Bob Gould, 2008

Electricity privatisation: the elephant in the room
The winter of our discontent

Source: Ozleft, June 28, 2008
Proofreading, editing, mark-up: Steve Painter

This winter is the coldest in NSW for a long time. The practical effect of this is that Saturday morning stalls and protests against electricity privatisation, aren’t affected when it’s sunny, but evening meetings preparing for such activities are affected rather dramatically.

This week NSW Treasurer Mick Costa announced the latest version of the Labor government’s privatisation scheme, with his usual optimistic fanfare about how quickly it will be completed.

The plan is now for a public float of the profitable retail side of the electricity network, and the rest can come later if a buyer can be found.

Costa was silent about the terms of reference for the now obligatory state auditor’s inquiry, but he has quietly dropped the fabulous $15 billion figure for the sale of the network, in favour of an equally fabulous $10 billion, given the present state of the capitalist economic system globally.

Buried in the small print is the first of the big sweeteners. Costa wants the legislation to empower him to drop state taxes for the successful buyer. What an obscene proposition that is.

Bob and Betty Con Walker, infrastructure experts, constantly make the point that by selling the electricity assets the government is relinquishing an income stream approaching $2 billion a year, and now, on top of that the government is proposing to worsen the state’s financial situation even more by giving away any income stream from taxes on the electricity assets.

This privatisation proposal has no logic except abstract free market ideology, and clear aspirations by the main players on the ministerial side to make their alley good with the big end of town, possibly to advance their career prospects after they leave politics.

Even that’s a dubious proposition at the moment because the Iemma government’s popularity has hit rock bottom in the polls, and the bourgeois press have given up their mild flirtation with Iemma over electricity privatisation in favour of ruthless political attacks on the government.

As the tough-minded Labor backbencher from Camden, Geoff Corrigan, is reported to have said in the caucus recently, the government is living in a fool’s paradise and unless it changes tack dramatically on a number of questions it will lose the next election.

The Labor Party in NSW is now totally polarised between the Labor ranks and the unions on one side and the ministerial rump of the government on the other.

This division is now acute and apparently unbridgeable in both the left and Centre Unity factions. The situation has been made worse for the ministerial rump by the quasi-accidental conflict and media frenzy over a blue between the Della Bosca family and the staff of a restaurant. The media have turned this into a kind of international incident and have given it about 10 times more exposure than, for instance, the crisis in Zimbabwe.

There’s little sympathy in the Labor ranks and in the trade union movement for Belinda Neal, who is widely regarded as abrasive and overbearing, and many in Labor an union circles have experienced that. (Nevertheless, a group of women Labor MPs and the two female Greens MPs in the NSW parliament are kind of defending Neal, pointing out that the media wouldn’t have had such a field day if she was a bloke.)

There’s a certain amount of sympathy for Della Bosca, who is a fairly mild-mannered, courteous and well-liked individual both in his own right faction and on the left.

The political significance of the parliamentary destruction of Neal and Della Bosca is this: in the electricity crisis, Della Bosca was trying to conciliate between the ranks of the labour movement, political and industrial, and the ministerial rump.

He was even the butt of the now rather notorious YouTube video, Della’s Downfall, which appeared to emanate from the ministerial rump because of his attempt at this conciliatory role.

The events of the past few weeks have just about finished Della Bosca’s usefulness as a buffer, and no one else appears to be able to play that role.

Quite a few of Della Bosca’s large network of personal friends and supporters are suspicious that the ministerial rump has played a role in his difficulties, and they have quietly crossed over to the rank and file side in the coming collision with the government. I’m inclined to reject conspiracy theories, and I don’t think any conspiracy on the Labor side led to the events in the restaurant, but even if it was an entirely accidental event, it has contributed to the polarisation in the Labor Party and the unions.

Last night was the traditional drinks at parliament house sponsored by the left ministers to raise funds for the semi-annual newspaper of the Socialist Left, Challenge.

These are usually large events of about 200 people jammed into the pleasant old Parliament House library room.

These days myself and my friend Jenny are members of the Socialist Left. We pay our annual subscription to Challenge, which constitutes membership, and go to the meetings of the faction, which are infrequent.

I’ve never formally been readmitted to the Socialist Left. Back in 1969 I was expelled from the Steering Committee, the predecessor to the Socialist Left, for having the hide to absent myself from the Steering Committee’s meeting before a Labor conference and then violating the reactionary decision to drop the withdrawal from Vietnam espoused by Arthur Calwell in favour of Gough Whitlam’s new policy of negotiation.

I committed the unpardonable sin of moving an amendment on the floor of conference and getting 90 per cent of the left vote and a considerable slice of the right vote as well to reassert the Calwell policy, and we forced the matter to a count, in which Whitlam’s policy won only by a few votes.

