The New Corporate Threat to Our Water Supplies

By Alan Snitow and Deborah Kaufman, Tomdispatch.com. Posted October 6, 2008.

The following is an adaptation of an excerpt from AlterNet's newest book, Water Consciousness.

In the last few years, the world's largest financial institutions and pension funds, from Goldman Sachs to Australia's Macquarie Bank, have figured out that old, trustworthy utilities and infrastructure could become reliable cash cows -- supporting the financial system's speculative junk derivatives with the real concrete of highways, water utilities, airports, harbors, and transit systems.

The spiraling collapse of the financial system may only intensify the quest for private investments in what is now the public sector. This flipping of public assets could be the next big phase of privatization, and it could happen even under an Obama administration, as local and state governments, starved during Bush's two terms in office, look to bail out on public assets, employees, and responsibilities. The Republican record of neglect of basic infrastructure reads like a police blotter: levees in New Orleans, a major bridge in Minneapolis, a collapsing power grid, bursting water mains, and outdated sewage treatment plants.

Billions in private assets are now parked in "infrastructure funds" waiting for the crisis to mature and the right public assets to buy on the cheap. The first harbingers of a potential fire sale are already on the horizon. The City of Chicago has leased its major highway and Indiana its toll road. Private companies are managing major ports and bidding for control of local water systems across the country. Government jobs are also up for sale. For the first time in American history, the federal government employs more contract workers than regular employees.

This radical shift to the private sector could become one of history's largest transfers of ownership, control, and wealth from the public trust to the private till. But more is at stake. The concept of democracy itself is being challenged by multinational corporations that see Americans not as citizens, but as customers, and government not as something of, by, and for the people, but as a market to be entered for profit.

How the Water Revolt Began

And a huge market it is. About 85% of Americans receive their water from public utility departments, making water infrastructure, worth trillions of dollars, a prime target for privatization. To drive their agenda, water industry lobbyists have consistently opposed federal aid for public water agencies, hoping that federal cutbacks would drive market expansion. So far, the strategy has worked. In 1978, just before the Reagan-era starvation diet began, federal funding covered 78% of the cost for new water infrastructure. By 2007, it covered just 3%.

As a result, local and state governments are desperately trying to figure out how to make up the difference without politically unpopular rate increases. A growing number of mayors and governors, Republicans and Democrats, are turning to the industry's designated solution: privatization.

Providing clean, accessible, affordable water is not only the most basic of all government services, but throughout history, control of water has defined the power structure of societies. If we lose control of our water, what do we, as citizens, really control?

The danger is that most citizens don't even know there's a problem. Water systems are generally underground and out of sight. Most of us don't think about our water until the tap runs dry or we flush and it doesn't go away. That indifference could cost us dearly, but privatization is not yet destiny.

A citizens' water revolt has been slowly spreading across the United States. The revolt is not made up of "the usual suspects," has no focused ideology, and isn't the stuff of headlines. It often starts as a "not-in-my-backyard" movement but quickly expands to encompass issues of global economic justice.

In Lee, Massachusetts, the revolt began against potential water-plant layoffs. In Felton, California, it was initially about rate increases and local control; in Atlanta, broken pipes and sewage lines. In other communities, it focused on corruption, cover-ups, and complicity between politicians and giant corporations.

One of the epicenters of this nascent movement has been Stockton, California, in the heart of the state's agricultural San Joaquin Valley. A citizens' group there took on not only the mayor and city council, but also some of the world's largest private water corporations in a preview of the corporate water wars to come.

When private water companies case a city as a potential privatization target, they look for a "champion" in city government, someone who will take the lead in selling off the city's water services. In Stockton, they found their champion in Mayor Gary Podesto, a former "big box" grocery store owner. In his view, it was "time that Stockton city government treat its citizens as customers."

But Mayor Podesto had other reasons to privatize. Stockton was already under pressure from state and federal environmental agencies to modernize its sewage plant to reduce San Joaquin River pollution. This was an expensive project, and the mayor thought that a private company could do it cheaper, if not better.

See more stories tagged with: water, water privatization, water consciousness

Alan Snitow and Deborah Kaufman are award-winning filmmakers whose PBS documentary "Thirst" was the first film to bring attention to the global movement against water privatization. Their book by the same name exposed how the corporate drive to control water has become a catalyst for community resistance to globalization.

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