Kimit A. Muston - Champaign For Everybody

The Essays of Kimit A. Muston

Champagne For Everybody
Mar 22, 2001

I think that capitalism is swell. And not just because it's popular at the moment. I even liked capitalism when nobody was sure it was going to work out. But I have no faith in capitalism.

To the faithful capitalism can sell mountains to Mohammed. And it's failure to achieve nirvana to date is blamed on the dreaded enemy, "Big Government". And no debate regarding this doctrinaire point is tolerated.

The high priests of capitalism are always infallible - until one of them fails - and spend their days debating in arcane techno-vernacular how many M2's can dance on the head of a G.N.P., and other such abstract concepts. But never is the ability of capitalism to solve all problems ever questioned.

Except, of course, capitalism can't seem to supply affordable dependable electricity to California. In this state of affairs the free market is badly biting the very hand that freed it. In fact California is just one of a number of thorny electrical paradoxes for capitalistic true believers.

Another is that electricity created by public utilities, (defined as power suppliers owned by stockholders) generally cost 25% more than electricity generated by municipal utilities, (meaning power suppliers actually owned by the public). This flies in the face of the accepted mantra that government is the enemy of capital.

Could it be that Adam Smith, the obtuse old Scotsman who first felt the invisible hand in his pocket, was wrong? Should the entire edifice of capitalistic determinism be thrown down? I don't think so. Because I know that Adam Smith knew about the Champaign Fairs.

The Fairs were a sort of temporary shopping mall of the high middle ages in France. A town would invite merchants and bankers from all over Europe to set up in their market place, to be followed, of course, by shoppers. Everything worth anything was for sale; silks and turnips and swords and linens. The quantities were minuscule; the entire year's commerce carried by the fleet of Venice, the greatest trading state then in the world, would not have filled a single modern ocean going freighter.

But this was the first sign of capitalism since Attila the Hun conquered Rome in a hostile take-over and then and sold off its parts; what a fire sale that was. And before this infantile capitalism could be born governments had to be convinced to recreate that great Roman concept Atilla cared nothing about; infrastructure.

Promised greater tax revenues Kings and princes guarantied that people and goods bound for the fairs would get there and that money made at the fairs would get home. Roads and bridges were built or improved and troops were stationed along the highways to discourage highway robbery. Tariffs were reduced. Warehouses where imports could be stored before they became exports were built and guarded. Foreign contracts were enforced by local judges, which meant courts had to be created and paid. Hotels were financed. And sanitation was insured by hiring somebody to cart away the stuff nobody wanted to touch.

In short only after an infrastructure was created by government was capitalism possible. In 13th. century France that meant roads. In Adam Smith's 18th. century England, it meant canals. And in 21st. century America it means electricity.

What seems obvious to anyone living in California today is that a big chunk of every dollar paid for electricity in California leaves California, to fuel the outrageous profits of the out of state private power producers. The only way to hold onto California's capital is to own our own infrastructure.

There are some who will chant the old chant that is "big government" and others who will demand that any surplus be returned to the tax payers in the form of tax cuts. But is that what Adam Smith would have preached?

Smith always asked what the entrepreneur would do. So, what if you were looking to locate your factory? Would you chose a town that had just refunded 50 bucks to every taxpayer? Or would you locate your new plant in a town that had invested in its sewers, its streets and rail crossings, it's water supply, its schools and fire and police services, it's telecommunication systems, and had a reliable, dependable supply of electricity?

A California owned power system makes good capitalistic sense. Even if some Nuevo-capitalists don't understand why.

Besides, wouldn't it be nice some day to be able to tell the fat cats in Texas to kiss our megawatts, rather than having to kiss theirs?

Kimit Muston is a writer living in North Hollywood. If you have any comments about his columns,
he may be contacted at inditer.com

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