The Economist (April 27, 2013) reports that the Obama administration is contemplating the privatization of the Tennessee Valley Authority, a landmark relic of FDR’s New Deal. Originally based on damming the Tennessee river to provide hydroelectric power to a poor region, hydropower now accounts for only 9% of output, while 41% is from coal, 38% from nuclear, 12% from natural gas, and “a token contribution of less than 1% from renewables (mostly solar).”
By Obama’s budget, TVA must retire 59 coal units by 2017 and install scrubbers in others. With a debt of $25 billion and a legal limit of $30 billion, TVA must raise an additional $25 billion in the coming decade. The once poor region has flourished economically due to the Right to Work Law (1947) permitting state legislatures to opt out of federal laws requiring unionization of workers. Industry has flooded south to avoid union interferences in production (most recently Japanese and German automakers). Privatizing the TVA was a major proposal of Republicans since the New Deal.
Frank Hannigan and Felix Morley, and later Frank Chodorov, as editors of the original version of Human Events, regularly advocated the privatizing of TVA, as did congressional Republicans. According to The Economist, local Republican politicians are “either frosty or outright hostile to Mr. Obama’s proposal.”
O Times, O Customs.