We do next to nothing to tap the vast energy resources in our buildings and homes, where 70 percent of energy is consumed, much of it wasted. For a small fraction of the cost of new power plants, we could have national retrofit programs for insulation, windows, electricity-saving devices, and other efficiency steps that would save many more billions of barrels of oil, pounds of coal, cubic feet of gas, and American dollars. People may want that, but in contrast to oil, coal, and gas, we do not have a string of multibillion-dollar corporations lobbying to get our government moving on that.
We are falling farther behind. Denmark and Spain generate 21 percent and 14 percent of their electricity demand, respectively, from wind power alone. Spain is on target to generate an additional 10 percent of its electricity from solar power and has a large export business in solar technology, though behind the leaders in this lucrative business—China and Germany. Three states in Germany generate 40 percent of their electricity from wind power. Scotland recently moved its 2020 target of 50 percent of power from wind up to 80 percent. The Philippines derives 28 percent of its energy needs from geothermal sources. In the United States, we generate less than 3 percent of our electricity from solar, wind, biomass, geothermal, and the like (an additional 6.5 percent comes from hydropower).50
Why do we fail to do what we know we need to do and what other countries seem fully capable of doing? We do not change because old-line corporations that profit from preventing change have extraordinary and growing power to resist. After all, those first “corporate free speech” cases involved power struggles between the people and utility corporations such as Central Hudson, Consolidated Edison, and PG&E, and with the Supreme Court’s creation of corporate rights, the people lost.
Thanks to the successful efforts of the Chamber of Commerce and Lewis Powell and his allies to enlist the power of the Supreme Court, it is now illegal—a violation of “free speech”—to prevent utility corporations from promoting energy consumption. After Citizens United, it is illegal for us to regulate corporate spending in politics and elections.
The energy industry spent $3 billion in federal lobbying expenses from 1998 to 2010. The oil, gas, and coal companies have been some of the biggest corporate spenders to gain and keep corrupt political influence in Washington and state capitals. Oil and gas corporations set a record for lobbying spending in 2009, topping $154 million. Electric utilities spent $134.7 million. Alternative energy companies combined managed to come up with $29 million to lobby in 2009.51
After Citizens United, the American Petroleum Institute announced that it would spend millions of dollars to support friendly candidates and attack perceived opponents of the oil companies. “This is adding one more tool to our toolkit,” said an API official. “At the end of the day, our mission is trying to influence the policy debate.”52
Symbolic of Our Fall: Mountaintop Removal
To fully appreciate the ecological, moral, and social disaster of corporate domination of government, you should go to Appala-chia and see the impact of mountaintop removal coal mining. You should hurry, though, if you want to see mountains; they are going fast. To get coal more cheaply than it would cost to hire more miners, vast swaths of Kentucky, West Virginia, Tennessee, and Virginia, with some of the richest, most diverse ecosystems in the world, have been destroyed.
More than five hundred mountains have been blown up and flattened, the toxic debris dumped into valleys and obliterating more than two thousand of miles of headland streams—literally, they no longer exist. As Robert Kennedy Jr. points out, if you filled 25 feet of a stream in your town, you could go to jail.53 Coal corporations have filled 2,500 miles of streams in Appalachia. Towns and communities have been destroyed, drinking water poisoned, disease incurred, and local economies ruined by this most destructive, irresponsible, and shortsighted form of extracting energy in the history of humanity.54
If you cannot go to Appalachia, you can still see and hear some of the brave people working to stop this by going to Web sites for organizations such as I Love Mountains, a coalition campaign to end mountaintop removal, or Appalachian Voices, the Kentucky Riverkeeper, or the Waterkeeper Alliance.55 The I Love Mountains Web site has a “see your connection” function that lets you type in your ZIP code and see how the destruction of Appalachia connects to you.
I live in Concord, Massachusetts, and felt good that our lower-cost municipal utility pursues alternative energy and conservation. However, when I put in my ZIP code at the I Love Mountains Web site, I discovered that when I turn on a light, coal from obliterated mountains in Appalachia is burned in the AES Thames power plant in Connecticut, which feeds into the New England grid and into the Concord Light & Power system.
Knowing this makes it hard to visit the people in West Virginia and Kentucky who cannot drink what used to be clean mountain water, whose coal-dust-covered homes shake with explosions, whose children go to schools and get sick from the toxic dust settling over them; the people who are pitted against one another by coal companies who destroy jobs and threaten to destroy the rest of them if anyone complains.
I did visit, and one must see it to believe that this is happening in America. Bill Haney, a businessman and film director, has documented the terrible crime going on across Appalachia in the film The Last Mountain. To watch it is to understand the sad, dangerous consequences of unchecked corporate power. Or watch Robert Kennedy Jr.’s speech from Blair, West Virginia, in June 2011, in which he explained the connection between mountaintop removal extraction, Citizens United, and the destruction of American democracy.56
Or you can hear online the voice of Elmer Lloyd, a retired coal miner in Harlan County, Kentucky.57 After he retired, Elmer Lloyd built a fish pond because the local streams had been ruined. “When I was small, kids could go down to the river to fish; I could go down to the river, put a line in, and catch all the fish I wanted. But over the years, I mean, it become where you couldn’t even find a minnow, or a fish, or nothin’ in the river, because they were all gone. So I figured I’d build me a pond, you know, you’d have something in the area where the kids could fish.”
