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Walker’s Attempt to Privatize Energy Would Slash Wages and Cost Wisconsin in the Long Term
The events in Wisconsin have focused largely on public employee union members, most notably teachers, and their battle for collective bargaining rights. The private sector, though, has rallied in solidarity with the public sector, flocking to Madison waving IBEW flags and sending pizza from New Hampshire, for instance.
Yesterday, a little-discussed provision in Walker’s maligned Budget Repair Bill surfaced on Rortybomb which had discovered it on ginandtacos.com. The provision, 16.896, directly impacts the private sector through the shifting of state energy assets to no-bid contracts. No-bid contracts, as defined by Wikipedia, “imply that there is only one person or company that can provide the contractual services needed, and any attempt to obtain bids would only result in one person or company being available to meet the need.”
Certainly, this can not be the case for Wisconsin’s power facilities.
According to Abraham Breehey, Director of Legislative Affairs for the International Brotherhood of Boilermakers, Walker’s 16.896 provision would “privatize the currently state-owned power plants and boilers at the University of Wisconsin as well as the small power generation facility that provides heating and electricity to the state capitol complex in Madison.”
While the sale of these particular assets would not constitute a full-scale man-hour drain on Wisconsin’s construction unions, Walker’s motivations for such a move are what are being called into question. It is another example of the larger story of essential services being either eliminated or privatized. On the potential “budget repair” that this aspect of the bill could provide, Breehey had this to say:
“The Governor is arguing that the production of this energy would be cheaper if it were sold off and operated by someone else. That makes sense for him, if he’s trying to close a one-year budget deficit, but in the long run it is an absolute deficit creator. Right now the state sells power back to the grid during the months when the boilers produce extra energy, and that is revenue that Walker is forfeiting if he privatizes these facilities. The state will end up having to buy this power back on the open market. Right now, the State of Wisconsin produces the power it needs to keep the lights on at the Capitol and the University. It is hard to imagine a scenario where paying a private entity to do the same thing saves money in the long term.”
The no-bid aspect of this is drawing the ire of the Big Business wary. As Rortybomb writes:
It’s important to think of this battle as a larger one over the role of the state. The attempt to break labor is part of the same continuous motion as saying that the crony, corporatist selling of state utilities to the Koch brothers and other energy interests is the new “public interest.”
Ed at ginandtacos, who initially broke this story, calls the 16.896 provision “a highlight reel of all of the high-flying slam dunks of neo-Gilded Age corporatism: privatization, no-bid contracts, deregulation, and naked cronyism. Extra bonus points for the explicit effort to legally redefine the term ‘public interest.’”
Breehey, who to his credit reserved judgment as to where the no-bid contract might fall, noted: “Usually when you put a no-bid provision into law, you’ve already got someone in mind.”
DailyKos and others weighed in on the link between Walker and the billionaire Koch brothers.
But, regardless of whether or not Walker’s move can be linked to corporate donors, the sweeping impact of this measure comes in the form of reduced wages for construction workers.
Breehey:
“The impact of this for the Building Trades, or whomever ends up with these jobs in the event this passes, is that when crews goes in there today to do maintenance on these boilers, they are paid prevailing wages. This provision would remove the prevailing wage.”
While a no-bid contract for state energy assets does not guarantee a job-loss for union construction, Scott Walker’s relationship with the Associated Builders and Contractors, a notorious anti-worker lobby, increases the likelihood that unions will lose these contracts under the new law.









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