Sandia, Citizens United, and Smart Meters: December 2011
EVERYONE WAS TALKING about the one percent, the few with
most of the wealth. The inequality that Bernie Sanders had railed against since
his first campaign was becoming indisputable. Therefore, it wasn’t surprising
that he was one of the first elected officials to back the Occupy Wall Street
movement. Sanders offered practical proposals to address some of its complaints
and praised protesters for “shining a national spotlight on the most powerful,
dangerous and secretive economic and political force in America.”
He was also leading the charge to have Congress consider a
Constitutional Amendment to address a radical Supreme Court ruling. On Jan. 21,
2010, in the Citizens United v. Federal
Election Commission case, the nation’s High Court said that corporations
are “persons” with First Amendment rights and can’t be prevented from spending
unlimited funds on political campaigns.
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| OWS Protest, October 2011 |
The case had begun in 2008 with a dispute over the right of
a non-profit corporation to air a film critical of Hillary Clinton, and
whether the group, Citizens United, could promote their film with ads featuring
Clinton’s image – an apparent violation of the 2002 Bipartisan Campaign Reform
Act, also known as McCain–Feingold. The Supreme Court struck down the
McCain–Feingold provision that prohibited corporations – both for- and non-profit,
as well as unions – from broadcasting “electioneering communications” within
60 days of a general election or 30 days of a primary. It did allow for
disclaimer requirements and disclosure by sponsors of advertisements.
The problem went back to the 1970s, when Congress amended
the Federal Election Campaign Act in an attempt to regulate campaign contributions
and spending. After that, in the controversial 1976 Buckley v. Valeo case, the Supreme Court ruled that spending money
to influence elections is constitutionally protected speech and struck down
parts of the law. It also ruled that candidates could give unlimited amounts of
money to their own campaigns.
Prior to Citizens United, however, a century of US
election laws prohibited corporate managers from spending general treasury
funds in federal elections. Instead, they could expend on campaigns through
separate segregated funds, known as corporate political action committees. Shareholders,
officers and managers who wanted a corporation to advance a political agenda
could contribute funds for that purpose. But the Supreme Court’s new ruling said
that corporations had the same First Amendment rights to make independent
expenditures as natural people, and restrictions prohibiting both corporations
and unions from spending their general treasury funds on independent
expenditures violated the First Amendment.
According to Robert Reich, a public policy expert and former
Secretary of Labor, Citizens United would extent corporate control and drive up
the cost of future presidential races. “All this money is drowning out the
voices of average Americans,” he noted. “Most of us don’t have the dough to
break through. Giving First Amendment rights to money and corporations has hobbled
the First Amendment rights of the rest of us.”
The growing influence of corporations made the emerging
relationship between Sandia Laboratories and Bernie Sanders somewhat
perplexing. Sandia was managed by Lockheed Martin for the Department of
Defense, had roots in the Manhattan Project and a history of turning nuclear
research into weapons. Most of its revenue still came from maintaining and
developing defense systems. Beyond that, as Sanders himself had frequently charged,
Lockheed Martin ranked at the top of the heap in corporate misconduct. Between 1995
and 2010 it was charged with 50 violations and paid $577 million in fines and
settlements. Sanders, an opponent of the Iraq war and wasteful military
spending, had been a vocal congressional critic for more
than a decade. It exemplified corporate power and the one percent.
In the mid-1990s, he’d led the charge against $92 billion in
bonuses for Lockheed Martin executives – nearly $31 million of that received from the
Department of Defense as "restructuring costs" – after the corporation laid
off 17,000 workers. He called that “payoffs for layoffs.” In September 1995, after
his amendment to stop the bonuses passed in the US House, Lockheed launched a
campaign to kill the proposal. When the amendment came back to the floor,
Sanders decided that it still contained too much for the military and opposed
it himself.
In 2009, he was still going after Lockheed in the Senate,
calling out its “systemic, illegal, and fraudulent behavior, while receiving
hundreds and hundreds of billions of dollars of taxpayer money.” By then, however,
he had visited Sandia headquarters and come away eager to have a satellite lab
in Vermont.
Learning
to love Sandia
In January 2010, Sanders led a delegation to Sandia’s New
Mexico lab for a closer look. The group included the CEO of Green Mountain
Power, the state’s leading private utility; the vice president for research at
the University of Vermont; the co-founder of successful alternative energy
companies; and the head of the Vermont Energy Investment Corporation, which runs
Efficiency Vermont.
