Saturday, April 19, 2008

Capitalism at Four Dollars a Gallon?

by Norman Markowitz

In 2005, I wrote an article for PA online titled "Capitalism at Three Dollars a Gallon." In 2006, I wrote another article for _PA _online titled "Brother Can You Spare a Gallon. " As I drive on the roads of New Jersey, which by the way has, because of its refineries, some of the cheapest gas prices in the U.S., the best that I can find is $3.17 a gallon and I doubt that I will be able to find that by Monday.

I am getting tired of writing these articles and it is costing me and the most Americans a good deal of money--money which could be put to much better use for ourselves, our families, and the national economy.

Nothing has changed and everything has in effect gotten worse. If the Bush invasion of Iraq was a "war for oil," it has been a war for expensive not "cheap oil." The crackpot assertions of Bush administration policy planners aside that they could invade and subdue Iraq and then substantially increase oil production there so that the war would "pay for itself" (or the U.S. would take oil profits from the Iraqis as the price of their "liberation") the price of a barrel of crude oil is today at an all time high and the U.S. government has done absolutely nothing to advance alternative energy programs. Instead, the administration, which has a "special relationship" with the most reactionary sectors of the capitalist class in the U.S., that is, the Texas based energy companies and the large military contractors, has done everything in its power to sabotage international alternative energy programs, which has not only increased the price of oil but has also obstructed international environmental protection policies.

Why is the administration doing this.? My "educated Marxist" judgment is that it is indifferent to very expensive oil because very expensive oil both enriches its Texas energy company backers and also increases their power in the capitalist class against other sectors of large capital. The capitalist class like the working class is highly stratified and while all capitalists defend their larger class interests against all workers, different sectors of capital fight for increased profits and power against others.

Expensive oil strengthens both the energy companies and also the military contractors, since it helps to create the catch-22 mentality that military interventionism is more not less necessary to keep other nations or blocs of nations from gaining control of oil producing regions and making the costs of oil even greater and "window of vulnerability" a nation faces greater (a version of the old Mutually Assured Destruction argument that fueled the arms race and came to be called MAD, that is, you had to build more and more weapons of mass destruction so that your enemies would not get the drop on you and they would do the same so that you would not get the drop on them and that would be a deterent to nuclear war).

I guess we can call more and more oil use, higher and higher prices, and more and more military interventions around protecting oil Unilaterally Assured Bankruptcy (UAB) not as catchy as MAD but if a national energy policy is not developed by the next administration just as probable.

These rightwing radical policies which Ronald Reagan brought to Washington when he dumped Jimmy Carter's energy conservation policies really need a serious left alternative in the U.S.

I would in looking for such a policy go back to one of the United States most successful public energy programs, the Tennessee Valley Authority ,which Franklin Roosevelt hoped would be extended to the large river valleys of the country as part of a national public energy policy.

I would hope the next administration will create something like a United States Energy Authority, in effect both nationalizing the Texas based oil companies and reorganizing them around the principle of providing the cheapest fuel possible. I would also expect this Authority (which would cover all energy sources) to use public profits from the oil sector to fund a national Research and Development program around solar and other alternative energy programs. Then, I would hope that a progressive U.S. government would immediately establish
cooperative relations with Venezuela and support rather than undermine progressive labor and political forces in Mexico(which also has a large oil industry), working to create a Hemispheric Energy Authority that would focus on public sector development and raising living standards
for the people of Latin America.Finally, I would hope that a progressive U.S. government would work to develop a global energy authority through the United Nations.

What would happen to the capitalists? Since many nations have operated on the principle that natural resources belong to the whole people and have created public energy sectors short of establishing a socialist society, the stocks of capitalist investors might be converted to bonds in the public energy authorities, no where near as lucrative as their present situation, but a policy that would give them some incentive to accept public energy policies. Also, I would hope that a progressive U.S. government would work to strengthen progressive political forces in both Iraq and Iran who are the only real friends that the American people have in those countries and seek to develop a regional peace process that would both create an federated Iraq which would retain its public ownership of oil and develop cooperative relationships with what would hopefully become a secular progressive Iran.

These are longterm policy goals that many will dismiss as "Utopian." I am sure some of our readers will ask me what I am drinking or smoking? My only answer would be that these policy goals constitute a policy worth struggling around, as against the "dystopian" policy of U.S. monopoly capital. That policy has given us oil barons allied to military contractors at home and feudal lords abroad, a commitment to "privatizing" Iraqi oil and profiteering from the Iraq and future wars, and, of course four dollars a gallon which will be followed by ? a gallon if rightwing Republican rule continues and there is no progressive national energy policy.


Gary said...


Excellent article!

Gary De Santis said...


Excellent article