A month after the storm, volunteers were still delivering pallets of drinking water to 50 separate apartment complexes in Austin. Most of the residents were charged full rent.
How (and Whom) the Market Failed
Winter Storm Uri’s devastation is the result of a long chain of utterly predictable failures: rushed construction, the non-enforcement of already weak safety regulations, just-in-time production, and capitalists’ collective inability to pay attention to any long-term prediction that threatens short-term profits. The state had a week to prepare for the storm and did nothing. For a decade, they knew that a storm like Uri would come, yet they ignored the warnings.
This is not a matter of mere incompetence. Capitalism incentivizes profit, not disaster-preparedness-for-its-own-sake. Capitalist infrastructure is at once haphazardly organized and prone to domino effects; one disruption in the chain affects everything else. The storm hit. The crude oil wellheads froze. Ice blocked natural gas pipes and knocked coal plants offline. The wind turbines didn’t spin—not because wind power doesn’t work in cold temperatures but because Texas energy providers didn’t bother to buy warming kits. The Electric Reliability Council of Texas (ERCOT) pulled power from 3 million households in order to keep power flowing to hospitals, fire departments, and police. Across the state, lights flickered then died. Water mains burst. Water filtration plants malfunctioned. Even with the power diverted, hospitals struggled to stay open with neither heat nor running water. Hospital staff were instructed to fish their own feces out of broken toilets. Seriously ill patients were discharged. Children froze to death and burned to death. Patients died trekking through the snow on foot towards dialysis clinics. Those battling COVID at home watched the needles of their oxygen tanks tick towards zero. Statewide, the final death toll from the storm itself was 111. The death toll from the storm’s long-term effects will be far higher.
Yet this is not an example of capitalism in crisis. It’s an example of the system at work. As people froze to death, Comstock’s CEO explained to investors how they “hit the jackpot” by selling natural gas at massive markups: “Frankly, we were able to sell at super premium prices for a material amount of production.” That’s just how it goes. Some capitalists win, other capitalists lose. Devastation, however, is always outsourced to the public.
The Limits of Liberal Explanations
Because their diagnoses assume capitalism must be preserved, commentators and pundits have kept the roots of this crisis buried using an often-contradictory “Texas exceptionalism” to explain away the disaster. The “Texas exceptionalism” thesis contends that incompetent Texas Republicans have created an ideologically separatist, Wild West capitalism responsible for the failures during the storm.
But there is no such thing as a special Texas-type of capitalism. Capitalism is capitalism. Texas exceptionalism is dangerous schadenfreude because it assumes ideology is more impactful than the norms of capitalist production, distribution, and reproduction. There was nothing particularly exceptional about how the capitalist state functioned during this crisis. Texas is not an outlier. It’s a canary in the coal mine. Not only is capitalist production driving climate change, but states are not prepared for the organizational challenges that climate change presents – blue states included.
If we want to understand this crisis so we’re not doomed to relive it, we have to abandon Texas exceptionalism’s main propositions. These include:
ERCOT is incompetent:
It has been argued that ERCOT’s incompetence caused the crisis. However, ERCOT’s function is to ensure profitability, not public health and safety. Since February, the Electric Reliability Council of Texas (ERCOT) has become a household name. Ostensibly, ERCOT’s job is to oversee the delivery of electricity to consumers and ensure supply meets demand during peak usage. Its decision to implement blackouts left millions without power during the freeze. ERCOT has defended its decisions, arguing the system was moments from months-long collapse (as if ERCOT had no hand in the grid edging so close to collapse). Though ERCOT deserves the harsh criticism it has received, complaints about its alleged incompetence obscures the nature of what ERCOT actually is: a private consortium of energy executives and political appointees whose job is not to monitor the grid’s reliability but to make sure the rules reliably work in favor of large, energy-producing corporations.
Grid failures are, of course, a problem for capitalist energy consumers, as well as residential consumers. But while smaller energy companies went bankrupt, Winter Storm Uri was a windfall for larger firms like Comstock. Natural disasters wipe out some sectors of capital to the benefit of others. While smaller retail energy providers folded or had to declare bankruptcy, energy generators made money hand over fist. In a wider sense, the Financial Times reported on how Bank of America (and Wall Street more generally) gained hundreds of millions in trading revenue due to the failed grid.
ERCOT certainly failed average Texans; however, it did not fail its main constituency, the multinational networks of capitalists who profit from Texas labor and land.
Texas separatism caused the crisis:
Pundits have widely argued that separatist ideology—a spiritual inclination towards secession, if you will– led Texas to create an independent grid vulnerable to shocks and, as a result, when the storm hit, there weren’t enough high-voltage DC transmission lines or variable frequency transformers to connect Texas to nearby grids. This is incorrect.