Our Watershed Election (Public vs. Private)

[usquebaugh]

Save Our Rivers

(This is such an important election issue that I think it deserves its own topic!)

The documentary Powerplay presents some of the important issues facing British Columbians during this election, and here is Corky Evans (retired NDP MLA) speaking about taking our rivers back, and preventing the further privatization of British Columbia's watersheds.

I also didn't want to derail some of the candidate threads that were delving into the question of private versus public ownership, so I thought I'd add these quotes about the dangers of privatization of the commonweal here. The first three quotes are from Benjamin R. Barber's Consumed:

As privatization commercializes the sectors it "frees" from public monopolies, it manages to conceal the social costs of the private market transactions it endorses. By calling such costs "externalities"--Milton Friedman uses the phrase "neighborhood effects"--economists give the impression that such costs are not part of the internal accounting by which market efficiency and productivity are to be measured. In the United Kingdom, for example, market-oriented governments in the 19780s and 1980s rationalized cutting rail service to smaller towns and villages across Britain based on diminishing passenger usage and ticket sales. This efficiency-based cost cutting omitted any reckoning of social costs--of "externalities." Yet the society-wide impact of these cuts was devastating as measured by the damage done to the quality of rural life and thus English culture, as well as to the preservation of a national communications network inclusive of all citizens--something deemed important to national morale. At the same time, the cutbacks added to pollution and traffic congestion by eliminating a key alternative to automobiles in rural areas. What is desirable from the standpoint of a market consumer may be untenable from the standpoint of a citizen. What serves the bottom line of a private rail corporation may not serve the aims of a national transportation system. A market system that recognizes only profit and treats all other values as externalities to be ignored can devastate a civilization on the way to assuring a return on investment.

Privatization also places invisible costs on taxpayers and allows market institutions to appear more cost efficient and inexpensive than they are. A report produced by the nonprofit group Redefining Progress, based in Oakland, California, has created the Genuine Progress Indicator, an alternative assessment of the economy. Authored by Jason Venetoulis and Cliff Cobb, "The Genuine Progress Indicator, 1950-2002 (2004 Update)," reports that the GDP overestimates the health of the economy by $7 trillion. Unlike the GDP, the GPI weighs the quality of the economy as opposed to merely its quantity. The GDP, for example, suggests that from January 2000 to January 2003 the economy grew approximately 2.64 percent (or $272 billion). The GPI, however, which factors environmental abuse and national debt into the equation, estimates economic growth in this period at a miniscule 0.12 percent, a $212 billion decline over three years. Another report, "The Ecological Footprint of Nations, Update 2005," also published by Redefining Progress, measures whether or not the global population is living within its ecological means. The report answers no, showing that while the earth's biological capacity stands at 42 acres per person, on average we use 57 acres per person. The United Arab Emirates, Kuwait, and the United States exceed their biological capacities. In a comparison of continents, North America and Western Europe have the greatest ecological footprints and run negative ecological balances.

The American market system has become a paragon of how to socialize the costs but privatize the benefits of a supposedly private market economy. Many of the pilots trained by the U.S. Air Force end up in jobs with commercial airlines; their expensive taxpayer-supported flight education results in lower training costs for the airlines, and commensurately inflated "profits" which do not count the public costs of learning to fly. Taxpayers are assessed for training pilots, commercial airlines reap the rewards. Much the same thing happens in the new corporatized military security sector, where mercenaries and other professional security personnel are hired by private companies only after they have completed their highly technical training in public military forces. Socialism when it comes to costs (the now classic Chrysler Corporation bailout), but market capitalism when it comes to profits. Ironically, firms that are politically connected to the governments by which they hope to be bailed out do better than those without connections.