At the end of the same year, ten days after the
mini-filibuster that jump-started the “draft Bernie” for president campaign,
Mayor Bob Kiss announced the results of his own Lockheed negotiations, begun at
billionaire Richard Branson’s Carbon War Room. It took the form of a “letter of
cooperation” to address climate change by developing local green-energy
solutions.
Lockheed’s proposal to the city focused on “the economic and
strategic challenges posed by our dependence on foreign oil and the potential
destabilizing effects of climate change.” Their partnership would “demonstrate
a model for sustainability that can be replicated across the nation.” Meanwhile,
the Vermont Sandia lab, simultaneously being developed at UVM with Sanders help,
would focus on cyber security and “smart grid” technology. Yet Kiss and
Sanders denied knowing about the partnership being negotiated by the other.
Both Burlington’s Progressive mayor and its famous former mayor-turned-Senator apparently
saw no need to consult. Yet somehow everyone was on the same page.
By 2011, Sanders was also supporting the Pentagon’s proposal
to base Lockheed-built F-35 fight jets at the Burlington International
Airport. Despite his past criticisms of the corporation’s serial misconduct
and excess, he joined with Vermont’s most enthusiastic booster, Senator Patrick
Leahy, signing on to a joint statement of support. If the fighter jet, widely
considered a massive military boondoggle, was going to be built and deployed anyway,
Sanders argued that some of the work ought to done by Vermonters, while Vermont
National Guard jobs should certainly be protected. Noise impacts and
neighborhood dislocation were minimized, while criticism of corporate
exploitation had given way to pork barrel politics and a justification based on
protecting military jobs.
Still, his position hadn’t changed that much. Sandia’s
nuclear associations were never a major obstacle; Sanders had once been
pro-nuclear power, and his criticisms were restrained. His stalwart alliance with
labor had always outweighed his skepticism about military spending. And his
corporate criticism, which focused on fairness and inequality, rarely prevented
him from making an alliance that furthered “bold” initiatives or burnished his record
of leadership.
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| Pushing the partnership: Sandia's Rich Stulen presents, Powell, Shumlin and Sanders listen. |
When Vermont’s partnership with Sandia was ultimately
announced, Governor Peter Shumlin didn’t merely share the credit for bringing the
Center for Energy Transformation and Innovation to Vermont. He joked that
Sanders was “like a dog with a bone” on the issue. They had agreed to co-host a
press conference on December 12 to outline the initiative, which now included Sandia,
UVM, Green Mountain Power, several Vermont energy businesses and state
government. The ambitious goal, announced the Senator, was to create “a
revolution in the way we are using power.” At this point the “Draft Bernie” for
president campaign was underway and running as a Democrat, most likely in 2016,
was on the table.
For the next three years, Sandia’s new outpost would have up
to $15 million to research energy efficiency, develop renewable and “localized
sources” and, according to Sanders, make Vermont “the first state to have
near-universal smart meter installations.” Shumlin meanwhile announced a Sandia
pledge to invest $3 million a year, along with $1 million each from the
Department of Energy and state coffers.
Several enthusiastic backers – Sandia VP Richard Stulen, GMP’s Mary
Powell, and UVM’s Acting President John Bramley – joined the governor at
Sanders’ Burlington office for the launch. For Sandia, it was “a way to
understand all of the challenges that face all states,” Stulen explained.
Vermont’s size simply made it more possible “to get something done,” especially
since “integration” had already begun with the university, utilities and other
stakeholders.
It didn’t hurt that Vermont’s reputation for energy
innovation had also attracted $69.8 million in US Department of Energy funding
to promote a rapid statewide conversion to smart grid technology. This would be
matched by another $69 million from Vermont utilities. The goal was to “turn
the grid from a one-way into a two-way street,” Stulen announced. Another focus
would be to ensure reliable service. That meant “anticipating any cyber
challenges that may be opened up, or vulnerabilities that may be opened up as
we move to this new future,” he explained. “Sandia is very much in the
forefront of cyber research.”
Sanders’ statement stressed the more provincial point that
although the US had 17 national labs doing “cutting edge research,” none of
them were yet located in New England.
“It occurred to me,” he explained, “that we have the potential to establish
a very strong and positive relationship with Sandia here in the State of
Vermont.” Thus, his intention was to turn the three-year arrangement into “a
long-term presence.” By implication, Lockheed Martin had gone from corporate scofflaw
to valued research partner.
