Neoliberalism, Climate Change, and the 2021 Texas Power Crisis
Katelyn
Buckley
March 22, 2022
Miranda Hazoury

In February 2021, a series of unusually severe winter storms sweeping across the southern United States created a massive electricity generation failure in the state of Texas, resulting in critical shortages of water, food, and heat. More than 4.5 million homes and businesses were left without power, some for several days. The resulting $18 billion in damage in Texas and surrounding states stemming from frozen water pipes that burst inside hundreds of thousands of homes, as well as schools, museums, churches, and businesses, proved devastating: homes rendered uninhabitable, businesses destroyed, lives upended, and tens of thousands of people made homeless. Months later, the Lone Star State still faces a long, hard road to recovery. 

Many media pundits expressed surprise at this ‘out of the blue’ event. Yet, the disaster came as no surprise to climate scientists who have linked an increasing frequency of these disastrous extreme weather events to a worsening climate crisis. And, as a deeper dive into the lack of preparedness in Texas demonstrates, state leaders were well aware that this kind of catastrophe could occur.  Even so, they chose to privilege the profits of the oil and gas industry over public safety.  In short, the politics of neo-liberal government deregulation of the electricity sector created the conditions by which a winter storm would result in a social calamity.

This was not the first time, either. In 2011, a similar storm caused freezing temperatures, power grid failures, and subsequently, an economic shutdown. It was clear that inadequately “winterized” power systems were to blame. The utilities simply refused to spend the extra money required to “winterproof” the state’s power plants and energy infrastructure. At that time, scientists and local activist groups called for legislative action to winterize energy plants and enforce safety regulations. Unsurprisingly, the issue was largely swept under the rug by the state’s power structure -- a collection of state and federal officials in the pocket of the polluter-industrial complex in general, and the oil and gas industry in particular. Some Texas politicians cited the storm in an effort to ‘debunk’ climate science - one of Sen. Ted Cruz and Rep. Dan Crenshaw’s favorite party tricks. They claimed that cold weather must disprove climate change! Rather than investing in winter-appropriate upgrades to the power grid, politicians instead weaponized the disaster to blatantly advance their own anti-climate change agenda. Governor Abbot even warned such disasters would be commonplace if a federal Green New Deal agenda was adopted in the United States (never mind the fact that winter-proof wind turbines are used successfully elsewhere in the country).

In clearing up this misconception we must make a distinction between weather and climate change. Unexpected bursts of cold weather in a typically warm area do not refute the validity of climate change. In fact, they are one of the signs of escalating climate change as historical weather patterns are disrupted by increasing warming and rising ocean temperatures. Only long term trends across regions can reveal information about climate change, while isolated weather events within a small area cannot. Studies of global temperature increase over decades show the reality: global temperatures are projected to hit a 1.5 degree Celsius threshold in the next few years, which will soon bring us beyond ‘tipping points’ and make the effects of climate change irreversible. 

Climate change is happening - and Texas saw the consequences firsthand. While a winter storm may seem counterintuitive, Texas’s ‘freak storm’ was caused and intensified by global warming. Arctic warming is weakening the polar jet stream that keeps cold air in the upper latitudes of the northern hemisphere, causing spouts of unusually cold weather to reach into the Deep South of the U.S. Global temperatures are increasing overall, but countless other consequences of climate change are as well.  Texas’s highly deregulated, unwinterized power grids and steadfast reliance on private fossil fuel companies are a direct product of the consolidation of corporate power by the oil and gas industry and misinformation campaigns on the science of climate change.  

Ignorance set the stage for power grid failure, but its roots are deeply embedded in Texas’s energy system. The U.S.’s lower 48 states operate on three power grid systems: the Eastern Interconnection, Western Interconnection - and the Texas Interconnected system. The last provides 90 percent of the state’s energy. While Texas is not completely isolated from these other grids, the state is essentially an ‘electrical island.’ The Electric Reliability Council of Texas, ERCOT, has notoriously rejected federal regulations on the Texas interconnection since the 1930s, largely to stay beyond the reach of the federal government. Lack of regulation over the energy market has incentivized competition between companies, thereby creating a disincentive to funnel investment into costly winter safe systems. So, when the storm hit, ERCOT’s inadequate power grids stood no chance. Texans froze, quite literally, at the hands of a profit-driven, loosely regulated energy market. In this sense, the power crisis in Texas is a reflection of a crisis in the distribution of political power away from ordinary citizens. The power crisis in Texas is a climate injustice.