This (literal) passing of the buck from private to public--another form of so-called free riding in which a beneficiary of public services to pay their cost--is most evident in the security domain where a sector once deemed quintessentially public is fast being privatized, with consequences yet to be reckoned. Functions many would associate with the very essence of statehood--of both sovereignty and the social contract which grounds it--are being outsourced and subjected to market forces. These quintessential functions include social security, individual (police) security, and national (military) security and represent a striking expression of privatization run amok. It is probably not an accident that social security privatization is being debated in the United States at the very moment when neighborhood policing, civil prisons, and military security are also being subjected to radical privatization in ways that suggest not merely a recalibration of how the state undertakes its public responsibilities, but an assault on the very idea of a democratic sovereign state's legitimate function.

Market arguments rarely confront "free riding" and "externalities," and almost never focus on these larger democratic issues. For example, while there was a great deal of discussion about whether the privatization of social security proposed by the Bush administration in 2005 was economically viable or technically feasible, the costs of President Bush' proposed changes measured by the vitality of civil society and the integrity of democracy were scarcely calculated or deliberated at all. The real question here is whether a nation that depends on its civic sector for its democratic oxygen can afford to allow the civic trust embodied in social security to be suffocated. When a public social insurance and pension policy is turned into a private bet where personal and private market decisions determine who does well and who does badly, irreparable harm can be done to democratic common ground and to what was once called the promise of public life. The promise of social security ameliorates the distorting traces of class, race, and gender which can play out so dismayingly in the private realm.

Privatization, whether of education, housing, or social security, makes us less of a public. As Margaret Kohn writes in her thoughtful study of privatization and free speech, "public space plays an important role in fostering democracy by preserving opportunities for political speech and dissent and providing a shared world where we can potentially recognize one another as citizens." When we privatize public space, we not only undermine citizen ship; we opt for market Darwinism where private investors may prosper but others will lose, rather than for social justice where all are equally protected. Privatization demeans the "us" as an "it" (big government, bureaucracy, "them") and [b]imagines that consumers and citizens are the same thing. But social security is not merely a technical scheme to give private workers a pension and disability and death benefits, to be toyed with and altered in accord with today's economic fashions. It is an emblem of civic membership in a common polity; a reflection of the benefits that come with the responsibilities of citizenship. We payin as working, taxpaying citizens not just to guarantee ourselves private pensions but to guarantee a fair social system and public justice to all. Yet today even tax collection is being outsourced by the [U.S.] federal government. In the countries of the European Community there has been much alarm at economic proposals that in the name of economic efficiency and market philosophy demand the rollback of the social security plans associated with the core meaning of European sovereignty. Although the French "no" vote in June 2005 on the new European constitution was animated by several competing motives, many on the left who abandoned their leadership feared that the new Europe dangered the social contract implicit in the French welfare state.

Privatization is undeniably a feature of our times and may be pernicious in its own right, but does this prove its affinity to the infantilist ethos? Examining the dynamics of privatization as we have done here suggests that private relates to public as childish stands to the adult. Prioritizing the individual and rendering community private in a way that makes it look like an aggregation of individual wants and needs in a puerile way to construct the social world. Obviously individualism and narcissism are not synonymous, but the reduction of a commonweal to a series of private first-order desires and the trivialization of the common good as nothing but aggregated discrete private interests can be thought of as a kind of regression.

The social contract and the res publica it creates are mature forms of social organization: how adults associate themselves when they have learned the limits of anarchism, the inadequacies of individualism, and the realities of interdependence. In William Golding's harsh novel Lord of the Flies, the absence of adults among a marooned group of children precipitates an erosion of social normals and a breakdown of the social contract that leads to brute anarchy and the domination of the strong over the weak--as perfect a picture of Hobbes's state of nature as can be imagined. Pursuing the Hobbesian metaphor as payed out by Golding, we are, so to speak, born solitary and self-assertive, we learn sociability and cooperation. Selfishness is inbred, altruism is learned, and civility a patina layered onto our narcissistic core by experience, education, and the shaping forces of democratic citizenship. We being scarcely able to distinguish the world from our grasping selves. We acknowledge the loving otherness of the mother, but otherwise remain wrapped in a cocoon of infantile sensibility. In time we come to see that we can only flourish as developing selves inside communities of common purpose of which the family is but the first instance.