When the mountaintop removal started, “people told me, when they start stripping behind your house, they’re going to destroy your home. I said no, I believe there’s enough laws out there to make ’em do it right. Well, they said, you wait and see.” Toxic runoff from the operations destroyed the stream and the fish pond, killing all the fish. When Lloyd complained, the coal company sent people over: “They were kinda laughing about it. Saying, there’s one that might make it. There’s one that didn’t make it. And they were saying it like they thought it was funny.”
Lloyd called the Kentucky Department of Fish and Wildlife, which told him to fill in the pond because with mountaintop removal coal mining, there was no hope for it. Lloyd says, “It just ain’t right for companies to try and come in here and get a dollar and destroy the place, destroy people, and leave because they don’t have to worry about it next year because they’re gone looking for something else to make money on and destroy.”
Lloyd’s right when he says, “I believe there’s enough laws out there to make ’em do it right.” Many of those laws are the laws that we demanded after the first Earth Day in 1970, such as the Clean Water Act, which the government once vigorously enforced. The Clean Water Act has a “citizens suit” provision so that when the government fails to do its job, people can bring a case of their own. People in West Virginia, Kentucky, and Tennessee did this, exposing widespread illegality by the coal corporations, from Clean Water Act violations (twelve thousand violations by one company at one mine alone) to falsified water-monitoring reports. Joe Lovett, a West Virginia lawyer who brought one of the first cases, says he “naively believed that we would just go to court, point out what was wrong, and that the United States government would fix it.”58
In four different cases, a federal judge in West Virginia found that the coal corporations, and the government that was supposed to regulate the co
al corporations, were violating the law. Mountaintop removal mining had “cracked the walls” of nearby homes and “made the air so dusty that [people] cannot sit out on the porch comfortably.” Even inside, people “cough from dust particles and their furniture is constantly layered with dust.” Judge Haden also heard testimony from kayakers who could no longer travel up a favorite tributary “because it no longer existed, having been covered and destroyed by mining activities.”
Judge Haden flew over southern West Virginia and saw the impact himself:
Mined sites were visible from miles away. The sites stood out among the natural wooded ridges as huge white plateaus, and the valley fills appeared as massive, artificially landscaped stair steps. Some mine sites were twenty years old, yet tree growth was stunted or non-existent.
If the forest canopy of Pigeonroost Hollow is leveled… and aquatic life is destroyed, these harms cannot be undone. If the forest wildlife are driven away by the blasting, the noise, and the lack of safe nesting and eating areas, they cannot be coaxed back. If the mountaintop is removed, … it cannot be reclaimed to its exact original contour. Destruction of the unique topography of southern West Virginia, and of Pigeon-roost Hollow in particular, cannot be regarded as anything but permanent and irreversible.59
Four times, the court of appeals reversed Judge Haden’s decisions and allowed the mountaintop removal and valley fills to continue. The court noted that the coal corporations, United Mineworkers, and “the West Virginia State political establishment” all were allied against the citizens groups and the Environmental Protection Agency.60 When Judge Haden again ruled that mountaintop removal and the obliteration of streams violated the Clean Water Act, the Bush administration rewrote the rules to try to make what was illegal “legal.” Judge Haden ruled that maneuver, too, was illegal because only Congress has the authority to rewrite the Clean Water Act, and “the rule change was designed simply for the benefit of the mining industry.”61 The court of appeals reversed that decision, too.
The power that leads government to encourage illegal activity is not because of the great number of jobs and livelihoods at stake. Coal corporations favor mountaintop removal precisely because it requires fewer jobs and is therefore more profitable. There are fewer than 20,000 coal-mining jobs in West Virginia today, compared to 145,000 in the 1950s. Underground mining requires many more miners than mountaintop removal mining.
The political force that obliterates the very Appalachian Mountains themselves is not driven by the people of Appalachia demanding the destruction of their homes, communities, woods, mountains, and streams for all time but from the power of corporate money. The vast majority of the people in West Virginia want mountaintop removal mining stopped now, yet not a single West Virginia politician will stand for them because of the political power of the coal corporations.62
Recently, the Environmental Protection Agency said it may begin to enforce the Clean Water Act on mountaintop removal. The coal corporation executives and hired hands went ballistic, calling this possibility a “regulatory jihad,” a “regulatory assault,” and “out of control.” Indeed, if you search the Internet on “EPA out of control,” you will encounter a well-funded corporate campaign spread out across the land, the blogosphere, the “think tanks” and “foundations,” and the airwaves.
