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Privatization of Water is Not a Good Idea

Quote of the day:

“Some of it is just completely inappropriate,” said Sen. Jennifer Beck of District 11 (Monmouth County), who supports the resolution. “They’re really being piggish here.”

The “piggishness” Senator Beck alludes to, as reported in today’s Asbury Park Press, is having water consumers – me and you – pay for country club dues, corporate marketing, and – get this – lobbying.

So, we are paying for a private water company to lobby legislators and regulators to increase their profits and weaken public health and environmental protections over the quality and quantity of our water supply!

The resolution cites witness testimony that said the water company’s costs included country club, lobbying and marketing fees in its calculation.

This is happening at a time when company profits rose by 16% in the last quarter.

As we’ve written, privatization and deregulation of water is not in the public interest (e.g. see this and this and this and this).

But it could be worse.

We read that in Italy and Greece, bankers are dictating policy to democratically elected governments. Some of the dictates include mandating that labor laws be weakened, pension benefits be reduced, and water be privatized.

As University of Massachusetts at Amherst economics professor Epstein noted (read and watch the interview):

We have this trend now where instead of democratically elected governments controlling these countries, so-called technocrats, the central bankers, are coming in, taking over as the prime ministers of governments in Italy, in Greece. In Italy we have Monti, and in Greece we have Papademos. These are supposed to be neutral arbiters of economic policy, but in fact are mostly doing the bidding of the large banks. And the other European countries, especially Germany, they want austerity.

And what’s amazing to me about is they’re going way beyond any kind of narrow policies with respect to debt repayment, monetary policy. They’re going into the deep core of social and economic policy in many of these countries. And that letter from the central bank, the European Central Bank, that you described went to the highly contested issues that have plagued Italy for many years about labor laws, privatization, and many others.

Here in the good ole’ democratic US of A, the dictates from Wall Street are not so transparent and heavy handed.

Much more subtle means are used, like threats to downgrade public debt ratings, destruction of pension plans, and advocacy of privatizing assets like the turnpike (for NJ examples, see:

So why is it that the news papers never report these austerity, privatization and deregulation policy responses to Wall Street threats as fundamental attacks on the concept of democratic government?

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  1. Harry Schwartz
    March 28th, 2012 at 11:30 | #1

    I don’t want to justify the water rate increases being proposed by the private water companies, but personally I wouldn’t make a blanket statement that privatization of water is not a good idea. In my years of experince in the field, the private water companies have typically been the ones who have invested in upgrading and replacing their infrastructure and installing the newest technology to the treatment plants for a better “finished product”. Often, the municipally owned and operated systems are very lacking in their repairs and upgrades to the infrastructure. It’s not so much that the operators/engineers of these sysetms don’t care, but because the town managers use the money that is brought in from water bills to fund other things within the town, instead of putting it back into the water system. And with the well-documented infrastructure issues in this country, that’s going to come back to bite them in the end. But hey, the pipes are underground and you can’t see them, so how do we even know there’s anything wrong with them??

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