Vital Businesses Need Nationalization
The gas station attendant came outside. Wow, I thought, full serve!
Ignoring me, she flung a magnetic price decal on top of the price
per gallon. Regular unleaded had gone up 20 cents in the time it
took me to drive from the curb to the pump.
"You're kidding me," I moaned.
"It's 3 o'clock," she shrugged. "Just got the new price."
There has to be a better way, I thought.
And there is.
It isn't drilling in the Alaskan wilderness. It sure isn't John
McCain's plan to offer $300 million to the first person to come up
with a longer-lasting car battery
Gas prices could hit $7 a gallon before long, Wall Street analysts
say, but Americans--always optimists!--take a little comfort in the
fact that Europeans have paid more than that for years. But a lot of
foreigners are laughing at us even harder than we're laughing at the
Euros.
Did you know that Venezuelans pay a mere 19 cents per gallon? It's
38 cents in Nigeria. Turkmenistan is might not have electoral
democracy, but they only shell out $4.50 to fill a 15-gallon tank.
Before we replaced Saddam Hussein with...with whatever they have in
Iraq now, Iraqis paid less than a dime for a gallon of gas.
One of the things that these countries have in common, of course, is
that they're oil-producing states. Countries that export oil and gas
have trouble explaining to their citizens why they should pay for
their own natural resources--and most are smart enough not to try.
Iran, Saudi Arabia, Egypt, Burma, Malaysia, Kuwait, China and South
Korea are just a few of the countries that keep fuel prices low in
order to stimulate economic growth.
But they also share something else: common sense. Strange it might
sound to Americans used to reading about big oil windfalls, they
consider cheap gas more of an economic necessity than lining the
pockets of energy company CEOs. So they don't consider energy a
profit center. To the contrary; government subsidies (Venezuela
spends $2 billion a year on fuel subsidies) and nationalized oil
companies keep gas prices low.
Unlike corporations, governments don't care about turning a profit.
They care about remaining in power. Their reliance on political
support (or, if you're cynical, pandering) allows them to do things
our much-vaunted free market system can't, such as make sure that
people can afford to eat and buy enough gas to get to work.
Like the rest of the world, Venezuelan consumers have been squeezed
by rising prices, and even shortages, of groceries. In 2007
Venezuela's socialist-leaning government decided to do something
about it. First they imposed price controls on staple items. When
suppliers began to hoard supplies to drive up prices, President Hugo
Chavez threatened to nationalize them. "If they remain committed to
violating the interests of the people, the constitution, the laws,
I'm going to take the food storage units, corner stores,
supermarkets and nationalize them," he said. Food profiteers
grumbled. Then they straightened up.
Not even international corporations are immune from Chavez's
determination to put the needs of ordinary Venezuelans ahead of the
for-profit food industry. Faced with severe shortages of milk
earlier this year, Chavez threatened Nestle and Parallax's
Venezuelan operations with nationalization unless they opened the
spigot. "This government needs to tighten the screws," he said in
February 2008, promising to "intervene and nationalize the plants"
belonging to the two transnational corporations.
Miraculously, milk is turning up on the shelves.
When it works, nothing is better at creating an endless variety of
reality TV shows than free market capitalism. But when it doesn't,
it isn't just that extra brand of clear dishwashing liquid that goes
away. Businesses fold. Banks foreclose. People starve. And no one
can stop it.
The G8 nations met in Osaka last week to try to address soaring food
and energy prices--a double threat that could plunge the global
economy into a ruinous depression. But the summit ended in failure.
"Any hope that the G8 meeting would result in coordinated monetary
action--or concerted intervention in foreign exchange markets--to
counter rises, principally in commodity prices, was dispelled by
their failure to agree on the phenomenon's underlying causes,"
reported Forbes.
So the G8 ministers punted. "Due to the lack of consensus, they have
stated the need for further study," wrote the magazine.
The problem isn't the weak dollar or the non-existent housing
market. It's capitalism. A sane government doesn't leave essential
goods and services--food, fuel, housing, healthcare, transportation,
education--to the vicissitudes of "magic" markets. Non-discretionary
economic sectors should be strictly controlled by--indeed, owned
by--the government.
Consider, on the one hand, snail mail and public education. The
Postal Service and public schools both have their flaws. But what if
they were privatized? It would cost a lot more than 42 cents to mail
a letter from Tampa to Maui. And poor children wouldn't get an
education.
Privatization, particularly of essential services, has always proven
disastrous. From California's Enron-driven rotating blackouts to
for-profit healthcare that has left 47 million Americans uninsured
to predatory lenders pimping the housing bubble to Backwater's
atrocities in Iraq, market-based corporations' fiduciary obligation
to maximize profits that is inherently incompatible with a stable
economy whose goal is to provide people with a decent quality of
life.
P.S. If you're reading this in Caracas, please mail me some gas.
Ted Rill
is the author of the book "
Silk
Road to Ruin
:
Is Central Asia the New Middle East?,
"
an in-depth prose and graphic novel analysis of America's next big
foreign policy challenge.
