US Electricity Blackouts: Power to the People!

The recent blackout on the US East coast highlights the inability of the capitalist class to provide even the most basic services in the heart of imperialism. The ability of capitalism to keep even something as important as its global headquarters, New York,  has been undermined by the blind mechanics of the profit-drive, the central component of capitalism itself. By Kurt Penca. Originally published on the new issue of the American Socialist Appeal.

The endless series of wars, economic breakdown on a global scale, reactionary violence, and numerous daily crimes against humanity and the environment are all characteristic of the rampant, chaotic instability caused by capitalism in our day. But now even providing a basic cornerstone of modern life, long taken for-granted by the workers in the world’s sole superpower, has proved to be too much for the senile, degenerate bourgeois order. The latest crisis of capitalism’s failure to supply the life-blood of modern society - electricity - to 50 million people in the most industrious and populous regions of both the United States and Canada, serves as a verdict of condemnation not only on the deregulation of the energy industry but also on both capitalist parties which support and advance this agenda to plunder the state of billions in tax-payers’ dollars. The ability of capitalism to keep even something as important as its global headquarters, New York, firmly in the 21st (or even 20th!) Century has been undermined by the blind mechanics of the profit-drive, the central component of capitalism itself.


On August 14th, at around 4:00 pm EDT, power outages rippled through the Midwest and Northeast of the United States, and into Canada, cutting power to some of the biggest cities on the continent. In the hours and days which followed, the calm, level-headed, helpful and neighborly attitudes and initiatives of the working-class masses of the blacked-out cities stood in stark contrast and total moral superiority to the rabid scramble which all the mayors, governors, and energy executives found themselves in as they rushed to shift the blame to anyone and anything besides themselves, at one point going so far as to blame the entire incident on a lightning-bolt striking a station at Niagara Falls - which, as it turns out, never happened.

Whatever technical issue may eventually be officially pronounced as the "cause" of the outages (and it’s most likely to have been a combination of multiple causes and effects), this will only answer the question of how this happened. It does nothing to answer the question upon which the real solution to these blackouts depends - why this happened. Any shorted circuits, burnt wires, downed lines, or even "demand spikes" would only be catalysts. Any of these factors individually would be capable of causing a disruption of this magnitude only if the entire system was already wholly inadequate for supporting the needs it is tasked to fulfill, and totally unprepared for failures and stresses through a lack of appropriate redundancy and monitoring measures. Things like this happen all the time in ex-colonial countries, but this is in America, the financial hub and economic motor-force of the world! How could a country possessing superior technology and the greatest amassment of resources let such an essential system, of international importance, become antiquated and insufficient, to such a severe degree?

Though a "review" has been promised, you’ll never get a straight story or an honest report on why the system is in such a sorry state from the Bush administration or either major party - they’re the ones responsible. Bush’s barefaced demagoguery, delivered from various conferences and fund-raisers in California (2,000 miles from the affected areas), pledged to "modernize" the "antiquated system" after this "wake-up call". Posturing as the "Washington outsider" stepping into the midst of an emergency to set things right, he slyly alleges: "We’ll have time to look at it and determine whether or not our grid needs to be modernized. I happen to think it does, and have said so all along."

And yet it’s a matter of public record that, for the past few years, wave after wave of experts, engineers, scientists, government panels and energy insiders presented time and time again to both parties, to state governments, and to the federal government the fact that power failures were looming in the near future and that the only way to avert them would be to "modernize the grids". Despite these warnings, the Republicans, with Bush and his cabinet at the helm, voted down on three separate occasions legislation which would have provided $350 million to enact precisely those improvements. We are spending more than $56 billion on so-called "Homeland Security" in 2003 alone, not counting the costs of the "war on terror" and the wars in Afghanistan and Iraq, and yet we still hear from the president’s press-conferences and the nightly news that "another September 11th is as likely as ever".

Thus, in the first few hours, the news stations were wild with speculation that the blackouts were the result of a terrorist attack - and that, even if a terrorist attack hadn’t happened, such a crisis would be one which terrorists would benefit from and strive to bring about again in the future. If the consequences of retaining a system of neglected grids are so costly and disruptive, resulting in a situation comparable to the effects of terrorist sabotage, why isn’t a mere fraction of the funds spent on Homeland Security used to prevent all of this? Why not spend this money on projects which will truly provide security and increased quality of life?


The answer lies in the nature of energy deregulation: the wasteful, gluttonous political corruption that reaps the benefits of it; the anarchic economic mechanics governing it; and the legacy of scandals, failures, and intimidation it has left in its trail. The present administration, which received its biggest share of "political contributions" from energy giant Enron, has close ties to all of these things.