What truly failed Texans is a systemic issue; one rooted in radical energy deregulation and privatization. Through the 1980s and 90s, free market champions including then-Gov. George Bush and Enron CEO Ken Lay became champions of energy deregulation. To cling onto energy monopolization and reignite the dying appeal of free-marketry, Enron launched a political attack on New Deal-era regulations - for instance, the 1920’s Public Utilities Holding Company Act which introduced price controls and other regulations to split up energy monopolies. Enron pushed a narrative of consumer benefit, new market “liberation”, and the idea that “what’s good for industry is good for everyone;” all ploys to help Enron’s bottom line. This baseless glamorization of the free market only bolstered corporate interests, and ultimately worsened consumer price burdens.

With Gov. Bush as a political ally, Enron and other private companies successfully seized control of Texas’s newly deregulated energy market. Yet, consumers did not see benefits of lower energy prices like their plan had promised. Rather than accepting slashed profits, competitive firms decreased production costs (around maintenance, wages, and resilience upgrades). Had the actions of corporations and policymakers been driven by a genuine care for public good, rather than neoliberalism, far fewer Texans would have frozen this past February. This paints a stark picture of American neoliberal capitalism, which places its emphasis on short-term profits in contrast to the longer-term goals of economic sustainability, and social equity. Misleading consumers into an economic trap and cutting production costs, both of which factored into February's disaster, was all collateral damage - something both expected and accepted by a profit-maximizing capitalist system.

Beyond the scientific and structural reasons why the power grid failed, it is important to recognize who let it happen. The heartbreakingly apathetic responses of Texas politicians to the crisis are to blame. Despite being public servants, Texas’s federal representatives are mostly wealthy individuals with deep ties to polluting industries. Republicans typically receive 90 percent of the money from corporate polluters flowing into the state’s elections. Sen. Ted Cruz’s decision to vacation in Cancun while the crisis unfolded makes clear that political elites in Texas do not fear public outrage at their own self-serving decision-making processes. 

Yet, the political privileges that Ted Cruz and other Texan neo-liberal politicians hold is no accident. Southern politics were originally shaped by a pro-slavery undertone. Those undertones evolved slightly to become pro-elite and pro-corporate, but still anti-democratic and used to maintain a status quo that benefits a wealthy few. Texas politics still overwhelmingly serves corporate power and wealthy elites, allowing those in power to displace the burden of pollution, climate change, and the health crisis that is the COVID-19 pandemic onto the general population, especially working-class whites and communities of color.  In this case, neo-liberals knew that a catastrophic storm was possible, yet chose to take monetary shortcuts because the consequences of such a crisis would not directly harm them while preparing for such an eventuality would cut into the profits of their campaign contributors. If they swept this issue under the rug, oil and gas donors would continue to ‘make it rain’ on their campaigns. So, after the 2011 freak storm, and even now, there is little incentive for neo-liberal politicians to make sizable public and private investments in power grid winterization. Instead, people like Gov. Greg Abbott will continue to take millions from oil and gas interests and express surprise when future climate-related crises erupt. Fossil-friendly politicians and corporate CEOs seem to occupy a parallel universe, where there are no consequences for their anti-social acts. Ironically, their wealth has created a system that insulates them from any effects of public outrage

So, who does face the consequences of neglectful leadership? While all of Texas’s residents felt the sting, working class communities and communities of color were disproportionately impacted. The crisis only exacerbated pre-existing disparities between low-income communities of color and more affluent neighborhoods. Black and Latinx communities lacked sufficient resources to combat this disaster. The Austin Justice Coalition delivered food to 40 million families who had run out, over 90 percent of which were Black or Latinx. Coupled with Texas’s history of redlining that geographically concentrates hazardous pollution sites in communities of color, Black and Latinx populations were already facing disproportionate health, environmental, and socioeconomic injustices. Houston’s Manchester and Harrisburg neighborhoods are 98% people of color, with 37% already living below the poverty line and lacking basic necessities. Now, these same communities must deal with the additional burden of climate change, power outages, lack of food/water, and overall less resilience due to their structural socio-economic disadvantages. If Texas follows a similar pattern of rebuilding following Hurricane Harvey that inundated Houston in 2017, affluent white neighborhoods will end up getting a bigger cut of reinvestments allocated by the Federal Emergency Management Agency (FEMA) despite having less need. This cycle of climate-related class and racial injustice will make rebuilding that much harder for Texas’s marginalized communities and further entrench wealth and health divides.