Vermont
as testing ground
“From an environmental, global warming and economic
perspective, it is enormously important that we transform our energy system
away from fossil fuel to energy efficiency and sustainable energy,” Sanders
argued at the launch. “And working with Sandia and their wide areas of
knowledge – some of the best scientists in the country – we hope to take a
state that is already a leader in some of these areas even further.”
For many activists and progressives, it sounded more like
corporate “greenwashing” than a bold step forward.
Shumlin called it “a really exciting development” for the
state. “We have an extraordinary opportunity to show the nation how to use
smart grid, how to use energy efficiency to save money for businesses, and for
consumers. And how to insure that Vermont is the leader in getting off our
addiction to oil.” He noted that when people asked him how Vermont had snagged
so much money for the project, his answer was the partnership the center would represent.
“It’s a huge opportunity and a huge accomplishment.”
On the other hand, there was little dispute that having so
many interactive devices on two-way networks would create new risks. In fact,
Kenneth van Meter, Lockheed’s manager of energy and cyber services, admitted
it, predicting that by 2015 there would be “440 million new hackable points on
the grid. Nobody’s equipped to deal with that today.”
Asked about cyber threats, Stulen acknowledged that “more
portals” certainly did create more potential threats, but countered that “we
think this is a manageable situation. In fact, the benefits far outweigh the
risks.” The main benefit was the potential for lower utilities bills by
monitoring home energy use. But security would also be a focus. “We don’t see
it as an overriding issue right now, but as a national laboratory our job is to
anticipate the future,” he said.
Smart Meters, the basic unit of a smart grid, are digital,
usually wireless utility meters with the ability to collect information and
transmit it to a central location. Supporters claim their widespread use will
improve energy efficiency, service reliability, and the environment. Critics
counter that they also make the power grid more vulnerable to hacking, have
potential radiation-related health effects, and don’t really reduce energy
consumption. They also charge that “time-of-use” pricing penalizes people who
can least afford it, while a centralized grid threatens privacy and gives
corporations more access to private data.
Smart meters have also been linked to fires and other
damage, but aren’t covered by homeowners insurance because the devices haven’t
been industry-approved. Needless to say, such problems and potential side
effects didn’t come up at Sanders’ press conference.
Instead, the Senator explained that “the federal government
has invested $4 billion in smart grid technology, and they want to know that
we’re going to work out some of the problems as other states follow us. So
Vermont, in a sense, becomes a resource for other states to learn how to do it,
how to overcome problems that may arise.” Another way to put that: Vermont
would be a testing ground, Sandia’s smart grid guinea pig.
It was a good example of Sanders’ style and pragmatism,
leveraging Vermont’s assets in a privately negotiated arrangement, a public-private
partnership with PR value and short-term economic benefits – but unknown
long-term consequences. And justifying the high-level deal on the grounds of
leading the nation, a transparent appeal to state chauvinism.
“In many ways, we are a laboratory for the rest of this
country in this area,” Sanders crowed. “With Sandia’s help, I think we are
going to do that job very effectively.” But in another way, it suggested that being
a corporate predator wasn’t always disqualifying, especially when weighed
against the mainstream acclaim and leadership role such a partnership would
confer.
Despite the confident presentation, however, the launch ended
abruptly after a single question was asked about the city’s aborted partnership
with Lockheed Martin. Before a TV reporter could even complete his query Sanders
interrupted and challenged it. Lockheed is not “a parent company” of Sandia, he
objected.
Then, as often the case when fielding unwelcome
questions, he declined to say more – about Lockheed Martin or the climate
change agreement Mayor Kiss had signed, the standards adopted by the City
Council, the mayor’s veto, or Lockheed’s subsequent withdrawal from the deal.
Instead, he turned the question over to Stulen, the man from Sandia, who
offered what he called “some myth-busting.”
It was more like a clarification. All national laboratories
are required to have “an oversight board provided by the private sector,” he
said. “So, Lockheed Martin does provide oversight, but all of the work is done
by Sandia National Laboratories and we’re careful to put firewalls in place
between the laboratory and Lockheed Martin.”
In other words, trust us to respect the appropriate boundaries,
do the right thing, and follow the rules. Moments later, the press conference
was over.
NEXT:
A Tale of Two Caucuses
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