Privatization reverses this journey to maturation. It re-privileges the "me" and stands with rather than against narcissistic childishness. Community and public good are about the "we." Marriage, the family, the clan and society are products of reproductive and social maturation. Yet from the point of view of private consumer society, these agents of adulthood are little more than obstructive gatekeepers to be circumvented or overcome. The market prefers bachelors and bachelorettes, kiddie consumers without social ties other than the ones marketers give them. Adulthood defined by agency, autonomy, and independent judgment is not a friend of consumerism. Capitalist paternalism today aims less at disempowering workers than at infantilizing consumers--in the paradoxical name of consumer empowerment.

I think this last quote sums up quite nicely the differences between citizens and consumers:

Grown-up citizens exercise legitimate collective power and enjoy real public liberty. Consumers exercise trivial choice and enjoy pretend freedom. Consumers even when childish have a place in a free society and express one part of what it means to live freely. But they do not and cannot define civil liberty. When they are defined as doing so, free society is put at risk. Privatization does not just reenforce infantilization: in the realm of politics, it is its realization.

I have a little something from Paul Hawken's Blessed Unrest for those who mistakenly believe that "weakening the (so-called) 'strong'" makes people poorer:

The assumptions that undergird market fundamentalism are so pervasive that they have become conflated with fact. IMF, World Bank, and WTO are populated by many macroeconomists who believe that there is no such think as involuntary unemployment, because in their economic models demand always equals supply. For true believers, markets are exquisitely calibrated mechanisms that always work perfectly; thus economic aberrations such as unemployment, poverty, or malnutrition must be caused by external factors. Because markets theoretically balance demand and supply, imbalances are caused by regulations or restrictions. According to this logic, it is unions and high wages that cause unemployment, while poverty is the result of high taxes imposed on people who aren't poor. In this upside-down world, idealism harms society and greed benefits the needy. Those who question the inevitability of supranational corporations to supply most of our material and employment needs are seen as out of step, if not nostalgic. But even the free market's most articulate defender, New York Times columnist Thomas Friedman, knows better: "The hidden hand of the market will never work without a hidden fist. McDonald's cannot flourish without McDonnell Douglas. And the hidden fist that keeps the world safe for Silicon Valley's technologies to flourish is called the U.S. Army, Air Force, Navy and Marine Corps."

P.S. Since this is a thread about public versus private ownership, etc., I thought I'd mention Jeremy Scahill's book Blackwater: The Rise of the World's Most Powerful Mercenary Army. I haven't finished the book, but thus far it has been an eye-opener of the dangers inherent in privatizing security forces (it makes me think about who exactly are the "other security personnel" that will be joining the RCMP and the CF during the Olympics!).

[Al Czervic]

I think this has been the biggest load of crap and hypocrisy from the NDP and the BC Hydro workers Union in history. Let’s play true of false.

IPP Run of the River projects are a new evil concept designed by Premier Campbell because he hates you.

FALSE. IPP Projects were pioneered and promoted by the NDP

There are hundreds of Rivers being sold and given away by Gordon Campbell to his rich Howe Street friends.

FALSE. Rivers have never been given away. There is no title to Rivers. You get a lease under the NDP this lease was for an eternity Under the Liberals it is for a fixed term

BC Hydro has been banned from making new power

FALSE. The biggest load of crap in history. BC Hydro is doing more projects to increase power generation. I don’t know how the loons in the left can even make up this kind of crap.

I could go on and on but the fact is the NDP wrote the book on IPP Run of the River power projects and now they are playing fast and loose with the truth. The NDP actually beat the Liberal and got more IPP Run of the River projects built than Liberals did.

It has been reported in the news that several NDP candidates have broken away from the NDP and come out in support of IPP Run of the River Projects. Wonder why that is?

[Smurf]

So does the fact that the NDP started it make it better or worse. It is still wrong.