I was the obvious scapegoat. The Steering Committee chiefs had difficulty touching Stewart West, who seconded my motion, because he was at the time president of the waterfront union in Wollongong. He later became a federal minister. The Steering Committee left West alone because they didn’t want a war with the unions on Vietnam.

To the best of my knowledge, I was only individual ever expelled by the old Steering Committee, and I’m rather proud of that.

A few years ago I quietly started going to meetings of the Socialist Left and paying the annual fee, initially with a certain amount of trepidation, but no one ever raised the issue of my expulsion from the previous organisation.

Despite this, I’ve generally avoided going to the Challenge events, because Challenge still leaves a rather bitter taste in my mouth. In the early 1980s my close friend Jenny led a successful insurgency in the nurses’ union, was elected general secretary and fought the good fight in a five-year stint in that role, and for many years thereafter as secretary of the biggest branch of the nurses’ union.

Jenny led the battle against offsets being imposed for righteously claimed working conditions such as the 38-hour week, and the struggle against the closure of inner city hospitals, and particularly the closure of psychiatric hospitals, and institutions for the developmentally disabled. The closures were buttressed by all kinds of phony liberal rhetoric.

This involved her in an industrial and political battle with the official left of the time and the left ministers of the time who went along with the government on all those questions.

That battle culminated in 1987 during a bitterly fought nurses union election in which the right and left officials ganged up defeat Jenny and her team. Challenge did an elaborate hatchet job on Jenny and myself and our political and personal association. This article was used by the right-wing team in the election. Understandably, I’m even now a bit wary of getting too close to Challenge.

The Challenge event last week, however, required a different approach. A couple of players on the left who saw that Jenny and I had registered for the event rang to say I should go along and play the hard cop and raise the matter of electricity privatisation with the deputy premier, John Watkins, who by tradition introduces the proceedings and makes a bit of a speech.

The people who rang me said the circumstances were difficult because the left unions had decided to boycott the event, and I was inclined to their view that vacating any field is usually a tactical error. However, after seeing what happened at the event, the left unions were probably right.

The event was much smaller than the one last year, according to people who attended both. The left unions were largely absent and another group noticeable by their absence were the young, slightly career-oriented people on the left, some of whom work for unions and others for left ministers. A lot of these people are a bit like Pavlov’s dogs in the present situation. Mostly, their instincts are to oppose the privatisation, but those instincts are moderated by career considerations and not wanting to be offside with whoever they work for. They’re caught in a kind of crossfire.

In tense situations like this they often absent themselves from areas of conflict, which is a fairly natural response.

Also notably absent were the staff of federal left ministers. Most of these people also instinctively oppose the privatisation, but they’re not stupid and they’re well aware of the pressures in the federal left to make a bit of a show of opposition but ultimately acquiesce in the privatisation.

It’s to their credit that a lot of these people aren’t overly keen on that approach, although their jobs and career aspirations are largely dependent on the left federal ministers they work for. These are some of the cross-currents and factors at work.

Such conflicts are sharpened by the day to day chop-chop in the state caucus. It’s widely rumoured that the leading left personality in the state caucus tried to intimidate the backbenchers who are determined to cross the floor against electricity privatisation and in support of Labor policy, by suggesting they would be regarded as Labor rats, which is pretty rich because the real Labor rats are the people who are defying conference and moving to sell public assets.

At the gathering, deputy premier John Watkins introduced the proceedings, fulsomely praising the work of all his fellow left ministers, but said nothing about the privatisation proposals. A young woman, well-known around the left, who works for Unions NSW, yelled from the back towards the end of Watkins’ speech: “What about the elephant in the room, the electricity privatisation?” And on the spur of the moment, because this was clearly the best opportunity to raise the issue, I called out something similar.

Watkins’s response was a bit of rhetoric about collectivism and the maturity of the Labor left, that the privatisation issue had been discussed elsewhere and he didn’t intend to discuss it at the gathering because it was divisive, and anyway he had to be at a school event for his daughter at 7pm (a rather feeble excuse, as the House was sitting next door).

A couple of minutes later Watkins wound up. I asked if he was going to take questions, but he raced for the door and fled. So the little plan for me to play hard cop didn’t get far because no questions were allowed.

Nevertheless, my friend and I put the rest of the evening to good use, spending a bit of time lobbying those of the left ministers present who I know, which is just about all of them. I made the point that by failing to take a public stand they risked going down with the Costa ship.

I put the same argument to several left backbenchers with ministerial aspirations, who so far have not come out with a forthright commitment to cross the floor.

