Sunday, April 11, 2010

Adventures in capitalism and other musings about California

So tell me, why is capitalism so important that it should be neither regulated--nor simply overridden when dealing with an important utility like water, electricity or oil?

See this article about the latest financial scam where scammers prey upon gullible religious people (a favorite pastime of such scammers) and this article about a couple who have obviously leveraged their growing economic power to control what should be public water resources in much of central California.

My sense of my Hebraic brethren in the water business, the Resnicks, is that unlike the Ponzi schemers, they are legitimate and good business people who are creative and very savvy. Heck, I'd definitely like them on a personal level, especially with Lynda Resnick being a friend of Daniel Ellsberg (read her Wiki bio on the link!). Also, I could frankly care less about protecting a smaller competitor of theirs who is likely not as efficient as the Resnicks' businesses are. The larger question, and one which unfortunately would get me tagged as a commie, is why the State does not simply and completely take over the operation of water reservoirs and sell directly to the businesses that want to sell bottled water to the public or sell water to farmers to grow their crops. Late in the article there is a brief discussion of a local water board that was essentially controlled by a private interests who the Resnicks ran roughshod over through litigation (Mr. Resnick started life as a power lawyer at one or more elite law firms). One can bet the disgruntled smaller private owners were running roughshod over their workers in a myriad of ways through that association. If we simply had the State own and control the water, regulate the sale of water and ensured the people who haul the water and work the fields are paid a decent wage, we'd actually see more efficiency in the distribution of water.

To put it another way, the Resnicks were simply smarter than the hick business owners who themselves ran the place like a feudal kingdom in such benighted towns like Bakersfield and into central California. The cute analogy here is the Resnicks were like Napoleon blowing apart various royalty in different parts of Europe, who simply never dealt with someone who played the same power game much better than they did.

But the basic public policy question may be stated this way: Why is it so important for the Resnicks to be billionaires to have any efficiency in the water business?

For decades now, corporate media have promoted the idea of California as a place of liberals, Hollywood and the arts, high-tech business and generally modern living. But at best that defines slivers of the coastal region of metropolitan areas. In fact, the land mass of California is much larger than that and the culture and politics is much more diverse (even if Republicans tend to win gubernatorial positions, and little else). The eastern part of the State is more like Nebraska, in terms of fields of wheat, water, fruit and vegetables, and ironically even more feudalistic--which explains the more ugly sort of right wing politics that bubble out of this eastern portion of the State. The reality is there an economic underside of California with deeply exploited workers, wide disparities in wealth and status, and other feudalistic economic patterns that mostly ignorant politicians and more intelligent, but scheming corporate media owners dress up as "Main Street" capitalism.

See "Factories in the Fields," by Carey McWilliams (a book first published in 1939, but amazingly relevant even today), "The Great Thirst: Californians and Water: A History" by Norris Hundley, Jr., "The King of California" (about a powerful businessman who controlled the CA cotton industry) by Mark Arax and Rick Wartzman, and "Strawberry Fields: Politics, Class & Work in California" by Miriam J. Wells, just for starters. A Nader funded book from decades ago, "The Politics of Land," (1973) led by now University of San Diego Law Professor Robert C. Fellmeth, provided an update and overview of the feudalism posing as merchant capitalism in California.

Overall, if California were to have a constitutional convention, a smart, creative and knowledgeable person might connect the dots in terms of wealth and power in the Staete, and translate it into structural reforms that produced more revenue and promoted economic equality that also led to economic growth (putting money in people's hands leads them to spend after all). But of course, that is a pipe dream...and (snickering starts here) Meg Whitman, who knows nothing about this structural history of the State (and could not be bothered with voting as opposed to buying politicians while at EBay) will surely lead us with her plans of capital gains tax cuts, selling off more state owned land for one time payoffs, and of course cutting "waste" in government, as if that last set of cuts buys any more than 5% at best.

Can Jerry Brown save us? Maybe. At least he knows what I am talking about here...particularly in his establishment of the Agricultural Labor Relations Board (ALRB) of 1975, which proceeded to get gutted with agribusiness appointees in succeeding Republican administrations in the State, but still improved the lives of agricultural workers from before 1975.

Funny, this was supposed to be a short post...:-)

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