The capitalists say that in 2016 everything is going to get better. Even with the crisis in oil production, they say everything will be “okay.” Here in Texas, they are saying we will have yet another boom, saying it is like one we have never seen. They call it “I smell oil.” What they really mean is “I smell money.”
Crisis in Oil
Texas is no exception to the basic economic laws of capitalism. Capitalism is not continuing to expand. In fact it is dying. Ever since the 1970s, when capitalism still needed thousands of workers, we also witnessed the oil crises during those years, with the cyclical crises of overproduction in the oil and gas industry. We have seen these booms and the busts in the oil industry of the 1970s to the 1990s here in Texas. It was these very crises that forced the capitalists to advance the means of production in the oil and gas industry, to enable the U.S. to compete with Middle East oil production.
There is a now a glut of oil on the world market. The U.S. used to import 65 percent of its oil. Now it imports only 40 percent due to increased U.S. production. This became possible with the new methods of gas and oil extraction, which uses new technologies to extract oil horizontally rather than vertically, a method called “fracking.”
The master mind, known as the “Father of Fracking” was Texas oil billionaire George Mitchell. He needed to figure out how to squeeze more oil from each well. As a capitalist, he wanted more money, more profit, and he did that by working the workers to the bone and beating the competition. He invested millions of dollars to perfect his system of hydraulic fracking to extract oil and gas from shale. At the time, it was a very dangerous technique. The process to unlock the previously unreachable reservoirs of oil and gas revolutionized the oil and gas industry.
The oil and gas industry is responsible for almost 13% of all the economic activity in Texas, but because it is so central its impact is much wider. Just in West Texas, there is enough oil and gas to run the whole world for two years. These days, drilling for oil and gas is easier, faster and most of all cheaper. Modern oil geologists examine the terrain and the surface with the help of satellite images for drilling and maintenance. They have also advanced, using the fracking drilling method, where drones are used to repair off shore oil platforms.
The federal government has done all they can to help the oil industry. They have given billions in subsidies and tax credits. The Environmental Protection Agency has exempted the practice of injecting fracturing fluids from EPA drinking water regulations, through an exception inserted into the Federal Energy Policy Act of 2005.
In some towns there are hundreds of wells inside the city limits. The quality of air and water are in question. In 2014, Denton Texas, just outside of Dallas became the first city to ban hydraulic fracking. The response immediately showed how the state protects the interests of the oil and gas companies. In 2015, the pro-fracking forces, led by then governor-elect Greg Abbott got a new law passed that strips cities and towns of the power to impose limits on fracking, or to limit the number of oil wells, or to sue companies for damage to their community. Abbott said that this legislation “was necessary to protect the oil and gas industry from the heavy hand of local regulation.” Community groups, including Earthworks and others, have been fighting for reform ever since.
The price of oil has been falling to new lows. Advanced technology in production eliminates jobs and then cuts in production to protect profits eliminate what’s left. Oil wells produce 24 jobs, so if you have 1000 working wells, you have 24,000 jobs. There were 840 active rigs in Texas in January 2015. They were cut to 321 in 2016. In Eagle Ford Shale, the field that arcs across South Texas, where most of the fracking takes place, the number of active rigs has tumbled from 200 to 76.
Economists, scientists, and professors all say Texas will rebound because of the $300 billion that national and global corporations are investing in the petrochemical industry. They say the building of new refineries is pumping money into “Down Stream,” benefitting those who are working in the the refining of petroleum crude oil and the processing and purifying of raw natural gas. The capitalists say this is going to make up for the loss of jobs that come with the loss of wells in production, when in fact, oil is cheap. The ones who benefit the most are the oil refineries and not the consumers at the pumps. Most of these jobs are done with advanced technologies and a limited number of skilled workers.
New Class and the Struggle for Survival
Texas is number one in almost everything from exports, Christmas stores, crops, oil and the number of executions. It is last in all of these areas: women with health care, the percent of the population with health insurance, on per capita spending on mental health, tax expenditures per capita (47th out of 50 states), people covered by Medicaid (48th), employer provided health insurance (48th), workers compensation coverage (50th), average credit score (49th).
