Crescent Dunes: Another Market Failure the Taxpayer Pays For

Crescent Dunes Nevada

Richard Mellor

Afscme Local 444, retried

Both President Trump and his sidekick Pence have proclaimed that the US will never be a socialist country. They really mean social democratic which is a far cry from an economy being socialist but still.

In reality, the US is a “socialist” country when it comes to subsidizing capital. There are numerous examples of how “socialist” the US is using its own definition, government hand outs. There is Congress where the members of the two capitalist parties enjoy wages, benefits and conditions even the French public sector workers would envy.  There are the sports stadiums, that are built with public backing and the taxpayer even guarantees so many seats will be purchased whether filled or not. The rail and energy industry received free land for tracks their trains to run on, free either side of the rails for 20 miles across a whole continent. The auto bosses would receive similar deals a century later as the taxpayer coughed up for a national freeway system, the tracks on which their autos would run.  The free enterprise system is not so vibrant is it.

The capitalist class does very well from government spending. The forever wars are good for the investors in the offense industry. As long few US workers die, the public will be pretty much pacified. But the most important developments of the day have all been developed through public means; the Internet, life saving drugs and so on. The research is socialized, the profits privatized. This is a smart move for the owners of capital; they use their government wisely.

I see that the Nevada’s $1 billion Crescent Dunes solar project, a structure of ten thousand mirrors two miles wide between Las Vegas and Reno which began operations in 2015, is now obsolete. As of this year it only had one customer according to Business Week, Warren Buffet’s NV Energy Inc. and NV Energy has pulled out.

And this was public money that was lost here because the loans the private developer, SolarReserve took out to build the project, were guaranteed by the government. The capitalist, unlike the miser, wrote Marx, doesn’t try to protect money by hoarding it. The capitalist is adventurous, takes a risk, throws it in to circulation with the intention of more money returning than they forked out. That doesn’t mean they pass on a free lunch though, and having the taxpayer cover their losses if their investments turn sour is something they can’t pass up so they’ll swallow their pride and take the deal. Principles are hard come by when it comes to capital accumulation.

With Crescent Dunes, the US taxpayer is on the hook for $737 million in loan guarantees according to Bloomberg.  Apparently, solar energy technology has increased so rapidly in 4 years that the Crescent Dunes plant is now inefficient. It’s hard to accept that this situation just up and surprised the folks making all the decisions, after all, the same politicians, experts and capitalists that run the show are the same folks that send probes and humans in to the cosmos. The whole space business is a huge government hand out to private capital.

Another disastrous situation contributes to this mess, and that is the politicians of the two Wall Street parties being guardians of our public land. The one time Senate majority leaders, Harry Reid ensured that this monstrous project could be built on public land. The truth is, they are guardians of public lands as they relate to commodity production, how they can be a profitable venture. The US predator in Chief has just opened up hundreds of thousands of acres of public land in California to mining and energy companies. All the talk of saving the environment and caring about our world from the US state department and other mouthpieces of the business world are phony. The indigenous people should be the first choice in leading the guardianship of public lands but we saw what happened to them at Standing Rock.

So with Crescent, the reliable ole US taxpayer has taken over the project as the private company that built it has gone to court to repossess it. We should recall that socialist measures were used to drag capitalism from the abyss back in 2007. Huge swathes of industry were nationalized although the term used in the mass media was “conservatorship”. The same process occurred with the Savings and Loan debacle a crisis that arose because of legislation introduced by both Democratic and Republican parties. The debt of the S&L debacle was nationalized and a government agency, the Resolution Trust Corp., created to facilitate cleaning up the mess. The worst S&L’s were thrown out and the best of them sold back to the private sector that caused the problem at bargain basement prices.  One person went to jail.

Important social needs like energy, transportation, education housing and so on, cannot be in private hands and their development determined by the profit motive. The public at large, the worker, the consumer, the small farmer and so on, are not included in such decisions and only through including the great mass of the people whose lives are dependent on such things can the worst mistakes be avoided. Profit should not enter in to it and with private capital it must. If studied closely, the market is a catastrophic failure.

We live in a capitalist system. The politicians that make legislation that affect how we live our lives make those decisions primarily on the basis of how much profit will arise out of them. This aside, it is still a step forward and generally more efficient in human terms if how we produce energy and where, are public sector decisions. Workers have no party and independent voice in the body politic at this point and in the last analysis the government will represent the interest of capital and defend the system, but we have more input and control than if these decisions are made in the boardrooms of major corporations. It is a small step to a genuine democratic socialist system of production and planning, it is psychologically important in that it undermines the private sector and the propaganda that the market is the answer to all things.

Readers may recall the collapse of Solyndra whose plant is not far form where I sit. That company filed for bankruptcy in 2011 and the taxpayer backed $535 million in loan guarantees there. These are just two limited examples of the failure of the so-called free market. There are many more examples out there from the fires in Australia to the plastic in the oceans and the homelessness and mentally ill we see sleeping in the streets. And then there’s the $2 trillion in forever wars. And that’s just the US. And we can’t solve world hunger?

The failure of these two ventures has dumped almost $1 billion in the US taxpayers’ lap. What would you do with that? How long will the US working class allow ourselves to live in a society where they have no real say in how the wealth and resources of that society are used?  Sooner than later I hope, we are running out of time.