Is Drinking Water Just Another Commodity?

The election of Assemblyman Reed Gusciora as Trenton’s Mayor was good news for the citizens of New Jersey’s capital city, who were opposed to privatizing the municipal water supply.  Yet, as important as that issue is, just one in five voters actually cast ballots in the run-off election earlier this month.

In similar battles in New Jersey over water system privatization in Newark, Atlantic City and Camden, local grassroots citizen campaigns have opposed high-priced lobbyists, lawyers and water companies that were hoping to make a killing on privatizing a local water utility.

It is like having a monopoly lock on selling oxygen on Mars.  What corporation wouldn’t want to get their claws into selling a commodity that all humans need in order to survive?  And America’s long neglected cities, like Flint and Camden, are ripe for the exploitation that comes with scarcity.

There’s no better example of profiteering than what we saw in Flint, Michigan; state and local officials engaged in a criminal conspiracy that involved having tens of thousands of unsuspecting households consume lead-tainted water, after officials switched from the pricier and purer Lake Huron water to the Flint River as the water source.

Just as in our New Jersey cities, messing with the plumbing was done as a way to help deal with municipal balance sheets deep in the red, after decades of federal neglect and US transnational abandonment that left a toxic legacy as they chased profits around the world.

In Flint, the lead poisoning and brain damage of a generation—mostly children of color—is  collateral damage. In contrast, the local General Motors plant, which complained the river water was corroding the assembly line production output, got switched back to the superior Lake Huron water ASAP.

But this saga of late-stage vulture capitalism is hardly complete without the Nestle’s chapter.  As the self-made Flint water crisis went on people turned increasingly to bottled water.

As it turns, out just a couple hours from Flint, the Nestle’s company—the largest water bottler in the world—had paid only $200 to withdraw hundreds of gallons-per-minute of water from the aquifers that re-charge Lake Michigan in Mecosta County.  So hungry was the state for business, it gave the multinational $13 million in tax breaks to site the plant in the state.

In Flint, just as in our New Jersey cities, trying to find ways to profit off of the plumbing was done as a way to help deal with municipal balance sheets deep in the red, after decades of federal neglect and U.S. corporate abandonment that left a toxic legacy as they chased profits around the world.

As a young reporter in the 1970s, I naively assumed that governments at all levels were the buffer between corporations and abuse of the public trust.  Now, over my forty years of reporting, I have seen that often government is already captive to corporations and that the two often work together to squeeze the public to “make their numbers.” Poor and struggling families, by default, are the target on which they can agree, because they’re typically unrepresented or disenfranchised; and, chances are, nobody they know personally is in that universe.

According to the Washington Post, here in New Jersey, already 43 percent of the state’s local water systems are in corporate hands—ranking it the third-highest state in the nation for private sector control.

For cash-strapped local governments in places like Newark, Atlantic City, Camden and Trenton, the Great Recession is still playing out, with tens of thousands of zombie homes depressing the value of the homes that are occupied.  All too often, the municipal remedy for this erosion of the local ratable base is to raise property taxes, further undermining the finances of the families that stalwartly try to hold on to their homes.

As these neighborhoods were deteriorating—not just here but across the US in places like Flint, Michigan—the federal government spent hundreds of billions on a prolonged war on terrorism abroad, let US multinationals stash $2 trillion off-shore, and neglected the upkeep and maintenance of nation’s critical infrastructure like the bridges, sewers and water systems.

But in the case of public water systems, local governments and regional authorities were also dealing with ever-more stringent water-quality standards coming out of the Environmental Protection Agency.

By 2016, the Natural Resources Defense Council reported that more than 5300 drinking water systems were in violation of federal copper- and lead-content limits.

This synergy of vulture capitalism and government neglect set the stage for global water giants, like SUEZ, to step in and offer local governments a way out; so they could get cash-in-hand and update their infrastructure.

Back in 2012, for $150 million, the City of Bayonne turned over managing its water works to Kohlberg Kravis Roberts, the Wall Street private equity firm, which in turn brought in SUEZ. Residents had been guaranteed that they would not see a price increase for four years; but an investigation by The New York Times found that rates spiked 28 percent over that four years during which residents had been told to count on price stability.

“Even as Wall Street deals like the one with Bayonne help financially desperate municipalities to make much-needed repairs, they can come with a hefty price tag — not just to pay for new pipes, but also to help the investors earn a nice return,” the New York Times reported.

In 2014, the decision by a bankrupt City of Detroit to shut off water to thousands of struggling households sparked protests and made international headlines.

About half of the city’s more than 300,000 accounts were delinquent, and Detroit’s average water bill was more than twice the national average.  The Canadian Broadcast Company reported that the draconian move to crack down was part of an effort to attract a private management company to take over the municipal utility.

