September, 2005

Fight in California Over Privatization of Public Sector: It’s What’s Happening Across America

By Steven Miller

One hundred years ago, this month, in 1905, the hottest book in America was “The Jungle,” by Upton Sinclair. This book described, in terrible and shocking detail, the squalor of the Chicago Stockyards, where America’s meat was produced. The public was horrified at a system of exploitation that drove workers so fast that their severed fingers and hands fell into giant vats of meat.

The huge outcry at adulterated meat was only half the story. The public was outraged at the picture of absolute corporate dominance of society, where every decision about community life was made by the so-called private sector. Few people recognized that government had any responsibility for the public welfare.

America in that era was, in fact, almost completely privatized. Wealth was highly polarized. If you didn't pay for it, you couldn’t get it.

By next June, 1906, a startled government was stumbling to respond to an outraged public. The federal government was forced to pass one of the very first laws acknowledging that the public had any voice in anything at all. They quickly passed the Pure Food and Drug Act, which acknowledged that public rights over health issues were superior to corporate rights. This was the beginning of the powerful push for public rights that was known as the Progressive Era, where public regulation of corporations was first asserted

In California, this movement was guided by a vision of “public works, public schools, public land, public rights and public access.” Unlike the East Coast, for example, beaches could no longer be privatized. This impulse consciously tried to extend the idea of “The Public” to its greatest limits.

Fast Forward to 2005

Under the mantra of “free trade,” corporations are once again pushing a hidden agenda to turn public property into private property. Free trade, of course, means that Mom and Pop stores are “free” to go head to head with WalMart any time they want.

Corporations around the world are forcing local governments into privatizing their functions, especially the pro-people functions. The result is that billions of dollars in public money becomes privatized — perhaps the largest transfer of wealth from the public to corporate hands in history.

The whole push is to maximize the rights of corporations over our lives. The goal is to make the idea of “The Public” extinct, driven over the brink by hoards of corporate lawyers with a Mission.

The same agenda is being played out at every level of government and in every state: corporate taxes are frozen and then cut. Suddenly governments face bankruptcy. The cry goes out to privatize all human services (even though the cost of corporate pollution, for example, is supposed to be born by the public). This is what the capitalist pundit, Grover Norquist, means when he says it is now time to drown governments like a baby in a bathtub.

Nowhere in the country is this process being driven faster than in California, led by the Governator.

California is on the brink of the most important election in the state's history. Schwarzenegger is forcing the state to spend at least $100 million on an election that the public doesn’t want.

Last year, Arnold changed the Constitution to all but eliminate Workmans' Comp and end the state's responsibility to provide medical care to injured workers. Then he tried to privatize the state's pensions for teachers, nurses, fire fighters, police and state workers. Massive public outrage forced him to temporarily abandon this one.

The Corporate Agenda

Arnold’s special election hosts a variety of “Constitutional Amendments” that paves the way to further privatization of state services:

Prop 74 — Raises the time necessary for teacher tenure from two to five years

Tenure is simply the right to due process and freedom of speech. How exactly does amending the state constitution address the financial crisis? Bill Hauck, president of the California Business Roundtable, who also chairs Arnold’s election campaign, states, “Ideally we would have no tenure and no collective bargaining.”

Prop 75 — The so-called “Paycheck Protection” Amendment

This one requires unions to get permission from every single member to spend one cent of union money in a political campaign. This, of course, prevents unions from mounting a campaign, as did the Nurses, to force the Governator's hands off the pensions. In California, corporations outspend unions 24 to 1 in political campaigns. Nobody requires their workers to give their permission first.

Prop 76 — The so-called “Live Within Our Means” Amendment

This guts the floor for guaranteed state spending on public education established in 1988. As the state’s schools fell from first to worst, the people amended the constitution to give investing in children and the future the highest priority. It also allows any governor to make unilateral cuts in the budget four times a year whenever there is a “financial crisis.”

Prop 77 — Redraws the state congressional districts next year, five years ahead of the usual date.

It also takes this power from the Legislature and gives it to a panel of three retired judges. Karl Rove has stated that the best thing Republicans can do to win in 2008 is to redistrict Texas, Florida and California.

Dueling Visions

Arnold is right about one thing: the system is not working. But the so-called budget crisis is carefully manufactured. What else can you call it when insurance corporations pay Zero (that's $000.00) income tax in the state? The Governator says he won't raise taxes (certainly not on corporations) yet California is the only energy producing state without an excise tax! This is a tax on companies that extract natural resources that can never be replaced again, like oil, gas or coal.

There’s plenty of money, but it is being redirected away from anything that benefits the public. Privatizing Social Security, public pensions, public water and public schools is now routinely discussed. These steps are promoted as positive reforms, yet they really represent attacks on public power. No one should forget how ENRON and other energy companies looted the state for $40 billion by deregulating public control of California’s electricity.

The real fight is the fight for which direction society will take. The resources of the world will increasingly be directed to become corporate holdings. Or we can rally around a vision of a new world where the public has universal access to housing, culture, income, quality medical care and education. It’s either private, corporate property or it’s public property.

Steve Miller is available to speak through Speakers for a New America. Call 800-691-6888 or email sandy@speakersforanewamerica.com