[Al Czervic]

So does the fact that the NDP started it make it better or worse. It is still wrong.

Why is it wrong ? And please use facts not false claims as pretty much every NDP canddiate is doing

[usquebaugh]

So does the fact that the NDP started it make it better or worse. It is still wrong.

Why is it wrong ? And please use facts not false claims as pretty much every NDP canddiate is doing

It's wrong for the very reasons outlined in the quotes I provided, which were not written by any NDP candidates. Privatizing the commonweal (meaning natural resources, such as water) does very little to improve the lives of citizens, and it does very much to line the pockets of private companies at the expense of citizens. (I really hate it when our politicians refer to us as "consumers," as if our only purpose was to fuel the market-based economy. Also, when I worked for IHA, I had to use the term "client" to refer to a patient, which really irked me, since it smacks so much of the language of privatization!)

[Al Czervic]

So does the fact that the NDP started it make it better or worse. It is still wrong.

Why is it wrong ? And please use facts not false claims as pretty much every NDP canddiate is doing

It's wrong for the very reasons outlined in the quotes I provided, which were not written by any NDP candidates. Privatizing the commonweal (meaning natural resources, such as water) does very little to improve the lives of citizens, and it does very much to line the pockets of private companies at the expense of citizens. (I really hate it when our politicians refer to us as "consumers," as if our only purpose was to fuel the market-based economy. Also, when I worked for IHA, I had to use the term "client" to refer to a patient, which really irked me, since it smacks so much of the language of privatization!)

Let’s ignore ideology for a moment and let me ask you this.

I think we can all agree that industries such as Forestry; Mining. Oil & Gas have long been both a driver and a creator of the BC economy. These sectors have helped build many towns and part of BC. They provide the hi-paying resource jobs that power our economy.

When any one of these industries suffers; such as is the case with Forestry right now; our BC economy also suffers; again such as is the case of the BC economy right now.

How do all of these major industries all work ? Pretty much the same way. We have Private Companies purchasing crown resources putting people to work in the harvesting of these resources; and the companies sell these resources to make a profit. BC benefits by the jobs and the sale of these crown resources. This is how our economy has worked pretty much since BC was first created 150 years ago.

So why is power generation any different? Why cannot we not allow the very economic model that works in every others sector to also be used in power delivery ? Why must there be a government monopoly ? Why cannot we not have some competition and innovation for less than 5% of BC’s overall power production?

We can have Air Canada and Westjet and see what innovations have been created in Canadian air travel as a result of competition and innovation by Westjet. Not to mention the many jobs and support to the economy. I truly fail to understand the hysteria and fear mongering by the mostly Unionist/NDP crowd afraid to loose a small portion of the BC Hydro monopoly on power generation. You know these groups have to be desperate when they resort to lies instead of facts much as they have been

I think this issue remains a load of bull and the NPD knew that when they were in power; hence why they promoted these projects very successfully creating more than even the mighty BC Liberals have to date. Granted offering up an eternal lease as the NDP did is financially far more lucrative than a fixed term as the Liberals are now only offering.

[Smurf]

First off I disagree with something as important to society as hydro ever being made private, even partially, for profit. All you have to do is travel to the United states to see what has happened to their power grids due to privitization. Their rates are criminal for average people.

What is going to happen the first time we have a water shortage. These plants will not have a forebay to hold water and carry them over. These plants will become a loss and private industry will walk away. What will happen to them when they have lived their useful life. Who is going to be responsible to clean up the mess.

Have you ever seen the operation of a generating station. Do you know the maintenance that is required. Where will they get staff that are properly trained in the maintenance of that equipment. What happens when a seal goes and there is an oil spill or grease spill in the river. Who will have the equipment and the spill response team. Do you honestly believe that these small operators are going to be on top of all these things, or will they slip through the cracks. It will happen because the government to save money won't have enough watchdogs to keep track of it. I had a relative that worked for Manitoba Hydro in one of it's northern generating stations. They found out that they were over greasing their units and the grease was being forced into the water. Major repairs and a great deal of investigation as to what the proper amount was. Do you honestly believe a small for profit company is going to look after all these things properly.