After Citizens United, according to a leaked letter from a coal corporation executive to other coal executives, the coal corporations moved in for the kill. The letter said, “With the recent Supreme Court ruling, we are in a position to be able to take corporate positions that were not previously available in allowing our voices to be heard.” (There are those corporate “voices” again.) He suggested that representatives of the corporations meet to discuss “developing a [political-spending] 527 entity with the purpose of attempting to defeat anti-coal incumbents in select races, as well as elect pro-coal candidates running for certain open seats.” He proposed “a significant commitment to such an effort.”63
This is what government of, for, and by the corporations looks like. If we want to live with it, the American experiment in freedom and government of the people is doomed. Fortunately, millions of Americans, from the mountains to the prairies and to the oceans, too, are saying “enough!” To win change, though, people will need to be prepared for the implicit blackmail of corporations threatening “jobs” if we try to restrain or balance corporate power. For that reason, the next chapter looks more closely at the idea that we must quietly accept corporations as rulers if we want to make a living.
Chapter Five
Did Corporate Power Destroy the Working American Economy?
Crony capitalism is usually thought of as a system in which those close to the political authorities who make and enforce policies receive favors that have large economic value….
[In such a system] the intermingling of economic and political elites means that it is extremely difficult to break the implicit contract between government and the privileged asset holders.
—Stephen Haber, “The Political Economy
of Crony Capitalism”1
Since the Citizens United decision in 2010, hundreds of business leaders have condemned the decision and have joined the work for a constitutional amendment to overturn expanded corporate rights. These include entrepreneurs such as Yvon Chouinard, founder of Patagonia; Ben Cohen and Jerry Greenfield, founders of Ben & Jerry’s Ice Cream; Amy Domini, founder of Domini Social Investments; Gary Hirschberg, founder of Stonyfield Farm; Nell Newman, founder of Newman’s Own Organics; Wayne Silby, founder of Calvert Social Investment Fund, and many more.2 These business leaders are doing this because they believe that democracy, freedom, and a sustainable world depend on a bill of rights for people, not corporations. They know that Citizens United and corporate domination of government are terrible for American innovation and business.
The Hoover Institution and others have probed the problem of “crony capitalism” and how it hampers economies in other parts of the world. These studies tend to associate pay-to-play crony capitalism with Indonesia, Russia, Egypt, and other countries with less of a tradition of freedom and democracy. It may be time to look closer to home. Stephen Haber’s description of crony capitalism as an economy where “those close to the political authorities who make and enforce policies receive favors that have large economic value,” increasingly fits the American economy.
Now, even the most gifted economists probably could not definitively answer the question that titles this chapter. Nevertheless, I would suggest that two propositions are worth serious consideration: First, the Citizens United vision of American government as a corporate marketplace, where citizens are reduced to consumers, rewards old, entrenched corporations that can leverage their last-generation economic muscle to delay and obstruct new rivals. Innovative businesses and nascent industries waste precious capital trying to keep up politically, rather than economically. As with the unions, however, new businesses, small businesses, or disfavored businesses do not have a prayer in the multibillion-dollar corporate lobbyist playground or in the corporatized courts. As a result, opportunity wanes, private costs in the favored corporations are shifted out to the public or onto potential competitors, and economic vitality declines.
Second, Citizens United’s elimination of the last modest restraint on corporate power—the limitation on spending in elections—is likely to be the endgame of the transformation of our economy into one where only a few people, rather than most people, have a shot to prosper. In our present corporatist era, good wages, benefits like health care or pensions, and such notions as craftsmanship and job stability have become bad things that should be crushed. They are costs to be reduced, avoided, or eliminated altogether, rather than good things to which society might aspire. It may be hard to remember, but we used to think that higher wages with more benefits for working people was a worthy goal rather than a problem to overcome so that corporations can be more “competitive.” Now CEOs who find a way to eliminate jobs and b
enefits or destroy a union are celebrated and paid tens or even hundreds of millions of dollars, while the stock price rises and the analysts and media cheer.
Entrenched Corporations Gain Inefficient Advantage
If we accept the false metaphor of corporate money as a “voice” and the fantasy that big corporations are no more of a threat to our political life than big people, you can count on coal and oil corporations prospering and solar, wind, tidal, and geothermal energy corporations struggling. When you call government for help after coal corporations crack your walls and poison your fish pond, you can count on being told to fill in your pond and move on. And we all can count on a low-wage, low-benefit economy with a great divide between the rich and everyone else.
In crony capitalism, distorted policies corrupt and tilt markets to favor connected, rather than good, businesses. Too often the “free-market” advocates concerned about “government” or “excessive regulation” propose the elimination of regulations on even the most complex and potentially destructive businesses.3 If this argument ever made sense, it no longer does. Eliminating regulations, or obtaining regulatory advantage, is the essence of inefficient, pay-to-play corrupt capitalism.
The perceived absence of regulations is neither the absence of government nor the presence of a market economy. The choice is not between regulation and no regulation; the choice is between a government that regulates in service of the public interest or one that regulates in the service of powerful corporate interests. Sometimes it’s more regulation (as in the case of laws prohibiting Medicare from negotiating with pharmaceutical companies for market rates), less regulation (as in passing a law prohibiting regulators from regulating the derivatives market), or different regulations (as in expanding the rights of patent protection to delay increased competition and lower prices). Under any of these scenarios, government action shifts public assets and benefits to a favored slice of powerful people and interests while allocating huge costs to powerless people and interests.
Corporations Are Not People Page 12