Yeah so NSW Labour Premier Morris Iemma is very keen to privatise the remains of the NSW state electricity system (a process begun some years ago). Anyway, Iemma’s plan is deeply unpopular among members of the NSW ALP, delegates of which at the NSW State conference last weekend voted overwhelmingly against it (by 702 votes to 107). Given that state conference has bugger-all control over state caucus, however, it looks like Iemma’s plan will be put into action sooner rather than later. Crazed anti-Communist scribbler Imre Salusinsky writes:
Iemma survives as opponents hold fire
May 6, 2008
NSW Premier Morris Iemma has emerged unscathed from a crunch caucus meeting that discussed Saturday’s rejection of his electricity privatisation proposal by Labor’s state conference. Opponents of the plan within caucus have stayed their hand in advance of further negotiations scheduled for tomorrow between the Government and representatives of the party and the unions. Emerging from the caucus meeting, Mr Iemma declared he was “very happy” with the outcome of the meeting. “There were plenty of questions about the electricity package,” he said. “No one disputes the need for reform. Caucus is happy we’re moving ahead with consultation.” Mr Iemma’s proposal to sell the three state-owned electricity retailers and lease out the three state-owned generators was defeated by 702 votes to 107 at the conference, but he has declared he is pushing ahead to secure the state’s future electricity needs.
Meanwhile, former PM, amateur pig farmer and antique clock collector Paul Keating has come out of the closet to declare his support for Iemma’s privatisation push (Iemma deserved better than naked obstructionism, Sydney Morning Herald, May 6, 2008). Keating frames the debate in terms of the potential return on the sale — “$15 billion… [money] that could [be] spent on education, health and vital new infrastructure” — and the claim that state ownership of such utilities has been rendered obsolete by the magic of the marketplace; that is, “from the day the National Electricity Market, established by the Keating government, went into operation in 1995, there [has been] no economic or commercial reason why any state would retain state ownership of power generating capacity”.
The Iemma Government’s proposals represent a dramatic and important microeconomic reform to the infrastructure base of the largest state and hence to the nation. The NSW economy represents just on 40 per cent of national gross domestic product. This is why the federal Treasurer, Wayne Swan, said over the weekend he supported the reforms, because “they go to the heart of the COAG agenda”. Dead right. More than that, they go to the very kernel of the Rudd Government’s federal-state reform program.
Which is a very apt observation, and one also reflected in those of a (pro-)Communist scribbler at the wsws.org:
Rudd backs Iemma
Iemma made his declaration knowing he had the full backing of the federal Rudd government. On Saturday, as the conference opened, federal Treasurer Wayne Swan was featured in a front-page interview with the Australian’s editor at large, Paul Kelly, describing Iemma’s privatisation agenda as central to the federal government’s economic program. “I think they are important reforms,” Swan told Kelly. “They go to the heart of the (Council of Australian Governments) agenda. I support the reforms put by Premier Iemma.”
Prime Minister Kevin Rudd addressed the state conference on Sunday morning, just hours after the motion’s resounding defeat, but chose not to restate his own public support for Iemma’s plans. His position, however, was made crystal clear. After referring to the “disagreement” of the previous day, he said his message to the conference was: “The time has come to get on with the business of building a modern Australian nation capable of meeting the challenges of the twenty-first century.”
Rudd’s speech reiterated his pro-business agenda. It was littered with references to “removing the unnecessary regulatory burdens on business”, “microeconomic reform” and “reducing government spending”. “Australian business wants us to lead the nation towards a long term goal of a seamless national economy,” he declared.
There was not a murmur of dissent from any of the 800 delegates. As he made his entrance into the hall, Rudd was greeted with an ecstatic standing ovation, a chorus of cheers and prolonged hand-clapping, all to the sound of rock music. No one had any intention of mentioning Rudd’s previously stated “complete support” for Iemma’s sell-off plan. Not a single delegate wore one of the yellow anti-privatisation tee-shirts that had been on display all over the conference floor the day before.
Ludicrous efforts were made throughout the conference to depict the privatisation plan as the brainchild of one man—state Treasurer Michael Costa, and his overriding arrogance. While Costa has certainly played a key role, he has not been alone. Rudd, Iemma and the entire federal and state party leadership are preoccupied with carrying through the NSW power sell-off as a signal to the media and corporate establishment that the Rudd government’s wider privatisation, “public-private partnerships” and “economic reform” agenda will be implemented in full.
The Rudd government’s new Infrastructure Australia agency is expected to lay the basis for highly-lucrative private investment and “partnerships” in public infrastructure and government services nationally, including electricity and gas, water, hospitals, schools and toll roads. In his conference speech, Rudd listed Infrastructure Australia as one of his government’s highest priorities.