They all, ministers and aspirants, asserted their strong personal opposition to the privatisation and several said they would cross the floor if it could influence the result. That, of course, is a circular argument, as must be obvious. They’re much more likely to influence the result if they publicly declare that they will cross the floor.

I put to all of them that they needed to form a cave unless they wanted to go down with the sinking ship, and they needed to sink Costa’s crazy scheme by quickly making a joint public declaration against the privatisation and declaring their intention to cross the floor.

They were all pretty courteous, although in such situations they can see me coming, and they all said they might consider doing what I said.

They are politicians, however, and their behaviour will be dictated partly by personal conviction and partly by their own estimate of their political interests, which is why the labour movement in NSW as a whole has to set some sort of deadline for all politicians who are undecided about what they will do, linking the question of political principle to the likely consequences of not adhering to political principle.

In this context, I’m told on good authority, the senior Centre Unity privatisation opponent in the Labor Party is chafing at the bit to charge Costa with deliberately violating party rules by introducing the privatisation legislation into the parliament.

After careful consideration, I agree that now is the time to charge Costa under the rules. So far I’ve been cautious about general propositions to charge Iemma and Costa, firstly because I’m not keen on charging members of the Labor Party simply for expressing ideas.

Conservative forces have hegemony in the Labor Party nationally at the moment, and they’re more likely than the left to charge people over ideas, and succeed.

In view of the extraordinary circumstance that Kevin Rudd seems to be able to throw anyone out of the Labor Party without due process, simply because he doesn’t like their language, I prefer to limit any action under the rules to real acts against party policy.

Another factor in my thinking has been that in a conflict of this sort it’s necessary to carry with you the party ranks, the trade union leadership and ranks, and the general Labor constituency, and none of these people like splits, although they are willing to contemplate a split if the vital interests of the labour movement are affected, as they are in this situation.

The issues in this conflict have been very widely discussed in the community and the broader labour movement, and a decision has been made by conference by about 700 to 100. The gravity of this situation is highlighted by the fact that the ministerial rump has even started to prepare the ground, legally, for their resistance to the whole labour movement.

The ministers have been waving around a legal opinion that somehow the seven to one decision of conference was not legal because of some specious technical issue.

This so-called legal opinion underlines the contempt of the ministerial rump for the labour movement, but it also indicates that they are preparing the ground for some kind of split.

In these circumstances, they must be challenged head-on, and now is the appropriate time for that.

The broader labour movement is solidly united against the ministerial rump, and if firm action is not taken now, by charging Costa for a deliberate act, we run the risk that the ministerial rump will win by default.

The time for action is now.

On a related matter, Garry Mclennan asked on Marxmail in response to a previous post of mine, how widespread was the threat of MPs crossing the floor.

My upper estimate is 15 or 16 between the two houses of parliament, with another 20 or so saying they might cross the floor in some circumstances.

Garry also asked about the electoral prospects if a split were to take place, and he made a comparison with Queensland in 1957. This comparison has also been made by some people on the Labor right, who are caught between their ideological agreement with the ministerial rump and their personal commitment to the Labor Party as the organisation in which they’ve spent all their lives.

They say the electoral result of a split would be inconclusive, as it was in Queensland, with the ranks and the labour movement having a majority and the ministerial rump retaining a considerable number of seats.

I think that’s electoral nonsense. If a split were to take place, the situation is not like Queensland in 1957. The Gair ministerial rump had a fair amount of residual electoral support in rural and provincial areas, which is where they held some of the seats in the split election.

The Gair government was in fact relatively popular before the split. This Costa-Iemma government is on the nose with the whole electorate, recent polls suggest.

Electricity privatisation is poison with the NSW electorate, particularly in the bush, which explains the opposition of the Nationals to the sale.

If a split takes place in the traditional working class heartland of Labor in Sydney, the South Coast, Newcastle and Lithgow, the ministerial rump will be wiped out electorally and replaced overwhelmingly by genuine Labor representatives.

It’s not even excluded that genuine Labor in NSW would emerge with a governmental majority in the lower house, in combination with independents who also oppose the sale.

In 1921 the Storey Labor government was elected in NSW even after the electoral bloodletting of the conscription split. On balance, Labor might hold government in NSW or lose it, but the ministerial rump would be annihilated along with the festering legacy of the Terrigal group, who are in practice a far worse menace to the labour movement than the Groupers were in the 1950s.

The Terrigals are worse than the Groupers because the Groupers, despite their reactionary anti-communism usually adhered to some basic Labor traditions, such as preserving natural monopolies like electricity. The current ministerial rump in NSW are far more like Billy Hughes, William Holman and Joe Lyons, rather than the old Groupers.

It goes almost without saying that the whole labour movement has to crank up the campaign against electricity privatisation in every way possible. Unless there is a strong campaign the ministerial rump may win by default.