Editor’s note: This op-ed is by Ron Jacobs of Burlington.
The history of publicly owned power in the United States is one that actually has a fair number of positives, if you are one who believes certain necessities should not be sold for profit. After the unleashing of electrical power by Thomas Edison and Nikolas Tesla a debate began regarding who owned that power. In popular lore, Thomas Edison is identified with the industry (specifically General Electric) which considered electric power and the means to transmit it as something that should be privately owned. Tesla, on the other hand (according to the story), thought it should be almost free. Furthermore, once hydroelectric energy was harnessed, progressives sought public use of river benefits as a matter of philosophy, believing that rivers should not be monopolized by private interests.
After New Deal legislation was passed creating public utility districts and funding said facilities under legislation like the Rural Electrification Act, it looked like the United States might actually have the bulk of its power provided by public facilities. Even in states and municipalities where utilities were corporate owned, there was usually a fairly independent regulatory system in place.
In recent decades, as Wall Street and Washington conspired to maintain the system of monopoly capitalism that keeps it in power, more and more public utilities have been sold to the highest bidder. Indeed, very rarely have municipalities been successful in stopping the corporate juggernaut once it begins. Cleveland is one municipality that comes to mind that was successful. In fact, the struggle to prevent its takeover by the banks may be Dennis Kucinich’s finest hour.
In the coming campaign for mayor of Burlington, it looks like a key issue will be whether the city should sell its municipally owned electric department. The immediate reasons for this proposal (originally brought up by the GOP candidate for mayor) is a fiscal situation brought on by a poorly executed plan to provide telecommunications service to Burlington residents.
As I recall, this entity, known as Burlington Telecom (BT), was originally intended to be publicly owned. However, not long after the laying of fiber optic lines beneath the city streets began, certain telecommunications monopolies cried foul. They claimed that a city-owned telephone, Internet and television system would be unfair competition. Of course, the fact that all of the above communications facilities in Burlington at the time were owned by two monopolies went unremarked upon. So, Adelphia (whose owners went to prison) and some of its “friends” in the Vermont Legislature pushed through legislation that BT’s losses are not to be borne by taxpayers. If the original plan had been allowed to move forward without interference from Adelphia/Comcast, the current financial situation would not exist.
Anyhow, back to the Burlington Electric Department (BED). When it comes to paying for electricity, the key for most people is the monthly electric bill. BED subscribers pay less, plain and simple. So, while the cost of each electrical unit may be more expensive, the cost to the consumer is less. Given that profit is not a motive, one can fairly assume that this will remain the case as long as BED is a municipally owned utility. Should the BED be sold to a private corporation, one can assume that bills will eventually go up. Furthermore, the possibility of shortages during peak periods becomes even more likely since for-profit energy companies have been known to divert power to grids where demand (and therefore profits) are higher. This possibility underlines the very basic assumption of a locally owned utility: that it will serve the locality that owns and runs it. As everyone knows in today’s neoliberal world, if the local grocery store is bought out by a national chain, then local needs and desires are less likely to be the primary factor in determining what that store sells and how much it costs.
Why should the citizens of Burlington sell a publicly owned entity whose operating raison d’être is service to a corporation whose only raison d’être is profit? Recent history proves that this type of transaction often brings in quick dollars but at a greater long-term cost to the consumer. Furthermore, local control usually becomes a thing of the past. Capitalism can put a price on anything, but it rarely knows that thing’s value, especially when it is a service essential to human life, as electricity has become in modern Vermont.
Most utility companies in the United States are not publicly owned. Instead, they are corporate entities that are sometimes nominally regulated by public commissions. In my experience, which includes living in five different states of the United States, rarely is a rate hike request from a corporate-owned utility turned down, if ever. Since the 1980s, when corporate America redefined itself as a free market and convinced Congress that the market was always right, electricity prices have jumped. Part of this is naturally due to greater demand, but another aspect to this increase is the fact that corporate-owned utilities are driven by profit, not service.
Burlington Electric Department is a fine utility. As the cliche goes, if it’s not broken, don’t fix it.