Texas’s power problems were a collective failure by the state’s power brokers, deeply entrenched within a corrupt political machine colonized by the oil and gas industry. Absent an immediate and aggressive response to global climate change, the public will experience these ‘shocking’ weather events more frequently in the years to come - and not just in Texas. This disaster is a warning to the rest of the country, and the world. Neo-liberalism is incapable of arresting the climate crisis and is making us ever more vulnerable to the impacts. Nevertheless, the state’s Republican Congressmen have continued to blame frozen wind turbines and a Green New Deal for the crisis. With such a cynical response from state leaders, it is clear that Texans must stand-up and reclaim their democracy, and join the fight for a Green New Deal and climate justice for all Americans, and in particular, for the future of their communities.

Yet, the political privileges that Ted Cruz and other Texan neo-liberal politicians hold is no accident. Southern politics were originally shaped by a pro-slavery undertone. Those undertones evolved slightly to become pro-elite and pro-corporate, but still anti-democratic and used to maintain a status quo that benefits a wealthy few. Texas politics still overwhelmingly serves corporate power and wealthy elites, allowing those in power to displace the burden of pollution, climate change, and the health crisis that is the COVID-19 pandemic onto the general population, especially working-class whites and communities of color.  In this case, neo-liberals knew that a catastrophic storm was possible, yet chose to take monetary shortcuts because the consequences of such a crisis would not directly harm them while preparing for such an eventuality would cut into the profits of their campaign contributors. If they swept this issue under the rug, oil and gas donors would continue to ‘make it rain’ on their campaigns. So, after the 2011 freak storm, and even now, there is little incentive for neo-liberal politicians to make sizable public and private investments in power grid winterization. Instead, people like Gov. Greg Abbott will continue to take millions from oil and gas interests and express surprise when future climate-related crises erupt. Fossil-friendly politicians and corporate CEOs seem to occupy a parallel universe, where there are no consequences for their anti-social acts. Ironically, their wealth has created a system that insulates them from any effects of public outrage.

So, who does face the consequences of neglectful leadership? While all of Texas’s residents felt the sting, working class communities and communities of color were disproportionately impacted. The crisis only exacerbated pre-existing disparities between low-income communities of color and more affluent neighborhoods. Black and Latinx communities lacked sufficient resources to combat this disaster. The Austin Justice Coalition delivered food to 40 million families who had run out, over 90 percent of whom were Black or Latinx. Coupled with Texas’s history of redlining that geographically concentrates hazardous pollution sites in communities of color, Black and Latinx populations were already facing disproportionate health, environmental, and socioeconomic injustices. Houston’s Manchester and Harrisburg neighborhoods are 98% people of color, with 37% already living below the poverty line and lacking basic necessities. Now, these same communities must deal with the additional burden of climate change, power outages, lack of food/water, and overall less resilience due to their structural socio-economic disadvantages. If Texas follows a similar pattern of rebuilding following Hurricane Harvey that inundated Houston in 2017, affluent white neighborhoods will end up getting a bigger cut of reinvestments allocated by the Federal Emergency Management Agency (FEMA) despite having less need. This cycle of climate-related class and racial injustice will make rebuilding that much harder for Texas’s marginalized communities and further entrench wealth and health divides.

Texas’s power problems were a collective failure by the state’s power brokers, deeply entrenched within a corrupt political machine colonized by the oil and gas industry. Absent an immediate and aggressive response to global climate change, the public will experience these ‘shocking’ weather events more frequently in the years to come - and not just in Texas. This disaster is a warning to the rest of the country, and the world. Neo-liberalism is incapable of arresting the climate crisis and is making us ever more vulnerable to the impacts.  Nevertheless, the state’s Republican Congressmen have continued to blame frozen wind turbines and a Green New Deal for the crisis.  With such a cynical response from state leaders, it is clear that Texans must stand-up and reclaim their democracy, and join the fight for a Green New Deal and climate justice for all Americans, and in particular, for the future of their communities.

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