What it did generate was outrage in Canada where the Council of Canadians, a social-justice non-profit, to bring water across the border for the thousands of Detroit’s struggling households facing water shut-offs.

The Canadians also petitioned the United Nations Human Rights Commission, which called the Detroit shut-offs a “violation of the human right to water and international human rights.”

In a press statement, the international panel maintained that “disconnections due to non-payment are only permissible if it can be shown that the resident is able to pay but is not paying.  In other words, when there is genuine inability to pay, human rights simply forbids disconnections.”

They continued, “The Detroit Water and Sewerage Department has been disconnecting water services from households which have not paid bills for two months, and has accelerated the process since early June, with the number of disconnections rising to around 3,000 customers per week.  As a result, some 30,000 households are expected to be disconnected from water services over the next few months.”

“I’ve seen this in the poorest countries in the world,” Maude Barlow, chair of the Council of Canadians, told the CBC, “This is what we call failed states; but to see this in North America, it’s a disgrace.  We’re sitting on the Great Lakes, supplying a fifth of the world’s surface water. It’s appalling.”

The CBC profiled Nicole Hill, a Detroit resident on disability, whose water had been shut-off.  “I turn it on, nothing comes out. You don’t hear anything but the squeaking of the faucets,” Hill told the CBC, which reported she needed more than $4,000 to get her service restored.

What’s happening in Detroit is just the beginning of what will increasingly become a challenge for poor and working-class families that struggle week-to-week to get by.

Last year, researchers at Michigan State University documented that the trend towards water service privatization was sending water rates skyrocketing;  and under the Trump administration’s push to shift public works to solely private/public partnerships, the sticker shock for potable water would get even worse.

MSU’s analysis found that currently one in ten households were struggling to pay their water bills.  In five years, they projected, it would be one in three—and concentrated in poor cities and rural communities.

“Further, water rates have increased 41 percent since 2010, and if they continue at that pace over the next five years, the number of households that cannot afford water and wastewater services could soar to an estimated 40.9 million, or 35.6 percent of all households,” according to an MSU press release.

All totaled, it’s estimated that it will cost the US a trillion dollars to replace the post-World War II water systems across the country.

Here in New Jersey and across the country the advocacy group Food & Water Watch have helped local communities organize to resist water privatization.

In Camden, that has meant going to court to force New Jersey American Water to disclose how many households in that poverty-challenged city have had their water shut off for lack of payment.  The non-profit had originally applied to the City of Camden under the Freedom of Information Act for that data; but because the management of the water supply in corporate hands, the city claimed it no longer had that information.

“Access to clean, affordable drinking water is a key issue of public health,” Lena Smith, Senior New Jersey Organizer and Policy Advocate at Food & Water Watch said in a statement.  “New Jersey American Water profits from controlling what should be a public service. If the company is denying water to residents due their inability to pay, this should be a matter of public record.”

This whole water shut-off thing is no abstraction to me.

Back in the summer of 1969, I was 13—the oldest of six kids.  We were living on Goodviet Place, a dead-end street in Glen Rock, New Jersey, when the Ridgewood Water Company shut off our water for lack of payment.  A guy from the municipal utility just pulled up to our curb, got out with a tee-shaped rod that he used to shut off service from the street. (In that same summer, I met my first elected official, Bergen County Sheriff Joe Job, who had handed me the foreclosure papers on my family’s home, because my parents were not home to accept service.)

We had experienced the electricity being shut off before, but that felt more like a rustic adventure.  It harkened back to a cooler historical time like the American Revolution.

But the water shut-off felt different.  It was that kind of threatening act that made me feel like the local powers-that-be wanted us to move on—like we were undesirables.  Let’s be honest: America really hates its poor.

There is nothing cool about being thirsty or enduring the smell of full toilets in the middle of a hot summer, especially when some of your siblings are still very young.  Electricity can be optional, but water is not. The water-human link is primordial; as a species, we build our settlements in proximity to water. We will go to war if access to it is blocked.  We will lie, steal or cheat to control it.

For me and my younger brother, who was 10, it meant conducting water raids on the Esso Gas Station up on Lincoln Avenue in Hawthorne, the next town over.  No doubt, we were quite a third-world sight in the midst of suburbia, carrying those heavy five-gallon buckets several blocks back home.

But it was empowering—an end-run around the system that had no regard for what we as children were experiencing.  It was the real America: no money, no water, no exceptions. For us, taking the cover off the toilet tank and dumping in big oil’s fresh water—so we could finally flush the toilet—was a direct action that gave us a sense we could control something in our lives.

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  • Tim Dalton

    My town is in the process of selling our limited water and sewer system to Suez. No real discussion.

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