The record internationally has been that the insistence on short-term profits leads to job destruction, price hikes, service breakdowns and environmental problems. In the neighbouring state of Victoria, where the electricity industry was sold off a decade ago, average annual power bills have increased from $945 to $1,106, while the number of jobs fell from 27,000 to 12,000 before privatisation, and to 7,000 afterwards. In another neighbouring state, Queensland, power bills are expected to have risen by nearly 20 percent by July, following the introduction of full retail competition last year.
The most notorious experience is that of California, where large corporations such as Enron literally sabotaged the power grid to drive up prices and reap massive profits, stripping an estimated $10 billion from the state’s coffers.
NB. Keating is International Chairman of Lazard Carnegie Wylie, the financial company which has recommended to the NSW Government the privatisation of the state’s electricity system. According to one report (Millions in power sale for advisers, Jacob Saulwick and Andrew West, The Sydney Morning Herald, January 12, 2008), “AN A-LIST of international investment banks, commercial law firms and accounting practices could reap up to $300 million from the privatisation of the state’s electricity industry.”
As for Enron:
Kenneth Lee “Ken” Lay (April 15, 1942 – July 5, 2006) was an American businessman, best known for his role in the widely-reported corruption scandal that led to the downfall of Enron Corporation. Lay and Enron became synonymous with corporate abuse and accounting fraud when the scandal broke in 2001. Lay was the CEO and chairman of Enron from 1986 until his resignation on January 23, 2002, except for a few months in 2001 when he was chairman and Jeffrey Skilling was CEO.
Jeffrey Keith “Jeff” Skilling (born November 25, 1953) was the CEO of Enron Corporation in 2001. He was convicted in 2006 of multiple federal felony charges relating to Enron’s financial collapse, and is currently serving a 24-year, 4-month prison sentence at the Federal Correctional Institution, Waseca in Waseca, Minnesota.
Andrew Stuart Fastow (born December 22, 1961) was the chief financial officer of Enron Corporation until the U.S. Securities and Exchange Commission opened an investigation into his conduct in 2001. Fastow was one of the key figures behind the complex web of off-balance-sheet special purpose entities (limited partnerships which Enron controlled) used to conceal their massive losses. He is currently serving a 6 year prison sentence for charges related to this conduct.
And the winner is… Lu Pi!
- Lu Pi’s Rule
Lu Pi’s rule is named after Lu Pi, who worked at the infamously corrupt Enron but cashed out before everything went to hell. At the time the film The Smartest Guys in The Room was made, he was not dead like Cliff Baxter (or, now, Ken Lay) or in jail like Jeff Skilling. He was the second-largest landowner in Colorado. Lu Pi has not cured cancer or come up with a Grand Unified Theory for Physics, or even figured out a way to make software suck less, but it’s safe to say he’s smarter than the titular Smartest Guys In The Room.
So Lu Pi’s rule is: If you’re the smartest guy in the room, in all likelihood it’s because the smarter people have already left.
See also : The Trillion Dollar War blog | Nickel and Dimed: On (Not) Getting By in America, Barbara Ehrenreich, 2001 | Myths of the market, John Quiggin, November 11, 2002: review of Thomas Frank, One Market Under God, Vintage, 2001; William Baumol, The Free-Market Innovation Machine: Analyzing the Growth Miracle of Capitalism, Princeton University Press, 2002
Why settle for what we’re shown
When there is so much more?
Sometimes the Book of Law
Is only half the story
Means and ends:
Deciding where to draw the line
Loss of work in Sellafield homes
Or the threat of cancers yet to come?
The choice is obvious:
There is no choice
Only the option of looking outside
This narrow definition of
“What you see is all there will ever be”
There comes a time – that time is now –
When every second, every day
When every action, every thought
Will tell the world how you cast your vote
They break our legs
And we say “Thank you” when they offer us crutches
Tired of mild reform
Sick of hand-me-downs
We topple all the theories to the ground:
All real change
Must come from below
Our bosses must live in fear
Of the factory floor
And when they smile
And they ask for my support,
I’ll give them these words
And a bloody nose:
You don’t help your enemy
When you’re at war
There are moments in all our lives
Tiny sparks still deep inside
When a new-born baby cries
When you’re watching clouds in a summer sky
The first time you walked out on strike
Love and sex and holding tight
Things that can’t be bought
By promises and votes
Each angry word
Every cynical put-down
Every song is carefully born
From a hope of something better to come
Love and hate and love
Each prompted by the other:
For the cause of peace we have to go to war
Refusing to sleep
Whilst there’s world to win
Yet happy to dream
Dreams make the plans to change this world
Here’s the rest of our lives!
…A tiny sparks still deep inside
We can and will run the factories and mills
We can and will educate ourselves
We can and will work the fields
We can and will police ourselves
We can and will create and build
Here’s the rest of our lives!
~ “Here’s the Rest of Your Life”, Never Mind The Ballots, Chumbawamba (Agitprop Records, PROP 2, 1987)