widely shared. But such is the effect of ceaseless propaganda.
One of the clearest examples of the phenomenon of outright public surrender to corporate values Pfaff describes is an issue that is facing us here in West Virginia, and has been much in the news of late because of what’s been happening in California: electricity deregulation. Under the regime of deregulation, the public interest in having reliable and affordable energy controlled by commissions answerable to the people has, in a few short years, been sacrificed to private interest and corporate profits.
The national rush to deregulate utilities has been driven by the same extreme free-market ideology that has influenced the deregulation of other important public services, like the airlines and telecommunications industries -- with similar disastrous consequences. And in the case of utilities, these consequences have been utterly predictable, because deregulation has quickly led to the kinds of abuses and monopoly power that inspired governments to regulate in the first place, back in the thirties.
So far, nearly half the states have engaged in some form of utility deregulation. The results for average consumers have been largely negative, with California (the first state to deregulate) being the most extreme example. As the consumer watchdog group Public Citizen has documented, "Not one state has restructured their electric industry in a way that will truly benefit consumers or protect our natural environment. Instead, large industrial customers and utilities have used campaign contributions and strong-arm lobbying to get lawmakers to enact legislation that will benefit corporate interests at the expense of the consumer's interest."
That’s a dead-on description of the situation here in West Virginia, where the energy industry has the advantage of being a de facto extension of King Coal, the dominant player in state politics for over a century. When a plan for electricity deregulation was drafted last year by the state’s Public Service Commission, it naturally incorporated some of the worst features of a deregulated scenario, both anti-consumer and anti-environment.
An article by environmental scientist Jim Kotcon in last month’s Highlands Voice lists specifics on what makes the West Virginia plan so bad: rate increases; price gouging; unfair competitive practices; inadequate energy conservation measures; no requirement to use renewable energy sources; continued grandfathering of old power plants; and inadequate environmental disclosure to consumers. In other words, just about what you’d expect from our business-friendly state government.
Fortunately, there have been some complications that have slowed down the process of deregulation here. For one thing, one of the few benefits of having the coal industry in West Virginia is that energy consumers in this state pay the ninth-lowest electricity rate in the nation. The political ramifications of raising that rate --the probable outcome of deregulation -- should be obvious to even the most obtuse law- maker. That’s why, when the state legislature endorsed the concept of deregulation last year, it insisted that the plan be submitted to the legislature again this year for final approval. Hopefully, this will give private citizens a chance to propose alterations where they are needed -- and as it stands now, they are definitely needed.
But the biggest break for consumers and environmentalists and other opponents of deregulation has been the alarm bell set off by the disaster in California, and the object lessons people are taking from that experience. Reports are that deregulation plans are either on hold or are being reconsidered in a number of states. Our new Democratic governor, Bob Wise, has indicated that he wants to move slowly on this issue in the wake of the California situation. Legislators are also likely to be more wary.
It’s unfortunate that California, with one of the most environmentally conscious populations in America, has to endure the hardships that have come with being the pioneer in deregulation. Yet it is providing a genuine service to the rest of the country by virtue of the problems that are being exposed. With the sixth-largest economy in the world -- constituting a sixth of the nation’s total gross domestic product -- California’s energy troubles necessarily command the attention of the national media.
As a result, a whole panoply of energy-related issues is being discussed, from conservation to price-fixing to the causes of the alleged power shortages. We now know that by being more judicious about energy consumption -- for example, by simply turning off lights when leaving a room -- Californians were able to reduce electricity use by 15 percent in one week. And we know that, in four of the last six months, energy use in the state was actually less than last year, so it is not a pattern of increased use that is causing the shortages, as the utilities originally claimed.
We also know that suspicions have been raised about the simultaneous shutdown of power plants -- allegedly for routine maintenance -- resulting in an unnatural decrease in the supply of available power and a subsequent sharp increase in price, dictated (of course) by market demand. Furthermore, we know that one of the largest beneficiaries of these increased prices was energy producer (and George W. Bush’s most generous campaign donor) Enron Corporation -- whose profits went up by 250 percent last year.
And we know something else about the new president. We know that he thinks the solution to California’s energy problems is to loosen the environmental restrictions on power plants; and to develop new energy sources, like drilling for oil in the Arctic National Wildlife Refuge; and otherwise, to let the "free" market determine the outcome.
How...convenient.
But I don’t think that’s quite what Jefferson had in mind.