Are they going to have to jump through the same environmental and legal hoops as BC Hydro would have to to put in a plant.

Just a few of the problems I see in a system like this.

[katzenjammer]

Lighten up !

[steven lloyd]

First off I disagree with something as important to society as hydro ever being made private, even partially, for profit. All you have to do is travel to the United states to see what has happened to their power grids due to privitization. Their rates are criminal for average people.

As a bit of an aside, I was stunned to learn how much some Americans pay for health care insurance. Only the wealthy can afford to have it. Private is definitely not always best.
(although it does help to fill the pockets of someone's private corporate buddies)

[Al Czervic]

First off I disagree with something as important to society as hydro ever being made private, even partially, for profit. All you have to do is travel to the United states to see what has happened to their power grids due to privitization. Their rates are criminal for average people.

As a bit of an aside, I was stunned to learn how much some Americans pay for health care insurance. Only the wealthy can afford to have it. Private is definitely not always best.
(although it does help to fill the pockets of someone's private corporate buddies)

I completely agree with you Steven 100%. But both the NDP and the BC Liberals allowed some privatization to enter into our healthcare system.

I believe that the Conversation on Health was a productive exercise in that it made Campbell realize just how much we value our current Healthcare system. Yes it can be improved (and needs to be) and skyrocketing costs must be controlled. Somehow.

But we should not sidetrack this thread with yet another health care discussions

[steven lloyd]

But we should not sidetrack this thread with yet another health care discussions

Agreed, and I identified my comment as an aside for that reason. I also agree with smurf, though, in saying our hydro production should not be privatized either. I don't buy the reassurances put forward by the corporate interests or their current political lackies. I believe that hydro production and distribution should be mostly in public control and that the revenues generated from the production of hydro from our rivers be routed back to public coffers - not out of province to foreign shareholders (or in kickbacks to criminal politicians).

[Al Czervic]

First off I disagree with something as important to society as hydro ever being made private, even partially, for profit. All you have to do is travel to the United states to see what has happened to their power grids due to privitization. Their rates are criminal for average people.

What is going to happen the first time we have a water shortage. These plants will not have a forebay to hold water and carry them over. These plants will become a loss and private industry will walk away. What will happen to them when they have lived their useful life. Who is going to be responsible to clean up the mess.

Have you ever seen the operation of a generating station. Do you know the maintenance that is required. Where will they get staff that are properly trained in the maintenance of that equipment. What happens when a seal goes and there is an oil spill or grease spill in the river. Who will have the equipment and the spill response team. Do you honestly believe that these small operators are going to be on top of all these things, or will they slip through the cracks. It will happen because the government to save money won't have enough watchdogs to keep track of it. I had a relative that worked for Manitoba Hydro in one of it's northern generating stations. They found out that they were over greasing their units and the grease was being forced into the water. Major repairs and a great deal of investigation as to what the proper amount was. Do you honestly believe a small for profit company is going to look after all these things properly.

Are they going to have to jump through the same environmental and legal hoops as BC Hydro would have to to put in a plant.

Just a few of the problems I see in a system like this.

Keep in mind Smurf BC Hyrdo is not going anywhere. It is simply more fear mongering from the NDP left on this issue. BC Hydro continue to create new power projects; continues to supply 95% of BC’s power and also is continuing to explore the Site C dam; so this debate is really about maintaining the BC Hydro monopoly or allowing some competition and innovation form the Private sector for a very small slice of the power generation market that we are currently paying for outside of BC.

Your point that Manitoba Hydro had a screw up is well taken. As you rightly establish incidents can occur. They can occur just as easily in the Public system as you pointed out with Manitoba Hydro as they potentially could in the private.