It’s fitting that the blackouts, expected for years by insiders but arriving like a bolt from a clear blue sky to the unsuspecting people most distressed by them, are the results of a rotten situation brought-about by the likes of Ken Lay and Enron, aided at every turn by their "executives" in the US government. The government hasn’t simply been "bought out" by the big corporations and shadowy trusts - the individuals holding all the reigns of power are themselves the biggest players in the largest energy, gas, oil and construction multinationals.

From the late 1980s onwards, Enron - a company which never produced anything itself and innovated only in the field of finding creative new ways to rob from various states and give to itself - forged partnerships with the biggest names in the power, oil, and gas industries, which just happen to have also been the biggest names in the presidential cabinets of the last four administrations and others before them. Enron’s predatory and extortionist tactics spread the company’s holdings (and its failures) across the globe. In Kuwait, India, Britain, Latin America and Eastern Europe, Enron left a legacy of billions of dollars being wasted or embezzled, chronic outages spanning entire regions, thousands of laid off workers, exponential increases in rates for residential customers, and even human rights abuses.

Even today, after the fall of Enron and continued disasters and outrages over the deregulation scams, the US government and the IMF are working to force more privatizations in Mexico, Iraq, and many other ex-colonial countries, with the obvious perspective of turning whole nations into assets to be bought, sold, traded and raided on the world-market. Last year in Peru, anti-privatization demonstrations were prompted by the impending sale of the state-owned Egasa and Egesur generators to a Belgian firm. Despite attacks from police, the calling of a state of emergency and the death of one young activist struck by a teargas-canister, the protests reached such an intensity that President Toledo of Peru was forced to call-off the sale of the two generators in dispute as well as sack several top pro-privatization ministers.

But Ken Lay and his pals finally succeeded in bringing Enron-style "competition" into the energy industry in America. The immediate result of this in California was a nearly 400 percent rate increase and a series of "brownouts" and "blackout-blackmail" incidents where supply of electricity was intentionally cut to artificially raise prices even higher and gouge hundreds of millions in tax money bailouts from the government. With the success of any capitalist venture resting upon its revenue, how could any deregulated power company act differently?

The Only Solution: Nationalization

For the capitalists, to deny one’s own company any available advantage is to hand that edge to your competitors, which of course would then outpace and overtake the less ambitious firm. It’s the kill-or-be-killed- law of the jungle - the moral system of the capitalists. The stated goal of the deregulators is to bring about "greater efficiency". Yet everyone knows that the capitalists’ sole means of gauging efficiency is by their returns, their profits. Therefore cutting corners on equipment quality and technology, monopolization of markets, layoffs in the same spirit as those responsible for the loss of millions of jobs over the course of Bush’s term, creating artificial shortages and outages, speculative expenditures, inflating rates, and all manners of technical shortcuts are more "efficient" than investing in greater transmission capacity, which would actually serve to lower rates - something counter-productive from a business standpoint.

All the while, every fiasco, every swindle, is rewarded with billions in "stimulus" sums, Bush apparently being anxious to put to use the most intellectual term he’s familiar with. If these private companies can’t function without leeching obscene amounts of money from the state’s funds, from our tax dollars, then what claim do they have to any progressive or innovative function?

The centralized production of energy and the conscious planning of its distribution are absolute necessities, dictated by the demands of large populations and modern technology. The inability of the capitalists to provide cheap, efficient, power is a clear indicator that along with stretches of rusty old towers carrying strings of neglected power lines, capitalist property relations are also "antiquated".

But privatizations and deregulations aren’t nearly as old as the grids we’re currently dependant upon. A national public power authority is only the first step. The heads of the energy firms along with the bosses’ parties that won’t commit funds to improving our lives instead of war have demonstrated that, under any circumstances, they’re totally unable to plan the construction of a system adequate for today’s needs. The energy workers, engineers, and panels of scientists tracking all aspects of usage and transmission efficiency are the only ones who know what this country needs to meet its energy needs efficiently and how to get it done. They have to be the ones making the decisions and formulating nation-wide plans if we’re ever going to have a dynamic grid we can depend upon.

The bosses’ lackeys in the union leadership would have the rank and file energy workers believe that higher pay and benefits for a handful of workers are worth more than the billions squandered in bailouts to private companies already making millions in profits. The fact is, working people as a whole end up paying the companies far more in inflated rates than a few of them get in increased wages and benefits. Union workers have known for a long time that "an injury to one is an injury to all" - and deregulation and price gouging hurts every working person in the country. No to the class collaboration of the union leaders! For a leadership that can truly defend the interests of all working people!

  • No to deregulation and privatizations, which are just covers for the looting of the public’s property!
  • Nationalize the power grid!
  • Break with the Democrats! For a mass party of labor based on the unions and armed with a socialist program to fight for these aims!
  • Power to the people - electrical and otherwise!