The disparity, the polarization between the rich and the poor, is growing. It seems like it might not exist to the privileged eye, but it’s there, and here in Texas, it’s a reality for so many people. Texas is the second largest oil producer in the world, where many of the world’s leading oil producers are located. A 2015 report from the Houston American Bar Association found the Houston area contains 4 of the 10 wealthiest communities in Texas. Houston is also where 38% of the children live in poverty and Harris County (where Houston is the county seat) has the highest rate of uninsured in the nation, more than 1 million in the county alone.
Like the book by Charles Dickens, A Tale of Two Cities, we have a section of society living the rich life and a huge section that is barely surviving. The gap between the rich and poor is wider than ever in Texas. Texas has 59 billionaires, according to Forbes Magazine, the 5th highest in the country.
All are them are living at the expense of a new class of workers that has no ties to capital that is multiplying by the thousands every day throughout Texas. This new class stretches from East Texas to the Southern regions. In these areas, there is not only low employment, but poverty, hunger and homelessness – the consequences of an economy that is rapidly replacing human labor with the computer and the robot. From the colonias here in South Texas, to the suburbs of Houston, Dallas, San Antonio, Fort Worth, this growing class is young and living paycheck to paycheck. It is projected that by 2020 robots and automation will eliminate 5 million jobs globally, from the lowest paid jobs such as service and office work, to the more well-paid such as healthcare, manufacturing and production, extraction and others. A study by the Bank of England last year placed the figure much higher, at 80 million jobs in the U.S. alone.
The U.S. Department of Agriculture recently reported that 18.8 % of Texas households couldn’t get enough food to meet their needs. Only the state of Mississippi at 19.4% had a higher percentage. A 2011 report released by Texas Hunger Initiative and Feeding Texas shows that East Texas counties, such as Dallas County, have over 400,000 people with unsteady access to food, or 19% of the population. In Collin County, there are about 100,000, or 14% of their population. And in Denton County, it’s 15%, which is almost 90,000 people.
Out of 254 counties in Texas, only eleven are above the poverty level. That means that the rest of the 243 counties are below the poverty level. They are ordinary people, who have been pushed to the margins of the economy.
We have seen more layoffs, as well as wage reductions and cuts in, or elimination of, health insurance for the workers that are still working, affecting the average Texas workers. People are losing their housing, their cars, and other essentials. The undocumented, the poor and all types of everyday people are struggling daily, just to survive, under conditions of fear. The founder of Mothers against Police Brutality in Dallas, Mrs. Collette Flanagan, laid it out straight about the police, “We don’t care about you coming to our community and having a barbecue and drinking soda with us. We want you to stop killing our kids.”
With the elections at the midway point, Texas ranks second to last in voter turnout. The new class is developing. It is being attacked by the ruling class, as they keep us divided along color lines. Things are getting worse and more tense. The capitalists divide the class by claiming those who are poor like to live off welfare, and that those working are supporting them. All the propaganda that’s put out through the media tries to convince the public that immigrants have no right to be here, and that the undocumented are blamed for the lack of jobs. The new class and its developing struggle for the basic necessities of life, for a life without fear, is something new. Revolutionaries show that the struggles against the police, within the Democratic Party and other fronts are part of the developing movement for changing society as a whole.
A Vision and a Solution
Based on this objective situation, revolutionaries must entrench ourselves into this spontaneous movement, from the elections to the fight for water, against homelessness and poverty, against police brutality, etc. We must have the patience to understand its motion and direction, so we can reach this new class with an understanding of the problem and the way to solve it – a new society where what we need is distributed on the basis of need.
We can see that things are moving in Texas like never before. There are also dangers with these opportunities, like anything in life. We are positioned in the right areas and every day new revolutionaries are being born and pushed into the struggle for survival. We have developed the League of Revolutionaries for a New America to train these new fighters and have them ready for the next level of the struggle.
May/June 2016 Vol26.Ed3
This article originated in Rally, Comrades!
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