It’s not unlike what happened with BC Ferries. In spite of being “public” the Union crew was incompetent; seriously screwed up and lives were lost. But what was the worst insult to British Columbians was that there was ZERO accountability. Had this been a private sector operator there would have been cries of blood from the Unions and no doubt those on the bridge would be facing criminal charges for manslaughter.

I mostly mentioned Westjet to prove that when people put their lives in the hands in commercial aviation even a private company can deliver effective competition and innovation to the marketplace; all while creating jobs and supporting the economy.

What are we so afraid of with BC Hydro having to face some competition ?

[Al Czervic]

Here is a great article from Province Reporter Michael Smyth. While the NDP/Rafe Mair crowd say Private Power costs more; they ignore the fact that anytime you build a new power project; it is going to cost more money.

Much like when the Government builds fast ferries; or a convention center; costs always get out of control Here is what happens when BC Hydro tries to “build” a run of the river project…

And by the way; don’t those loons in the left say BC Hydro has been “banned” from doing projects like these? More lies from the NDP and super liar Rafe Mair….

Hydro fails test it should easily have passed

Ammo for fans of private power projects

By Michael Smyth, The ProvinceApril 3, 2009



Province provincial affairs columnist Michael Smyth
Photograph by: File photo, The Province
One of the loudest arguments from the forces fighting private power projects in B.C. is it that would be cheaper for B.C. Hydro to build them instead of the evil, nasty private sector.

Because B.C. Hydro is a Crown corporation, the argument goes, it doesn't have a greedy profit motive. Private corporations, on the other hand, don't care about the public good or the environment and just want to get rich off our resources.

Which all sounds very compelling -- until you remember unfortunate incidents such as B.C. Hydro's failed Raiwind power project in Pakistan, which burned taxpayers for $10 million in the 1990s. Or the doomed Duke Point natural-gas plant on Vancouver Island, bungled to the tune of $120 million four years ago.

But for an even more current example of "cheap" B.C. Hydro projects, look no farther than the newly expanded Aberfeldie Generating Station on the Bull River near Cranbrook. This is one of Hydro's "heritage" assets, originally built in 1922 to produce just five megawatts of power. Hydro decided to upgrade it by adding a run-of-the-river system to divert water to a new powerhouse and generate 25 megawatts.

No greedy private-sector fat cats gouging taxpayers on this one! This would be a public project. What could possibly go wrong?

B.C. Hydro's board of directors approved the Aberfeldie expansion in October 2004 at a cost of $46 million. But, in February 2006, the board received a new price tag: $65 million -- a 41-per-cent increase in just 16 months. Despite the mushrooming costs, the board again gave the project the green light.

What caused the price to jump so high, so quickly? Reports posted on Hydro's website blame many factors, including escalating costs of contractors, unforeseen work at the river and extra head-office oversight to keep the project's risks in check.

One of the flow charts blames "corporate overhead" for adding another $1 million to the price tag, for example. Can someone remind me again how this is cheaper than the private sector?

By November 2006, the cost of the project had ballooned once more -- to $95 million. This is the number B.C. Hydro now uses as the official budget for the project, more than double the original estimate.

Aside from the capital cost of the project, what about the cost of the new power itself? B.C. Hydro vice-president Bev Van Ruyven told the B.C. Utilities Commission in February that the cost of power produced at Aberfeldie was about the same as -- not less than -- the average private-sector power producer.

Keep in mind Aberfeldie was not a brand-new project requiring staff to map new terrain or build extensive new roads or test water flows or install new power lines to deliver the electricity to the grid. Most of that work was already done.

Despite those major up-front advantages for the Aberfeldie project, the construction price still soared 106 per cent and the price of the power was no cheaper than a private producer building from scratch.

The bottom line: If there was any public project where B.C. Hydro should have been able to give the private sector a run for its money, it was this one. Unfortunately for the enemies of private power, it didn't turn out that way.

[usquebaugh]

Michael Smyth, of course, being a Liberal shill.

[Al Czervic]

Michael Smyth, of course, being a Liberal shill.

ahhhh yes. shoot the messanger.