Seth Sandronsky:
> financial capital doesn't speak it shouts.
or as Bob Dylan said, money doesn't talk it swears.
One thing that interests me about the California energy crisis is the relationship
between theory and actual history: for example, for saying for years that stuff like
this was inevitable, I got accused by some folks of apocalypticism, Cassandra-ism,
misanthropy etc. But isn't predicting crises what Marxist social theory is about?
As far as the failure of so-called 'deregulation' in California. goes, what they
called deregulation actually wasn't that, it was just a different kind of regulation
which allowed finance capital to get a grip more directly on the circulation of
value, and the valorisation process, of energy production (which previously had
tended to be either state-owned or subject to formal kinds of price and
investment-planning processes). The industry was still highly regulated, but not by
the previous keynesian/indicative planning methods. Neoliberlaism is *not* actually
"deregulation". Markets not only regulate, they require a strong framework of law
and other kidns of regulation, and this existed in California (and has now
collapsed).
This change in tactic away from Keynesian/public sector investment + planning
approaches took place more than 20 years ago and of course was facilitated by the
burgeoning of neoliberal ideological agendas and number-crunching capacities, and
the whole trend towards marketisation, commoditisation and securitisation of public
debt since the 1980s. All this is simply a different and (from capital's point of
view) more 'rational' form of distribution of surplus value (i.e. profit) among
capitalists; the fact that energy supply, or transport systems, or health servcies,
or telecoms, are seen as public services to be owned by the state and operated by
large publicly-funded utilities (under the now 'obsolete', Keynesian-type post-1945
models) does not, of course, mean that these processes are not part of the system of
profit-extraction and distribution which is the capitalist game. Changing the labels
doesn't necessarily change the contents. Neoliberal apologetics always ignored the
way in which 'nationalisation' was just another ruse by capitalists, who profit from
nationalised industries but in different ways.
But at another level, the real reason why neoliberal methods became fashionable was
because they were an adaptation to a long-term capitalist malaise. Thus leaving
energy supply to the markets is an adaptation to the emergence of producer cartels
like OPEC, which are themselves indicators of a growing and endemic crisis of energy
supply (you can only cartelise something you have a lock on producing, i.e.
something which is scarce). Oil has always been ruled by monopolies since
Rockefeller took charge of the Pennsylvania oil industry in the 1860s, but
Rockefeller's stranglehold was more on distribution (control of pipelines,
railroads, refineries) that on the amount of product in the ground, which has not
been a physical constraint on production until the 1970s. After 1970, US Lower-48
production began to decline and is now about half what it then was. This is, of
course, the real key to what is going on. Texas, the home of oil, is actually now a
net energy *importer*.
The neoliberal answer to OPEC after the 1980s was threefold: (1) enforcing a global
process of deflation and of indebtedness in the peripheries; (b) enforcing 'free
markets' in energy, thus crowding out 'ineffective' demand (i.e., poor people can't
afford to buy energy: and the oilshocks of the 1970s did indeed put a final stop to
the dream of development in the ex-colonial world) and (c) enforcing (by military
means as a last resort) competition between energy-carriers of all kinds, thus
removing 'rigidities' and monopolies from the market.
All this worked fine as long as the global energy production system continued to
squeeze the last drops from the energy sponge, and enhanced production technologies
still accelerated the depletion of what was already a declining resource. But it was
rather like solving a booze shortage by freeing up the market for liquor inside the
bar, while not doing much to increase actual production. What happens is that
everyone has an even better time than before, but the booze runs out even faster
than before, leaving a bunch of dry customers with a giant hangover after the binge
is over.
Given the many uncertainties in the energy supply equation and also, uncertainty
about the physical nature and extent of global oil and gas reserves, it was possible
to argue a good case for letting the markets do their stochastic thing, while
ridiculing the 'futility', 'soviet-style madness' etc of planning (Yuck!
Teleological! Therefore a religion, dogmatism, ideology etc, unlike the 'science',
cold, neutral rationality of the markets, etc). All these compelling arguments for
neoliberal TINA vanished like petrol vaporising in hot sunlight when shortages began
to bite. Suddenly everyone, even rock-ribbed, tunnel-visioned Republicans believe in
re-regulating to remove market 'excesses' and 'inadequacies.' Duraki, Duraki,
Duraki, as Lenin said: Fools, Fools, Fools all around us. And a fool's work is never
done.
California is such an exceptional case that it is difficult to generalise from the
meltdown there, and, despite the foregoing, I don't argue that the energy-death of
capitalism is going to happen next week or even next year, although it is clearly on
the way (absent either new technology, or making fusion work, or death from some
other cause, e.g. thermonuclear war). But it is clearly a straw in the wind.
A combination of measures can save the situation in California from total crash (it
won't be like the USSR, where the collapse by half of oil production in the late
1980s destroyed the whole state and Society). But it will be painful, protracted,
will deepen recessionary forces, will deepen inequality (wealth will go from the
mass of consumers to the small number of owners of oil and gas), and even strenuous
efforts to totally restructure the energy supply system will not succeed in doing
more than hold the line (IMO): i.e., the best that California and the USA generally
can hope for is that strenuous measures prevent the situation from getting any
worse. The days of boundless horizons and effortless annual increases in per capita
energy consumption, are almost certainly over. That is an important milestone in the
accelerating terminal decline of capitalism.
Mark
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